In the current age of social media and 24/7 connectivity, the ways in which we communicate are constantly shifting, and commercial real estate has not been immune to these changes. This article will discuss a specific type of communication in the CRE industry: Tenant Communication, which here refers to the correspondence from commercial property owners and managers to their existing tenants.
Like those in most other industries, commercial real estate professionals are now being faced with a choice between embracing change and falling behind, but keeping up on today’s best practices is easier said than done. We hope that by the end of this article you will have a better understanding of what commercial tenant communication means for you in the second half of 2018.
Why is Tenant Communication Important?
Before delving into tips and strategies, it’s important to recognize why tenant communication is important, and how it applies to your broader goals. In commercial real estate, every initiative supports one of two desired outcomes: recruiting new tenants and/or retaining existing tenants. When you add lifestyle amenities, beef-up maintenance, or improve security protocols, you’re really contributing to broader initiatives of enhancing the tenant experience and building client relationships, which in-turn results in more signed leases and better renewal rates. The same goes for effectively communicating with your tenants.
If you work in commercial real estate, you’re probably familiar with the concept of the “Tenant Experience” and its much-discussed influence on getting leases signed. Property Managers around the country are adding experiential elements to their buildings, but unfortunately many are not getting the usage they want from these costly additions. This is where communication becomes important. Let’s say you’ve just spent a bunch of capital to add a gym or a café to your property. To get the best bang for your buck from these amenities, you should be communicating their hours, available specials offers, and, in larger buildings, exactly where to find them. In a recent study, 51% of decision-makers who were “extremely” or “very aware” of experiential offerings, said they were “extremely likely” to renew their lease. Of those who responded “unaware,” only 34% said they were “extremely likely” to renew. By incorporating content into your messaging, your communication can actually become experiential in itself. With a team of editors that curate news from over 150 media partners daily, Captivate is the industry leader for professional-oriented digital content. Along with their blend of national headlines, lifestyle anecdotes, local traffic updates, and more, Captivate screens also deliver custom-built property messages, which we will discuss in more detail later.
Building solid client relationships is equally as important to tenant retention as enhancing your property experience, and it begins and ends with good communication. Forging a real relationship requires more than just sending renewal and maintenance notices, it’s about incorporating a personal touch, being proactive & responsive, and–maybe most importantly–being a trustworthy partner. It’s truly a combination of management, marketing, and good old-fashioned customer service. The numbers speak for themselves: tenants who are satisfied with property management are three times more likely to renew their leases, and it can take up to two years to make up for the income lost by the loss of a tenant. Yet, in a recent study, 69% of office tenants said they had never interacted with their property manager and didn’t even know their name. That has to change if traditional CRE properties are to compete with culture-oriented coworking spaces such as WeWork.
For managers looking to better their tenant communication, the best best practice is to construct a formal strategy. Begin by segmenting your planned communications into the following four categories: Daily Communications, Scheduled Messages, the Continuous Feedback Loop, and Crisis Communications. These segments will also help guide the methods and tools you use to get your messages out to the proper recipients. Your team will need to allocate tenant communication duties, but you have flexibility with these assignments. Some firms hire a single liaison to oversee the full scope of their tenant relationships, while others divvy communication, for example: allowing Leasing Agents to handle renewal reminders but tasking property managers with the delivery of maintenance notices. Whatever choices you land on, you’ll be more successful executing from a plan.
Your Daily Communication segment includes building notices such as fire drill schedules and construction warnings, but it also encompasses your “culture building” communication, such as event announcements, tenant welcome messages, amenity highlights, workplace sustainability tips, and so on. When selecting a delivery method, consider digital signage for your Daily Communications, as the viewership rates are significantly higher than other tools. For example, Captivate, a leading provider of digital signage, has daily viewership of their screens at 97%, where outdated means of messaging, such as email and bulletin boards, see results lower than 50%. ScreenCenter™, Captivate’s tenant messaging tool, allows you to build messages from a vast library of easy-to-use templates, and you can even incorporate your brand attributes onto the displays.
Scheduled or “Periodic” messages consist of standard payment notices, expiration reminders, and seasonal updates. These messages typically go to designated recipients at the tenant company and may be automated. We recommend these types of messages be sent using multiple, trackable methods, since any conflicts regarding missing or incorrect information will require proof that you properly communicated the disputed details. You can certainly use email to distribute scheduled messages, and there a number of apps on the market that serve the same purpose, but to be safe, always include direct mail in your strategy, and save copies of your correspondence.
The feedback loop is slightly different from the other segments in that it is more of an ongoing process than a set of individual messages. It may include periodic messages requesting feedback–which we do recommended–but the bulk of your efforts should be on the web. Many properties now have their own websites where comments can be submitted to management, and others integrate apps like Equiem or TenantLoop, which allow managers to share tenant polls and even live-chat with building occupants. The feedback loop represents the growing emphasis on service and brand trust. Clients want to be heard, and be responded to quickly, or they will find another office building to meet those standards.
The final segment, Crisis communications, is becoming an increasingly hot topic among today’s real estate community. Office buildings hold hundreds, even thousands of workers on a given day, and they must be over-prepared for crisis situations or potentially face harsh liability. So, when it comes to crisis plans, you should not only over-prepare, you should also over-communicate. Make sure every tenant is fully aware of the procedures on their floor, and hold emergency trainings at least semi-annually. Before an urgent situation does arise, confirm that your intercom systems are working properly, and ready email templates to be sent out to your tenants immediately during an incident. Digital Signage can also supplement your crisis plan. For example, Captivate’s Override Messaging tool allows for immediate screen takeover of Multipurpose screens with urgent messages that persist for up to 24 hours. You can also use Captivate’s ScreenCenter portal to share your emergency procedures between trainings.
In conclusion, the number one tip to remember is: have a plan! Segment your communications, make sure responsibilities are covered, and, when possible, take advantage of technology and the wide-spread innovation that has taken place in the industry over the last few years. Remember, it all comes back to the tenant experience and relationship building, and those tenants who are willing to pay premier rents are those that have received a personal touch.