The average age of buildings in Northern and Central New Jersey is thirty years old. That’s the average! With many older buildings facing the possibility of becoming functionally obsolete, landlords are investing capital to update the building systems and refresh the common areas.
However, a new lobby and new bathroom finishes aren’t enough to win tenants in this competitive market. Amenities are driving many decisions as companies are focused on their workforce and the experience while at work.
Google is well known for feeding their employees endless snacks and drinks and creating a work environment that encourages people to stay in the office rather than race home. With upgraded cafeterias, fitness centers, and building common conference rooms, landlords are able to show prospective tenants that they are committed to maintaining older buildings as top of the market.
For example, the chart below outlines the amenities at several fully leased buildings in the market.
Buildings fetching the highest rents in the market also offer more services such as a concierge instead of a security guard, shuttle service to the airport and/or local shopping, and tenant events like popcorn Friday.
Smart, aggressive landlords will continue to try and find the differentiating factor for their buildings. We are starting to see less money spent on lobbies and bathrooms and more money put in to amenities that benefit the tenant experience, a trend that I am confident will continue.