Maintenance Satisfaction Stable in First Half of 2019

As 2019 began, tenants' feelings about office upkeep were consistent, except in the industrial sector, which continued its trend of variability, according to Kingsley Associates.
John Falco

In the last 12 months, Kingsley Associates surveyed over 2 billion square feet of office, industrial, medical office, and retail properties across the United States. Across almost all property types, overall satisfaction with maintenance stayed stable in the first quarter of 2019, except for the industrial sector where maintenance satisfaction decreased.

Kingsley Associates’ data illustrates that a swift turn-around time after a tenant submits a maintenance request leads to greater satisfaction with the tenant experience. Maintenance responsiveness, skill, communication, and accommodation of special requests are some of the most significant factors in tenant satisfaction, and therefore highly affect tenant retention as well. Satisfied tenants in all sectors are much more likely to renew their leases when the time comes.

Office: Maintaining Tenant Satisfaction

Across the country, overall maintenance satisfaction at office properties remained stable this past quarter, only increasing by 0.2 percentage points from the last quarter of 2018. The first quarter of 2019 saw 91.4 percent of tenants indicating they were satisfied with their maintenance experiences. This marks a four-quarter growth from 82.9 percent to its current position. Currently, scores are in line with what was seen in 2013 with a high of 91.9 percent. Response time served as a significant factor within overall tenant satisfaction with maintenance in the last quarter; the quicker maintenance responded to a report, the higher the scores.

Except for Boston and Atlanta, all major markets saw year-over-year increases in maintenance satisfaction scores. This is unsurprising as national maintenance scores have been on the rise since the first quarter of 2018. Dallas had the highest individual improvement with 3.7 percentage point increase from this time last year, which landed the percent of tenants satisfied with maintenance at 92.1 percent. San Francisco had the second highest market-level increase in maintenance satisfaction with a 3.4 percentage point climb to 91 percent satisfied this past quarter.

When looking at maintenance and engineering response times, the faster the response times, the higher overall the maintenance satisfaction scores. Response times within 24 hours of the initial request received high maintenance satisfaction scores of 87 percent from tenants. Within the same vein, resolution of a maintenance request on the first attempt garnered 96 percent maintenance satisfaction. The less attempts needed, the better the scores. Conversely, the more attempts by maintenance to fix a problem, the lower the score given by tenants.

Industrial: The Long-Term Variability of Maintenance Satisfaction

When it comes to overall maintenance satisfaction within the industrial sector, the scores are wide-ranging. Over the past few years, overall satisfaction with maintenance has ranged from a low of 81.4 percent in the fourth quarter of 2015 to a peak of 92.2 percent in the second quarter of 2016. At the end of 2018, numbers were on the rise. Throughout 2018, satisfaction levels rose from 84.3 percent to 89.9 percent. However, the first quarter of 2019 saw a slight decline in overall maintenance satisfaction to 89.3 percent of tenants indicating they were satisfied with maintenance.

The majority of cities surveyed at the market level experienced an increase of overall maintenance satisfaction from the prior year, which matched the national trend, despite the slight decrease this past quarter. Atlanta and Chicago had the largest changes in year-over-year satisfaction with maintenance. Chicago had the largest year-over-year decrease of 8.9 percentage points, dipping to 88 percent of tenants satisfied with maintenance in the first quarter of 2019. Dallas also had a decline in year-over-year satisfaction, decreasing 2.1 percentage points to 87 percent. Conversely, Atlanta had the largest year-over-year increase of 8.4 percentage points to reach a 97 percent overall maintenance satisfaction rate.

Similarly to office satisfaction with maintenance, the more quickly a complaint was addressed and fixed, the more satisfied the tenants were with maintenance. Problems that were addressed within one day had scores of 86 percent overall satisfaction with maintenance. When addressed within two hours, those scores rose to 92 percent satisfied. Request resolution on the first attempt also resulted in top overall scores of 88 percent of tenants satisfied with maintenance.

Medical Office: National Overall Maintenance Satisfaction is Smooth and Steady

Medical office is the most consistent of the commercial property types in terms of overall maintenance satisfaction. The current satisfaction score of 88.1 percent in the first quarter of 2019 was slightly lower than the fourth quarter of 2018, which held a score of 88.6 percent satisfaction with maintenance. Historically, from the first quarter of 2018 until the first quarter of 2019, overall maintenance satisfaction kept steady around 88 percent. True to form, the first quarter of 2019 numbers were in line with the historical data. There is generally little variability from quarter to quarter in the medical office sector. The lowest maintenance satisfaction level was in the fourth quarter of 2016 with a score of 85.8 percent. The highest score was more recently in the first and second quarters of 2018 with maintenance satisfaction scores of 88.7 percent.

Individual markets in the beginning of 2019 experienced a mix of year-over-year increases and decreases in overall maintenance satisfaction. Most notably, San Francisco had an impressive year-over-year growth of 20.6 percentage points and ascended to 94 percent satisfaction. Overall maintenance satisfaction in the medical sector had decreased most in Atlanta. The city’s maintenance satisfaction score was 79 percent with a year-over-year decrease of 8.1 percentage points. However, Atlanta had the largest year-over-year increase of overall maintenance satisfaction in the industrial sector, but decreased in the office and medical sectors.

Medical office tenants have similar drivers of overall maintenance satisfaction as other sectors, including timeliness, attentiveness to their specific concerns, and efficiency in solving the problem. Maintenance requests with a response time within two hours received overall satisfaction scores of 89 percent. Requests that were resolved on the first attempt saw an overall maintenance satisfaction score of 94 percent satisfied. Tenants appreciate quick maintenance resolution, and that appreciation shines through in higher overall maintenance satisfaction scores.