The demand for high-tech office spaces that exceed the comforts of home is increasing more and more. Businesses are turning to newer office spaces that can compete with what workers have at home and provide decent experiences that justify commuting to workplaces.
A clear example is the United States, where office buildings completed in 2015 or later have seen net occupancy growth of 4.9 million square meters since the start of the pandemic, compared to 13.7 million square meters of office space that were vacant during the same time, according to JLL research.
In Costa Rica
Demand is driving up rental prices for modern buildings, which tend to offer state-of-the-art services such as ultra-fast internet and smart meeting rooms. “In today’s flight in search of quality, smart office technology is becoming more of an expectation than a luxury”, says Ariel Castillo from JLL’s Technology area.
Before the pandemic, many corporations loaded up on their “war for talent” arsenal by renting open-plan office space in attractive sectors. The buildings they chose were packed with amenities like corporate gyms, bike storage, and cafeterias. Now they are looking for things like artificial intelligence technology that understands daily routines and work habits, smart software that predicts energy consumption, and wow factors like media rooms designed for video calls. Such technologies are set to make office technology superior to what people have at home amid the rise of hybrid work.
“The more fluid environment will be a great attraction point for people to return to the office”, says Ariel Castillo, Director of JLL Technology. “Many employees like remote work and flexibility, so there needs to be a good case for returning to the office. The office should offer the same lifestyle convenience as the home”. Recent JLL research shows that the quality journey is being fueled by outsized leases on new construction.
Experiencing significant growth
During 2022, the Costa Rican corporate office market experienced significant growth according to the latest JLL Office Report, given the entry into the market of 59,941 square meters of new office space. This brought the total amount of office space on the market to 1,446,890 square meters. It is relevant to note that San José maintains its position as the second largest office market in Central America, and currently ranks 11th among the largest office markets in Latin America.
While concessions are expected to remain elevated compared to historical normal values, JLL expects effective rents to continue to rise on new products, while second-generation assets will require larger concession packages to stay operational. “There is real value in investing in smart technology and the infrastructure that supports it”, says Castillo. “If you do not, your building will be the last in the office tour with potential clients, if it makes the list at all”.