The Multigenerational Workforce & Commercial Real Estate

One of the reasons commercial real estate is such a complex industry—and a reason why there is a barrier to entry, perceived or not—is the variety of factors that CRE pros must consider in their properties. These investments involve everything from market trends and location considerations to specific property types and the industries of the tenants that occupy them.

Among the many factors commercial real estate professionals tend to overlook is the demographic range of tenants. Particularly when it comes to age, certain characteristics can play a big part in the demand, usage and appeal of your space. Let’s take a look at some of the ways the multigenerational workforce affects commercial real estate.

Understanding the Multigenerational Workforce

The current workforce is more diverse than ever. So much so that it’s impossible to ignore the effect this diversity has on the commercial environment. This workforce encompasses four primary generations:

1. Baby Boomers (born 1946-1964)
2. Generation X (born 1965-1980)
3. Millennials (born 1981-1996)
4. Generation Z (born 1997-2012)

Each generation brings unique values, work habits and expectations to their place of employment. In turn, these shape their needs and preferences in commercial real estate.

• Baby Boomers, for example, are known for their strong work ethic and loyalty. Many are in leadership positions or nearing retirement. This generation values stability and prefers traditional office settings. As it pertains to CRE, this means ensuring their office spaces are equipped with privacy and conventional amenities, as well as ease of access and ample parking. Convenient locations are also appealing.
• Generation X is seen as the bridge between the analog and digital eras. This generation values work-life balance and flexibility. They are likely to seek out spaces that support both collaboration and individual work. CRE properties that offer a mix of private offices with open-plan areas—as well as facilities that support remote work—are particularly attractive to this segment of the workforce.
• Millennials have revolutionized the workplace in many ways, with their preferences for flexibility, collaboration and technological interaction. They favor open, creative environments that foster teamwork and innovation. Office property management strategies should include modern, adaptable spaces with communal areas, wellness facilities and strong technological infrastructure. Sustainability is another critical concern for this generation, so energy-efficient buildings are a boon.
• Generation Z is the newest entrant to the workforce and brings a digital-first mindset. They expect seamless integration of technology in their workspaces and are particularly inclined to remote work. For this generation, commercial properties need to offer advanced technological amenities, such as high-speed internet, smart building features and ample charging stations. Additionally, they value diversity and inclusion, so spaces that cater to various cultural and accessibility needs are essential.

The Effect on Commercial Real Estate

Now that you understand the different generations of today’s workforce, how do they impact what you do beyond tenant targeting and building investment choice? This workforce impacts several areas of CRE, actually, including design, amenities and location. Understanding these effects is crucial for both office property management and retail property management.

• Office property management: flexible workspaces are one way to cater to cross-generational preferences, so make sure your office buildings offer a combination of space types and versatile features. Technology integration is another area that is no longer optional, but necessary, as are wellness and sustainability initiatives. Incorporating amenities like fitness centers, relaxation zones and green spaces can only make your property more attractive to any generation. Finally, accessibility and inclusivity ensure that office spaces are appealing to all and respect the diversity of the workforce.
• Retail property management: if your building has a retail focus, there are other considerations to think about. Younger generations value experience-driven spaces with interactive displays and community events, while technological enhancements that the general public expects include digital signage, mobile payment options and even augmented reality features. Don’t sacrifice convenience and community focus, however, and ensure there’s a mix of essential services and local businesses to attract a broad customer base. If you can emphasize sustainability in any way (e.g., using recycled materials, supporting local artisans), it will attract conscientious shoppers.

Strategies for CRE Professionals Moving Forward

To effectively cater to a multigenerational workforce, commercial real estate professionals should consider the following strategies as a guideline in the future:

1. Conduct demographic research. Try to understand the demographic makeup of your tenant base and adjust accordingly. This starts with the CRE software you choose and its ability to identify market trends, but can also include surveys, focal groups and other data analysis.
2. Embrace flexibility. Design spaces that can easily adapt to changing needs and preferences, whether it’s modular furniture, movable walls or adaptable layouts.
3. Invest in technology. Stay ahead of technological advancements. Invest in high-speed internet, smart building features and other emerging tech.
4. Promote sustainability. Implementing green building practices and earning sustainability certifications can not only attract certain tenants, but reduce operating costs in the long run.
5. Foster community. Create a sense of community with social events, shared spaces and other initiatives that encourage interaction among your tenants.

At Quarem, we’re dedicated to helping commercial real estate pros navigate the complexities of a multigenerational workforce—and every other consideration for CRE investments. Request a demo of our one-stop-shop CRE software today to see how leveraging the right CRE software solutions can help you better manage your properties, enhance tenant satisfaction and stay ahead of industry trends.