Saturday, August 10, 2013

Do nearby food trucks increase demand for office space?

An article from Portland earlier this week caught my eye.

As firms pile into downtown — it's the most crowded commercial real estate area in the city (PDF) — researcher Patricia Raicht of Jones Lang LaSalle has stumbled on a surprising trend. Downtown office buildings, she says, consistently fill up faster when they're close to food carts.

In the first six months of 2013, Raicht said, 92 percent of net demand for high-quality downtown Portland office space occurred within two blocks of a food cart pod.

"When our brokers are out talking to tenants, what they’re hearing over and over again — and particularly with creative tenants and tenants that have a younger demographic — is that there are a lot of things that are really important to them," Raicht said in a July interview about the trends in net absorption rates for Class A and Class B office space.
Bike Portland

If this study is correct, it has interesting implications for the Fresno market.  You may have heard of Carthop, an "event" which started out as a weekly "meeting" of the local food trucks on the Fulton Mall. It has since expanded to other days of the week.

Carthop has been a success because it brings a food court of options to an easily accessible location during the lunch hour. On the Fulton Mall, it means all the area workers get to try something new for lunch once a week.

The fact that the event has been made somewhat permanent may be good news for nearby towers with high vacancy rates, as they can use the event as a marketing tool when finding tenants.

According to the same article:

Factors that almost every young firm seems to be looking for in office space, she said: bike access and parking; plentiful light; open, unwalled office layouts; easily configurable collaborative areas; and a pod of food carts within walking distance.
The Fulton Mall area certainly has ample parking, bike access, lots of light...and at least on Thursdays, a pod of food carts within walking distance. As for unwalled office layouts, the obviously varies by building.

Employees certainly want amenities nearby. Not everybody likes to make their own lunch ever day, and if your building is isolated, it makes going for lunch a hassle. I don't think it's a surprise that one of the densest clusters of offices is around Fig Garden, which has the very popular Whole Foods as a lunch spot.

On the other hand, the location of Fresno's future 10 story building  is completely isolated from amenities. True, a large commercial center is planned across the street at Friant and Audobon, but that's been "in the works" for many years. Even if that center does open with attractive lunch spots, the walking environment is extremely hostile. Perhaps not the best way to make employees happy.

Downtown may not have a Whole Foods, but food trucks bring in a variety of foods, including locally sourced and organic options. That's certainly a highlight for certain classes of firms.

It would be interesting to see if the same relationship has been observed in Fresno.

1 comment:

  1. CartHop looks pretty cool, We have something similar here on the east coast. At the Philly Navy Yard. Check it out here.