Consider two Class A office buildings in the same submarket. Similar construction quality, comparable locations, nearly identical asking rents. Yet one commands consistent premiums and maintains high occupancy while the other struggles with tenant retention and requires aggressive concessions. It’s part of a changing dynamic impacting commercial real estate valuations in 2026.
The difference isn’t physical; it’s how people actually use the space and the experiences the properties deliver. Traditional commercial real estate valuations remain grounded in fundamental metrics: net operating income, capitalization rates, cash flow projections, and price per square foot. These foundational measures haven’t disappeared and won’t.
What’s changed in 2026 is that forward-thinking investors, appraisers, and advisors increasingly factor in how effectively properties support human experience, productivity, and engagement. People-centric metrics don’t replace financial analysis, but they do help explain why assets with similar traditional profiles perform dramatically differently over time. Here, SVN® International provides an understanding of this evolution and how it helps commercial real estate professionals serve clients.
Why People-Centric Metrics Emerged
The shift toward people-centric valuation factors accelerated as hybrid work models normalized occupancy patterns and fundamentally changed how tenants evaluate space. Organizations no longer simply need square footage; they need environments that attract talent, support productivity, and justify employees choosing in-person work over remote alternatives.
Tenants became choosier about where employees work, evaluating properties not just on location and price but on how spaces support collaboration, wellbeing, and business outcomes. Capital followed this shift, with investors growing more selective about assets demonstrating sustainable demand rather than just current occupancy.
The result is a market where buildings are increasingly valued less on what they are and more on how well they’re used. Properties delivering superior occupant experiences command premiums and maintain stability. Those falling short face higher vacancy risk, increased capital requirements, and compressed valuations regardless of traditional quality indicators.
What People-Centric Metrics Measure
People-centric metrics evaluate how human experience, behavior, and engagement within properties contribute to asset performance, not merely how much revenue spaces generate. These measures reflect commercial real estate’s evolution into part of broader business ecosystems rather than purely financial holdings.
Occupancy & Utilization Metrics
These indicators reveal who actually uses space and how effectively different zones perform. Occupancy rates measure the percentage of available space being used over time, while space utilization rates track how effectively specific areas serve their intended purposes. Peak utilization data identifies crowding or underuse during the busiest periods.
Experience & Engagement Metrics
These factors assess how occupants feel about and interact with properties. Employee satisfaction scores measure contentment with space environments and services. Wellbeing indicators track ratings of air quality, comfort, natural light availability, and wellness features. Amenity usage data reveals how frequently occupants utilize communal services like cafés, fitness centers, or outdoor spaces.
Wellbeing & Health Metrics
Properties now demonstrably influence physical and psychological health, affecting overall organizational performance. Indoor Environmental Quality measures encompass air quality, natural lighting, acoustic control, and temperature management. Safety and comfort scores capture occupant perceptions of building security and physical comfort.
Strategic People Outcomes
The most sophisticated metrics directly link real estate to organizational performance goals. Talent attraction and retention impact measurements correlate location, amenities, and workspace design with employee turnover rates. Cross-functional alignment assessments evaluate how properties support broader HR, IT, and operations objectives — such as hybrid work policy success or collaboration effectiveness.
How People-Centric Metrics Influence Commercial Real Estate Valuations in 2026
The mathematics of commercial real estate valuation hasn’t changed. Net operating income calculations, capitalization rates, and discounted cash flow models remain the foundation of property assessment. What has transformed is how aggressively or conservatively key inputs within those formulas are set, and people-centric data increasingly informs those critical assumptions.
Lease-Up & Vacancy Assumptions: Properties with strong utilization data and positive occupant experience metrics are underwritten with shorter downtime assumptions between tenants, higher renewal probability, and lower frictional vacancy projections. This creates divergent valuations between similar assets; the same building size and market rents, but different risk profiles based on how effectively properties serve occupants.
Rent Premium Justification: Occupant engagement scores, wellness metrics, and location convenience data increasingly support sustainable rent premiums rather than speculative ones. Strong people-centric performance helps distinguish commodity Class A space from experience-driven properties, particularly important in office and mixed-use assets where headline rents don’t tell complete stories about positioning.
Tenant Retention & Cash Flow Stability: High amenity adoption rates and positive occupant experience scores translate directly into higher assumed renewal rates within valuation models. Appraisers increasingly assert that buildings with strong people-centric performance feature stickier income streams, facing lower assumptions about future tenant turnover costs and vacancy periods.
Cap Rate Adjustments: People-centric data influences perceived obsolescence risk and functional competitiveness. Assets demonstrating strong people-performance metrics may justify slightly lower capitalization rates because they present reduced risk of becoming functionally obsolete as workplace preferences evolve. Conversely, properties lacking compelling utilization data face higher risk premiums, particularly relevant for office but increasingly affecting life science facilities, medical office buildings, and retail assets.
What This Means for Commercial Real Estate Advisors
Understanding people-centric metrics helps advisors guide clients through market dynamics where identical buildings perform dramatically differently based on how effectively they serve occupants. Properties demonstrating strong utilization data, occupant satisfaction, and amenity engagement command premiums and face lower perceived risk, while those without such evidence confront compressed valuations and elevated capital requirement assumptions.
SVN’s collaborative network across 225+ offices provides market intelligence on these evolving trends across asset classes and geographic markets. The advisory opportunity lies in helping clients understand that people-centric data doesn’t create value independently — it reveals why certain properties sustain performance while similar assets struggle, insight that proves valuable whether acquiring assets, repositioning portfolios, or making capital improvement decisions.
The Evolution Continues
People-centric metrics don’t replace traditional commercial real estate valuation fundamentals — they make those fundamentals more accurate by reducing uncertainty around future cash flows. The mathematics remain unchanged; what’s evolved is recognition that how people use and experience properties materially affects the confidence with which key assumptions can be set.
Commercial real estate advisors who understand this evolution and can help clients evaluate properties through both traditional financial metrics and people-centric performance indicators deliver more complete guidance for navigating markets where human experience drives long-term value as significantly as lease terms and operating efficiency.
Connect with SVN’s commercial real estate specialists to discuss how evolving valuation approaches affect your investment strategy and property portfolio in markets where occupant experience increasingly drives asset performance.
Key Takeaways
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