High Building Standards Boost Tenant Retention

New findings by the Building Owners and Management Association (BOMA) demonstrate how buildings operating at high standards translate to tenant satisfaction and retention.

The BOMA 360 Performance Program was launched in 2009 to help buildings become more competitive during the economic recession. BOMA has since awarded the designation to more than 200 buildings, with about 50 more nearing qualification. The 360 Performance designation recognizes all-around excellence in building management and operations.

“The industry needed a holistic approach to buildings, so we designed a BOMA best practices program,” said Henry Chamberlain, BOMA's president and chief operating officer. BOMA developed the program during the recession to promote the value of facilities to potential clients and inform them that a property is well managed.

Kingsley Associates surveyed more than 1700 tenants at 62 BOMA buildings with the 360 designation in major markets across the country. Tenants who were surveyed rated their buildings in key areas such as property management, security, maintenance and green initiatives. The study found that BOMA 360 buildings consistently outperformed a comparable set of commercial office buildings that have not achieved 360 status.

Among the survey’s key findings: 91 percent of tenants in BOMA 360 buildings reported "good" or "excellent" overall satisfaction, versus 88 percent of tenants in comparable buildings; 73 percent of tenants in BOMA 360 buildings are satisfied with the value they receive for the amount paid, versus 66 percent of tenants in similar buildings; and 90 percent of tenants in BOMA 360 buildings are happy with office security policies and procedures, versus 84 percent of tenants in other buildings.

When it comes to making a business decision about selecting a property, Chamberlain said tenants are looking for quality of service, security and efficiency. Additionally, they want a building where it will be easy to conduct business.

Tenants also want to do business in energy-efficient buildings, according to Chamberlian.

“People are really looking into how you are operating a building and if you are being efficient,” Chamberlain said. I think you have to have a sustainable component as a part of the mix. That is an expectation in the marketplace today.”

He added that it’s been harder for buildings to retain tenants through the recession and the building market has become more competitive:

“Prices have come down in the market and tenants are looking around to see how much value they can get,” Chamberlain said. “Tenants are doing more due diligence, and it would behoove owners to work to be able to demonstration performance and value.”

Phil Mobley, a vice president in Kinglsely Associates’ Atlanta office,
said owners and managers of BOMA 360 Performance buildings have been able to deliver significantly better tenant service than their peers.

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