Michael McGuinness is CEO of NAIOP New Jersey
By Michael G. McGuinness
This will be my last byline in Real Estate NJ as CEO for NAIOP New Jersey. I am beyond grateful to Paul Profeta and Josh Burd and the rest of the RENJ team for providing me with this opportunity and platform to report on public policy issues, trends and other useful topics impacting the commercial real estate industry. Honestly speaking, it hasn’t always been easy finding another timely topic that I felt was relevant. The assignment did, however, encourage me to do the research, review publications and interview many experts to get my information.
In prepping for this piece, I reviewed the 72 articles I wrote since 2017 to identify common themes. There were clearly six that were “frequent flyers” as follows: (1) government leadership; (2) infrastructure investment; (3) pressing need for innovation and reform of inefficient government operations; (4) demographics, labor and shrinking workforce; (5) sustainability and resilience; and (6) what motivates investors to fund projects. Unsurprisingly, the common denominator was the crucial need to change how we do business with the end goal of improving people’s lives for a simpler and better quality of life — one that is less taxing and costly and more efficient and effective.
For each of these main areas, there were plenty of examples and stories where the problems were solved and addressed through a new way of thinking and doing things, a.k.a. innovation. Too often, many of us (especially the older ones like me) resist making a change as it can be frightening or disappointing. But change can also be exciting and rewarding. Sometimes, change is no big deal at all. Nevertheless, change is relentless. Without it, we become irrelevant and, like the dinosaurs, extinct.
Collaboration, flexibility, hospitality, sustainability and continual innovation and investment in new technology are all critical components of a successful playbook. It should be part of our DNA and standard operating procedures. We all need to invest more time and resources in taking better care of the members of our communities — workforce, residents, tenants, neighbors and visitors. Such examples might include more street dining and green space, more mixed-use development, prioritizing work-life balance that allows for a hybrid work schedule, removing obstacles to allowing more brew pubs, providing free Wi-Fi, food courts and fitness rooms or centers throughout entire buildings and neighborhoods, increased utilization of renewable resources and widespread implementation of carbon reduction strategies including solar panels, electric vehicles and universal adherence to recycling and reuse practices, use of QR codes to speed up the transfer of information and much more.
In the aftermath of COVID-19, we all need to refocus our behavior to being more hospitable and treating the people we rely on as our neighbors. The pandemic has permanently altered the office sector and many of the big cities, especially the downtowns. Urbanist Richard Florida sees downtowns evolving from destinations for work into “better neighborhoods” that offer a range of amenities. This same thinking should also apply to the office. According to Florida, real estate developers should focus on creating offices with comfortable seating, natural light and open spaces. “The trend now is to make the office look more like your living room or house, to look more like a hotel lobby.” Florida maintains that the biggest key to success for cities is to focus on the people who live there. In addition to creating affordable housing and investing in education and training, it also means providing opportunities for everyone regardless of their background or socioeconomic status. He notes that diversity, equity and inclusion or DEI initiatives are not just ethical imperatives but also economic ones.
It’s funny how often I am drawn back to my early days in the Boy Scouts where we had to memorize the Scout slogan, “Do a good deed daily.” We also had to learn the 12 points or ideals of the Scout law, meant to be a code for action on how we were to conduct ourselves at all times. “A Scout is trustworthy, loyal, helpful, friendly, courteous, kind, obedient, cheerful, thrifty, brave, clean and reverent.” I trust that you can see how at least the first eight points are the essence of hospitality.
According to Gensler’s U.S. Workforce Survey 2022, the following 10 types of office amenities are no longer optional: quiet or tech-free zones, alternative and individual workspaces, focus rooms, libraries, innovation hubs, maker spaces, project/war rooms, rest/nap areas, outdoor spaces and meditation spaces.
The real need for flex space is reflected by the fact that “people are the new amenity,” according to Jacob Bates, head of Americas for Flex by JLL. “They probably always were, but we didn’t perhaps recognize them as an amenity. The types of spaces listed above fill the need for community connection and engagement. We’re seeing the revenue that is being generated from these spaces far exceeding anything we ever expected pre-pandemic. In some cases, these spaces are generating more revenue than the office space itself.”
So, in the spirit of trying something new and innovative, I suggest that we require educational courses in hospitality for our students and mandate hospitality training for all public officials. Uh oh, here comes the hook. I’ve got to get off the stage now.
It’s past my time, I’ve got to go. Respectfully, there’s another show (not going far and you can find me on LinkedIn).
(Portions of this article were obtained from two articles in the summer 2023 NAIOP Development Magazine: “What’s the Future of Cities in the Aftermath of COVID-19?” by Trey Barrineau and “The Evolution of Office Amenities” by Ron Derven.)
Michael McGuinness is the outgoing CEO of NAIOP New Jersey and, prior to retiring on July 19, led the commercial real estate development association since 1997. NAIOP represents developers, owners, asset managers and investors of commercial, industrial and mixed-use properties, with 850 members in New Jersey and over 19,000 members throughout North America.
