What We Heard at DC's State of the Office

RDM’s VP of Sales and Marketing was in attendance at Bisnow's 2nd Annual DC State of the Office conference. The event, which RDM proudly sponsored, brought together an all-star panel of real estate professionals who are dictating the state of the DC office market and reshaping the future of office development.

The panel included DC area real estate professionals from Brookfield Office Properties, Federal Capital Partners, The Tower Companies, Jones Lang LaSalle, Gensler, MRP, Winmar Construction and Vornado.

First Panel

- Creighton Armstrong (JLL) - Tenants in DC are looking for smaller spaces in order to maximize on efficiencies.

- Jeff Barber (Gensler) - A one size type building doesn't fit all now; think tech company vs law office. 

- Edwin Villegas (Winmar) - Landlords are now more willing to bring change to their buildings to attack and retain tenants.

- 60% of tenants are renewing in DC, it is important to have a long term plan with a tenant to keep them engaged with the property.

- You can't miss on "focus" workspace when designing a space.

- Office space can be "cool" as long as it makes sense and the space will be used. It is also important to get clients onboard with using this type of space; if they aren't educated on the amenities they may overlook them.

- Creighton - Larger tenants over 40000 SF put time in with finding space and have shifted to finding newer space options in DC.

- Breaking up space creatively can provide a new identity for an older building.

Second Panel

- Eric Posner (Tower) - The biggest challenge for Tower’s portfolio is giving second life to older projects.

- David Bevirt (Brookfield) - A challenge in downtown DC is figuring out how to process commodity office space to max its value.

- Ryan Wade (MRP) - Land value in DC has appreciated so much that overtime commodity A office space will fill as space availability shrinks.

- Wade says it will take 20 to 30 years to turn Tyson's Corner into a place where people want to live as well as work.

- DC will eventually require buildings to provide numbers on their energy usage which will force owners to place a bigger emphasis on sustainability.

- The GSA will continue to look for cost reduction and efficiencies. This is putting a tremendous amount of pressure on all commoditized space.

- Rents in DC area will probably remain moderately flat until supply is sorted out.

- Some sub markets will suffer greatly b/c of oversupply of commodity space in DC area.