Very Few Office Landlords Trust Their Market Data

A mere 6% of landlords completely trust data sources, a number that’s particularly concerning as COVID-19 continues to wreak havoc on markets, according to a new report from VTS released this week. 

The biggest reason landlords surveyed cite to support their distrust of market data? Most sources contain lagging indicators and anecdotal information—and those types of data points are pretty weak when you’re deploying billion-dollar investments. 

“This lack of real-time insight has only been exacerbated during a chaotic and disruptive pandemic when market conditions seem to change day-to-day,” the report states. “A clear takeaway is a critical need for real-time market data and insights as this industry can no longer operate without them. Landlords who invest in data will be far better positioned to strike the best path forward.” 

To conduct the survey, VTS commissioned an independent market research firm to survey 154 office landlords globally who account for 5.3 billion square feet of assets. All of the respondents had budget authority, and the professionals surveyed represented a broad cross-section of portfolio sizes. 

Among the report’s other findings: while 86% of landlords think they do a good job  engaging and communicating with tenants, only 20% have full clarity into which tenants are on the brink of collapse. And while two-thirds of landlords surveyed have a technology platform in place to monitor tenant relationships, 85% of landlords aren’t sure they actually know what investments or features tenants will need to safely return to work post-COVID. The result: landlords are making often huge investments in things like air filtration, touchless entry, and COVID-safe building management systems, often without the benefit of insight into what’s driving tenant decision-making.