BusinessQ Rountable: If These Walls Could Talk

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Jeanette Bennett, BusinessQ: How have office design trends evolved in the past decade?

John Monson, Colliers: There’s a lot less paper and more electronic storage. You’re seeing cleaner lines and less filing cabinets. Offices are more collaborative. Little station cubicles are going away and in their place is a more open look across the workspace as people work together.

Ed Axley, Davies Design Build: Office design used to be around private work, and it’s much more informal and collaborative right now. We’re putting fewer walls than ever before and much more glass. Interestingly, trends swung from completely private to everything being open, and now it’s swinging back a little.

Heather Osmond, Osmond Designs: A combination of both is that sweet spot. Keep it collaborative, but with opportunities for privacy.

Axley, Davies Design Build: When I first got started, all we did was put offices along the perimeter of the building with open cubes in the middle, and common area was very limited. A breakroom might be two stools, a bench and a microwave. Now, there’s much heavier emphasis on common space with low-lying tables and chairs, even bean bags have been added so people feel they can get together and relax while they meet.

Monson, Colliers: Even the break rooms aren’t so much rooms as they are an open bar setup. In our Colliers building, Infrastructure is on the sixth floor. It has almost a restaurant type of feel to it. The younger generation like to come in and collaborate around food. Companies have realized that if they bring food in, workers stay, which brings more efficiency.

Dr. Joel Tenbrink, Director of physical therapy for Rocky Mountain University of Health Professionals: There’s an interesting thing we see as far as students and large study areas. We even have one study area that has about 20 carrels. You can study but have a little privacy. Students don’t go in there. They don’t want to be studying next to someone, they want a private room. We have big classrooms that when they’re not in use, they’re open for study space, but students don’t go in because they say “somebody is studying.” This is a 3,000-square-foot classroom! They want their own study space because they want to zone in and focus on what they’re doing personally. When it’s group work, they’ll go around the table, but when it’s individual, they want a small, intimate space.

Monson, Colliers: What Heather said about a combination reflects those habits you’ve described. Ideal design has places where people can get together, and then go back to their desk or computer in a semi-private group area.

Osmond, Osmond Design: I’m jealous of these recreational rooms. Ping pong tables and video gaming in the office is really fun, but as a business owner you wonder if it’s productive. There’s a balance — you want it to be a really fun space to work in, especially when a lot of people spend eight-plus hours per day there, but you also have to have productivity. As I’ve gone to some of the Silicon Slopes office spaces, they have barber shops, hair salons and basketball courts. People don’t even need to leave.

Monson, Colliers: What’s fun, too, is they have these “swag rooms” where they have all their marketing merchandise. The workers get a certain amount of points where they can go in and grab stuff, whether it’s a hat or sweatshirt.

Tenbrink, RMUoHP: It’s interesting that they could basically live there. I think many people spend the day working from home because today as a society we’re fairly mobile, digital and less paper orientated. A lot of people spend a day or two a week working from home.

Axley, Davies Design Build: Everybody wants their office cooler than the next person’s office. If the employees feel like their office is cool, they feel like they work in a cool place and they themselves feel cool. It raises their self-esteem and creates a certain value around the company. I remember the first office I saw that was following a very modern trend. The materials and finishes were extremely cutting edge, and they had huge open areas of desks with no backs and ping pong tables and video game consoles right in the center. I went back to their office four years later, and the ping pong tables and the video games were gone. They said it was a bigger distraction — it drew people into taking a job there, but then they didn’t get any work done. Everybody couldn’t help but place bets on whoever was playing ping pong. It wasn’t productive. Now the trends are swinging back a bit to how it was before. When employees are polled, the biggest thing that draws them in is the accessibility to food. They want to go have a snack when they’d like to and socialize around that, but then they want to go back and do their work.

Osmond, Osmond Design: I think Utah is a bit unique. In general, we don’t go for wine, we don’t go to bars or pubs for our social scene. So it is food — we’re all a bunch of foodies in Utah.

Monson, Colliers: The nature of the business makes a difference, too. Obviously, when meeting with a lawyer, you want to have a quiet room. But software companies are largely collaborative, so they put teams in pods.

Bennett, BusinessQ: From a physical perspective, what does a healthy office environment look like?

Tenbrink, RMUoHP: Our bodies aren’t meant to be in one position all day. You shouldn’t be in one desk for eight hours straight, whether it’s a sitting or standing desk. So having the flexibility to change positions, or get up and go to the cafeteria and talk to a group in another room, is healthy. With people working from home, they’re often on a laptop and it’s not great ergonomics to be hunched over and squinting at a small screen. Having a bigger monitor that’s set up appropriately, but then having a laptop to take to meetings, is probably the best way to go because you’re changing your position around a bit.

Bennett, BusinessQ: You mentioned standing desks. Is that a strong trend we’re seeing? What are the benefits and drawbacks?

Tenbrink, RMUoHP: The design of modern office chairs has been increasingly helpful in correcting mechanics for low back pain, but it’s still beneficial to stand up for an hour or two a day. At our office, half of our faculty has a standing desk, and some of those are treadmill desks. They can walk while working. If we can avoid costly injuries caused by prolonged sitting or standing, why not have employees moving a bit?

Axley, Davies Design Build: We’ve had a lot of requests for standing desks in our office. A lot of our project managers sit a lot. We find that our guys need to have a little bit of an open office space because when they’re in heavy conversation or deep communication with somebody, they’ll walk circles around the conference room table all day long. You can always tell when the day has been busy or stressful because everyone’s watch is pinging that they got their steps. I wonder if the standing desk to some degree is like the curved monitor. Everybody wanted the curved monitor for a minute, but now nobody is buying it.

Tenbrink, RMUoHP: It depends on what role you’re in. When you look at hospitals, they’re all standing desks so they can go room to room and stop briefly to type for a minute. The best option for most people would be a variable desk where you can sit or stand.

Osmond, Osmond Designs: People don’t want to stand all day or sit all day, so if you have a setup that’s adjustable, they can get the best of both.

Bennett, BusinessQ: I like this focus on trends. Let’s transition to talking about trends in our area. What makes Utah unique in terms of office design?

Axley, Davies Design Build: Something I see here more than other places is the concept of nurseries. Back east, I simply don’t see them. There doesn’t seem to be a demand for it.

Osmond, Osmond Designs: I was born and raised in Utah so I feel like I understand the Utah market. We’re all value-oriented. All of us feel like we have to be experts in everything — including office design. One of my philosophies I learned very early on was to do what you do the best and sub out the rest. Realizing what you do best and letting other people do their expertise saves money in the long run. There’s a quote that says, “If you think hiring a professional is expensive, wait until you hire an amateur.” Sometimes you try to do things and it costs more and takes more time than what is necessary.

Monson, Colliers: I believe the trend is to entice the younger generation — that mindset of what do they want and what do we change to make them happy and fulfilled in their work station. Some of it relates to the seating and for other companies it’s the break room with soda fountains and snacks.

Axley, Davies Design Build: One thing I see in Utah more than others are soda bars in the workplace. The first built-in soda bar I put in was for Open Source Tailors in Pleasant Grove in 2007. They put a heavy emphasis on bringing in two large soda multi-mix machines with flavors you could add in. I thought, “That’s crazy!” And then all of sudden, we were putting them in everywhere. In Maryland, their office spaces don’t have that. But it’s very common in Maryland around 5-6 p.m. to leave and go to Happy Hour.

Bennett, BusinessQ: How have millennials influenced office layout and design?

Axley, Davies Design Build: They have blended the lines between fun and work more than any other generation. My father and uncles went to work every day in a suit and tie. Employees at tech companies come in hoodies and Lululemon pants. They have blended this concept of work and play better than any other generation ever — and they’re getting away with it. They’re productive, they’re making just as much money or more. It’s changed how we buy furniture, such as buying more bean bags. I remember as a child watching “Superman 2” and they had this super modern office space where the furniture was horrible. Very square, straight, hard and clean lines, but not comfortable. Now there’s this interesting mix — modern furniture is comfortable and it is low line, low back, low to the ground, low tables and less division between me and you. Lower backs create less division of space. People feel they can walk in and just join in. It’s subconscious, open, collaborative. It has a lot to do with the way millennials were educated in college. When I started at BYU, all of my projects were very individual. Halfway through my senior year, the business school at BYU debuted the group concept, and we were gonna be graded as a group — which stressed me out. They forced us to work in a collaborative way. Millennials work in collaborative ways in college and then they go off to work and need to be in a collaborative setting.

Monson, Colliers: I’m glad this age group uses social platforms, which is something I lack. They love to share via Twitter, Facebook, Instagram. When we have a new listing, they create a video tour, whereas I want to print things up and send emails. Millennials are like, “Let’s get it out there.”

Osmond, Osmond Designs: In both residential and commercial, the general theme has been, “This is not my mom or dad’s office space.” None of us want what our parents had in their offices or homes. So we reinvent and make things fresh and new. Ed and I are working on a new office complex for the Utah Valley Home Builders Association. The veteran builders have a different view of what that should look like than the younger builders. As the designer, it’s been a challenge to merge all the ideas and make everyone happy. I also think today’s employees work smart. They get a lot more done in a shorter amount of time because they’re so tech savvy. They do their projects and go play ping pong. Back in the day, it was about gathering everyone, having huge meetings that would take a week or two to calendar. Now teams get it done in five minutes just by logging on to a digital meeting or communications platform.

Tenbrink, RMUoHP: We are based in Provo but have faculty across the country, so we use Zoom or GoToMeeting or Skype Business. I can work from home and jump on a meeting, or I can be at my office and the meeting is down the hall.

Axley, Davies Design Build: Interestingly, we’ve had clients who do a lot of video conferencing or virtual collaboration. In their homes, we’ve built these super quiet sound rooms for these moms or dads to do their business. It’s this super ridiculously small room that has no other purpose than for doing that. From 28 inches up, it gives the illusion this room is awesome. It’s super quiet, and you can lock it from the inside so no one can come in while you’re doing stuff.

Monson, Colliers: I’ve done several offices that have green rooms for filming YouTube videos or their training series. They create content right there in the office and ship it out to the world.

Tenbrink, RMUoHP: People want to get in, do their stuff and move on. Rocky Mountain wants to have people incorporating 30 minutes of wellness a few times a week. In my office area, we have this little putting hole and people putt for 15 minutes a day. They get their work done, then they have social time and get back to work. Making those spaces has been helpful.

Bennett, BusinessQ:  Where are we at right now in the balance of people wanting to own their office spaces vs. leasing?

Axley, Davies Design Build: National companies don’t tend to come in and buy; they lease. Locally, there are so many people around here flush with cash, and they’re scrambling to put it somewhere and buy an asset. The common conversation I’m hearing is, “I want to buy something so in a few decades, I have a retirement account.” Smaller spaces are hard to lease but are easy to sell. We tell clients if they believe their company is going to exist for seven plus years, they should buy. At year seven, the pendulum swings in your favor.

Tenbrink, RMUoHP: Do people start a business thinking they won’t be around in seven years?

Axley, Davies Design Build: There’s a lot of insecurity. They already carry stress and anxiety from starting their business. My clients who succeed the most are those who can look out that far. But many are so busy just keeping their business afloat and growing it that they’re not looking any further out than four months, six months, or a year.

Monson, Colliers: I think you’re right. People are nervous and think, “What if I buy this and I outgrow it?” They wonder if it is lease-able or sell-able. A lot of people come in with ambition. They want a short-time lease with options to expand.

Osmond, Osmond Designs: My husband and I have purchased all of our real estate. We’ve made more money in our real estate investments than we’ve ever made in the furniture business or the assisted-living business. Now we’re doing retail storefronts. They say that 90 percent of all millionaires made their wealth in real estate. So if you can own, do it. Be creative enough to purchase it and possibly even lease part of it to help supplement. It’s a good investment when interest rates are so low. It’s probably not going to get any better than it is right now.

Axley, Davies Design Build: A lot of people think they don’t want to buy something unless they will stay there for 20 years. That’s a fallacy. Whatever your company is going to be within that 5-7 years, that’s the size you should buy.

Osmond, Osmond Designs: You can find a great deal in any market. Don’t pay full retail for something. If you’re savvy enough and doing your research, you can find a great deal in the height of the market as well as the bottom of the market.

Axley, Davies Design Build: The big indicators in any of these markets is inventory. If you’re wondering if you’re buying at the wrong time or not, check the inventory. Are people buying products for speculative investment or for growth? If the market is a growth consumption market, then you’re in a safe place. If it’s a speculative investment market, you take your chances. If the market has no inventory, that can be regional or it can be related to the business cycle — it’s a good time to buy. If it’s got high inventory, then you should wonder. Geographically, for example, the inventory in Thanksgiving Point right now is floating at 16 percent. You go down to Spanish Fork, it’s floating at .6 percent for professional office space. Everyone wants to be in Thanksgiving Point, but if you were to buy something in Spanish Fork, the likelihood of you being able to lease that back out is extremely high because there’s no inventory.

Bennett, BusinessQ: What is the current state of supply and demand? And how is it different in industrial vs. retail vs. Class A?

Monson, Colliers: There’s been lots of building going on and we’ve learned a lot of lessons from history as far as growing too fast. I think we’ve been building about right, and things have been absorbed. It looks like Heather’s project off 500 East in American Fork is being absorbed quickly.

Osmond, Osmond Designs: We’re building 18 retail storefronts. We have only two left.

Monson, Colliers: It’s projects like that which show things are being built and absorbed in our market.

Osmond, Osmond Designs: Most of those are just local companies, too. It’s not national brands coming in. That says a lot about our area and the state of Utah.

Monson, Colliers: Another example is along Lehi Main where you can see all those fast casual restaurants. That’s a proud Utah thing, too — we like to go out to eat. Another Utah characteristic is a staggered, layered system. The further north you go in our county, you get higher prices. When you move further south in the valley, you can get great deals on office space. Being close to BYU, for example, you can find fantastic deals that are Class A buildings next to the river, walking areas and restaurants. People have turned their heads north, but they can still find great deals further south in the valley.

Axley, Davies Design Build: Of all segments, retail is under an evolution right now. The bigger retail is actually struggling, while the smaller retail cubicles are doing well but only in centers of economic growth. If you get out of those areas, and get into these small towns where they’ve had long-term retail fronts, they’re disappearing as far as the next generation of retail. You’re seeing architects, attorneys and engineers taking storefronts and turning them into really hip, cool office spaces. Case in point, Peg Development. Their office space was a retail space at one point. I don’t know what the future is for retail. It’s the Amazon effect. When we have Amazon taking over 49 percent of all e-commerce, that’s ridiculous. Then again, we’re seeing other things blossom like never before. Never in my life have I seen so many restaurants. Food is our experience, our socialization. That’s where you make memories, create friends and enjoy time off.

Osmond, Osmond Designs: There are still places Amazon won’t ever fulfill, such as services like getting nails done and getting hair done. That’s where local stuff is always going to be strong.

Bennett, BusinessQ: What final advice would you share with BusinessQ readers about office trends and design.

Osmond, Osmond Designs: I love the quote, “Don’t wait to buy real estate, buy real estate and wait.” In Utah, things are still booming so take advantage of that. There are SBA loans and ways to get the funds to accomplish what you need in your business. Time is money. Sometimes people drive 20 minutes to save money on gas, so keep that in mind when you’re thinking of real estate in your business. That’s why millennials are doing so well, they are efficient. They have to be.

Axley, Davies Design Build: When you think about real estate, take into consideration that there is a decentralization effect going on right now, as opposed to urbanization. Everybody is moving back to town centers in those areas that were dilapidated and worn out for generations. Areas are being revitalized. People are moving in as opposed to moving out. We’re not just sprawling out anymore, we’re seeing things go up, we’re seeing things get demolished, we’re seeing things get refurbished — both commercial and residential. Salt Lake’s to the point where you can’t get out too much anymore within reason and get into town easily. So there’s a heavy emphasis on recentralization, coming back to the city center. We haven’t seen that for a hundred years. Those who are ignoring this trend are missing the boat.

Bennett, BusinessQ: Wow. Such an exciting time in real estate and office design. Thank you for sharing your insights.

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