During the sunny, summer lunchtime rush around Amazon’s Seattle headquarters campus one day last week, it almost looked and felt like business as usual.
More than a year after the tech giant issued a call for corporate and tech employees to return to the office at least three days per week, outdoor and indoor tables were full at a number of restaurants and cafes, lines snaked down various blocks where food trucks were parked, and foot traffic in general seemed more robust.
GeekWire visited a handful of businesses in the South Lake Union and Denny Triangle areas around Amazon last Wednesday, where we heard that the middle three days of the week are definitely the peak times for in-office work.
Business owners and workers said the three-day mandate has “made a big difference,” that South Lake Union is a vibrant neighborhood once again, and that “things are going in the right direction.”
Restaurateur Nathan Yeager said he’d tell Amazon CEO Andy Jassy to take things a step further.
“I think we should be at a five-day work week,” he said, using the collective we to mean those who work at the tech giant and those who work around its offices. “Everyone who has businesses here would like to see Amazon back five days a week.”
Five days could be a stretch for the roughly 50,000 Amazon employees who work in Seattle. The May 2023 mandate from Jassy wasn’t well received by everyone, including some 30,000 people who took to a “Remote Advocacy” Slack channel to air concerns about returning, those who walked out in protest last year over the return to office and other issues, and some who ultimately quit, including workers who were forced to relocate.
Amazon is now starting to track individual hours spent in the office for some employees and requiring a minimum of two hours per visit, Business Insider reported this week.
Amazon says its return-to-office policy is working — both for internal employees as well as businesses, citing data showing higher foot traffic around its buildings.
“Over a year ago we asked employees to start coming into the office three or more days per week because we believe it would yield the best long-term results for our customers, business, and culture. And it has,” Amazon spokesperson Zoe Hoffmann said in an emailed statement. “The vast majority of employees are in the office more frequently, there’s more energy, connection, and collaboration, and we’re hearing that from employees and the businesses that surround our offices.”
‘We’re in a really good place’
A messy, noisy street construction zone in front of her building on 9th Avenue North is just another obstacle to overcome for Shannon Rau, owner of a dog daycare and boarding business called Martha’s Garden.
Rao opened at the start of the pandemic and has weathered what she called her “share of hiccups,” from potential customers who suddenly switched to remote work to a mystery canine respiratory illness in December that forced her to lay off her entire staff.
“I think we’ve hit every medical emergency possible,” Rao said.
When GeekWire visited in February 2023, Rao called it “great news” that Amazon was going to be bringing people back three days a week. More than a year into the mandate, business is booming for Martha’s Garden.
“I think it has made a big difference,” Rao said of the three-day rule. “You definitely see a lot of people coming in during the week.”
Martha’s Garden now has seven employees and is doing well enough now that there’s a wait list to get in, and Rao was able to renovate her space and switch from a previous format that featured a bar for human customers to add boarding for dogs instead. She likes keeping her focus on one location and has no plans to expand.
“I think we’re in a really good place,” Rao said, adding that it would be nice to fill up a bit more on Mondays when it seems that a lot of Amazonians stay home. “There’s always a little bit of room to grow. We’re just training and building, it’s exciting.”
‘A whole different ballgame’
Around the corner and down the block from Rao’s business, Anthony Smith, an attendant with parking management company SP+, was working the entrance to a parking garage on Republican Street. Standing next to a sign that read “garage full,” Smith said he thinks South Lake Union is doing quite well and that there are a lot more people and lots more traffic in the neighborhood these days.
During the pandemic and before Amazon instituted its mandate last year, it was a lot easier to find parking. Even the food trucks are jockeying for spots now, as GeekWire counted more than a dozen such vehicles on various corners, and lines at some of them during peak lunch hour were 10 to 20 people long.
“It’s a whole different ballgame now,” Smith said of life around Amazon’s numerous office buildings. “It’s nice to see.”
‘Better now than it was a year ago’
Tyler Loch is manager of the Orangetheory Fitness location on Fifth Avenue, just a couple blocks from Amazon HQ. The gym was empty during the mid afternoon when GeekWire stopped in, but Loch said classes have picked up before and after work.
Like every other nearby business, Tuesday through Thursday is the busiest time.
“A lot of our members are coming from Amazon,” Loch said, noting that Orangetheory offers mostly 60-minute classes, topping off at 15 people each using rowing, treadmills and weight training equipment.
Loch said he’s seen an increase in customers and demand for memberships of late, and some class times have had to have wait lists.
“Things are looking like they’re going in the right direction,” he said. “I’m sure having people back in the offices is helping with that. We felt that when they all left.
“It’s definitely better now that it was a year ago.”
‘Pretty happy with everything right now’
Nathan Yeager is the owner of the chain Great State Burger and the bar/restaurant King Leroy, which share a large space across from Amazon’s Spheres on 7th Avenue. After the lunch rush last Wednesday, the bar was still relatively full with a crowd of soccer fans watching England defeat the Netherlands in a European Championship match.
Yeager acquired the businesses in January 2023, and said Amazon’s three days in office have been great and South Lake Union is thriving.
“I’m pretty happy with everything right now,” he said. “I like the vibrancy of the South Lake Union area. I think they’re doing a good job attracting good tenants. I like the food trucks coming back, it gets people outside, walking around noticing the bars and those types of things.”
While his Monday and Friday lunchtime and happy hour crowds are definitely down, Yeager said Tuesday through Thursday is carrying the load, and his revenue is up 25% year over year.
“That’s a pretty significant jump,” Yeager said, and he thinks it’s tied to a South Lake Union bounce back specifically. “You wouldn’t see that in the restaurant industry, usually it’s like 5%.”
Yeager loves the downtown core and would definitely be interested in opening a restaurant there or further south in Pioneer Square, but more changes are needed to address public safety, he said. He’d like to see 3rd Avenue opened up to traffic beyond it’s bus-only designation now — an argument former Microsoft exec Steven Sinofsky made earlier this year.
Yeager also said big businesses with office leases downtown should require their workers to be back in the office.
“I’ll open up a business down there,” he said. “I love Pioneer Square. It would be great if there were places to go and there were people there.”
For now, his latest Great State Burger and a soon-to-be King Leroy location are in Lincoln Square in Bellevue, Wash. — a city where Amazon employs another 12,000 people.
Beyond Amazon’s reach
Having a tech giant return thousands of workers to the neighborhood has clearly been good for many of the businesses around Amazon. Whether the same mid-week vibrancy for restaurants and retailers can eventually extend across downtown Seattle remains to be seen.
Some high-profile closures and property sales point to a tougher comeback from the pandemic. Seattle grocery chain PCC Community Markets closed a flagship location in the heart of downtown earlier this year after the store significantly underperformed. Restaurateur Ethan Stowell paused operations in April at his Victor Tavern on 2nd Avenue due to “the current challenges of operating in the downtown core.” And in May, downtown’s Pacific Place mall sold for $66.75 million — a steep drop from its 2014 sale price of $271 million.
Overall office space vacancy rates in downtown Seattle surpassed 32% in the first quarter of this year, according to Colliers, which expects that number to increase. A new report out this week from JLL said that “active demand continues to be far overshadowed by available supply” in the broader Seattle area office market.
There are signs that some tech companies remain committed to downtown. In June, digital remittance company Remitly, which employs 450 people in Seattle, confirmed that it’s moving its headquarters to Rainier Square Tower.
A recent survey of business leaders by Resume Builder found that while RTO remains a heated topic in workplaces, a quarter of U.S. companies will require workers to show up at the office more often in 2025. But another case study on return-to-office mandates at major tech companies found a spike in departures among senior, tough-to-replace talent when those policies were implemented at Microsoft, Apple and SpaceX.
In the latest update to its “Revitalization Dashboard,” the Downtown Seattle Association said June saw more than 90,000 average daily workers — its highest daily average since the start of the pandemic. But foot traffic is still about 36% below pre-pandemic levels from 2020.
The DSA said the number of workers returning should continue to rise, and would be helped by a commitment from public sector employers, where DSA said there has been a “significant lag” in return to office. Just this week, 26,000 city workers in Philadelphia were mandated by Mayor Cherelle Parker to return to offices five days a week.
“Whether it is workers, locals or visitors, we need to be focused on delivering the best possible experience downtown and we do that through an interesting mix of uses that will keep people coming back,” DSA said in a statement.
https://ift.tt/8NEsk7x July 17, 2024 at 03:00PM GeekWire
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