“Avoiding the gap” – ISG at the online press conference on commercial property management
With fellow invitees, Andreas Trumpp, Head of Market Intelligence & Foresight Germany at Colliers, Alexander Eggert, Managing Director of HIH Invest Real Estate and Martin Ballweg, Managing Director of Scaling Spaces – Harry Tettinger discussed the current state of the German office property market, the importance of ensuring ongoing tenancy to secure the value of the real estate and potential options for dealing with vacancies.
ISG: Avoiding vacancies through multi-tenant conversion and subletting
From ISG’s perspective as a fit out contractor who optimises office space and redevelops it for the future, Harry reported: “One way of reducing vacancy rates in office space is by converting a single-tenant property into a multi-tenant property, thereby making it possible to sublet vacant spaces. For this to happen, a compatibility check for multiple tenants should initially be carried out: What are the location’s general conditions? Are the tenants conservative corporations or startup companies? What are their ESG requirements? The next step would be to look at the structural feasibility for subletting, such as the availability of reception areas, staircases, security and access arrangements.”
According to ISG's 2022 “The Power of Place” study, companies are seeing a 23.5% increase in revenue after investing in modern offices and flexible workplaces. Harry explains: “To be ready for the ‘war for talent’ and to counter the home office trend, both single and multi-tenant models need to be designed in a contemporary way,”.
When asked in the final Q&A round whether employers are currently making significantly higher investments per square metre in their employees' offices. Harry unequivocally responded: “Yes, definitely. I can also confirm this from my experience on the client side. Employers are investing more now as the office has a very high social value. It also acts as a “business card” for companies. The goal should be for employees to feel as comfortable as they do at home. In addition to “activity-based” spaces designed for different tasks such as focused work, meetings or collaborative work, there is also a need for social spaces. For these kinds of modern workspaces companies are happy to invest in their space – despite the current economic environment. A prime location is also something that is very important for every client.”