What we learned was the chief motivator
for a company’s move is not cost savings
— although the move generally results
in more efficient use of space — but the
desire to attract and retain talented
employees, especially Generation Y and
Millennials, who thrive on diversity and
urban amenities. Corporations exposed to
this cohort of employees are the first to
relocate to urban centers.
THE SURVEY
The survey focused on 46% of the more
than 100 respondents whose companies
have experienced, are experiencing,
or are considering urban relocations.
The respondents were a diverse mix of
corporate real estate leaders from all over
the U.S. from over 20 industries, weighted
towards financial services, technology,
media and telecommunications.
Why are so many
companies relocating
to the urban core?
WHAT’S DRIVING THE DECISION
TO RELOCATE?
Our respondents cited diverse motivation
for their companies’ relocations. The five
dominant reasons, here ranked in order
of importance with sample respondent
comments, were:
1. TALENT/EMPLOYEE RETENTION
“Availability to talent and talent
attraction…”
“Proximity to universities…”
2. CORPORATE IMAGE
“Higher profile…”
“New start for the company, a culture
change, better suited premises
and support for brand and HR
attractiveness…”
3. DESIRE TO IMPROVE EMPLOYEE
WORK/LIFE BALANCE
“Brand new facility with great views and
access to public transit…”
“Recruiting and retaining talent pools and
decreasing commute times…”
4. TRANSPORTATION BENEFITS:
“Better commutes for staff, closer to
clients and airport…”
“Proximity to customers…”
5. LACK OF AMENITIES IN SUBURBAN
OFFICE PARK ENVIRONMENTS
“Location to attract the labour force we
were seeking and providing an energetic
work environment…”
WHO INITIATES THE DECISION
TO RELOCATE?
It’s a good idea for all corporate real estate
executives, aware of the increasing trend
toward urbanisation, to become familiar
with the issues touching on relocations
of their own companies, or be proactive
in starting the discussion at the C level.
In fact, 20% of the respondents reported
that the real estate executives drove the
decision to relocate, taking the initiative to
make the case for the move.
While 60% said the decision was a
collaborative process that involved
both the real estate team and top
management, a solid 20% of respondents
were acting on — or rather reacting to —
a decision to relocate that was handed
down from top executives, a more
challenging task.
IMPROVED EFFICIENCY AND
PRODUCTIVITY
Relocation may not mean cost savings
— rents are higher for urban spaces
— but companies can achieve cost
neutrality through more efficient use
of available square footage. Of the
46% of respondents with experience
in relocation, 100% cited the increased
diversity of the new workspaces as a
benefit of the move.
And an impressive 80% reported
improved productivity and efficiency.
In their own words:
“Employees are more motivated in this
type of space and location, more willing to
meet up with their team…”
“Better cooperation…”
“A better physical environment for
improved collaboration…”
“A shorter way between different
groups…”
“Better collaboration and processes,
knowledge sharing.”
A vibrant trend toward the
urbanisation of corporate
real estate is sweeping the
nation, from San Francisco
to Hollywood, from Austin
to Chicago, from Detroit to
Brooklyn, and even across
the world. In the U.S. alone,
metropolitan areas today
generate 80% of the nation’s
jobs and gross domestic product
(GDP). We decided to examine
the roots of this phenomenon via
a survey of corporate real estate
executives, conducted in the last
quarter of 2013 in collaboration
with CoreNet Global.
Detroit
• Lowe Campbell Ewald: 122,000 sq ft
• Chrysler: 33,000 sq ft
• Quicken Loans: 8,000 employees relocated to Downtown
• Confidential client: over 3,000 employees relocated to
Downtown
San Francisco
• Samsung: 225,000 sq ft (multiple locations)
• Neustar: 144,000 sq ft
• Illummina: 98,000 sq ft
12 DTZ | In Situ
