The most important metric in commercial real estate is outdated. It is time to move on from square footage.
For some time, office occupiers have been moving towards flexible ways of working and this has been accelerated by the pandemic. Now, occupiers value quality over quantity.
So, as a standalone indicator of value, square footage is not enough. These days, businesses are looking for offices that offer employees a sense of experience – high ceilings, outside space, wellbeing facilities, great local amenities – as well as great connectivity and strong sustainability credentials.
Cubic metres anyone? Instead of square feet, what about cubic metres? High ceilings, in particular, are of growing importance to occupiers. Volume gives a sense of generosity and timelessness – high ceilings are more often found in older buildings, though are less common in newer buildings, where floor space has been prioritised over scale and atmosphere.
In today’s market, lofty ceilings are extremely desirable, giving workers a sense of arrival and of place, but volume is not reflected by a two-dimensional measurement of square footage.
Rather than needing a set floor area to accommodate a certain number of employees, today’s employers want to be able to offer a workplace experience that attracts and inspires staff.
This has been a key driver behind the growing emergence of a two-track market: recent research from Gerald Eve found growing demand for high-quality space and decreased interest in secondary offices, while Knight Frank research revealed a growing appetite amongst occupiers for amenity-rich spaces that support an enhanced workplace experience, with 56% of those surveyed expecting an increase in and the broadening of the amenities provided within their workplaces over the next three years.
At The Kensington Building, the expansive ceiling heights highlight the inadequacy of square footage as a valuable measurement.
The market norm for ceiling height in office buildings is often regarded as 2.7m, and we have exceeded this by between 20% and 44%. With grand proportions stretching up to 5m, in addition to a double-height reception, the building provides an exceptional volume of workspace – not to mention over 12,900 sq ft of landscaped terraces.
Location is also important: Kensington is home to an abundance of shops and restaurants, parks and green spaces including Kensington Gardens and Hyde Park, and well-known museums like the V&A – giving tenants an exceptional working lifestyle.
Of course, space is important. Should the industry seek a way of communicating the value of a building based on more than just floorspace? High ceilings, hybrid working, ESG – these things are not going away, and demands on space are only going to become more multifaceted.
That is why it’s time to ditch square footage in favour of something a little more holistic and a little less square.