The COVID-19 pandemic has been especially challenging for commercial real estate and data center companies as they look to navigate new and changing customer needs. Recently, AkitaBox CEO Matt Miszewski hosted the latest webinar in the AkitaBox Innovation Series, "Return to the new normal: Limiting Risk and Reimagining Facility Space".
In this insightful Q&A style webinar, our expert panel discussed the challenges facility data centers and commercial real estate organizations face in managing their portfolios today. The panel included Matt Miszewski - CEO at AkitaBox, Andrew Schaap - CEO at Aligned, Andy Power - CFO of Digital Realty, Michael Martin-Tellis - AVP of Finance at Harsch Investment Properties, and Jay Koster - President at JLL Investor Services.
Here are the four biggest takeaways from that discussion, and feel free to watch the webinar in its entirety here.
As more companies have moved remote, data center demand has continued to grow and even accelerate. This growth isn't just driven by industries that have been mostly untouched. Even industries hit hard such as hospitality and retail are seeing an uptick in their data center usage. As companies continue to accelerate the digitization of their processes and core business functions, the critical nature of data centers will continue to grow exponentially.
Insight #2: Data is key to better facility management in commercial real estate
Many top-performing commercial real estate organizations have been digitizing their processes for years. This access to massive amounts of data has brought a whole host of benefits to facility management teams within these building portfolios, such as:
Data-driven CapEx decisions, as opposed to relying solely on the opinion of onsite teams
A more proactive approach to maintenance, helping reduce overall OpEx costs and improving asset conditions over time
Better collaborations amongst teams
Insight #3: Acquiring assets requires extra due diligence
It has always been best-practice to do your due diligence when looking to acquire a new asset even in good market conditions. As Andrew Schaap pointed out, going that extra mile before making that purchase is more important than ever in today's market. "Quite frankly it is appealing for the seller to boast NOI by reducing OpEx and maintenance."
Having the right tools and access to the right data is pivotal to avoid poor purchases and sunk costs. As markets and demand shift it is important to ask the right questions and ensure a clear picture of deferred maintenance, maintenance history, and overall building conditions before acquiring that next asset.
Insight #4: Flexibility is key to meeting commercial real estate customer needs
Before COVID-19, commercial real estate organizations were mostly expected to keep things functional (elevators, badge scanners, etc). But as occupants and customers start to return to their office space in the next six months, their needs will be vastly different than they were before.
Customers will be looking for flexibility both in their workspace and their lease agreements. Services are also growing in demand, especially services that make customers feel safer such as increased cleaning or PPE onsite. As Michael Martin-Tellis pointed out, the next 6-12 months are going to tell us an awful lot about office demands as more customers and businesses return to their spaces.