Revamping Commercial Properties for New Use
Major changes in the way people shop, work, and interact have left the commercial real estate market on edge. In retail, the continuous growth of e-commerce has had a devastating effect on once prominent brick-and-mortar businesses. Traditional office buildings are struggling to keep up with shifts in workplace dynamics and the rise of the work-from-home employee. As a commercial landlord, these developments can feel extremely discouraging. However, instead of focusing on the negatives of change, it’s important to keep in mind that an evolving market is always ripe with opportunity. A savvy landlord will take advantage of disruptive shifts and seize the competitive edge by revamping commercial properties in their portfolio for modern use. Here are a few ways your properties can be re-purposed and revitalized for years to come.
Re-purposing Retail Units
Updating with the Market: Adaptive Reuse
As time goes on, communities change and adapt to the world around them. The physical structures that make up those communities should be no different. Some locations, like old hotel buildings, lend themselves well to being completely remodeled and upgraded to better serve their original purpose in a more modern fashion. Others, however, can be better utilized in new ways. With the right effort and vision, aged or outdated buildings such as factories, warehouses, and even power plants can be transformed from abandoned eyesores to thriving community spaces. This process, adapting an old site or building to an entirely new purpose, is called adaptive reuse. For instance, the Pearl in San Antonio was a former brewery that has now been re-purposed into a combination of higher class restaurants, shops, bars, and even office spaces. Modern-day elements have been combined with the rustic feel of the historic brewery, resulting in an elevated experience for its countless visitors.
Adding Residential Units
Even if your property’s current purpose is commercial, residential units may be a viable addition to boost its appeal. One of the most successful examples of such a revival is The Arcade Providence in Providence, Rhode Island. Once a failed mall, the building is now a mix of shops and residential micro-units with a wait list of over 4,000 people. In addition, the newly added units bring in a rent-per-square-foot (RPSF) amount that is 2.5 times higher than the RPSF for the Providence metropolitan area as a whole. Another example of a commercial-to-residential conversion is Baltimore’s Gunther Apartments. Repurposed from an old brewery, the apartments are currently demanding some of the city’s highest rental rates.
Thinking Outside the Box
Many former shopping centers have undergone non-traditional routes in order to recoup foot traffic. Malls especially have seen a rebirth in a variety of ways, from self-storage to haunted houses. Mixed use applications have also been extremely common due to the large, open spaces. After closing in 2011, the former Hickory Hollow Mall in Tennessee reopened as the Global Mall at the Crossings, now including a library, recreation center, a satellite campus for Nashville State Community College, and even a community ice rink. Medical facilities such as the Vanderbilt University Medical Center and University of Kentucky HealthCare have also leased out former mall space for clinics and administrative uses.
Optimizing Office Space
Enhancing the Workplace Dynamic
To the delight of millennials all over the country, the cubicle is no longer the king of the office. Modern office layouts are reflecting changes in the way companies operate – working areas are becoming more open and including collaborative meeting spaces to encourage teamwork. With more and more people working from home, many businesses have realized that investing in their workspace can directly affect their bottom line. In addition to being a huge draw to a prospective talent pool, an attractive office can make employees more willing to come in as opposed to work from home, allowing landlords to keep units occupied.
Let There Be Light
When designing or modifying an office, natural lighting should be a huge point of emphasis. In addition to saving money on artificial lighting during traditional business hours, there are numerous physical and psychological benefits filling your property with sunlight. Utilizing bright, lively colors can also help to keep a positive atmosphere and high energy in the building.
These days, there’s a good chance that your office tenants are relying immensely on technology to run their business. While other desired office amenities (cafes, gyms, kitchens, etc.) can take up more space or capital than you’d like, investing in strong internet speed can go a long way. As everything around us seems to be increasingly wireless, having reliable internet connectivity is critical. It never hurts to survey your tenants to ensure that they are satisfied with their work environment.
Emphasizing the Experience
Regardless of which avenue a real estate re-purposing has taken, the one thing that will keep the foot traffic coming is the experience that the location provides. Many re-purposing projects have become high-end or non-conventional for this reason. It gets people talking and engages the senses in a memorable way that online experiences cannot emulate. The right project (whether retail or office) can spark new life into any community, and in that regard, commercial properties will always have an advantage in a digital world.
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