Amenity Evolution: how developers are navigating the tension between amenities that get them out of the house or may make them more likely to stay

By Mia Spero

Jun 06, 2025

In today's evolving real estate landscape, amenitization redefines commercial and residential real estate markets. In a world that prioritizes lifestyle, convenience, and experience, people and businesses are amenitizing properties to increase foot traffic. Capitalizing on this, developers incorporate high-quality and modern amenities into new projects and renovations. The presence and quality of amenities have become a crucial selling point for developments. Amenities can become the defining influence between stepping out to one property and staying in another.

It increases the value and appeal of the property while increasing competitive advantage and long-term tenant retention. These assets contribute to an increase in rental rates and decreased vacancy rates for landlords. On the commercial side, amenitization builds brand recognition, reputation, and overall revenue. The placement of amenities in several office buildings on Park Avenue, known very well for its high-end features, has contributed to a vacancy rate of 8.9%, much lower than Manhattan’s average of 16.64%.

These trends have become so key that companies such as JLL have a division specializing in managing “flexible workspaces” for buildings and investors. The workspaces generate so much income that the former managing director, Jacob Bates, says that they are making more than if they had just traditionally leased office space. CRE Insight journal says that amenitizing a building could be the defining factor in the success of the property. In fact, in the third quarter of 2024, Manhattan office tenants signed deals for over 23 million dollars. This is a 25.1% year-over-year increase that is being attributed to the enhanced amenities that are encouraging employees to work on-site.

There are at least four main groups that additions tend to fall under. These groups include: Fitness and health, distractions from daily life, workspaces, and green environments. Each of these is seen and desired more as apartment buildings and office spaces implement gyms, gardens, workspaces, lounges, game rooms, and more. In residential properties, amenities can also include in-unit laundry, dishwashers, elevators, doorman services, and more, which are increasing demand from buyers. Properties with these amenities sold for approximately 37.4% more than similar units without these amenities.

The challenge with the amenitization of residential and commercial real estate is the inherent tension between the two. As developers aim to cater to the evolving needs of remote and onsite workers, they face the dilemma of whether amenities in the office will effectively draw people back to onsite work or if the amenities at home anchor people to work remotely. In an era of remote, onsite, and hybrid work, how can developers determine whether their investments in commercial amenities will actually drive foot traffic, or if the convenience of home-based amenities is what's keeping people away? Each sector of the real estate industry is working to improve their game, while 25% of commercial office buildings have integrated smart tech into their properties, residential buildings are focusing on wellness, boasting a 94.7% growth in health and fitness-oriented amenities.

The reality is that individuals can’t be in two places at once. While residential landlords are working to amenitize their luxury properties, office space developers are doing the same. The question is, who will win out? Will luxury office spaces draw tenants back into the office, or will the comfort of home keep workers remote?

Sources:

NYU Schack's Blueprint

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