Intelligent Investment
Perks & Potential: Why a Free Cup of Coffee Signals Smart Investment
July 24, 2025 7 Minute Watch
Summary
President, Americas Office Investor Leasing
Head of U.S. Investor Research
- Current State of the Office Market
The office market is showing signs of strengthening, with investors expressing cautious optimism. Leasing activity is improving, and base rents may rise, though landlords will still need to offer generous tenant improvement allowances and other concessions. - Demand Trends and Market Outlook
Demand continues to shift toward premium, newly built office spaces, but when those properties aren't available, tenants are moving to well-located and amenitized Class A and B buildings. With new construction deliveries in 2025 expected to be just 25% of 2019 levels, limited new supply will bolster landlord’s negotiating position. - Amenities and Tenant Experience
Modern tenants expect amenities like fitness centers, conference rooms, lounges, and outdoor spaces, with growing interest in on-site facilities. Property owners are also offering perks like free coffee and app-based food delivery to enhance the workplace experience and encourage office attendance. - Investment Opportunities
Investors should consider opportunities in secondary and tertiary markets where top-tier buildings can attract high-credit tenants. These markets, while smaller, offer tenant profiles similar to those in major gateway cities and the potential for, making them increasingly attractive for investment.
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