In today’s rapidly evolving commercial real estate landscape, occupiers are becoming more discerning and demanding. According to a comprehensive new report by Cushman & Wakefield in collaboration with CoreNet Global, priorities are shifting: from square footage to quality of space, from status to functionality, and from centralized offices to flexible, sustainable environments.
This article outlines the report’s key findings, explains the underlying market shifts, and offers practical insights for landlords, developers, and investors alike.
The Evolution of Occupier Needs
Over the past three years, commercial real estate has been shaped by emerging work models—remote, hybrid, and redefined in-person work. According to Cushman and CoreNet’s research, over 64% of occupiers have re-evaluated their office strategies, with nearly half implementing hybrid models.
A major transformation is the move from size to quality. Companies increasingly prioritize not the largest, but the most efficient and multifunctional office spaces. The top features occupiers seek include:
- high-quality ventilation and air circulation;
- access to natural light;
- flexible layouts;
- collaborative work areas;
- green building certifications (such as BREEAM, LEED).
The Office as a Talent Magnet
The report emphasizes that 83% of HR leaders view the office as a key factor in talent retention. A well-designed, comfortable office is now a competitive edge in the battle for skilled workers. This is especially important to Gen Z and millennials, who value:
- work-life balance;
- environmental and ethical standards;
- choice in how and where they work.
As a result, occupiers are demanding more from landlords—seeking environments tailored to employee expectations and experience.
Flexibility: The Leading Demand in 2025
The study reveals that 72% of occupiers now seek flexible leasing options, including coworking, subleases, and adaptable spaces. This demand is strongest among companies with fewer than 500 employees.
Key areas where flexibility is critical:
- short-term leases (3–12 months);
- scalability up or down;
- reconfigurable spaces for project teams;
- pay-as-you-go pricing models.
This marks a clear departure from traditional long-term leases, which are becoming less attractive to both tenants and capital-focused landlords.
ESG and Sustainability Take Center Stage
Sustainability has become a core component of corporate strategy. According to the report, 58% of occupiers have integrated carbon reduction goals into their KPIs, and 34% have pledged to reach net-zero emissions by 2030.
For commercial property owners, this means:
- increased demand for certified green buildings;
- energy efficiency impacting rent premiums;
- ESG-compliant properties receiving more regulatory support.
In short, ignoring ESG may lead to higher vacancy risk and a decline in asset value.
Smart Technology is Now Essential
Technology is no longer a bonus—it’s a baseline requirement. The report found that 68% of occupiers consider smart building systems a critical factor in selecting office space.
The most in-demand technologies include:
- automated climate control;
- contactless access;
- motion and occupancy sensors;
- space utilization analytics;
- integration with tenant mobile apps.
Artificial intelligence platforms also help landlords enhance tenant experience, understand behavior, and anticipate future needs.
Location Trends: Decentralization on the Rise
The pandemic redefined proximity. Increasingly, companies are opting for offices outside central business districts—especially when similar amenities are available at lower costs.
The report notes that 25% of occupiers plan to open hubs in suburbs or satellite towns to reduce employee commute times and improve well-being. This creates opportunities for commercial development beyond traditional urban cores.
Downsizing is the New Normal
On average, companies have reduced their leased footprint by 10–30% compared to 2019. However, this does not necessarily mean lower rent expenses—higher-quality spaces in better locations still command premium prices.
Interestingly, companies now spend more per employee to ensure comfort, health, and productivity—suggesting a shift in value rather than cost-cutting.
The Role of the Modern Landlord
Tenants today expect more than just square meters—they want a results-driven partnership that includes:
- collaborative space planning;
- flexible lease terms;
- access to digital platforms;
- transparent communication;
- alignment with their ESG goals.
This forces property owners to evolve from landlords to service providers, with tenant satisfaction at the core of their business model.
Implications for Investors
The occupier shift is also reshaping investor behavior. According to Cushman & Wakefield:
- Class A offices with ESG certification have lower vacancy rates (under 8%) and show strong yield performance;
- there is growing demand for redevelopment of outdated buildings to meet new standards;
- flexible office providers are increasingly being added to investment portfolios or acquired outright.
Conclusion
The Cushman and CoreNet report makes it clear: the office leasing paradigm has changed dramatically. Location and prestige alone are no longer sufficient. Tenants now prioritize:
- flexibility;
- sustainability;
- technological infrastructure;
- workplace quality;
- collaborative relationships with landlords.
To thrive in this new environment, all market participants—from landlords to developers—must rethink their strategies and align with the values shaping the future of workspaces.
