Property | International

Businesses trading sterile offices for “creative space”

Real estate companies, financial industry organisations, law firms and other traditional office tenants have joined the fray

  • Los Angeles Times
  • Published: 14:50 July 17, 2013
  • Gulf News

Comedy writer Soren Bowie depends on bursts of inspiration to produce his next great joke. But he says it’s no fun to labour for hours in a tiring office cubicle with a chair and computer.

Last month, that changed for the Cracked.com writer when his office moved to a new location in Santa Monica he likes much better. Gone are isolating walls and partitions, and Bowie says he can concentrate at work yet still see and communicate with his colleagues across wide-open office spaces.

The new space has plenty of flair, including three decked-out kitchens, a pingpong table and meeting rooms decorated with international themes. There is an authentic red phone booth in the “London room,” a Buenos Aires space and an Austin, Texas, room. “It’s nice to have all these different places,” he said. “It unlocks you a little bit.”

Bowie’s employer, Demand Media, is one of an increasing number of businesses trading sterile offices for what real estate companies are calling “creative space.”

“Creative office is the darling right now,” said Christy Ingle, a spokeswoman for Los Angeles-based CBRE, the nation’s largest real estate brokerage firm.

Increasingly, life at work is changing, and office space all over Southern California is evolving with it.

Most people still work amid fairly traditional surroundings. But more and more, office cubicles are disappearing, and big partitions too. Open work spaces are more common. Some conference rooms look more like living rooms. Goodbye framed photographs; in their place are vast murals and more splashes of bright colours.

And it’s not just at advertising firms and technology companies eager to hire bright young hipsters. Creative work spaces are going mainstream.

“The burgeoning demand for creative space has now extended into the more traditional office environment as many real estate companies, financial industry organisations, law firms and other traditional office tenants have joined the fray,” says a new CBRE report.

Companies such as Google, Facebook and other technology firms pioneered the shift to open work environment, but the idea has spread. Instead of secluded cubicles, more offices feature open tables and desks where employees can easily communicate with a quick swivel of the chair. The space can include anything intended to spur innovative thought among employees, like the pingpong table at Demand Media’s new office.

Perhaps the biggest reason employers are moving into these creative environments is to increase productivity. Courtney Montpas, Demand Media’s executive vice president of people operations, said even making simple changes like adding more natural light in the office helps.

“You would be surprised about how much it affects output from employees,” she said.

Typically, entire buildings are refurbished to provide a stimulating atmosphere. But the supply of larger vacant buildings in Los Angeles is dwindling and will not be able to keep up with the rising demand for hip places to work, said broker Carl Muhlstein, managing director at Jones Lang LaSalle.

In the last five years, 2 million to 3 million square feet of real estate has been converted to creative office space in Southern California alone, Muhlstein said.

“There’s nowhere near that kind of supply for the next five years,” he said.

Demand Media, however, was able to snatch up a vacant building that could be renovated with the extra amenities that are now so popular.

Built in 1978, the 53,500-square-foot property was redesigned to offer workers a more open and collaborative environment, said David Mojica, the company’s director of facilities.

Exposed brick around the perimeter of the office, concrete floors and open ceilings with skylights that let more natural light into the space are some of the building’s features that provide a more “open” feel, and are extremely important for the writers who work there, Bowie said.

“Most of the places we used to work had no natural light,” he said. “It felt more like an interrogation room; it just felt tighter and that’s tough to write in.”

Industry experts say the creative work space trend may soon shift toward renovations of only portions of existing buildings, such as a few floors instead of the whole building. The trend also will probably permeate into smaller spaces and some traditional high-rise buildings, said John Zanetos, first vice president of brokerage services for CBRE.

For instance, the top two floors of a particular building may feature several treadmill desks, open spaces and the “free address approach,” which takes away employees’ assigned seats and enables them to work in a new space each day. At the same time, other floors in the building may still follow the traditional model with typical cubicles and desks.

The other option is for builders to construct creative office buildings from the ground up.

Jeff Worthe, a local real estate developer with several creative office buildings in his portfolio, said he is considering both options and may eventually start renovating certain floors in traditional high-rises, as well as building new properties from scratch.

“I think there is a limited supply of adaptive reuse properties,” Worthe said. “We’re continuing to try to make the spaces more and more creative than they ever were before.”

His company, Worthe Real Estate Group, recently opened one of the largest creative office projects near Playa Vista, called the Reserve.

The project sits on a 20-acre lot and has a massive 380,000-square-foot building that was once a US Postal Service distribution centre.

It cost an estimated $30 million to renovate the building, which now has a sand volleyball court, dog park, bike shop, cafe, fitness centre and fully equipped locker rooms.

The creative office space trend should start to speed up because many companies’ 10- and 15-year leases are set to expire soon, and countless companies are already looking for “a more creative work environment,” the CBRE report said.

The drastic growth in demand for creative office space also has a lot to do with the changes in today’s marketplace. The workforce is becoming much younger, Muhlstein said.

“A lot of the young people, they’re spending a lot more time at work so they want a more residential feel to it, as far as amenities,” he said.

Skate parks, fitness centres, dog parks and trendy cafes are among the amenities in new creative office developments, Zanetos added.

“Corporate America is realising their teams work better in a collaborative environment,” Zanetos said. “There’s a lot of different aspects in the space that you wouldn’t think of in a traditional office space.”

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