Sept.11 'Reality Check' Finds Focus on Security

CHICAGO-Changes in power and data back-up, as well as disaster planning, are among the efforts undertaken in response to Sept. 11 by 85% of the corporate clients recently surveyed by Jones Lang LaSalle. Meanwhile, the mass exodus from Central Business Districts and high-profile trophy buildings has generally not happened as originally feared, according to the survey, which the real estate services firm considers a “reality check” nearly a year after the terrorist attacks on the US.

“What really excited me about that is we have concrete data about what the marketplace is thinking,” Bruce Ficke, chief executive officer of account management for Jones Lang LaSalle, tells GlobeSt.com.

Investors and shareholders are both paying more attention to disaster recovery plans, he explains. “If anyone wants to say nothing’s really changed, 85% of the companies we talked to say things have changed,” Ficke tells GlobeSt.com.

The survey found a strong emphasis on the front door—91% ranked security at the entrance among their top three concerns, with 57% making it No. 1 on their list. Evacuation planning made the top three among 85% of the companies surveyed, followed by garage security at 54%.

Most companies foresee more changes ahead. “Ongoing, we’ll always have a strategic approach to security,” Ficke tells GlobeSt.com, specifying some areas that that will be tweaked regardless of future attacks. “I think we’re beginning to see more of a focus of owning and hardening of primary data sites,” Ficke says, adding that major companies also are splitting data functions between more than one facility.

Among the predictions in the wake of the terrorist attacks on the US was an exodus from high-rise, trophy office tenants, with low-profile suburban locations expected to benefit. That hasn’t happened, as evidenced by this market, where Sears Tower has held its occupancy while suburban submarkets have continued to fare worse than the Central Business District.

“One of the comforting things you get from this survey is people are not going to change their approach to the old real estate maxim of location, location, location,” Ficke tells GlobeSt.com.

One client told Jones Lang LaSalle’s research team it was going to continue to be based in Downtown New York City. “That’s not going to change,” Ficke says. “That’s very important.”

While the survey found 54% of the companies having no plans to change the location or property type of their real estate, 28% planned to spread operations among other locations.

All that may change, Ficke concedes, if there is a repeat of what used to be unthinkable before Sept. 11. “There would be a reaction initially with trophy buildings, and move backward from there,” he opines. “You could see the typical worker saying, ‘I’m not going to work in that building because I perceive it as a risk.’ Companies may then prefer to locate in more low-profile buildings.”

More than 70% of the companies say perceptions of a safe workplace already are affecting their ability to attract and retain employees, according to Jones Lang LaSalle’s survey.

While 58% of the companies surveyed report increased occupancy costs, most say increases have been 3% or less. However, Ficke cautions the full impact of higher insurance costs have yet to be passed on, but will begin to be felt by companies later this year and early 2003.