"Go West, Young Man, Go West" was an expression made famous by Horace Greeley when he quoted it in a New York Tribune editorial published on July 13, 1865 that encouraged young Civil War veterans to move westward to establish their homesteads.
Cut to 2016 and we find that the manifest destiny of a younger working generation has shifted back to the urban areas in the United States, prompting an abandonment of the traditional suburban office park and its 90’s era style.
In a study published by Newmark Grubb Knight Frank titled “Suburban Office Obsolescence,” it was found that 14% to 22% of U.S. Suburban inventory is obsolete, meaning that between 600 million to 1 billion square feet in the 50 largest U.S. metropolitan areas is not competitive in today’s office market.
The Newmark Grubb study identifies six factors that contribute to building obsolescence:- Amenities
- Age (via renovation)
- Parking
- Location
- Floor plate size
- Building size
The exodus from suburbia has prompted a restructuring of the corporate headquarters in its design nature. Shifting to an urban landscape, companies are eliminating the needs for parking lots, security gates, and therefore the sense of seclusion typically characterized by the office parks of the past. Millennial workers prefer office layouts that feel open and communal and this shift in mentality has lent to a demand in office construction and renovations. According to the NGKF study, with the right types of investments and changes, existing office buildings still have the potential to prove a savvy investment and attract high-profile tenants.
The attractiveness of an office building is dependent on the overall life quality the building can offer its employees. Key building factors taken into account by a young workforce include:- Access to public transit/highways
- Neighborhood conveniences
- Onsite amenities
- Renovations
- Building size
If employers cannot offer the heart of Manhattan as an incentive to employees then there are still ways to attract the talent they seek. Many companies such as Major League Baseball, Citigroup, and Blackrock have made plans to leave the former mecca of Park Avenue, and head to new and upcoming areas of NYC such as Lower Manhattan and the far West Side.
The rise in office vacancies in Midtown combined with the City's upcoming Midtown East Rezoning Plan, will provide building owners with an opportunity to rebuild and renovate Midtown East's outdated buildings and finally bring life back to the aging office district. Leading the pack of new developments coming to Midtown East is One Vanderbilt, a monumental supertall tower that will rise to become the second tallest tower in NYC and the tallest tower in Midtown.
If you’re interested in discovering how Milrose can help save you time and money on an upcoming office renovation or new building project, contact us today!
