Bricks and Mortar Still Have a Place

For all the doom and gloom written about commercial real estate over the past couple of years, tech firms are still making hefty investments in their office space.

Facebook recently unveiled the company’s high-priced renovations made to its Menlo Park, California campus.  The social networking giant spent $250 million to enhance its one million square foot headquarters.  The objective was to create a space that reflected the culture of the company.  Without question, tech giants like Twitter and Facebook are on a mission to design “creative spaces” that will not only support their growth but provide an environment conducive to creativity for the employees.

According to Dan Fasulo, managing director of Real Capital Analytics, “A new generation of corporate leaders is looking at space-planning as a core part of business to increase productivity and keep people in the office. The old guard looked at it as an expense.”

Tech firms are thinking outside-the-box and transforming stale spaces like corridors, nooks and kitchen areas into places where workers want to linger and collaborate with colleagues.  Major cities in the US are seeing a rising demand for this type of space, including New York, Boston, San Francisco and Seattle.

Obviously, not every company can spend $250 million like Facebook on their office space but it does reinforce the role that office space has in defining a brand.