Office developers need to match needs of all sizes of tenants

Office developers need to match needs of all sizes of tenants

In many leading financial centres, it is common for an office building to be occupied by several large tenants. But in Bangkok, it is more likely that a landlord of a reasonable- sized building will have to lease to over 100 tenants.

The AIA Sathorn Tower on Sathorn Road in Bangkok. (Photo supplied by CBRE)

This is because the median size of office leasing transaction is relatively small at around 180 square metres.

In 2016, there were only two new office leasing deals in Bangkok for premises larger than 10,000 sq m, three deals for between 5,000 and 10,000 sq m and 85% of new office letting were for tenants taking space of less than 1,000 sq m.

This has implications on the design of office buildings as landlords must be able to accommodate tenants needing 100-300 sq m, as well as the limited number of larger tenants taking entire or multiple floors.

The design must allow a floor to be occupied by a single tenant or multi-floor tenant, as well as much smaller tenants. It is not possible to predict in advance whether a floor will be leased to a large or small tenant and the size of the tenant on a particular floor may change over the life of a building.

Large tenants want column-free space to allow an office layout without restrictions caused by having to work around structural columns.

Landlords should use knock-out panels that will allow a multi-floor tenant to install a staircase. This will greatly improve the efficiency of lifts, which will otherwise be slowed down by a single tenant's staff using the lift to go between floors occupied by the company.

For smaller tenants, the design must ensure that the dimensions of a small unit are still attractive with enough windows to give reasonable natural light.

The landlord also needs to minimise the space taken by corridors on multi-tenant floors because even though he has paid for the construction area occupied by the corridors he will receive no revenue from them.

The design must try to avoid a "hospital-look" corridor with a long passageway of office entrances and try and provide tenants with some sense of exclusivity.

Attention needs to be paid to common corridor finishes to provide the look and feel of a five-star hotel, not a government office.

As well, the air-conditioning system should cater to both a whole floor open-plan layout and a heavily subdivided multi-tenant layout.

One of the biggest complaints about buildings from office tenants is the inability to provide a constant temperature with sufficient fresh air throughout the day, irrespective of the outside temperature.

The key to office development is providing a product that tenants want today and in the future in terms of design and specifications.

Landlords need to understand tenants' requirements and one of these is the size. Designing a building that only matches large tenant requirements will limit both the target market and achievable rentals, so the floor plate design and specifications must match both small and large tenants.


Chotika Tungsirisurp is senior manager for research and consulting at CBRE Thailand. She can be reached at bangkok@cbre.co.th Facebook: CBRE.Thailand Twitter: @CBREThailand LinkedIn: CBRE Thailand Website: www.cbre.co.th

 

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