Hartford Business Journal

HARTFORDBUSINESS.COM | OCTOBER 28, 2024 7 DEAL WATCH Pickleball courts and cafeterias: Downtown Hartford office buildings beef up amenities David Fagone, CEO of RM Bradley Management Corp., at a fitness center inside the Goodwin Square office tower in downtown Hartford. HBJ PHOTO | MICHAEL PUFFER a draw, noted David Fagone, CEO of RM Bradley Management Corp. The 30-story Goodwin Square tower installed a fitness center, locker room and conference center on the 15th floor several years ago. That was an unusual move for the time, Fagone said, as most owners tended to put amenities in harder- to-lease areas, like the basement. "I think that's changing because it has to," Fagone said. "Everything is trying to become higher-profile." In truth, amenities are often sparsely used. The same dozen or so people can generally be found each day in the fitness center of any given building, Ostop said. Even so, the absence of such offer- ings would be noted by prospec- tive tenants weighing their options. "They are part of the initial checklist for tenants when they are looking for new buildings," Ostop said. "They look for the more highly amenitized buildings. The punchline is that while they are not readily used, most buildings offer them, so the ones that don't, really stand out." For the first time since 2018, Hart- ford recorded back-to-back quarters of positive absorption in 2024, meaning office tenants collectively added more space than they gave up. Overall, Hartford County has recorded 103,000 square feet of positive office space absorption through the first three quar- ters of 2024, according to CBRE. That's lowered the region's office vacancy rate to about 23.1%. McCormick said many companies have embraced hybrid models that encourage employees to be in the office for at least three days a week. "Tuesdays, Wednesdays and Thurs- days, we're seeing average occupan- cies in the 75% range. Mondays and Fridays are still probably half that percentage," he said. "But people are recognizing that there's a cultural miss of not coming into the office, and not having an interaction. And I think it's added to us being a little bit busier, representing owners and tenants in the office space sector." Frank Amodio, a broker for Amodio & Co Real Estate, repre- sented the Connecticut Association of Realtors in its recent downtown Hartford lease deal. He said recent conversions, or planned conversions of office space to apartments have taken some inventory off the books, but there's still a healthy amount of space from which to choose. Amodio said he is working with several other businesses looking to move into downtown Hartford. "I think the demand will continue to grow," Amodio said. "I'm seeing weekly, monthly, other companies coming forward, changing their return-to-office status, and so we're really seeing an increase in demand. People are looking for locations where there are opportunities to go out and eat, to socialize, walk around, have easy access to mass transit, and that's more than you'd get in a freestanding office building or corporate park." By Michael Puffer mpuffer@hartfordbusiness.com T wo pickleball courts were recently added to the fifth floor of the 29-story office tower at 280 Trumbull St. in downtown Hartford. At the 38-story CityPlace I office building at 185 Asylum St., the landlord has refurbished a fitness center that was part of the nearly 300,000 square feet of space recently yielded by health insurer UnitedHealthcare. Now, this amenity is open to all tenants. A new upscale American cuisine restaurant — The Foundry — is opening in the former On20 Restau- rant space on the 20th floor of the Hartford Steam Boiler building, at One State St. That office tower also added a golf simulator and features a renovated cafeteria. As the deep post-COVID slump in downtown Hartford's office market continues, some landlords are using newly vacant space as an opportunity to beef up amenities, with the goal of attracting tenants in a still lackluster leasing market. "All these tenants are looking to have landlords help with their push to get employees back in their seats on a Monday-through-Friday basis," said John McCormick, executive vice president of brokerage firm CBRE. "And if the owners have these (amenity) spaces, they can help draw those employees back to the office. It's just that simple." In 2022, Prudential Financial confirmed plans to shrink its footprint at 280 Trumbull St. from 250,000 square feet to around 25,000. Now, the building owner has converted the floor that formerly housed Prudential's cafeteria into an amenity space with executive dining and grab-and-go meal options, along with the pickleball courts. Chris Ostop, managing director of brokerage firm JLL in Hartford, said the city's Class A office buildings must upgrade amenities to remain competitive. Almost every landlord has added common conference rooms, fitness centers and locker rooms over the past decade, he said. So far, only 280 Trumbull St. has pickleball courts. "If it takes off and people want to use it, then every landlord who has a vacant floor, every building could easily make these available in the near term," Ostop said. Hartford's largest office landlords have long depended on amenities as

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