From the observation deck at the International Commerce Centre in Hong Kong, visitors can gaze across the city from 100 stories up. And as landlords and developers are increasingly finding, that’s worth something.
The observation deck has seen double-digit growth in visitor numbers and revenues, as locals and tourists seek out the sweeping panorama.
Viewing decks in the world’s highest buildings have long drawn visitors – and their cameras. But the proliferation of skyscrapers has upped the ante for what tourists expect and opened a new opportunity for owners and operators to pull in a profitable revenue stream.
From the top of the 123-story Lotte World Tower, visitors can look down at Seoul through the world’s highest glass-bottomed viewing deck. Other observation decks in progress or recently completed across the world include the first 360-degree view of the Washington, D.C. metropolitan area at CEB Tower in Arlington; Bangkok’s Grand Rama 9 Tower; and Kuala Lumpur’s Merdeka PNB118.
“Today’s tourists are more focused on having Instagramable experiences than buying trinkets from street vendors,” says Derek Soh, Head, Property & Asset Management, Singapore & Southeast Asia at JLL “Office owners have quickly realized they can capitalize on something they already own – the best views in the city.”
Observation decks provide first-time visitors views with a unique perspective on a city’s geography and highlights – and for many people throughout the last century, it’s been an experience worth splurging on.
In the early 1900s, the rush to build the world’s tallest skyscraper was on. Developers knew that observation decks, already a part of the property, could lure tourists willing to pay for a ticket.
In 1933, one of the first observation destinations opened at the RCA Building, now Rockefeller Center, in New York City. By 1935, it brought in about 1,300 visitors a day, with an entry cost of 40 cents per person. Today, the Top of the Rock observatory will cost you a minimum of $36 and more than 3 million visit annually. It’s rival, The Empire State building observation deck brings in a $60 million annually.
Office towers around the world are taking a page out of New York’s playbook.
“You do not need to be the tallest or most-recognized building to create a viewing deck,” Soh says. “You just have to have a unique offering – a different perspective, interactive component like a glass floor or food and beverage offerings.”
Easy does it
An observation deck’s main goal is to draw in guests – but while some properties have no trouble funneling tourists through, not every observation tower is successful. If the building isn’t ready for hundreds, if not thousands of extra visitors each day, the elevators, traffic flow and security are likely to be impacted negatively.
It’s in the best interest of a property owner to work with an architect on traffic flows and support infrastructure, Soh says. The last thing you want is to be 103 stories above ground and hear a cracking noise, which happened to four tourists sitting in Chicago’s Willis Tower glass observation deck overhanging the city. In the end, it was just the protective coating.
“If a building owner is looking to add an observation deck by converting former office space they need to consider several safety upgrades. Authority and approval for the planned changes, enhanced occupant load barring infrastructure, and improved fire escape routes and protection systems,” Soh says.
Yet the extra work isn’t deterring skyscrapers from creating ever more ambitious viewing platforms, with competition increasing both in terms of height and creative design. In New York City, 30 Hudson Yards, a skyscraper under construction is going to house the highest outdoor observation deck in the Western Hemisphere while the US Bank Tower in Los Angeles has taken the wow factor a stage further with a 1,000 foot outdoor, glass slide on the side of its skyscraper.
“Owners of iconic or up-and-coming buildings will continue to look for ways to capitalize on the awareness of their assets,” Soh says. “Observation decks consistent revenue stream from entrance fees and use as a tenant amenity for hosting visitors make it especially enticing. It’s an upfront investment, that in most cases continues to pay dividends decades later.”
Article by JLL Staff Reporter