Even before the pandemic prompted employers to consider relocating offices outside of crowded cities, the inner-ring suburb was calling—places where commutes are shorter, the work-life balance is more centered, and where urban commerce and culture are still within easy reach. The trends toward millennial talent, healthy workplaces, and productivity-focused management explain why suburban core locations are the new destination for leading companies.
Millennial talent clusters, healthy campuses, and talent-focused management trends are driving the move toward top suburbs.
1. Demographic Shift
Young professionals are on the move. As the millennial generation increasingly shifts to the suburbs for larger homes, green space, quality schools, and engaged communities, they also do not want a long commute. They choose suburbs with walkable amenities and transit access to keep them within reach of the urban experience. At 25-40 years of age, they also boast more professional experience. This puts them at the pinnacle of desirability for companies whose business models rely on educated and productive professional talent. Millennials currently represent 50% of the workforce and will reach 75% by 2025. Leading companies are in a race to determine ways to attract, retain and engage them.
2. Workplace Shift
The focus of corporate responsibility is shifting. The demand for “green” or LEED-certified buildings that minimize their impact on the planet has expanded to include “healthy” WELL or Fitwel-certified buildings that measure the impact on the people who work inside. Together, these qualities address the fundamental priorities of the millennial workforce – environmental sustainability and workplace wellness.
These are the workplaces that provide ample natural light, views, amenities that encourage physical movement and social interaction, access to nature, water features, walking paths, bike trails, fitness centers, and healthy food options. Collaborative and casual workspaces, inside and out, combine with walkable neighborhoods to turn these office environments into experiences. But the neighborhoods that have it all—restaurants, residential areas, parks, public transit and direct roadways to talent clusters—are only available in certain well-located suburbs.
A healthy work environment sustains an everyday culture of wellness that demonstrates a company’s commitment to its employees’ health, balance, and well-being. Increases in productivity, recruitment and retention of the finest talent explain why Google, Apple, Amazon, and Microsoft have built corporate campuses that support creativity, collaboration, satisfaction, and well-being. The resulting quality, loyalty and productivity of their professional talent offer evidence of a business decision that supports the bottom line.
There’s a “massive opportunity in front of us when we begin to shift from thinking about green buildings (which largely focus on the 1 percent of costs associated with energy, waste, and water) to thinking about Healthy Buildings (which focuses on the 90 percent of the costs of our buildings – the people).”
Joe Allen & John Macomber
Healthy Buildings: How Indoor Spaces Drive Performance and Productivity
3. Management Shift
High-performing professional services, finance, and technology companies are adopting a “productivity mindset” to drive industry-leading performance. C-suite conversations about costs and efficiency are shifting toward growth and productivity, as companies seek the maximum return for the employee compensation that is by far their largest expense.
Bain & Company research on productivity concluded that companies that treat their workforces with the same discipline as they do financial capital perform significantly better than the rest. These companies carefully manage the time, talent, and energy of their people to drive huge gains in growth and profitability. That’s where location and work environment come in.
• Time
Top companies consider their employees’ time their scarcest resource and manage it accordingly. A long commute is an inherent drag on productivity and quality of life, a fact brought into sharp focus during the pandemic. Offices located near professional talent clusters not only minimize commuting time but also support flexible work strategies.
• Talent
Well-located and dynamic workplaces attract the most productive “stars.” Such top talent is easier to recruit to great work environments. And when the workplace experience is a magnet for them, they stay longer and draw others in.
• Energy
Employees who are engaged and inspired bring more discretionary energy to their jobs, making them 125% more productive than employees who are merely satisfied. Knowing that one inspired employee can equal the productivity of up to 2.25 mediocre performers justifies the investment in creating workplaces and cultures that promote excellence.
The top-tier companies in Bain’s research are 40% more productive, generate 30-50% higher profit margins, and grow faster than industry peers. Their employees serve customers, work together, and innovate better because they are talented and inspired, and their time is well spent.
“The only way to succeed in business in the 21stcentury is to continually create great products, and the only way to do that is to attract smart creative and put them in an environment where they can succeed at scale.”
Eric Schmidt, former CEO, Google
How Google Works
Productivity impact
What defines an inspiring workplace? Top companies provide talented employees with a combination of good work, good managers, good teams, and a positive culture. They build that positive culture with a compelling vision and values, solid business practices, an inspiring corporate narrative, and hiring practices that draw people who embrace that narrative. They are also dedicated to creating and maintaining physical spaces where employees can do their best work.
Researchers at Harvard’s T.C. Chan School of Public Health have documented the measurable effects of work environment on cognition and human performance. The World Green Business Council also identifies key workplace factors that can drive the following productivity improvements:
- Better/natural light: +23%
- Access to natural environment: +18%
- Improved ventilation: +11%
- Individual temperature control: +3%
Other studies demonstrate that:
- walking improves creativity
- access to green space and water features improves productivity and well-being
- outdoor meetings improve team performance
- regular physical movement improves metabolic function and mood.
The post-pandemic workplace will emphasize the human experience more than ever before, incorporating collaboration and private workspaces in addition to social, outdoor, dining, and fitness amenities that make it a better environment than working from home. Investments in accessible, flexible, healthy, inspiring workplaces will attract, retain, and engage the best talent, and can drive a 10x return for companies who need a top professional workforce to excel.
Conshohocken: Philadelphia’s Suburban Core
Conshohocken represents a prime example of a burgeoning sub-market at the heart of the Philadelphia region. Intersected by two major interstates and a regional transit line, Conshohocken provides direct access to the region’s major professional talent clusters in Center City and the prosperous Main Line suburbs. The formerly industrial town offers a walkable business district with over 40 bars and boutique restaurants, over 3,000 modern apartments, riverfront walking paths, a 40-mile bike trail, good schools, and a vibrant community. And major employers are moving in, with AmerisourceBergen and Hamilton Lane opening their corporate headquarters in 2021, joining a roster of other blue chip tenants in the 4 million-SF commercial submarket. Hamilton Lane will lease 130,000 SF of the 260,000-SF Seven Tower Bridge office tower on the banks of the Schuylkill River.
The Bottom Line
As business trends magnify the appeal of central, transit-oriented, urban-suburban, walkable commercial hubs, demand for these hotpots for talent and performance has never been greater. And that equals demand for places like Conshohocken, Cambridge, and Bethesda — the inner-ring suburban locations wheretalent, transit, lifestyle, and urban-suburban balance is driving corporate growth and performance.
Better days begin in better space. seventowerbridge.com is designed for the future of work. Co-developed by American Real Estate Partners (AREP) and Oliver Tyrone Pulver Corporation, and opening in May 2021, Seven Tower Bridge delivers 260,000 square feet of Class-A riverfront office space to Conshohocken, a commercial and residential hub 13 miles outside Philadelphia.
AREP is an institutional fund manager and operating partner focused on office/mixed-use repositioning and development across the Mid-Atlantic. AREP’s 10+ million-SF portfolio is UL Healthy Buildings Verified, and WELL Health Safety Rated. Oliver Tyrone Pulver Corporation has developed over 15 Million SF of first-class office space in the most desirable locations in major U.S. cities.