The hospitality sector is going from strength to strength. Marriott’s recently announced record occupancy rates and its merger with Starwood Hotels & Resorts show how customer experience and service are integral to success.

Steve Jude

There are clear parallels between the hotel industry and offices - after all, guests and office tenants both rent space - so what lessons can office landlords take from hotels’ customer-centric approach to reinvigorate their proposition and adapt to the changing market?

A while ago, you would have said not many. Most of us have been on the receiving end of Basil Fawlty-style customer ‘service’. It will come as no surprise that actor John Cleese based the fictional character on a real-life experience of a hotel manager during his stay at Torquay’s Gleneagles Hotel in 1970.

But the hospitality sector has come a long way since then. Companies such as Intercontinental have taken the lead and are renowned for the way in which they treat their customers. ‘Customer’ and ‘guest’ are synonymous with special treatment and good service. This guest-centric approach ensures these companies are putting customers and their needs at the very core of their business.

So why isn’t this model being applied across the office sector? Like hotels, offices need to have high occupancy and be efficiently run to be profitable. Now more than ever, customers are demanding a positive ‘guest’ experience and an approach that is tailored to their needs, rather than a one-size-fits-all outlook. In the hotel sector, management companies or opcos come with the huge depth of skills and expertise to run the business, fill the hotel and keep customers happy. Frontline knowledge and insight is fed into an agile business strategy, enabling it to adapt and use customer trends to future-proof.

Many building owners do not have the inclination, time or knowledge to invest in managing numerous customer relationships. As a result, landlords often prefer large corporates, which require less flexibility and are easier to manage. Long leases have not been conducive to the sector needing to adapt to a more customer-friendly approach.

But in a survey we conducted among small businesses, over half wouldn’t sign a contract of more than three years. Even more tellingly, not one respondent would sign a contract of more than five years. Enterprise in the new economy has evolved from large corporates towards a greater number of start-ups, SMEs and entrepreneurs, and the world of work has changed. Many landlords need to manage an increasing number of smaller tenants demanding flexible terms. Here, customer service and retention will be pivotal and landlords will need to invest in relationships if they are to be successful.

An office opco model offered by Citibase is replicating this hotel management model in the office sector, enabling landlords to benefit from more revenue and less fuss. SMEs also benefit from more flexibility, affordability and a customer-focused experience. In a similar vein to hospitality, it is the opcos that attract and manage customers and oversee staffing, processes, sales and financials, while the propco simply owns the bricks and mortar.

We recently undertook research with Northumbria University, revealing that 90% of the UK’s vacant office space is in the secondary office sector. This hotel-style opco approach could help these propco landlords to fill their under-utilised secondary space. There are clear lessons we can take from hospitality and parts of the office sector are already taking heed. In an ever-changing market, being able to adapt to the customers of the new economy is fundamental to a successful business.

Steve Jude is chief executive of Citibase