Leveraging second-generation space for your new workplace

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1 United States 2018 Leveraging second-generation space for your new workplace Adding value, saving time and money Every business makes trade-offs when balancing the wants and needs of their organization with their office build-out budget. With Washington businesses paying an average of $ per square foot in out-ofpocket build-out costs, it s important to find value in every aspect of your construction, furniture, finishes and equipment budgets. For some businesses, this means seeking lower cost furniture options, forgoing high-end finishes in employee-only areas or holding off on costly technology investments. In addition to vendor partnerships and rebate benefits that come with engaging an experienced project management team like JLL s Project & Development Services team, some businesses look for previously occupied, already built-out spaces that offer elements that can be repurposed or recommissioned for a new space. Did you know? Washington, DC has the lowest out-of-pocket tenant build-out costs across major cities in the US. (Source: JLL s 2017 Fitout Guide) Why second-generation? In addition to cost savings, leveraging second-generation space also brings the following benefits: Unexpected employee perks Freed up budget dollars can be used to further enhance your space with culture-enhancing meeting and training areas or technology to make your team more productive. Existing infrastructures may also bring entirely new workplace experiences to your employees day-to-day. Want to learn more? Check out how a commercial kitchen brought a whole new level of collaboration and health to JLL s DC space in our Food in the Workplace whitepaper on our website, jll.com/dcstory Faster build-out time Depending on how much of an existing buildout your business leverages, you can also decrease your build-out timeline substantially. Things like mechanical, electrical and sprinkler infrastructure tend to account for large chunks of time in the process and when eliminated, can mean anywhere from days to weeks less time under construction sometimes as much as 10% of your overall construction timeline. Decreased landfill impact In addition to costs savings, leveraging second generation space also brings a huge sustainability upside. In fact, LEED certification applicants receive additional points toward their accreditation based on how much of their build-out was reused. jll.com/dcstory

2 What to look for While the cost benefits can be enormous, it doesn t mean that any second-generation space will work for you. Here are a few key things to consider during your space search: Look for spaces with finishes that are similar or complementary to your business desired aesthetic. Spaces previously occupied by companies whose work and meeting types are similar to yours are more likely to have conferencing set-ups and technology that you can repurpose. When considering things to repurpose from your existing office build-out or secondgeneration space, think of items that are less likely to be impacted by technological advances: Furniture that doesn t require connectivity (chairs, sofas, accent pieces) Window treatments Flooring Storage and organizational solutions Specific high-value items will save you big bucks: Cutting-edge building automation technology (lighting controls for light harvesting, smart building technology that is easily upgraded, etc.) Internal stairwells Commercial kitchen and back-of-house infrastructure Retractable walls and multi-purpose rooms High-end, high quality finishes (marble floors, light fixtures, etc.)

3 How we did it Formerly occupied by a law firm, we inherited an elegant and quality build-out. Repurposing elements of the previous user s space resulted in huge savings while also creating opportunities and infrastructure to offer new perks and services to our employees. $150K Infrastructure The existing kitchen from the prior tenant was and transformed into a hip, welcoming space that further enhances the experience of employees, clients and guests. Leveraging this existing infrastructure not only provided enormous savings, it created an opportunity for us to offer employees daily food service that includes hot breakfast and lunch, a salad bar, a self-serve snack and drink bar as well as an in-house barista and smoothie bar. $175K Internal stairwell Internal stairwells contribute greatly to connectivity and accessibility for multi-floor office users. They also contribute heavily to build-out costs. The floating stairwell provides a functional design feature that also accounted for more than $175,000 in savings. $330K Conference room wall and marble floor Repurposing finishes (like the existing marble floors) and utilizing the existing retractable walls and multi-purpose rooms our team over $330,000. Chevron wood paneling The previous tenant installed thick, elaborate wooden doors in each individual office. The design of our new space relies heavily on the use of glass, but instead of disposing of the doors, they were repurposed to create design elements in other areas of the space.

4 Is it worth it? Leveraging second-generation space and reusing materials throughout the office redesign process can sound like the best option for a company. However, it s critical to have a project team who is well-versed in office renovations to determine if repurposing existing elements is the most economical approach. Elements that are often overlooked include the time required to remove, store and repurpose the materials in an office. At some point, it can be more cost effective to remove and replace these materials. By having experts to guide the process, the ultimate cost of revising or replacing can be properly evaluated. JLL s Project & Development Services (PDS) team managed the renovation and transition process as the firm moved to 2020 K Street. As a result of identifying and repurposing the right materials for the project, JLL DC approximately $1 million in renovation costs. Those funds were then allocated toward other capital improvement projects to better the space. More ways to save with JLL s project management team JLL s preferred supplier program, Synergy, delivers the best service at the best prices by leveraging our considerable buying power and global platform. Comprised of more than 70 best-in-class global, national and regional suppliers including architects, general contractors, lighting, flooring, furniture, engineering, HVAC and more, Synergy offers discounted pricing. The benefits of leveraging second-generation space and adaptive reuse go further than sustainability and cost savings a certain element of history is passed along, bringing forward an element of the past that is undeniably unique. 24% Average cost savings more than 65 Synergy suppliers Our savings We gained over $15 per square foot in value by leveraging existing equipment, infrastructure and design elements. $15 p.s.f. $1.1 million value added 10 days off of a project schedule Why Synergy? Typical savings of 10-45% $54M total cost savings in 2016 Pre-negotiated contracts and quick mobilization, saving time Assurance that suppliers meet highest standards for service process and procedures Most efficient delivery, installation and extended warranties Global capabilities 50% of Synergy suppliers have global reach

5 JLL 2020 K Street, NW Suite 1100 Washington, DC About JLL For more than 250 years, JLL has been a trusted partner to organizations who want more value from the commercial real estate they own, use and invest in. We focus on what we do best, and that s helping our clients achieve their ambitions. We are a professional services firm, with specialists whose common passion is real estate. Our knowledge runs deep, with experts in every property type and every facet of transaction, management and advisory services. Our people are known for the way they collaborate with each other and with their clients. We have a talent for bringing together the right combination of skills and matching them with valuable data, powerful connections and a deep understanding of real estate and capital markets. The result? One-of-a-kind advice and solutions. Assets and portfolios that are more valuable. Buildings that operate at peak performance. Workplaces where employees can thrive. Our 70,000+ employees are hard at work in 80 countries, tackling local, regional and global real estate challenges for corporates and investors of all sizes. They re building careers in a company that seeks out talented performers from diverse backgrounds and offers a setting where they can achieve their own ambitions, both professional and personal. jll.com/dcstory Jones Lang LaSalle 2018 Jones Lang LaSalle IP, Inc. All rights reserved. The information contained in this document has been compiled from sources believed to be reliable. Neither Jones Lang LaSalle nor any of its affiliates accept any liability or responsibility for the accuracy or completeness of the information contained herein. And no reliance should be placed on the information contained in this document.