Heather Weerheim (00:00):
Welcome Jessica. Thank you so much for joining Greiner’s In Practice podcast session.
Jessica Mogilka (00:04):
Thank you so much for having me.
Heather Weerheim (00:06):
You’re kind of a celebrity status, I will say. You definitely helped me through the pandemic with my mental health a little bit. I would.
Jessica Mogilka (00:15):
That’s So kind.
Heather Weerheim (00:16):
And I want to talk to you a little bit about that because when I would look on LinkedIn, I would see your posts and some, they had glimmers of hope for the downtown or the corporate office market. And so I needed that and I would engage and look at the comments and there was hope. So during that time, what was going through your head and did you have an old crap moment?
Jessica Mogilka (00:38):
I mean, so I think we’ll get to some of it a little bit, but I’m a broker, right? So I help companies find real estate and they’re figure out what do they need and their physical footprint and all of that. And so you can’t really be in this industry and industry adjacent without some version of an oh crap moment. But I would say that I think I got really, really lucky and I have an amazing partner. I have a great family and I’m not sure if I should say this on a public podcast, but we just left, like, so we went and got an Airbnb where we didn’t know anybody and spent a few months like living in, outside the mountains in Santa Fe.
Heather Weerheim (01:19):
I had no idea.
Jessica Mogilka (01:20):
Well, if you look at some of my posts, I do not have an Adobe house. Like that is clearly not where I live. But and certain people picked it up and I’d get these really funny side messages. Where are you in the world? Like, so we spent a bunch of time doing that. And then I had planned on doing the podcast before the pandemic actually happened, but the pandemic kind of gave me a little more runway to actually launch it. Whereas normal day-to-day life is hard to do that kind of a project. But yeah, I mean, I think I’m just an optimist that I truly believe that people want to be together in some fashion. And God, I felt that so intensely during the pandemic that I had a hard time imagining that at some point we wouldn’t all come back together and be super happy to do it.
Heather Weerheim (02:11):
I couldn’t agree more. I loved, there was a comment. I heard that you can maintain culture outside of the office, but you can’t build a culture. And, and I, that’s why that kept me hopeful too, with the office market, but I should revert back. Okay. So Jessica welcome. You worked for JLL. You’ve been in the industry for
Jessica Mogilka (02:30):
15, 16, 17. I’d have to add it up again. Something like that.
Heather Weerheim (02:34):
Always as a broker?
Jessica Mogilka (02:36):
Not really. I’ve always worked in the corporate real estate side as opposed to a little bit more of the commercial side. And that’s a fine distinction that some people in the industry will understand, but I actually started not as a broker because I worked for a big French bank in New York and I was their kind of support part of their support team to bring projects into at the time there were mainly Western Europe and then we’re kind of expanding into Eastern Europe. And so I wasn’t a broker then because you can’t be a broker and work for a bank, but I’ve always worked in that kind of corporate, where do you need to be in the world and how are you going to get there in that fast?
Heather Weerheim (03:16):
Got it. And then your title right now includes tenant representation. Is that right? And for those, I think most people in our that are listening. If you are listening, I hope you are know the difference, but can you talk about what it means to be a tenant?
Jessica Mogilka (03:33):
Yeah, absolutely. So a tenant rep broker is a broker that represents the company and the people that are going to physically sit in and use the space. The flip side of that coin is more of an agency landlord representation, and they represent the folks that own the buildings and operate building.
Heather Weerheim (03:52):
Okay. So on the corporate side, can you give me an example, the size of corporations that you’re working with? Is it gosh, you do limit it or does it
Jessica Mogilka (04:01):
Not really, you know, it’s one of those things that you can be finding an office for a nonprofit that is 15,000 square feet, 10,000 square feet, or, and there’s a one-off, this is their only space. Or we could be working with a much larger corporation that has lots and lots and lots of different locations. There are different aspects to both of those projects, but fundamentally it’s, the basics are very similar. Right.
Heather Weerheim (04:31):
So working for JLL, a big corporation that does offer kind of educational tidbits, the white papers.
Jessica Mogilka (04:40):
Yeah. They do great research.
Heather Weerheim (04:41):
It’s awesome. And so recently one came out talking a little bit about the great resignation, which I know is kind of a hot topic, or maybe even I heard about the great, not employees, not even applying like that that might become a thing. Yeah. Which is really scary. So do you think that the term great resignation is that exaggerated or
Jessica Mogilka (05:03):
I think it’s real. I think that I just saw in, what was it earlier this week? And the labor statistics came out with a 3% quit rate and I just looked at it this morning and it gets just above 3% at this moment. So I don’t think that the great resignation is overstated.
Heather Weerheim (05:21):
Okay. And I I think when I’m called, I’m called the geriatric millennial. You heard that
Jessica Mogilka (05:28):
No, I haven’t heard, am I allowed to ask how old you are? Yeah,
Heather Weerheim (05:31):
I think so. I guess I’m 39,
Jessica Mogilka (05:33):
Okay, well then I’m like an extra geria, I’m like a super young X-er or something I’m older than you, so,
Heather Weerheim (05:39):
Okay. Can we cut that out by the way? No, I’m just kidding. It’s fine. Fine. no, but with that, I want to state that I am a geriatric millennial because do you remember the day when we were just happy to have a job?
Jessica Mogilka (05:51):
Yes. Yes, of course.
Heather Weerheim (05:54):
I still feel that way! So I just think it’s crazy that people are not applying or that can just resign from their job and not have any fear, I guess. Okay. Am I looking at it wrong?
Jessica Mogilka (06:05):
Well, I do think you’re looking at it wrong, but I think that that’s how a lot of people have always looked at it. So I would say I’m a little bit older than you and yet when, and so when we moved from New York from that job with the big bank, we had our first kid and it was like, eh, I don’t really want to live in an apartment building in Manhattan anymore. So we moved here to Minneapolis. We, neither of us had jobs. We didn’t have a house. We didn’t have anything beyond. Yeah. That seems like a better place to live. I knew there was a bunch of big corporations and we just figured we’d figure it out. And I think that more people have adopted that kind of attitude. Whereas at the time I’m sure that various parents and grandparents and all of that were a little nervous about what we were doing, but, you know, I mean, it worked out great we’ve we got jobs and everything’s fine. And then of course the economy fell off the cliff right after we moved. So we did get really lucky, but it’s the like big reckoning right. Of the balance of power reship, like re realigning, if you will. So we don’t have to always feel like that. Right. When we got out of college, like, oh, please let me get a job, please let me get a job. And I’ll take whatever job says Yes. That’s just not the reality anymore. And I’m really glad, I’m glad to
Heather Weerheim (07:22):
You’re right. And when you mentioned the economy shifting, so for me, that happened in 2009 and I was just explaining to our podcast crew that at that time, Katie said they probably weren’t born yet, but they were that in 2009, I was, I got laid off from my first job in commercial real estate. And I knew that I really loved commercial real estate. So I thought I was doing the research. How do I get back into the business? And I mean, nothing was happening. And basically nothing was happening
Jessica Mogilka (07:50):
It was at a tough time.
Heather Weerheim (07:51):
Right. So once I got back in, I’m like, I’m never leaving
Jessica Mogilka (07:55):
Didn’t you have friends that were graduating law school. And they couldn’t, there was like thousands of lawyers wandering around with their boxes. And it just, it’s such the inverse now that it’s kind of remarkable.
Heather Weerheim (08:06):
It’s remarkable. And it’s pretty cool. So like let’s talking back about the great resignation and then the white papers. So basically it’s kind of to sum it up, how to attract employees, how to keep them engaged, how to get them to enjoy their work environment and the hybrid model. Right. Like that’s key right now, which is pretty cool. That’s one of the changes. I think that if anything, great came out of the past couple of years is probably this work-life balance initiative. So I guess first I want to know what has your conversations been with your clients about either the great resignation or hybrid model?
Jessica Mogilka (08:46):
Yeah, so I’m also really lucky to be a board member on CoreNet. And so I’ve got, I’ve not just my clients, but also all of JLLs clients and a whole bunch of really great corporate side folks that are open to sharing in that environment, how they’re thinking about and how they’re dealing with it. So I think that it’s almost hard to even figure out where exactly to start with this conversation because it’s such a people just don’t know. And we thought for that moment they were coming out of it and we were going to be able to, we’re going to, we had all of our plans in place. We went through the upheaval of, do we turn off the ice machine? Do we leave it on this crazy nitty gritty? Okay. We moved 12,000 chairs into the cafe. Now we got to put them all back up into the, and now there’s every other one, and now we’re taping and there’s all of this kerfluffle.
Jessica Mogilka (09:41):
And then that kind of flattened out for a while. It’s like, okay, now we’re ready. Now we’re going to return to office and we’re going to have a plan. And I have a very large corporate in town and said, okay, where are you guys these days? And she just said, we’re on iteration 27 of our return to office plan. And we’re just going to hit pause. We’re just going to pause for now. We’re not gonna force it anymore. We’re just gonna see how, see how it on how it kind of continues with Delta. It’s become incredibly difficult to say here’s and then the timeframes that have passed. Right? And so one of my big takeaways of those conversations, clients, companies locally is that very few people believe that it’s almost too easy to say. We’re just going to build a beautiful office and all these people are going to come.
Jessica Mogilka (10:33):
It’s just too simple. It’s too one noted. And it’s too, it’s almost demeaning to everything that’s happened. In my opinion, in the last chunk of time, I think we have an amazing opportunity and we can talk about opportunities next, but having a beautiful office is not going to say, oh, now yes. Now I want to figure out my childcare. Now I figured out my elder care. I figured out how to have a work-life balance. I figured out how to park two to three days downtown, but not pay for all. Nope. Haven’t figured that out. I mean, there’s this laundry list of things, including inertia around coming back into an office. And so, yeah, I love, I would love to have the conversation to be as simple as let’s make a beautiful space.
Heather Weerheim (11:18):
And let’s have an outdoor walking path and a green roof and yes.
Jessica Mogilka (11:22):
And if you have every amenity you could ever imagine, then you’re going to want to come to the office, but it’s not, it’s just not as simple as that. It has to be a deeper conversation by, for every company. So yeah, I can talk all day about what company Bob is doing over here. Cause company Sally is not the same company and those leaders need to decide how they want their culture to build and to be created and sustained in some of those companies. They just said in the middle of the pandemic, we’re out, we’re going to go a hundred percent virtual. And to me that is a hard play towards that culture. And I totally support them in that conversation. Yeah. Get rid of your office. And then there’s the folks that are like, Nope, the JP Morgan’s in office office centric office is best. And then you’ve everything in between to me, it’s these companies that are just sort of lagging and floating and in and out and changing their returns to office every other week that are going to have the far and away biggest challenges because they can’t identify and they can’t point to things. So people don’t know where and how to mentally plan at all. And I think those are the folks that are gonna have the biggest challenges.
Heather Weerheim (12:44):
Okay. So a few takeaways from that conversation. So one you, if a company is committing to go all work from home,
Jessica Mogilka (12:53):
Remote yeah. All in
Heather Weerheim (12:55):
Like you support that even as like a broker.
Jessica Mogilka (12:58):
Yeah. That’s because that absolutely speaks to a culture that you’re building. And if they don’t see the value in an office, if the leadership doesn’t, why would everybody below the leadership see value in the office? And maybe there is no value in that office for them and they can build it in other ways they can gather in other places you don’t think that precludes that company from gathering. I just think that it’s the folks in the middle of that can’t quite nail down what their goals are and how they think, because once you understand how and what your culture should be or how, and what goals you have for what should be done in an office, or what should or could be done at home. Some of it, I think it’s okay to be honest with your folks and say like, we don’t know right now, and we’re going to just hold tight. This is where we’re in, how we’re going to hold tight and we’ll keep updating you as we go. But I’ve also seen a lot of companies that are go this way and then this way, and then they get a new boss and it’s this way. And then it’s over here and that’s not, that’s not helping. No,
Heather Weerheim (13:59):
That’s not sustainable. I have a friend who went through that same thing and they’re like, okay, everyone has to come back to the office. And then a few COVID outbreaks later. Okay. Everyone’s at home. Yeah. You know, it just wasn’t the conversations have to happen. And I think I loved in one of your LinkedIn posts too. You mentioned how you were going back to work, and it was hard. Yeah.
Jessica Mogilka (14:18):
It was weird. It was like, I can still barely actually get to a meeting in person at eight o’clock in the morning. I never used to have that problem, but I just cannot seem to get myself up and out. And then, oh, wait food. Oh, wait kids. Oh, wait this, ah,
Heather Weerheim (14:34):
Do I have shoes on,
Jessica Mogilka (14:36):
Am I still wearing my slippers? Which I may have done once over the last few months, but let’s see, my kid caught me. Yeah. Thank you.
Heather Weerheim (14:44):
It’s usually once I like put my foot on the gas pedal is when I realized I still have my slippers on oh crap.
Jessica Mogilka (14:51):
Heather Weerheim (14:53):
No, but that I think for any company, for us, it was easy. The decision was kind of made for us is deemed essential. Yup. Get back in the office. So it’s been kind of fun to watch. Like I hope you’re excited about this too, because we, every, all the restaurants were shut down in the Skyway. So here Greiner construction’s back. We had to have snacks in our office because we couldn’t go to convenience store. And there’s been, there’s a caribou from the Oracle building into our office, like across the Skyway. And it’s been closed for a year and a half and it just opened. Yeah.
Jessica Mogilka (15:31):
I didn’t know that when it was open, I feel
Heather Weerheim (15:33):
Like it’s a sign that things happening.
Jessica Mogilka (15:34):
Super fun and I took a picture of the line coming out of roti. And what is it? The IDS crystal court or
Heather Weerheim (15:42):
Support. Yeah. I mean, it is
Jessica Mogilka (15:47):
Something like that. I was sitting there waiting for my salad and it’s like, oh my gosh. There’s like dozens and dozens and dozens of people waiting for hummus. I mean, yeah. It’s just not, it’s just not that revolutionary, but to have a place that was open, even like a sit-down lunch, you can’t do it downtown yet, but it does feel like it felt, it feels like a little, little tiny waves of people coming back and Dayton’s is opening. Like just walk by the walls are down
Heather Weerheim (16:14):
Really good. I’m very excited to hear that they have some small boutique shops open. And I think, I don’t know if their food market is opening too, but either way still like positive signs. So are you feeling like with your, so the conversation to clients maybe has it changed? Has it evolved to this point? What are they saying now? Are they following the white papers and, and doing everything it says in here? Because I do want to go through those. Yeah.
Jessica Mogilka (16:45):
Yeah. Absolutely. Most corporates that I see are using words like the office is for collaboration and this is where we’re going to meet and gather heads down work happens more at home. There’s a hybrid model for almost everybody. But most of them have not required any sort of return, like being coming back now in my, like they’re open, but because Delta just keeps dragging and dragging, and I just was listening to the radio on the way here. And we’re talking about the COVID era. And I agree with that.
Heather Weerheim (17:20):
Tell me a little bit more about the COVID era
Jessica Mogilka (17:22):
Or it’s not going to like, just go away this winter when it’s just not going to dissipate. And then all of a sudden, everyone will be back in their office and doing the same thing in schools will be fine. It’s going to be a long term management of as opposed to a, oh, it’s done now, now we’re done and we’re fine. And everything is, you think it will be fine. And I think it will be transformational in the big picture, in the long, mid to longer term also.
Heather Weerheim (17:48):
We’re just not in the clear,
Jessica Mogilka (17:49):
We’re just not there yet. There’s I mean, one of my kids was on quarantine for two weeks and not that long ago. Cause she was on the same bus as the kid that got COVID. You know what I mean? Okay. So now we’ve got that, we’ve got short staff in a lot of places henceforth the great resignation, right? Rejigging, how people are thinking about work and where that balance is. And the same thing. I think a big piece of that there’s norms that have been, I wouldn’t, I don’t want to say like exploding, but kind of like pop! Like little pops of norms, like dissipating or something. And I think one of them is this feeling that you cannot have a gap in your resume. Did you have that also when you’re young that you can’t have like, oh no, no, no, no, no. I had a job right away. As soon as I left that one, I went to another one and kind of fudging the using months or years instead of months. And like, just to sort of gloss over this idea that maybe you had a gap in your resume, I think that’s one of the norms that’s kind of poofing away and now we don’t have to worry so much about some of it.
Heather Weerheim (18:54):
I agree with you. And I haven’t had it explained to me that way, but I like it. But so someone I had, I’m not an HR professional, but I heard this quote from somebody that I really liked. And I think people could use it for this, for what’s happening right now with this great resignation. So it was hire fast. So anytime you’re going to be hiring someone, you know, what’s kind of questionable. Like usually you don’t know, they can be a great interviewee and, or they can be great and then you can hire them and they can stink or they could – either way, if they’re qualified and you feel good about them, hire them fast. And then, and then it’s fire faster and promote fastest. I like that. Yeah. I kind of like that too. So, you hire fast, there’s some unknowns there, but then you also know when, you know, when someone needs to go right there, I think that could help if there’s not a huge talent pool and you kind of are only working with
Jessica Mogilka (19:53):
So hard to find people. It’s
Heather Weerheim (19:54):
Hard to find people, give them a shot and then if it doesn’t work out or whatever, whoever doesn’t work out fire fast and then promote fastest. So I kind of a fun little example, again, not an HR person, so I’m not going to say that’s perfect, but yeah, I think for companies right now that might be struggling, it could be some good advice. Okay. So the white papers, I just want to go through some topics because I think that there I’d be interested to know what you’re talking to your clients about and if you agree or disagree with some of the comments, but I’m assuming you’ll probably agree with most of them. Let’s see. Yeah. So one of the topics, so basically this document addresses, if you haven’t seen it, it talks about how to make employees feel fulfilled and connected to their organization. But I love, and I think people need to think about culture more and more in order to retain talent. So treat employees as customers. So what environment are they? This is kind of what the hybrid model, what environment do they work most effectively in understand their attitudes towards the high hybrid war?
Jessica Mogilka (20:56):
Yeah, it’s the activity-based work conversation 2.0 or whatever, you know, activity-based work in the office. The idea originally of activity-based work right. Was work in the chunk of the office that supports the work you’re doing. And now it’s coffee shop home. It’s now blown up outside of the office. Right? So now you can do your activity based work. I think that will evolve into something else. And we’ll see how that actually is utilized inside of offices. Yep.
Heather Weerheim (21:27):
Agreed. Create a workspace environment that is like a destination. So it’s branding or it’s not, it’s not just branding and paint. It’s the amenities.
Jessica Mogilka (21:37):
That’s a big topic of conversation with every ownership group. And it kind of hearkens back to the, create an experience for your employee slash customers. There is a whole conversation about Convene is a coworking space in – it’s not coworking, where they do meetings and all of this. And that was their whole thing. And they’re based out in New York and there were clients of mine for a little while and they didn’t end up actually opening anything here. But their thing was, as you pull up to the building, your barista knows exactly what coffee you have and that it’s the experience of your employees from the moment they drive in or walk in till the end of the day. And so everything is just this really lovely, supported environment and experience. And that kind of leans into this idea in maybe not quite as customized a way, oh, we’ll just put in every possible amenity into our buildings.
Jessica Mogilka (22:34):
And there is an absolute trend right now of a flight to quality in the downtown area. So if you look at the gateway building, which is a brand new building, it’s not open yet, right. It’s going to be my new building. I think we’re moving in, in like March or April of next year. It’s pretty much full. I mean, there’s a little bit of space, but it’s pretty much full same with 10 west end in the, in the St. Louis Park pretty much full or definitely fuller than some of the naysayers maybe would have said beautiful buildings, not cheap buildings, flight to quality leans into the companies agree with you. If they’re doing real estate deals right now, they’re moving towards places that support, their employees with amenities and location. And that kind of thing.
Heather Weerheim (23:20):
Tell me about some of the amenities that are going to be at, oh, Cause are you going to have you mentioned childcare,
Jessica Mogilka (23:28):
There will not be childcare as far as I know inside of either of those buildings.
Heather Weerheim (23:32):
Is the barista going to hand you your latte? I don’t think so.
Jessica Mogilka (23:35):
Cafe meal I’m yeah, I wish, but I don’t think that’s true. But you know, one building that is going all in that just broke ground last week is north loop green. So if you want to talk about amenities, north loop green is a hundred percent your building to talk about amenities. They have. So one tower is an apartment. One tower is an office and they’re going to have a bridge between the two at like, oh, I don’t know the 12th floor. And that entire bridge floor is amenities, a big, beautiful gym, you know, conferencing center. And then on the outside, there’s going to be all of they’re turning the underneath the highway, ugly bit into like a beautiful, curated and managed park. And so there’s going to be all these events. And then it leads right into the transportation hub of target field. And then target field is right there. It’s going to be a beautiful, I forget how many acres in every amenity that you can think of and just a beautiful building.
Heather Weerheim (24:31):
So what advice can you give to these old boring buildings? So I might not,
Jessica Mogilka (24:37):
No, you have to play on price. I mean, you have to differentiate yourself somehow. So if you’ve got an old, boring building with no amenities or your gym is a closet in the basement and nobody uses it anyway, maybe you gotta think of some other way to be the value building or the like start a building and you can chop it up. There’s a million things that people are talking about also around coworking. And how can you increase flexibility and spec suites. Everyone loves a good spec suite these days. So all of these products are different ways that I think that the pandemic and the recessionary kind of hit on real estate is pushing ownership to be more creative and more interesting. And what they’ve got,
Heather Weerheim (25:21):
You mentioned two things, co-working and spec suites. So first with the spec suites, I agree. I think that’s worked really well for a lot of
Jessica Mogilka (25:32):
A lot. I’m looking for a number of specs space for clients right now. And before the pandemic, I had never done a spec suite deal. It just never made any sense.
Heather Weerheim (25:41):
Why does it work for them now?
Jessica Mogilka (25:42):
Because before the pandemic landlords wouldn’t offer flexible terms on most of them, they’re like, oh, we spent all this money on this beautiful suite. We need at least five or seven years. But to me, the only reason you would go into a spec suite or one of the main reasons is that you see, you don’t know what your future holds, which is pretty much every single company right now is they don’t know what two years from now looks like in their office space or their space. So, and this is all just to cover it. This is all an office conversation. With more knowledge workers, there is a whole other conversation that we could have around manufacturing and some of those kinds of labor and demographics challenges and locational and life sciences going bananas. So like every life science, industrial building has been taken. So that’s a really different conversation
Heather Weerheim (26:32):
What are you doing in December?
Jessica Mogilka (26:34):
My gosh, I know. Right? so from the office perspective, it’s like the office today, the spec suite thing works great now because landlords are like, oh, shenanigans, we got to move this product. And all these companies are like, perfect. We don’t have to come out of pocket for that capital. We don’t have to deal with the supply chain issues of that doorframe taking 74 weeks to show up. I mean, you can speak to that all day long. And we can take it for 1, 2, 3 years and then see where we are. So the ownership groups that have been able to fill the need for flexibility, I think that that has been more important than amenities by a long shot for most companies today.
Heather Weerheim (27:17):
Did you hear that? Do you guys hear that amenities meh but specs. Yeah. I mean, you need the amenities. Okay. I shouldn’t say that. Let me, flexibility right now is key. I think the good news is the return office is happening. It’s happening. It’s still going to take time. I would say amenity spaces and spec suites are key right now to successful lease agreements. Newer buildings are definitely more popular
Jessica Mogilka (27:46):
Flight to quality,
Heather Weerheim (27:47):
A flight to quality. I think for employee retention, ultimately it sounds like
Jessica Mogilka (27:54):
I wish it was as simple as an office, a beautiful, amazing office, but it is definitely not that simple. And it, if that is the only thing you’re doing, you’re doing it wrong.
Heather Weerheim (28:05):
Yeah. That’s great
Heather Weerheim (28:07):
Jessica Mogilka (28:08):
Oh, a hundred percent. Yeah. I mean, McKinsey did an amazing article that compared the reasons that employees said they left to the reasons that companies said that their employees left and it was like, Nope, like these things are not on the same page at all. And it was all about engagement and culture and feeling that there is a place for them to go and a team that they were, that they liked working that folks liked working with. Whereas employers thought it was more like, oh, I’ve got an ugly office. I’m not paying them enough. I didn’t give them enough of this.
Heather Weerheim (28:39):
Right. Well, they’re only gonna hear what they want to hear. I think too, when that’s what happens again, not an HR professional.
Jessica Mogilka (28:47):
Heather Weerheim (28:48):
Well, Jessica, I can’t thank you enough for taking the time to join us. I really appreciate it. I was really excited to have you here today,
Jessica Mogilka (28:54):
Heather. It was super fun. Thank you for having me. Okay.
Heather Weerheim (28:57):
Please join us again.
Jessica Mogilka (28:59):
Oh yeah. To me? Yeah, please
Heather Weerheim (29:00):
Join us. That sounds good.