By Keith Loria, Contributing Editor<\/p>\n
Kingsley Associates reported that tenant satisfaction in office buildings rose nearly 2 percent to reach a three-year high, according to its second-quarter Office Industry Trends survey.<\/p>\n
The data shows that for the four quarters ending on June 30, 2014, 88.6 percent of tenants rated their overall satisfaction of office space as \u201cgood\u201d or \u201cexcellent,\u201d an increase from the previous report\u2019s 87 percent, which came in as the lowest percentage observed since the latter part of 2012.<\/p>\n
\u201cAt Kingsley, we perform correlation analysis to determine which areas move in lock step with overall tenant satisfaction,\u201d John Falco, a principal in Kingsley Associates\u2019 Atlanta office, told Commercial Property Executive<\/i>. \u201cWe have found the most highly correlated areas to be focused around management service delivery.\u201d<\/p>\n
The analysis shows that satisfaction rose in eight of the 11 largest markets in the U.S., with Seattle experiencing the greatest increase from the previous quarter, at 4 percent.<\/p>\n
\u201cTo be honest, we have not found the uptick to be all that surprising. More and more owners are placing high importance on delivering exceptional customer service,\u201d Falco said. \u201cIt is perhaps interesting to mention that even in a market like San Francisco, where rental rates have significantly increased over the past year (15 percemt), satisfaction has remained relatively stable during the same period.\u201d<\/p>\n
Additionally, the report shows that the rise in perceived value for amount paid also increased this quarter, to another three-year high, coming in at 69 percent compared to last quarter\u2019s 67.3 percent.<\/p>\n
According to Falco, the top five areas most highly correlated with overall tenant satisfaction were: Management – Overall satisfaction; Management – Problem resolution; Management – Accommodation of special requests; Management \u2013 Responsiveness; and Management \u2013 Accessibility.<\/p>\n
The survey showed that loyalty built on the previous year\u2019s growth, with increases in tenants\u2019 likelihood to renew observed in seven of the 11 largest markets in the U.S. Los Angeles measured the greatest increase, with 63 percent of tenants indicating intent to renew, up from 58.9 percent last quarter.<\/p>\n
\u201cWe are witnessing an increase in property management firms placing greater importance on catering to tenants\u2019 needs,\u201d Falco said. \u201cThese dramatic rises in tenant satisfaction and perceived value for amount paid are reflecting this new focus.\u201d<\/p>\n
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