Fourth Annual Report Highlights Landlords' Top Priorities As the Economic Climate Remains a Challenge for the Commercial Real Estate Industry
VTS, the commercial real estate (CRE) industry’s leading technology platform transforming how strategic decisions are made and executed across the asset lifecycle, today released the findings from its fourth annual 2023 VTS Global Landlord Report, which identifies new strategies utilized by landlords to retain tenants and weather the current economic climate. The report is the result of a survey commissioned by VTS from an independent market research firm, surveying today’s landlords from across the globe on their priorities and challenges going into 2023.
The report, which is based on a worldwide survey of hundreds of top industry leaders, shows that as new office demand continues to falter, 87% of landlords say that the retention and renewal of current tenants are more of a focus in 2023 than acquiring new tenants. With new office demand currently at 46% of pre-pandemic levels, according to the latest VTS Office Demand Index (VODI), 2023 promises to be a challenging environment for landlords as they face major headwinds. This means that strengthening existing tenant relationships and investing in the technology needed to draw employees to their workplaces will be key to success, as just over half of landlords still struggle with daily tenant occupancy rates under 30%.
"As the office market remains cool, it’s more important than ever that landlords are placing a focus on retaining the tenants they already have,” said Nick Romito, CEO of VTS. “These days, it takes more than just negotiating lease terms to remain competitive. Employees are demanding activated and connected buildings that make them want to come to work, and companies are seeking flexible space options that enable them to scale up or down as needed and provide their workers with flexibility in where they work. Our Global Landlord Report highlights the challenges building owners are facing and how they hope to combat them in 2023.”
Key takeaways from the report include:
Landlords Primary Focuses for 2023 Include Advancing Tenant Relationships, Prioritizing Tenant Retention and Investing in Touchless Tech
- The top investment activities for landlords in 2023 are managing tenant relationships, implementing new tenant amenities, asset redevelopment, and maintaining tenant occupancy
- 90% of landlords say technology is critical to managing their tenant relationships
- Nearly all (91%) of landlords say it is their business’ goal to create a hospitality-like experience for tenants on-site in buildings
- Touchless tech is imperative in enabling a positive tenant experience, as well as food and beverage options, tenant experience technologies, outdoor communal areas and building management systems
Despite the Fact that 87% of Landlords Say That The Retention and Renewal of Current Tenants Is More Of A Focus In 2023 Than Acquiring New Tenants, Most Landlords Don’t Have Insight Into Tenant Attrition and What Tenants Are Looking for From Spaces
- Less than half (41%) of landlords are sure they have insight into upcoming renewals or tenants that are at risk of leaving
- Only 38% of landlords are sure they have the tools that help them understand, in real-time, how tenants are using their space and amenities
With Less New Office Demand, Landlords are Paying Close Attention to Their Marketing Strategies
- Marketing automation is the top marketing investment for landlords in 2023, followed by photo content, corporate websites, content management solutions and digital advertising
- Despite the importance of websites as a marketing tool, only 44% of landlords have full clarity into their web visitor count and visitor patterns
The report shows the results from a survey commissioned by VTS from an independent market research firm for today’s landlords worldwide on their priorities and challenges going into 2023. Survey responses comprised a wide range of portfolio sizes and leasing specialties.
Download the full 2023 VTS Global Landlord Report here.
About VTS
VTS is the commercial real estate industry’s leading technology platform that transforms how strategic decisions are made and executed across the asset lifecycle. In 2013, VTS revolutionized the commercial real estate industry’s leasing operations with what is now VTS Lease. Today, the VTS Platform is the largest first-party data source in the industry and delivers data insights and solutions for everyone in commercial real estate to fuel their investment and asset strategy, leasing and marketing automation, property operations, and tenant experience.
With the VTS Platform, consisting of VTS Lease, VTS Rise, VTS Data, and VTS Market, every business stakeholder in commercial real estate is given real-time market information and executional capabilities to do their job with unparalleled speed and intelligence. VTS is the global leader, with more than 60% of Class A office space in the U.S., and 12 billion square feet of office, retail, and industrial space is managed through our platform globally. VTS’ user base includes over 45,000 CRE professionals and industry-leading customers such as Blackstone, Brookfield Properties, LaSalle Investment Management, Hines, BXP, Oxford Properties, JLL, and CBRE. To learn more about VTS, and to see our open roles, visit www.vts.com.
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Contacts
Media:
Eric Johnson
eric.johnson@vts.com
