Emerging Technology Advisory Group

THOUGHT LEADERSHIP & INDUSTRY INTELLIGENCE View a complete list at cushwaketech.com or click on individual thumbnails below.

MARKET TRENDS & OVERVIEW CommonLocalMarketPractice

OVERVIEW OF MARKET NORMS AND TRENDS – COMMON LOCAL PRACTICES There are several key concepts causing curiosity among today’s tenants. This is a Montreal-based example of today’s Market Norms and Trends. Cushman & Wakefield can provide similar perspectives on any global market your team is interested in.

LeaseTerm

InQuebec,mostoffice lease terms fornew transactionsor renewals range from3 to 10 years,with the most common term commitmentbeing5 years.Considering thatMontreal is currently exhibiting a Tenant’smarket& thatACMECompanyhashigh standards for their leasehold improvements, a longer term (such as 10 years)wouldundoubtedlyuncoveropportunities such asnew constructions,build-to- suitprojects aswell as conversionof industrialbuildings, allwhile keeping the costs relatively low.A longer term also increasesnegotiating leverage tobuild inflexibility into the lease agreement including the rights to expand& contract the space, rightsoffirst refusal, terminationoptions alongwith rights to assign and\or sublease and soon.

RentStructure

A commonpractice in themarket,when considering either institutionallyorprivatelyownedoffice buildings, is tohave leases that arenet-net to the landlord.Thismeans theparties establish a minimum rent (NetRent) and theTenant shallpay all costs and expenses relating to theoperation and maintenanceof thebuilding, the leasedpremises and/or thebusiness carriedonby theTenant (known as “AdditionalRent”).Landlords remain responsible for all structural elementsof thebuilding.

RentEscalations

NETRENT The escalationsof theNetRent shallbenegotiated and agreeduponbybothparties in theLease.For long-term leases, there aregenerallypredeterminedNetRent increases, i.e.$15.00Net (years 1-5)&

$16.00 (years6-10) ADDITIONALRENT

Tenantsgenerallypay theirproportionate shareof thePropertyTaxes&BuildingOperatingExpenses according to theLandlords’ auditedfinancial statements.On average, theAdditionalRent increases by 2 to3percent annually.Some landlords accept for a cap tobe imposedon such augmentations, limiting thebuildingoperational expense increases to amaxoutpercentage (generally3-4%).

SecurityDeposits

A commonpracticeofLandlords is to require aminimumdepositorprepaid rent equivalent to thefirst and lastmonths’NetRent andAdditionalRentplus taxesormoredependingon the solvencyof the Tenant. In the caseof some large and reputableorganizations likeACMECompany,however,wehave been successful inhaving suchdeposits excluded from lease agreements.

AUTHOR: ErikLangburt SeniorVicePresident, InvestmentSales&Leasing +1514841-3818 erik.langburt@cushwake.com

cushwaketech.com cushmanwakefield.com

AnEmergingTechnologyAdvisoryGroupPublication

CRE TECH FOR DESK ALLOCATION, HOTELING & MEETING ROOM BOOKING This overview of several innovative CRE technologies is appropriate for occupiers of flexible workplace solutions and a mobile workforce. Now you can identify the right technology solutions for managing hot desking and conference room booking.

CRE TECH FOR DESK ALLOCATION, HOTELING & MEETING ROOM BOOKING Anoverviewof the latestSaaS solutionswhichhelp clients allocate,&monitor, desk allocations (permanent andhoteling)&meeting roombooking

SUZANNEMEHTA Building aVision for EmployeeEngagement suzanne.mehta@cushwake.com

Suzanne leads thedesign andoperationalizationof the firm’sEmployeeExperienceProgram.Theprogramhelps ouroccupier clients establish a vision and strategy for enhancinguser experience and servicequalitydelivery in supportof employee engagement, retention, and productivity.

Robin

Condeco

Teem

Essensys

• Robin software allows clients to schedule rooms and deskswith integration across Google&Outlook calendars whileprovided real-time officemaps andworkplace analytics. • Robin integrateswithdigital meeting room signage via tablets and televisions and is scalable across enterprise- gradedeployments

• Condecohelps clients managemeeting rooms, visitors,hospitality, services and video conferences acrossmultiple locations and time zones. • CondecoDigitialConference Room allowsuses to instantly start a conference, scheduleor release a room usingPINorRFID • Screensgather real-time information abouthow conference rooms are reserved andused andhave auto-bumps forno shows.

• Teemprovides space scheduling&management, visitormanagement,building wayfinding andworkplace analytics. • Book conference roomsor desks through amobile app, digital tabletdisplayor voice activation • Integrationwith real-time occupancy sensors to supportworkplace analytics

• Software tailored for the coworking/flexibleoffice industry, includes features specific to aflexibleoffice manager such asmove scheduler,WiFimanager/ stats, and supporthub. • The software’sSpace Publisher feature allows users topublishmeetings rooms toonlinedata aggregators and a space management tool to reserve and allocatedesks and roomson thefly

SEANBUCKLEY Understanding& Implementing TechSolutions sean.buckley@cushwake.com

AtCushman&WakefieldSean advises clientson the Space&Workplace technologymarket landscape and trends.Newproducts are analyzed and scored so that differentiators canbe clearly communicated to interested clients.The levelof engagement variesper clientbut can range from a simplephone call to confirm a client ison the right track in theirown search to a full technology software selectionproject.

SaaS Solutions:

ELISAKONIK ManagingDirector,Brokerage &StrategicServices Chair,EmergingTech AdvisoryGroup elisa.konik@cushwake.com

ElisaKonik leadsC&W’sEmergingTechnologypractice group, advising startups andhighgrowth technology occupierson theirglobal real estate strategy. With a broadnetwork across theglobe,C&W’sEmergingTech teamhas exceptional experienceworkingwith innovative tenants tofind,negotiate andbuild cutting edge workplaces.

cushwaketech.com cushmanwakefield.com AnEmergingTechnologyAdvisoryGroup&TenantAdvisoryGroupPublication

Copyright© 2019Cushman&Wakefield.All rights reserved.Nowarrantyor representation, expressor implied, ismade to the accuracyor completenessof the information about the services containedherein, asCushman&Wakefielddoesnotown these services.

FLEXIBLE

DIRECT LEASE

FLEXIBLE WORKPLACE TO DIRECT LEASE ANALYSIS With our partnership you can formally evaluate a transition from a coworking or serviced office to a direct lease. This framework helps to qualify the quantitative and qualitative impact of long term traditional leases to help you identify the right inflection point for your portfolio’s growth.

MarketProfile:HongKong,HK Theaccompanyinganalysisprovides anestimatedeconomic and qualitative comparativebetween ourexistingFlexible Workplaceagreement (ManagedorServicedoffice)and a traditionalDirectOfficeLease. Adirect leasealternativewas chosen (10minwalk from currentoffice) for representative pricing;however all termsare subject tonegotiationandare estimates innature.

ExistingOfficeObligation Address

AddressXXX,XXFloor

Provider /Landlord

WeWork

LeaseExpiry

8/31/20

RSF

1,000

TheWorkplace Team recommends evaluating Direct Lease alternatives in the range of 4K SF for a 3-5 year term commencing Sept 2020, in linewithour current expiration.

Desks

18

CurrentMonthlyOffice ServiceFees$USD

$XXX

Headcount –Current andFuture GrowthProjections:

2019 2020 2021 2022

36Employees 40Employees 44Employees 38Employees

18Desks 20Desks 22Desks 24Desks

2023

53Employees

27Desks

Note:36employees inmarket todayat ratioof2Employees:Desk anda10%perannumgrowth rate.

10 | EMERGING TECHNOLOGY ADVISORY GROUP