In the 40 years that I have spent building the largest tenant-exclusive brokerage in Los Angeles, I have been at the forefront of helping clients create new and creative office space solutions to meet their goals of attracting and retaining the best talent for their businesses. We are witnessing a rapid and massive change in how businesses use space to create a workplace for the 21st Century, and the biggest trend in Los Angeles today is the move by the hottest businesses into industrial buildings in formerly run-down areas converted into new space with very high-end architectural design.
There are many factors that have led to this change, but the biggest is the ever-increasing need for companies to attract and keep millennial talent. The economy is at or near full employment, and among specialized fields, such as technology, there is a shortage of well-qualified applicants that has made staffing extremely difficult for even the most prestigious Fortune 500 company.
As a result, the millennial workforce is in a position to seek jobs that provide not just a salary, but a lifestyle. Millennials have a fundamentally different approach to work and life than my Baby Boomer generation. According to Nielsen Research, 62 percent of millennials prefer an urban mixed-use living environment, far more than their Baby Boomer predecessors.
In 1982, I helped Exxon move their offices from Century City to Thousand Oaks. Employees complained that due to the high cost of homes on the west side they were living in the suburbs and had to fight traffic every day into the city. The company wanted to come up with a solution that would give their highly skilled engineers a shorter commute, while still creating a space that provided individual offices desired by their staff.
The answer was a new five story, nine acre campus that was a breakthrough for its size and height in the area, as we had to navigate through the restrictive zoning and planning limitations that the suburban regulations had in place. But perseverance is my calling card, and we created a state-of-the-art workplace that met Exxon’s needs by daring to come up with a creative answer.
Now today’s workplace is all about collaboration and transparency. Gone are the days of individual offices in high-rises surrounded by support staff in cubicles. Now open space plans with few walls encourage employees to discuss ideas with each other without artificial barriers.
Recently, along with my associate Matthew Miller, we brought Warner Music into a renovated Ford manufacturing facility originally built in 1912. Warner Music consolidated an office in Burbank and Culver City in the move, so they could be closer to the creative heartbeat found in the Arts District, just east of Downtown LA. Warner Music moved out of the suburbs for the same reason Exxon moved in—to attract and retain the best talent at the time.
This radical change in how companies use space poses special problems for the Class A and B high-rises that until recently were the top of the commercial real estate pyramid. What can these landlords do to make their properties attractive once again to the hottest employers?
I am proud to have worked with Gensler, the giant architectural and design firm, to move their offices from Santa Monica to downtown Los Angeles. We created a truly radical makeover of a freestanding office building into a dynamic new way to think about workspace. Convincing a creative company to move into downtown would seem unlikely, but Gensler’s co-CEO Andy Cohen, had the same vision and understood what was possible.
Taking over a building that housed Bank of America’s private banking division, Gensler won numerous international design awards for the transformation of a staid banker’s building into the kind of open space that modern employees crave. Since the move, the company has nearly tripled its staff, proving the concept.
The future poses many questions. As the millennial workforce ages and has children, will they still want to live and work in the city, or will they want to move out to the suburbs like previous generations? In either case, I am looking forward to help leading companies find creative answers to these questions as they seek the best space to attract and keep the best employees.
Jim Travers
Cresa
550 South Hope Street, Suite 2600
Los Angeles, CA 90071
jtravers@cresa.com
212-683-1500
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