The Institutional Real Estate Inc Sponsorship brochure, Connected-Investor Focused, We connect people, data and insights, sponsorship, events, IREI Products
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NATIONAL ASSOCIATION OF REAL ESTATE INVESTMENT MANAGERS 12 a profound impact on the choices that Millennials make. Companies seeking to recruit the best and brightest Millennials need to consider sustainable factors among other features of their workplace in order to attract and retain the top talent they need to grow. THE SUSTAINABLE APPEAL For office tenants, attracting and keeping Millennials and the STEM Generation is vital as their workforce presence expands. These groups have an evolving mindset when it comes to long-term company-employee relationships, one that is requiring companies to provide a different environment and culture. According to a recent study of Millennials⁴ by Deloitte Touche Tohmatsu, Millennials "express little loyalty to their current employers and many are planning near-term exits. This remarkable absence of allegiance represents a serious challenge to any business employing a large number of Millennials. However, because most [Millennials] choose organizations that share their personal values, it's not too late for employers to overcome this 'loyalty challenge.'" That is good news for companies in properties that incorporate green practices into their property management, because sustainability is in high regard with this cohort. How important? According to a recent Nielsen study that called Millennials The Green Generation: "Despite the fact that Millennials are coming of age in one of the most difficult economic climates in the past 100 years, [Millennials] continue to be most willing to pay extra for sustainable offerings—almost three-out-of-four respondents in the latest findings, up from approximately half in 2014." The key elements to consider when developing a property that will be state-of-the-art sustainable and a draw for the Millennial workforce starts with location – with transportation infrastructure and nearby services and amenities all difference makers, particularly for Millennials for whom connecting and being connected is so essential. Importantly, a location is assessed not only for its current assets but what the future potential is for making additional connections within the community. As Millennials continue to desire living within a CBD, work's proximity to a modern transportation system is critical – and the key to "getting out of your car." As a result, telecommuting is no longer the "must-have" it once was. This environment also provides a sustainable benefit that may be less obvious—the need for less parking, which results in using less concrete, producing less greenhouse gases, and additional environmental advantages. Internally, the desire for connecting means creating spaces that improve the chances for spontaneous interactions and impromptu meetings. Incorporating the extensive and effective use of natural light also promotes a sense of well-being for the workforce, in addition to reducing energy consumption. Externally, it means developing green spaces, rooftop gardens, public art projects and other efforts that will get the community to interface in a positive way. And of course, the trees in these outside spaces also reduce carbon footprint. GETTING THE GREEN EDGE Once a sustainable property is developed, how best to institute an operational approach that can gain a "green edge" in real estate? Success is found in three pillars that focus on a building's physical characteristics and operations, and on tenant and resident relationships: 1. Energy management systems. It's vital to implement a system that tracks and monitors energy efficiency across all properties in a portfolio. This way, landlords can better understand utility consumption and identify best practices that can be shared to drive value and reduce environmental impacts. 2. Certification. It may seem obvious, but it's important to strive to make buildings certified for sustainability, preferably through the LEED certification, BOMA BEST (in Canada) and Energy Star rating programs. These certifications are symbols of a commitment to sustainability and are increasingly being expected by tenants. The competitiveness of a property could be considerably altered if it does not have any level of certification. 3. Tenant engagement and communications. After the physical work is complete and a property is certified, additional improvements and efficiency can be achieved through the active engagement of tenants. This is where the overlooked value-add is hiding. As an example, at Bentall Kennedy, we've created ForeverGreen, a communications program for tenants that won the 2015 Green Building Council Innovation in Sustainability Award. It's an engagement campaign that includes an annual twelve-poster series, resource guides, newsletters, team packets and more; the 2016 campaign is movie-themed, leveraging pop culture and humor. We have seen clear evidence that major corporate tenants are now expecting and even demanding green buildings. @