The Rise of the Experience Economy

In commercial real estate (CRE), businesses—whether retailers, office users, or mixed-use operators—seek more than physical space. They want environments that build connections with customers, employees, communities, and their brand. Experience has become a defining differentiator. 

Welcome to the experience economy—a shift reshaping how commercial spaces are designed, leased, and valued. 

What Is the Experience Economy? 

The term was introduced in 1998 by B. Joseph Pine II and James Gilmore, who argued that economies evolve from selling products and services to staging experiences. Now, more than two decades later, this concept has taken root in CRE.

Buildings are no longer static containers for activity — they are curated environments that contribute to the user journey. 

In an increasingly digital world, physical places offer what screens cannot: multi-sensory engagement. The opportunity to create memories, build community, and express identity in place. 

CRE’s Strategic Response to the Experience Economy 

Retail: From Storefront to Stage 

Retail is at the forefront of this shift. No longer just transactional spaces, stores are becoming immersive brand touchpoints. Companies are layering in experiential design: think in-store events, influencer pop-ups, scent and soundscaping, hands-on customization, or tech-driven interactions that surprise and delight. 

Retailers that once competed on price or convenience are now competing on how they make people feel. And property owners are responding by offering flexible build-outs, placemaking support, and co-marketing opportunities that amplify these activations. 

JLL’s 2024 Global Consumer Experience Survey reveals that 76% of consumers believe cities need to offer new experiences to remain relevant. This sentiment is even stronger among younger generations, with 84% of Millennials and Gen Z agreeing with this perspective.   

Office: From Workspace to Culture Engine 

In the office sector, experience is redefining what companies expect from their workplace. As hybrid work becomes the norm, organizations are reevaluating space through the lens of purpose. If employees only come in a few days a week, why they come in — and what the space offers them — matters more than ever. 

Businesses are looking for workplaces that foster culture, connection, and collaboration. Wellness amenities, hospitality-style lounges, event-ready break rooms, sensory design, and flexible meeting zones are no longer “nice-to-haves.” They’re tools to attract talent, reinforce brand, and retain employees. 

Forward-thinking owners are responding with upgraded common areas, programming support, and tech-forward infrastructure that enables frictionless, intuitive use. 

Mixed-Use & Urban Spaces: Curated Community 

Mixed-use developments are particularly well-positioned to thrive in the experience economy. By integrating residential, commercial, and public realms, they provide natural ecosystems for discovery and interaction. But to deliver real value, they must be curated intentionally. 

Placemaking strategies — from pop-up markets and live music to seasonal activations and public art — create a reason to linger, share, and return. For businesses, this translates to higher foot traffic and dwell time. For owners, it means a more resilient, magnetic property. 

This shift reflects a broader movement toward “hyperphysicality”—a trend where physical spaces intentionally deliver sensory immersion, elements of surprise, and meaningful social interactions that digital environments cannot replicate. 

Implications for Businesses and Organizations 

For today’s companies, the experience economy offers both an opportunity and a challenge. 

• Opportunity: By occupying spaces that elevate customer and employee experience, they can strengthen loyalty, increase engagement, and differentiate themselves in saturated markets. 

• Challenge: It requires a mindset shift. Leasing is no longer just a facilities decision — it’s a brand, marketing, and culture decision, too. 

Organizations now ask: 

• Will this space support our identity and values? 

• Can it help us attract and retain top talent? 

• Does the property align with our customer and audience expectations? 

• Will the surrounding environment amplify our brand? 

  
  

Spaces that check these boxes will lead the market. 

How Owners and Developers Can Respond 

CRE stakeholders can succeed by: 

 1. Thinking Like Curators 

Actively curate environments considering interactions among businesses, consumers, and communities. 

 2. Designing for Flexibility 

Flexible infrastructure and modular spaces allow businesses to update their experiential offerings. 

3. Leveraging Data & Feedback 

Smart technologies and analytics inform strategic improvements and demonstrate experiential ROI. 

4. Creating Shared Value 

Collaborate with businesses on branding, events, and community activities to enhance satisfaction and retention. 

Conclusion 

The experience economy represents a fundamental shift in valuing physical spaces in commercial real estate, driving meaningful change. 

Spaces prioritizing emotional connection and engagement outperform utility-focused properties. For businesses and property owners, the experience economy redefines real estate as platforms for storytelling, differentiation, and lasting human connections.