What will the office building of the next decade look like? In an age of rapid disruption, innovation, shared spaces, and adaptive reuse, CBRE Inc. is attempting to reshape the vision for commercial real estate with its newly opened Glendale offices. At a recent showcase event, President of the Los Angeles-Orange County Region Lew Horne provided an overview of the transformation of CBRE’s LA North offices at the renovated Masonic Temple in Glendale. In collaboration with developer Rick Caruso and other industry leaders, CBRE created an innovative work environment with cutting-edge technology to attract and retain top talent and better meet client needs. VX News presents highlights from the event.
Lew Horne: CBRE is a commercial real-estate services firm. We’re a Fortune 300 company with more than 70,000 employees in 420 offices across the globe—but frankly, this office was a risk for us.
Our team was focused on finding a site around Universal City, a regional hub for us, as we cover the entire area from Camarillo to San Pedro. But then we saw this site in Glendale, and it had so much potential on so many different levels. Still, normally, we would never have done this deal. For one, it was too far east, while we cover an enormous region to the west. But because of Rick Caruso’s concierge concept, which I’ll explain shortly, we actually saved time for all our employees.
The other risk was moving in on time. We couldn’t be late by even a day. We were being tossed out of a building, and needed to move in on time. So, we had 10 months to make a deal and go from a signed lease to a move-in arrangement. The building had not been used in some time, and it really did not have an occupancy capacity. It also had historic implications. The zoning was OK, but all the floors needed to be put in, and the windows needed to be adjusted. It just wasn’t an office building—and to add insult to injury, it didn’t have any parking.
It was my 30-year relationship with Rick, and his relationship with the city, that gave us the confidence to do it. It would have been physically impossible, in any other city, to go from a signed lease to creating and finishing this building in that amount of time. Truly, no other city could have done it.
The Masonic Temple is an extension of a workplace strategy we implemented three and a half years ago in Downtown Los Angeles, called Workplace360. A building such as the Masonic Temple gives us a showroom for users and occupiers to come to and take a look at how we live and work—which is the most advanced way of occupying office space today. Each one of our employees sits in a seat that’s not assigned to them. They pick where they want to work every single day, based on what they’re doing. If you need privacy, for example—if there’s an interview, or you have to have a confidential conversation—you can use one of our enclosed “offices for a day.” You get to choose.
Due to this flexibility in our 360 offices, we were able to add 100 people at our already filled Downtown office without changing it at all. In the last 10 years, we’ve acquired 100 companies. For a firm like ours, the flexibility to grow is extraordinary and important.
Efficiency is a big part of this space, so we’ve incorporated technology into it. Because we do all of Google’s work globally, we were able to take what was essentially an experiment for the engineers in their hub office, and implement it in our space. The product is called Liquid Galaxy and is powered by Google Earth. It’s this massive screen that allows us to go anywhere in the world and take a fly-by tour of the environment, then drop down and take a walk around the block. It’s a great and convenient way to familiarize clients with a city or a neighborhood.
There’s also a wellness component that we’re incorporating into the way we work. Some say that what smoking was to our parents, sitting is to us today. You can’t sit for eight or 10 hours a day in a single position and be healthy, no matter how much you work out. All these desks are sit-stand, so they can adjust according to how you feel. A lot of people are sitting in the morning; by afternoon, most of them will be standing.
David Josker: In working daily with real estate in different parts of Los Angeles and Southern California, we deal with different municipalities. This office was a case study of a partnership between a city, a developer, and a company looking to relocate.
For Caruso, the result was a rebirth of an iconic building here in Glendale. For the city of Glendale, the result was bringing in a Fortune 300 company with 150 employees. And for us, the result was one of the most talked about offices in the world. Nearly 10,000 visitors have come through to see what we’ve done with this space.
The project represented several firsts for us as a company. For one, it was the first adaptive reuse we’ve participated in as a company. This building is almost 90 years old, and it was really brought back to life by Caruso, by our architect Gensler, and by our vision. Also, our other Workplace360 locations in the U.S. use the “neighborhood” concept: groups sit together in an area, and while individual employees move around within that space, typically these groups gravitate to the same spots. The Glendale office was the first to fully implement 100-percent free-addressing, and that was by employee choice.
Finally, we have the concierge program that Rick Caruso has created. In a nutshell, the concierges are basically our personal assistants. The Caruso Group even provides an app for us to communicate with them. They’re stationed downstairs, and the bar they’ve set for our company is at an all-time high. They make our lives more efficient and saves us time, and treat all of our employees like VIPs every day. As a commercial real estate services firm, we’re building these offices because we want to create a showroom for our clients.
We believe that by building these showcase offices, we can demonstrate to our clients that we understand how to incorporate technology into their space, how to incorporate amenities, and how to create functional adaptive reuse environments. It gives us a competitive advantage. In fact, in the last three years, we’ve opened more than 30 Workplace360 offices, and we have more than a dozen under construction.
We’ve not only changed the way CBRE uses office space—we’ve created a global standard. Multiple Fortune 500 companies are now doing the same thing we’re doing: trying to attract and retain talent. Acquiring these adaptive reuse buildings and converting them to something like we’ve done here—really understanding the pedigree of an office—is very desirable.
Look at Warner Music. They just moved from their offices in Burbank and West LA to a combined site in Downtown Los Angeles in the original Ford Motor factory. It’s a 257,000-square-foot building, and they still have the chains that they used to hold up the engines for the Ford Model T. You can only imagine how somebody will walk into that space now and say, “Oh my god—this building’s got a soul.” That Warner deal went for a higher rate than any other Downtown high-rise.
For us, we loved that this was a Masonic Temple, and that it was the tallest building in Glendale for years. We love looking at the concrete in the walls. They literally came in with donkeys and carts to load the concrete into this building. You can even see where the workers threw cigarettes in the concrete. We’ve recruited 13 people in the last 12 months in Glendale. These are top-tier professionals who have come over here in great part because they’ve recognized that they want to be in a space like this.
Developer Rick Caruso explained the concierge service in a video made for CBRE. VX News presents an excerpt below.
Rick Caruso: All of us have a second shift, no matter what stage of life we’re in. The second shift is what you have to do when you get home. You leave work and then you’re getting dinner ready, stopping at the market, stopping at the dry cleaners’, helping your kids with school, putting them to bed—whatever the case may be. Our days start early, and—especially for younger couples—they go well into the evening.
What we are trying to do in our company is to eliminate a lot of work on the first shift that would otherwise get carried over into the second shift—so we give you back more time. When you’re our tenant at Masonic, we’re going to bring you your lunch. You get room service. We’re going to help you plan your vacation through our concierge. If you have a business meeting, we’re going to make reservations at the restaurant or we’re going to set up a private conference room.
The services are so broad. We’ll go grocery shopping for you, and we’ll hold your groceries in a refrigerated area. When you’re ready to leave, you call the valet and your groceries are put in your trunk. Your dry cleaning is picked up and put back in your car. You drive home, and—going back to the idea of the second shift—now you’re getting home sooner, and you have more quality time.
We’re giving you that time every day at the office so you can be more productive in your office. It’s backed up by a team of professional concierges who wake up every day passionate about serving people. I think this is a game changer in the office industry, because all of us are short on time.
David Josker: This sort of service had not been seen in the office industry before. We almost didn’t believe it until we got in here and actually started using it—and using it quite a bit. Frankly, it’s been industry-changing.
We represent some major investors in the United States. They’re coming through here and trying to figure out how to replicate what Caruso’s organization has done. But you can’t replicate something unless you’re an expert in it. Rick’s group is an absolute expert in customer service. They live for that every day, and our employees and clients get to experience it.
Lew Horne: Every week, Dave gets a report from the concierge team on total tasks completed and hours saved. It really is extraordinary. And when Dave is out trying to recruit talent, or somebody’s thinking about going to a competitor, trust me, that goes into their thinking. We’re now trying to replicate this at our offices in other parts of the world as a competitive advantage. In fact, we just opened an office in Oxnard. When the developer pitched this idea, we said, “Done.” It was the differentiator as to why we went into that space versus another one.
Adaptive reuse is something we’ve taken on as a company, and is something we’re extremely interested in. We’re building our second one right now out in Woodland Hills. It’s an old vacant restaurant in the middle of a park, surrounded by high-rise office buildings. We’re going to convert it into an office where people will have the ability to work inside or outside in the park.
Rather than choosing a traditional office space, we’re really looking for gems that have been overlooked. The Temple had been vacant and underutilized for a long time. The building in Downtown Los Angeles hadn’t been occupied since 1980. The Woodland Hills space was also vacant, waiting for a new purpose. These are gems people have ignored and not considered.
The big difference for us as a company, because we are growing so rapidly, is the idea of flexibility and freedom, which means free address and going paperless. There aren’t family photos on desks. All desks are cleaned at the end of the day; someone comes in with an ultraviolet light that burns off any kind of bacteria. In the morning, they’re all adjusted to the same height, and you’re ready to sit wherever you want.
In Downtown LA, we once had a flood. A pipe broke and three inches of water covered the entire office. We had to completely gut the space and push everybody out of the building. That was on a Friday. On Monday, everybody was working. We had zero interruptions, because there was no paper. Everything could be accessed off your iPhone, your iPad, or your computer.
When you free yourself from the dependency on paper, all of a sudden you’re untethered. You can work from anywhere. We offer free choice to all of our employees in terms of where they want to work inside the office, which is also accelerating and propelling the untethered way they work outside the office.