June 23-23, 2005
MORE AMENITIES, CONVENIENCE BUILT INTO WORK PLACES TODAY
By Chris Gottschalk
In the 21st century, jobs continue to become increasingly office based. As a result, companies that design and build office buildings have begun to focus more on the comfort of the people who work in them.
“It’s all about the details,” said Jeff Shapiro, vice president in charge of business development at TMN Builders. “It comes down to comfort in the office building, access and parking.”
The details include such things as weight rooms, childcare space and even restaurants. One of the more common amenities is basic climate control.
“One thing we like to do is provide operable windows so that fresh air can be let into the buildings or in just a single office,” Shapiro said, pointing out that windows are usually fixed in office buildings.
TMN is located in Okemos and employs 15. It reported $12 million in revenue in ’04. “Amenities are very important to office buildings today,” said Ron Boji, the president of Boji Group.
Boji Group operates out of two offices, one in West Bloomfield and one in Lansing, and grossed $75 million in revenue in 2004. It currently has 25 employees.
“One amenity stands out from the rest,” Boji said. “By far one thing-parking.” He notes that his two office buildings in downtown Lansing have parking ramps either attached to them or located across the street. Given the weather in Michigan, this is especially important. Other companies have also taken measures to make parking lots closer.
“We have created office parks where people can park in front of the building and actually see their car,” Shapiro said. However, Boji notes that parking is never included as part of the tenant’s lease cost, which runs $21 to $23 per square foot in downtown Lansing. “It is the responsibility of the tenant to take care of their parking needs,” Boji said. “Some take care of the parking themselves, others tell their employees to take care of it.”
Another important amenity is access and location. “We have found that being close to the interchanges is important.” Shapiro said. “Everybody’s traveling. No one is doing business in their own local area.”
Location always is critical for success, but it is also important in determining the look of the office building, according to Boji. “Office buildings in the suburbs are wider and shorter. In the city they’re narrower and taller,” he said. “This area is not very corporate and they’re not looking for those five, six, seven story buildings,” Shapiro said. “They are looking for a building that kind of reminds them of home.”
Both Boji Group and TMN claim low vacancy rates. Since an office building costs $145 per square foot to build, this is extremely fortunate. According to Shapiro, TMN has zero vacancies. The Boji Group has “close to 100 percent of occupancy in each building,” according to Boji. However, both insist that are anomalies in this market.
“The better locations will always experience better absorption, regardless of market,” Shapiro said. “I think we’ve been very careful to select our locations.”
In Lansing, 5 percent to 7 percent of class A offices are vacant, while for all classes (A, B and C) the vacancy level is at 15 percent. “There has been an increased vacancy in B and C classes because the state consolidated and moved into single office buildings,” Boji said. However, he believes that the vacancy rate will drop, “Not immediately, but over time. In the next two to four years, in my opinion,” Boji said. He credits this to Governor Jennifer Granholm’s executive order bringing far-flung state offices downtown.
“I see downtown Lansing making a comeback,” Boji said.