News • Feb 20 2024
news • Jul 25 2023
When it comes to property development, the only constant is change. Always evolving and transforming, the industry demonstrates how the spaces we spend time in reflect the changing nature of our daily lives. Nowhere is this more obvious than in the commercial real estate world.
Across the country, buildings are being converted from unused spaces into something new. Whether it’s an office building or a pickleball court, creative conversions are an opportunity for brands to think outside the box, and breathe new life into buildings.
When the pandemic hit, downtown areas that once served as hubs for office workers began to empty out. With remote and hybrid work skyrocketing, urban office buildings that used to draw employees into cities on a daily basis began to sit empty. While there has certainly been a modest return to the office since then, some experts have determined that these underutilized office spaces could potentially help to solve America’s massive housing shortage.
In cities like Dallas, New York and Washington D.C., the trend of adaptive reuse is likely to continue. According to a study by global real estate firm Avison Young, roughly one in three office buildings in the largest U.S. cities are well suited to be converted to multifamily residential properties. Of course, this endeavor isn’t without potential challenges. From lack of parking in downtown areas to the typically low ceilings of offices, some people are skeptical of adaptive reuse.
But as Americans reconsider the way they work, experts are hoping people begin to look at the traditional home layout in a different manner as well. “There may be a way that those sorts of conversions actually can accommodate a different way that people are living,” Segun Idowu, Boston’s chief of economic opportunity and inclusion, told the Globe.
It can feel like a major retail chain that used to be a prominent force in the shopping world descends into bankruptcy every day. While America has certainly seen some previously-successful stores collapse, the evidence shows that there has also been tremendous growth. Active physical store openings actually exceeded closings last year for the first time since 2016, according to Coresight Research.
Some long-time retailers, like Bed Bath & Beyond, have chosen to close up shop, but they’re also transforming into something new and exciting. For example, chains including TJ Maxx, HomeGoods and Ross have already grabbed hold of BBB’s vacant storefronts. However, it goes far beyond the traditional retail experience.
These days, retail stores are being transformed into experiential retail venues that allow shoppers to take part in a new way, like this shopping mall turned into a food hall. Even fitness chains are getting in on conversions, with Planet Fitness planning to open about 200 new gyms a year in large spaces that were previously Sears and Toys “R” Us stores. It’s a strong example of how the retail industry is constantly transforming to fit the needs of the current buyer.
In a strong demonstration of how developers are thinking outside the box, there’s evidence of many unique building conversions happening right now.
For example, you may have heard how shopping malls and big stores are being converted into pickleball courts. There’s also significant growth in the life sciences field, with previous retail space being transformed into lab and research and development space. There’s even been transformation to industrial space, since warehouses require massive square footage similar to big box stores.
Another unexpected conversion is educational space, like the Texas shopping mall which now houses Austin Community College. And in one of the most unexpected transformations, some properties have even been transformed from retail space into office conversions, like the former Macy’s store in California’s Westside Pavilion, which repurposed 240,000 square feet of retail space into a creative office campus.
Each of these conversions is a strong example of the creativity quotient. Commercial property owners recognize how essential it is to remain profitable, and are therefore increasingly motivated to pursue new tenants in creative ways.
Consider New York’s Industry City, which has done 150,000 square feet of new leasing this year. Using flexible and reconfigurable floor plates, Industry City provides tenants with smaller spaces and expansion potential, Fast Company reports. They also emphasize high-quality amenities, like a fitness center, programming and events, a conference center, and desirable food options. Clearly, employees are eager to return to the office when it provides options like these. At a time when the modern workplace is constantly changing, it’s fascinating to see how commercial space owners are constantly reinventing their inventory.
When it comes to conversions, a building’s potential really is in the eye of the beholder. No matter the original function of a building, almost any space can be transformed for the future. As the industry constantly changes, it’s vital that companies recognize the value of having a strong vision for what’s to come.
Generis Collective can be your single point of contact for all your property development needs- providing leadership across every stage of your project and managing all moving parts. Let’s connect and start transforming your guest experience.