Richard Morell: Creating A Sense of Place
Published Nov. 2018
The war for talent has become the war for the tenant. Equiem is creating a style of engagement and brand for real estate landlords to meet and exceed the expectations of today’s tenants. Richard Morrell, EVP Business Development for Equiem dissects what tenants want from their workplace.
I'm Richard Morrell, the Executive Vice President of Business Development with Equiem an Australian company with offices now in Melbourne, Brisbane, Sydney, London and right here in beautiful New York City. Many of you may recognize this, it's a boomerang. You might know it as a traditional Indigenous Australian hunting tool but it has one other purpose and I'll get to that at the end. He's a really interesting quote from Anthony Slumbers who's a CRE strategist from the UK, if you don't know him and all of his work, he's a fascinating guy and you should look him up. But he says the real estate business is no longer about real estate. Technology is changing the way demand is being looked at in the industry and we all know this. We see it in various ways and then a supply side of things is having to adjust to suit current demand. Supply services become the norm, long term leases are out the door, and the industry has to adapt. We like to say that the war for talent has become the war for the tenant.
Dr. Lee Elliott from Knight Frank summarized here saying occupiers will locate in buildings that support them in attracting and retaining talented staff. They seek talent magnets - locations that have a buzz, vibrancy, and cohesion.
Equiem at its core is a digital and people based tenant engagement platform for landlords. Where right in the heart of that market, we were founded in 2011 growing all over the world.
Traditionally what landlords have delivered, when I say little is we're talking a whole building, fund managers, facilities manager, leasing, asset management strategy. But what tenants now want we hear at Equiem - Engagement. Technology. Community building.
One of my clients in Chicago said to me that I don't really know what engagement is and I certainly don't know what it means in the community of our commercial office buildings, can you help us out? To landlords are evolving from being rent collectors to service providers. It's become a more B2C business rather B2B business with many customers across the entire building now to manage that relationship with not just a bottle of wine and a steak and a long term lease.
So if real estate is now B2C, not B2B, let's take a look at some brands that we would identify with it and have been strong on the consumer side of things and compare whether we think the real estate market has caught up. We work as the obvious example have changed the face of real estate forever. Whether you like it or not they've completely shifted the needle in the industry and the likes of Knotel, Industrious and others, are finding their own way. What WeWork has done is be the credited brand outside of the real estate industry. Everybody knows WeWork. And what they've also done within the industry is everybody knows when they're in a WeWork space and the challenge, for traditional landlords is to work out how to create that style of engagement, that style of brand, and that true sense of place.
You see here what we're saying is the likes of a WeWork that provide not only spaces a service, but flexibility on-demand, community engagement services and experiences, beer on tap coffee, product launches events.
That model coupled with space creates valuable real estate. Services, flexibility, engagement and community, plus the physical real estate, is what we deem as really valuable real estate.
Equiem was founded in 2011. You can probably tell from my accent that I'm from Australia. We’re originally founded by a property owner of a 1 million square foot building, facing 30% vacancy. It was a 35 year old asset competing against newer, shiner assets in other parts of the city. And the mantra was, how do we create a level of engagement and stickiness through a technology platform and engagement platform that will change the face of this building? How do we know what investments to make from an asset management perspective? How do we know what tenants want? Do they want a shoe shine do they want another café, what sort of restaurants do they want? So Equiem is founded on the premise that by building an engaging platform that would speak to the entire building community rather than a select few, and you all know what it's like trying to get messages out through a tenant rep. The idea was to with custom built a platform that would be engaging enough that everybody in the community would want to be part of it. We realized very quickly that that needed a different mindset in how the building would be staffed and also engaged. So today our platform and the services extends to 125 buildings globally.
Over 57 million square feet of office space, we've got 110,000 active users, 250 staff and growing. What we do is we white label and develop a digital engagement platform for each and every building. In some cases we staff the building with community managers with events, PR and marketing backgrounds and then provide a curated engagement strategy for each and every one of our buildings whether it be ordering coffee, your laundry and dry cleaning, we provide all that service, all under one digital platform.
Here are some examples of the kinds of events that we do. I think one of the biggest challenges for landlords is to know how do we create this? What's the secret sauce? How do we engage everybody within our building and I'd love to be able tos ay the answer is very straightforward and it’s the same for every building but the reality is it's not. So we have to sit down we have to look at an asset management strategy and ask are we trying to retain a tenant or are we trying to add new retail into the precinct because what we have is stale, are we trying to help an existing retailer get more as sore of a digital booking system? So we curate a strategy for each and every building.
And just to finish with a couple of examples of some of our clients. Dexus is the largest landlord in the Australian office market. In the early days a lot of the major funds were confused about how to approach the space and we worked with them across their entire portfolio to custom develop the platform too brand DEXUS as a workspace to all of their tenants, not just to the to the broader community or the outer community that now we're trying to attract as new tenants. So what are we delivering? Child minding services, wellness classes, meeting rooms and event spaces, parking perks. They have 30000 tenants registered on their platform, a staggering 81% of those tenants are thrilled with the platform that's being rolled out across the 36 buildings.
Adams and Co was our launch client here in New York City. We rolled out across 16 buildings in Manhattan. Our system is modular in that we have the platform, the people and the engaged services. What we did with Adams was one of their own community managers so we deployed the technology and engagement services with them across the portfolio. The Equiem academy team was used to train their community managers and the feedback to date has been nothing short of outstanding. You can see the statistics around the number of registered users. What we try to do is set benchmarks with each and every client. So the 54% of the population are registered, we would typically say that trend up to about 70% of the entire building population. That's where the value is created and the data that you have access to with tenants doing surveys, polls, helping understand what the tenants of your communities want.
In one case in Australia, we issued a survey to the building community of three and a half thousand people. It was a 12 minute survey and we received over a thousand responses which then feeds into the asset management strategy. So creating community buzz, a platform that is engaging, curated for every asset, and that people want to access every day.
My final slide is one of my favorites. This is Craig McDonnell. I knew Craig from my early days with Equiem. He sells the Big Issue at the front of the Rialto Tower in Australia which actually was the first building that the portal was rolled out and he's been doing it for five years. His wheelchair was no longer meeting his needs and a call to action went out on the digital tenant portal at Rialto Tower to see if the remaining fifteen thousand dollars needed to be raised, could be raised within the building community. The results were nothing short of astounding and what keeps our business thriving.
10 separate community fundraising events were put into place by the tenants of the community and also by building management. From each one of those events, fifteen thousand dollars was raised and Craig twelve months later received his brand new wheelchair. A staggering insight into what the traditional bricks and mortar asset can look like when a community is truly engaged and people feel a sense of place and at the end of the day that's what we're trying to help you achieve. We're trying to help traditional landlords across their entire asset portfolio or a specific building create an environment and a level of stickiness that when a newer, shinier building comes up down the road, that I don’t want to leave because I feel part of something really special.
So back to the back to the boomerang.
I was with Equiem its founding he is in Australia in 2011. Another opportunity presented itself and I moved to the US to the West Coast actually ran another company for 4 years until the phone rang and it was Gabrielle, who many of you know the CEO of Equiem. Gabrielle and I caught up and said we're setting up in the US we're going to be in Manhattan. We're really excited and we want you back. And so as well as being a hunting tool, the other thing a boomerang does if it's thrown correctly, is come back to its origin with pinpoint accuracy and it's those kinds of stories that got me back in and why I'm now known as the boomerang within Equiem.