The new headquarters of a fast-growing pet food company won't just have desks and electric-vehicle charging stations for employees. There's also dedicated office space for their dogs.

It's one example that illustrates two practices that can be found in the workplace these days as a result of reduced office demand: Landlords are sometimes more willing to design space solely to reflect the sensibilities of incoming tenants they are trying to lure, and some companies are catering to their employees' furry companions.

Freshpet, a seller of refrigerated fresh food for dogs and cats, will be relocating to a custom-built headquarters in Bedminster, New Jersey, with a dog park out back, an indoor watering station for pets, and a cordoned-off area where a pet sitter can watch felines and canines when their owners are occupied, perhaps attending a meeting, according to CEO Billy Cyr. The company also offers benefits such as "paw-ternity" leave, meaning time off when a worker adopts a pet, and bereavement leave if a pet dies, he said.

Plans for the company's new corporate home under construction show how some landlords and employers can be willing to accommodate employees — some of whom adopted animals during the pandemic — to make working in the office more palatable. That includes providing space for pets, most often dogs but sometimes also cats, a move tech companies such as Google have done and more firms could do at some point, according to the brokerage JLL.

At the same time, office buildings are becoming more customized for their tenants. As part of that shift, it's not unusual these days for office properties to be bought by the firms that will occupy them — or for the buildings to be specifically constructed for upcoming tenants, as is the case with Freshpet, according to Phil Mobley, CoStar's national director of office analytics.

"Occupier-specific buildings are indeed a trend," Mobley said. "Space users have been on the buy-side of nearly a quarter of office deals in the past year, whether that is a result of buying buildings they occupy or buying a building to move into."

There are high-profile examples of build-to-suit offices in Dallas, including Goldman Sachs and Bank of America, he said, and other much-smaller examples in high-growth markets, even as construction of all types of office properties has decreased.

Earlier this year, JLL produced a report on why more companies are opening their doors to dogs, citing in part the "proliferation of lockdown puppies." Household names like Google, Salesforce, Uber and Ben & Jerry’s are now welcoming pets, mainly canines, into their offices, according to JLL.

There can be obstacles to both the pet policy and tailor-made offices. When it comes to pets, some employees can be allergic, and the animals could prove to be a distraction. As for building offices to suit specific uses, landlords have to be willing to make changes to secure a new tenant and the property has to be able to accommodate the changes.

Even so, the flexibility of letting pets in the office "is one of the perks more companies are using among hybrid work models and efforts to get people back in the workplace," JLL said. "It’s also caused by the rise in so-called lockdown puppies, acquired when many employees became dog owners during the pandemic. In the U.S., 78% of pet owners surveyed by Forbes Advisor acquired pets during the pandemic."

Even the European Commission last year began discussions on dog policies for European Union institution buildings, according to JLL.

“More companies are opening their doors to dogs, and that’s coming at a time of serious discussion about the workplace, its appeal to hybrid employees and occupancy levels,” Emma Hendry, people experience managing director for JLL Consulting, said in a statement. "Being dog-friendly offers companies a big opportunity to engage employees and potentially boost that days-per-week average.”

There are not only practical benefits for dog owners — like not having to continually check a camera monitoring pets at home or paying a dog walker — but well-being benefits as well, according to JLL. The brokerage cited a study by the Harvard Business Review, University College London and the National University of Singapore that found that pets contribute to a more pleasant and social work environment. 

“A dog under a desk may go unnoticed, but equally it can spark new conversation between colleagues and greater interaction. It’s a great icebreaker,” Hendry said. “Stress levels have been proven to lower.”

The large companies that are pet-friendly include a major Seattle e-commerce business that JLL didn't name. That firm has about 10,000 dogs registered to come to the office equipped with dog-friendly features such as "paw-wash" stations.

"Tech giant Google has also long been a 'dog company,' putting its policies into its code of conduct well before the pandemic ushered in a new wave of dog owners," JLL said.

However, there are a number of large employers that do have blanket no-dog policies, given the scale of their workforce and size of their workplace, according to JLL.

“There’s of course a valid point that for some: it could affect focus and concentration,” Hendry said. “Impact on colleagues who aren’t dog lovers, or who may even be allergic, should also be considered.”

Freshpet is leasing its new 30,000-square-foot, eco-friendly facility in Bedminster, an affluent suburb that sits amid several major highways. The building is being constructed by Advance Realty Investors on vacant land on the developer's 15-acre campus, home to its headquarters, along Route 206. Advance is revamping and rechristening the site as Bedminster Village Square, with plans to add roughly 20,000 square feet of retail, dining, and amenity space to the property as well as Freshpet's headquarters.

It comes as U.S. office landlords remain challenged, with companies trimming workforces or allowing employees to have hybrid work schedules. The national office vacancy rate is 13.8%, according to CoStar data, the same as for Northern New Jersey. Advance officials said they were able to obtain financing for Freshpet's headquarters — in a difficult macroeconomic environment — after the township of Bedminster approved their rezoning request for the project and because of the tenant, a global brand.

Advance's plans to bring stores and restaurants to its headquarters' campus is also on track with another technique some developers use to boost office attendance, namely adding features to suburban office properties to make them more appealing to tenants and their workers. Advance expects to draw customers to the new retail space at Bedminster Village Square from not only Freshpet but Dallas-based AT&T, which has a new regional headquarters across the highway at 1405 and 1425 Route 206, where it leases 230,000 square feet.

Freshpet's new headquarters is scheduled to be completed early next year. It will house roughly 100 Freshpet employees, who are allowed to bring their pets to work, according to Cyr. He told CoStar News about the on-site amenities for pets at the building's groundbreaking last week.

"We encourage our employees to bring their pets into the office," Cyr said. "I bring my dog in."

At this time, Freshpet's policy welcomes dogs and cats, but no additional pets.

Being pet-friendly in some ways is easier for smaller companies and new ones, Hendry said, adding, "At startups, it’s often the founder who has a dog, which then becomes a de facto office mascot. There’s a nimbleness to smaller firms and that may mean less formal structure is needed.”

Freshpet does business in five countries and has nearly 1 million square feet of production facilities at several sites, with sites in Bethlehem, Pennsylvania, and Ennis, Texas, Cyr said. Freshpet's headquarters had been at 400 Plaza Drive in Secaucus, and it's now operating out of temporary space at Advance's Bedminster campus, according to Cyr, that offers "employee amenities and work spaces deigned for the world of today, not the pre-pandemic world," Cyr told attendees.

As part of the redevelopment of its campus, Advance, a real estate firm owned by the Cocoziello family, plans to update the 87,000 square feet of existing office space it has there. Like the Freshpet office, Bedminster Village Square has features that go beyond traditional office space, such as additional landscaping and a system of pedestrian paths connecting to an extensive hike-and-bike infrastructure in Bedminster's open-space network.

Now publicly traded, Freshpet expects to hit $1 billion in net sales next year and has a stock market valuation "that's more than $5 billion starting from nothing," Cyr said. The tagline in Freshpet's TV ads reflects a culture that isn't quick to draw a line between people and pets: "It's not dog food, it's food food."

As for pets coming to work, JLL said that with dog ownership showing no signs of peaking, more companies could need to adapt.

“Many dog owners are now realizing a dog is for life, not just for COVID-19,” Hendry said. “So I’d expect to see more companies include a range of dog policies in their workplace strategies.”

Jeff Garibaldi and Jackie Madden of The Garibaldi Group represented Freshpet in the lease. ConnectOne Bank provided the construction financing. Gladstone Design provided civil engineering and site design, and Iron Hill Construction Management is serving as general contractor.