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While given less attention in many firms’ ESG plans, the social aspects of a workforce are now proving integral to success in 2024.
And according to JLL, that’s what will shape companies’ real estate needs – and developers’ and office block owners’ outlook on the important features of their assets – now and in the medium-term future.
Facing a tight labour market, the global real estate firm reported that businesses are increasingly looking to enhance their offerings for meaningful social interaction in the workplace, in a bid to attract younger employees in particular who place a high value on community-mindedness.
As JLL’s head of tenant representation in Australia, Michael Greene, explained, while environmental factors have historically played a big part in tenants’ ESG plans when it comes to their space needs, social needs are now rivalling this concern.
“We have seen a trend towards tenants demanding greater and greater levels of sustainability with the environmental element undoubtedly the leading pillar of ESG. However, with younger generations tending to prioritise the social aspect of the workplace, the ‘S’ is now assuming a greater level of importance,” he said.
Greene opined that establishing a strong culture and community in an organisation has the flow-on effect of reducing churn, in turn increasing “morale, productivity and efficiency”.
Like many of the changes in office culture over the past few years, this new requirement for employees finds its roots in pandemic-era social shifts.
“The epidemic of loneliness and the rise in mental health issues following the pandemic have highlighted the crucial role of the social aspect of the office. In bringing people together physically, the office not only fosters collaboration and productivity but also provides a vital support system for individuals, promoting wellbeing, connection and a sense of belonging that can help alleviate these pressing issues,” Greene commented.
He pointed to a number of initiatives attached to commercial assets that have been proving popular for tenants hoping to up their office’s social amenities.
“Charter Hall’s 130 Lonsdale community choir provides a remarkable example of fostering not only internal connections but also an enhanced commitment to the community. Linked to the church on site, this initiative encourages greater involvement within the community, allowing employees to connect on a deeper level and contribute positively to the broader social fabric,” said Greene of one Melbourne office tower.
In Brisbane, he pointed to “the recently completed 31 Duncan Street development in Fortitude Valley, [which] has a sky terrace and garden to encourage employees to take part in social and wellness activities”.
“Another example is 895 Ann Street, which on completion will have a rooftop bar, adding to the attraction and engagement with the broader community,” Greene added.
And a commercial tower planned for Perth, which is set to be the world’s tallest timber office building, is reportedly going to include a 500-square-metre vegetable garden and dining and entertainment amenities, as well as 1,600 square metres of communal wellness space surrounding the building.
At a time when businesses are trying to ascertain the right level of at-home versus in-office participation among their workforce, social aspects such as these can serve as a powerful driver to enable face-to-face time. And unlike mandates that have the impact of increasing churn, these office ad-ons actually help with retention.
For firms currently considering their office needs, Greene described the social component as a “no brainer”.
“The adoption of a greater emphasis on the social aspect as a means of attracting employees back to the workplace may well help to address an issue that has become more and more problematic for landlord and employers alike as work from home becomes more entrenched.”
ABOUT THE AUTHOR
Juliet Helmke
Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.
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