Special report Q&A: Perspectives on a changing economy and the ‘Future of Work’

Editor’s Note: The “Future of Work” is a WRAL TechWire series, supported by commercial real estate firm JLL and other partners. This week, the series looked at what’s happening, today, in the Triangle’s economy, in two reports. The first report is here, and the second piece is here. This is a lightly edited transcript with two experts from JLL.

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RALEIGH – The Triangle’s economy is changing, driven by factors both related and unrelated to the ongoing COVID-19 pandemic. In the “Future of Work” series, WRAL TechWire investigates what is occurring in the Triangle and across the state of North Carolina at the intersection of real estate, economic development, and the workplace.

WRAL TechWire spoke with Brett Cox, research manager at JLL, and Kimarie Ankenbrand, managing director and Raleigh lead at JLL, as a part of the research for the series. A transcript, lightly edited for clarity, appears below.

State of commercial real estate

WRAL TechWire (TW): In your opinion, and generally-speaking, what’s the current state of the Triangle’s commercial real estate market?

Brett Cox, research manager at JLL (Cox): I am very optimistic about the health of commercial real estate. This market has great fundamentals and buzz right now, and 2021 played a large part in generating those. I’m interested to see if 2022 begins to slow its growth in terms of interest and activity, or if it continues to accelerate. The market will continue to grow, but the rate of that growth will determine if it becomes a leader in the country or not.

Kimarie Ankenbrand, managing director and Raleigh lead, JLL

Kimarie Ankenbrand, managing director and Raleigh lead at JLL (Ankenbrand): The market is still not stable despite it having momentum. I don’t think this market will plateau anytime soon—it’s a matter of the rate of growth from year to year. Once conditions and the labor market stabilize we will be able to see what sort of growth this market can expect in the mid- to long-term.

Offices and coworking

TW: What’s happening in the office sector of the market, given the ongoing pandemic?

Cox: The prevalent narrative at the beginning of the pandemic was that office space was on the way out.

However, as the newness of work from home has worn off, our data are showing that workers want to be back in the office.

That doesn’t mean everyday, but they certainly want an office space as one of their options – and it is an important option.

The change then is how the space is being used.

An increase of collaborative space is certainly there, so that when employees are in the office they can maximize their presence by meeting in person.

To incentivize employees to come into the office, companies are wanting to now make the office a place unlike they can get at home, with high-quality atmosphere, ability to socialize, location, and amenities.

TW: What’s the future of coworking, and of coworking facilities?

Cox: Coworking is certainly here to stay. By JLL’s estimates, 80% of coworking space is leased at any given point, so the demand is there. Again, it is about having options if you are a standalone employee. For companies and startups, of which there is an increased amount in our current economy, these spaces offer quick solutions when speed is rewarded.

A broker’s role

TW: What’s a broker’s role in these types of projects?

Ankenbrand: From the tenant perspective, it is increasingly our job to help them think about their people first.

People are the most valuable asset. We are also there to help them manage change by assessing and engaging with their employees, analyzing responses and testing possible recommendations, and ultimately we make recommendations about the direction a company should take.

We are moving past simply knowing the local real estate market—properties, players, market conditions—to integrating technology and people into the decision matrix.

Landlords are looking to us to be creative, cutting edge, outside of the box thinkers on how to position their assets beyond just a one-dimensional real estate play.

There’s more things in the mix than just pure space—what tenants want and companies need.

We have to make sure the building/property is a desirable asset and commute-worthy.

The future of the region’s economy

TW: What else is important to note about the future of the Triangle’s economy?

Ankenbrand: We are in the early innings of the Raleigh-Durham market transformation. We can see the direction this market is going, and it is picking up momentum. Over the next couple years we will see how much momentum builds and how quickly we get to where we think we are going.

Cox: The market is evolving rapidly from being driven by old money and local players to companies and investors with national reach, more sophistication. With that comes not only a maturing market, but an evolving culture. It will be interesting to see how the market’s quality of life factor gets shaped in the process, as it has traditionally been one of the biggest selling points for the market.

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This editorial package was produced with funding support from JLL and other partners. WRAL TechWire retains full editorial control of all content.