Advancing technology, social mobility and individuals’ desire for a better work-life balance are driving changes that are shifting workplace choices to the users of buildings rather than the providers.
In many areas of life, we are seeing dynamic pricing at the point of demand – airline seats, for example – and it may well be that landlords will need to adjust their models in response to what occupiers want. Remote and flexible working, with increasing warehouse automation add up to the need for astute distribution space management, which could eventually end up looking very different to existing models.
Investors in the industrial sector are often investing in sites and buildings over a 20-year horizon. Given the systemic changes going on around us, that means they are looking into the unknown. It is therefore imperative that enlightened distribution developers facilitate projects that enhance the physical and mental wellbeing of people working in warehouse buildings as an inherent part of investment risk mitigation.
Developers of office buildings now recognize that with modern lifestyles, problems to do with breathing, vision, posture, weight, physical inactivity and mental health are all on the rise. Against this backdrop, office building design which focuses on enhanced health and wellbeing for users has become the new norm and the industrial sector will follow suit.
Meanwhile, logistics investors are also recognizing that there are significant drivers for environmentally responsible buildings, including tighter regulation; environmental, social and governance commitments; the demands of funders and tenants; and the potential impact on investment value. In this context, environmentally responsible distribution buildings are seen to future-proof against the risk of declining values, falling returns and building obsolescence.
Tenants have somewhat different imperatives. Over a 15- or 20-year lease they have little idea how their businesses – and therefore their building requirements – will change. What is certain is there will be change, and that is likely to be driven by emerging technologies and changes in workplace practices.
These forces are combining to mandate the development of logistics buildings that are healthier, greener and more flexible. Buildings designed to produce clean air, water, soil and energy can result in enhanced health and wellbeing for people working in distribution buildings. That enables occupiers to benefit from lower energy, maintenance and operating costs. Moreover, by enhancing health and wellbeing for employees, companies can increase productivity and retention while reducing downtime and meeting ESG goals. Facilities with such attributes will continue to attract tenants, even in a rapidly changing business environment, creating lasting value for investors.
It is crucial the benefits of initiatives delivered on each project are measurable within the technical rigor and quality required by the available rating systems, for example BREEAM or LEED for environmental responsibility and WELL for workplace health and wellbeing.
See the light
In each focus area, a variety of features can be delivered. Environmentally responsible features may include solar photovoltaics, electric vehicle charging stations, air source heat pumps, enhanced use of recycled and recyclable materials, prefabricated building elements, low energy LED lighting and a super airtight, insulated building envelope.
Initiatives in pursuit of social and environmental value include gym equipment, circadian lighting and the use of healthy, safe building materials that specifically enhance the comfort and well-being of all building users.
The underlying principles that inform designs for enhanced health and wellbeing are rooted in the recognition there is a relationship between proximity to natural light, the maintenance of optimal thermal comfort and the control of environmental characteristics such as noise, indoor air quality and light maximin productivity.
Conspicuously old-fashioned lease structures will not keep pace with environmental and social change, but adopting a considered approach to building design and development that combines efficiency and wellbeing can protect investor returns in the long-term. After all, innovation is the engine of commerce and commerce is the engine of change.