August 2024 - Commercial Asset Preservation

Transforming Office Spaces: Repurposing Underutilized Structures in the United States

August 26, 2024/in Uncategorized

Reprinted from Arch Daily

River Point / Pickard Chilton. Image © Angie McMonigal

Written by Ankitha Gattupalli
Published on August 19, 2024

The continuation of remote work practices has altered cities’ bustling downtown areas along with the traditional office landscape, leaving behind many vacant spaces whose future purpose is a matter of speculation. Four years after the onset of hybrid working policies, office occupancy rates in urban centers remain lower than pre-pandemic levels, signaling a long-term shift in the work environment. Some developers have aimed to reposition these buildings while other are seeking alternative uses of vacant buildings in central location. While both approaches prove beneficial in their own ways, the potential for repurposing office buildings is vast and exciting. From residential living to cutting-edge research facilities, architects and developers explore diverse possibilities and challenges of transforming these underutilized structures into thriving new spaces.

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Office vacancy rates in the United States have sharply increased, with forecasts indicating that a large share of office spaces could be left empty in the near future. In reaction, there’s been a recent trend in office-conversion projects across urban areas. By early 2024, nearly 70 million square feet of office space were already in the process of being repurposed, and the number of conversion completions projected to more than double compared to last year. Among the many office-conversion projects anticipated for completion, most are being transformed into multifamily residential spaces. Though this is a popular option, there are many other productive ways to transform and revitalize office spaces:

Office to Residential

Converting offices into residential buildings has become a highly popular solution in the United States particularly to address housing shortages in urban areas. This approach revitalizes aging office buildings in major cities like Boston, Cleveland, and New York City as an alternative to new construction. Some architects have proposed creating standardized housing units that can be “plugged into” existing office structures, similar to Le Corbusier’s plug-in city concepts. Addison Godine’s Urban Housing Unit is an example of this approach to help create and sustain middle-income housing in Boston. These prefabricated units could be slid into gutted office floors, with the building providing basic utilities and support structures.To make these conversions successful, several key design changes are typically implemented. Floor plans are reconfigured to create individual residential units with suitable room divisions, and essential amenities like bathrooms, kitchens, and updated plumbing and electrical systems are added. Enhancements such as enlarging windows to improve natural light, along with incorporating features like laundry facilities and fitness centers, are also common.

Office to Hotel

Similar to office-to-residence conversions, the opportunity to repurpose commercial space into hotels prove beneficial when located in prime downtown areas near amenities and attractions. Historic office structures lend themselves well for boutique hotel concepts. For example, Aspen Hospitality plans to transform 10 vacant office floors at 10 Rockefeller Plaza, New York City into the 130-room Little Nell luxury boutique hotel. Experts highlight that about 25% of Manhattan’s vacant office spaces, particularly older Class B and C buildings, are suitable for such conversions due to their smaller floor plates and favorable ceiling heights. The rise in hotel room demand, driven by strong tourism recovery and restricted new hotel developments, has made these conversions lucrative

These projects require significant modifications such as, updates to mechanical systems and adherence to new environmental regulations. Floor plans need to be reconfigured to accommodate guest rooms and suites and allow for each room to be fitted with private bathrooms. HVAC systems must be upgraded to allow for individual room control, and new features such as lobby and reception areas are to be created. Additional amenities, including restaurants, meeting rooms, and fitness centers, can be added to enhance the guest experience.

Office to Life Sciences Building

Growth in the life sciences sector has resulted in a demand for well-designed laboratory and research spaces. Office conversions, particularly in biotech hubs, have been meeting these needs. Typically, these conversions involve repurposing a portion of office space for lab use to generate rental income comparable to that of a newly constructed life science facility. The cost savings from converting an existing office building can be substantial, often current expenses by at least 50% compared to a new development. Office-to-lab conversions accounted for nearly 10 million square feet of new lab space in the largest U.S. life sciences markets by the end of 2021

Office to life science building conversions benefit from proximity to established life science clusters, supporting the attraction of top talent and collaboration among researchers. To adapt office buildings for lab use, several design modifications are essential: floors must be reinforced to support heavy equipment, ceiling heights increased for specialized ventilation, and electrical and plumbing systems upgraded to meet lab standards. Additionally, creating specialized spaces like clean rooms and improving loading dock access are crucial for supporting the demands of life science operations.

Office to Healthcare Facility

As healthcare needs expand, converting offices into medical facilities has become an appealing option, especially for properties already located near hospitals or in areas with insufficient medical services. This trend is being driven by a demand for accessible healthcare. Around 10,000 baby boomers are retiring daily in the United States and this has resulted in a need for convenient one-stop healthcare solutions. Recent examples, such as the renovation of a three-story office building into a state-of-the-art medical facility for Summit Health in Long Island, New York, depict the potential of these conversions.

Essential design modifications for these conversions include reconfiguring spaces to accommodate waiting rooms, exam rooms, and procedure areas; upgrading HVAC systems for better air filtration; enhancing plumbing to support medical equipment; improving accessibility features; and installing specialized medical waste disposal systems.

Office to Storage Unit

In locations that are less well-connected, there have been instances of converting office buildings into self-storage facilities as a cost-effective solution to meet the demand for storage units in the United States. Start-ups like Stuf emerged during the pandemic and repurposed vacant offices, empty garages, and unused storefronts instead of constructing new storage warehouses. Stuf lays its focus on urban areas by collaborating with landlords to install largely automated storage units into these underutilized spaces, generating revenue for both parties.

Key design changes to convert office buildings into storage facilities include the ability to remove interior walls to create large, open storage areas. Floors may need reinforcement to handle heavy loads. Climate control systems could be installed to protect temperature-sensitive items, and security systems such as surveillance cameras and access control systems are to be added to ensure safety of the stored items.

Repurposing office buildings into residential spaces, hotels, laboratories and more are successful at addressing specific market demands while also promoting sustainability in the construction and real estate industry. The adaptive reuse of underutilized properties allow for minimized waste and reduced carbon emissions associated with new construction. Additionally, these projects benefit from a shorter turnaround time compared to developments started from scratch. Conversions offer a streamlined approval process and quicker construction timelines, offering an efficient solution to meet evolving needs.

The trend in office conversions raises important questions about the future of commercial real estate and the need for adaptable design. The multiple office conversions have made it clear that the lifecycle of a building may involve multiple repurposing. To facilitate these future conversions and maximize the long-term value of commercial properties, architects and developers should consider incorporating flexibility into their initial designs. This forward-thinking approach of “future-proofing” designs involve creating spaces with versatile floor plans, robust infrastructures, and easily modifiable systems. This strategy not only enhances the longevity of buildings but also potentially reduces the costs and environmental impact of future conversions.

This article is part of the ArchDaily Topics: Multi-Purpose Spaces. Every month we explore a topic in-depth through articles, interviews, news, and architecture projects. We invite you to learn more about our ArchDaily Topics. And, as always, at ArchDaily we welcome the contributions of our readers; if you want to submit an article or project, contact us.

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Using Vacant Commercial Spaces As Affordable Artist Studios Is a Win-Win

August 20, 2024/in Uncategorized

Reprinted from Nexycity.org. Cinnamon Janzler

Florida’s Zero Empty Spaces connects artists with spaces in otherwise vacant spots to bolster their careers, activating unused space in the process.

Zero Empty Spaces celebrates the opening of its 26th location in St. Petersburg, Florida, inside Simon Property Group’s Tyrone Square Mall, on July 30, 2022 with the initial resident artists of the space. (Photo courtesy Zero Empty Spaces)

Since the pandemic, large swaths of office space across the United States have sat vacant. The downtown areas and other commercial centers that have enjoyed the built-in business that office workers bring have gone from bustling to bust.

At the beginning of 2024, 13.7% of office space was empty, while 7.6% of multifamily buildings, 4% of retail spaces and 5.6% of industrial spaces were vacant. As cities scramble to find creative new uses for these spaces, from climbing gyms to small-scale manufacturing to vertical farms, one organization in Florida has a stop-gap answer: Use the empty space for affordable artist studios.

Since launching in June 2019, Zero Empty Spaces has placed more than 600 artists in 10 commercial buildings in 10 cities. Most are in Florida but extend as far as Little Rock, Arkansas, and Boston.

Placements last about 18 months on average, with some lasting for years. Artists pay between $2.50 to $4.50 a square foot, including all utilities, for spaces that range from 80 to 250 square feet. Artists must commit to working on at least one piece a month and being in the space at least one day a week between noon and 5 p.m.

Prior to the pandemic, Zero Empty Spaces co-founders Evan Snow and Andrew Martineau had already been working on innovative ways to bolster the arts in Florida’s Broward County where they’re based.

“Our community has always been considered a cultural wasteland,” Snow explains. “We’re in between Miami to the south and Palm Beach to the north.”

Having spent plenty of time in Miami’s Wynwood Arts District, which helped turn the city’s warehouses into a hotspot for the arts, Snow and Martineau decided to play on their community’s water-based strengths and host art shows in mansions that could only be accessible by boat.

“Long story short, we did that for four years up until COVID,” Snow says. By summer 2019, they had worked with more than 1,000 independent artists, many of whom lamented the perennial challenge of finding affordable studio space.

At the same time, brokers, developers and members of the county’s real estate community were asking Snow and Martineau to host art shows in their commercial spaces.

“We saw all these ‘For Lease’ signs and said, what if we can make [Broward County] one of the most affordable places for artists to create and collaborate?” Snow says. Equipped with Martineau’s background in retail development for shopping centers, which included vacancy management strategies that transformed vacant mall spaces into commission-free art galleries, the idea for Zero Empty Spaces was born.

The duo reached out to Fort Lauderdale’s mayor and shared their idea to activate vacant commercial spaces to create affordable artist studios until permanent tenants could be secured. The mayor suggested reaching out to the man who held the most property in downtown Fort Lauderdale at the time. He happened to have a whopping 19 vacancies.

Zero Empty Spaces brought in nine artists to fill one of the developer’s spaces, which had actually been an art studio originally. “We had one of the best attended grand openings in anything in Fort Lauderdale’s history,” Snow says of the event, which won local and national news coverage.

About three months into that activation, the landlord found a permanent tenant. “We just ask for a 30-day notice to vacate when that happens,” Snow says.

Zero Empty Space’s Boca Raton location is the largest single office facility in the state, according to Giana Pacinelli, director of communications for CP Group, the location’s commercial partner. She tells Next City that working with the organization “has allowed us to activate our vacancies while bringing a special amenity to our existing office tenants.”

Pacinelli says the tenants enjoy seeing the work of the 17 artists placed there as they move through the campus. They’ve ultimately developed their own relationships with the artists, even purchasing their work as gifts or for their personal collections. “The collaboration helps us develop a productive and creative ecosystem that tenants won’t find at other office buildings, giving us a competitive advantage,” she says.

Naturally, there are benefits enjoyed on the artists’ side as well.

The emerging, mid-career and established artists Zero Empty Spaces works with are able to afford studio or gallery space in popular parts of town that would otherwise be unattainable. And in the process, they can enjoy opportunities that might otherwise evade them.

The Fort Lauderdale gallery, for example, was located on a street that Snow compares to Rodeo Drive. “Artists would never have been able to afford [space] there,” he says. “Some of [our artists] have had tens of thousands of dollars of sales and made life-changing connections, gotten exposure to the press.”

Most recently, Zero Empty Spaces is working to expand beyond in-person events. They’re working to launch an online store so customers nationally and internationally can support their artists.

“It’s going to be another ‘win’ scenario that helps artists sell and get discovered,” Snow says.

This article has been corrected to reflect that Zero Empty Spaces is not a non-profit organization, to update the number of artists at the Boca Raton location, and to indicate that the Fort Lauderdale location was a gallery rather than a studio.

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Cinnamon Janzer is a freelance journalist based in Minneapolis. Her work has appeared in National Geographic, U.S. News & World Report, Rewire.news, and more. She holds an MA in Social Design, with a specialization in intervention design, from the Maryland Institute College of Art and a BA in Cultural Anthropology and Fine Art from the University of Minnesota, Twin Cities.

Vacant since the ’90s? Minneapolis pushes to reduce number of long-empty buildings

August 13, 2024/in Uncategorized

Reprinted from: StarTribune Minneapolis Elliot Hughes

City officials and residents say owners of vacant buildings aren’t under enough pressure to restore their properties to occupancy amid a housing shortage. The Minneapolis City Council unanimously approved a measure Thursday meant to up enforcement.

This property in northeast Minneapolis is one of the longest to stay on the city’s registry of vacant properties. It was condemned in 1998 and placed on the registry in 2001. (Elliot Hughes/Star Tribune)

Some vacant buildings in Minneapolis sit empty and weather away for years, perhaps decades. As the time piles up, according to those who live next door to them, so can the nuisances and safety hazards.

Chimney bricks fall into neighboring yards. Rodents and birds congregate. Fires, fireworks, vandalism, drug use and overdoses ensue.

The Minneapolis City Council, at its regular meeting on Thursday, unanimously got behind an ordinance amendment that could more than triple the financial penalties — up to $24,000 a year — for owners of residential or commercial buildings that are designated as vacant and condemned, unless the owner restores it within a two- or three-year period.

Several council members praised the changes as offering important tools for fixing up hazardous properties. Council President Elliott Payne relayed an example of an elder-care facility that has been “sitting vacant since COVID” near a school and a park in the city’s Windom Park neighborhood.

“It’s been a real problem in my community,” Payne said. “It’s boarded up with squatters coming in on occasion.”

Minneapolis’ collection of 311 vacant and condemned properties is small in comparison to that of other American cities, which can number in the thousands. But more than half are clustered in the city’s predominantly Black North Side, driving down nearby property values and aggravating a shortage of affordable housing.

“Our residents know that those are homes that could be used by families or individuals who are in desperate need of housing or shelter,” City Council Member Robin Wonsley said at a recent committee meeting. “We know many of these properties are in Black, brown and working-class neighborhoods. This is a tool that would definitely help us reach some of our racial and economic goals as a city.”

In Minneapolis, all vacant and condemned buildings are placed on a registry. Property owners pay a flat fee of about $7,100 and the city boards them up and monitors them for trespassing and other issues.

Owners are also required to state a timeline for when the building can either return to code or be demolished. But the city has never required a deadline for doing so.

The proposal, written by Wonsley and Council Member Jeremiah Ellison, would require owners to restore buildings to code in two years, with a third-year option for those who have made headway but need additional time. Afterward, fines can quickly pile up before they total $24,000 a year.

“This is just a really, really great way for us to do something tangible that will impact the daily lives of residents in our city,” Council Member Aurin Chowdhury said.

The number of vacant and condemned Minneapolis buildings is down from the 1,500 that were empty at the outset of the Great Recession in 2008, according to Bryan Starry, who manages vacant and condemned buildings for the city. But the number of properties sitting in that condition today, now 311, is roughly unchanged over the past six years.

Of those properties, more than 130 have been on the list for three years or more. Some stretch as far back as 2001, and one was first condemned in 1998.

There is a range of reasons why owners let buildings sit empty to deteriorate, according to city officials and residents who spoke at the July 9 public hearing. Some owners may not have the funds for rehabilitation. Others may be waiting for an opportune time to make a move on their building as property values increase.

“The problem is that the current fine system provides no incentive to change anything,” Daniel Suitor, a tenant’s rights attorney, said at the hearing. “Seven or eight thousand dollars a year — if my property taxes say anything, the property’s appreciating more than that every year. Much more.”

That leaves problems for everyone else. After three years, vacant properties can reduce by about 1% the value of neighbors’ properties within 250 feet, and those within 500 feet by about 0.27%, according to a study by the Center for Urban and Regional Affairs at the University of Minnesota.

The same study found that vacant properties can increase safety issues, fracture ties among neighbors and leave communities vulnerable to gentrification.

“It’s a stress on the neighborhood,” Ellison said in an interview. “When you have these inactive houses and the neighbors feel like they don’t have any influence over the condition of those houses, it really erodes the spirit of the block, which has ripple effects.”

Link to story: https://www.startribune.com/minneapolis-proposal-would-mandate-annual-fines-of-up-to-24000-for-owners-of-vacant-buildings-that-go-unrestored/600381608?refresh=true

Detroit plans to harness solar power on vacant lots throughout the city

August 5, 2024/in Uncategorized

Reprinted from AP U.S. News:

Trash and debris little an empty lot on Detroit’s eastside, Monday, June 24, 2024/ The eastside neighborhood is one of a few that are expected to receive solar arrays as part of Detroit’s efforts to remove blight and find uses for underpopulated areas in the city (AP photo/Corey Williams)

DETROIT (AP) — Patricia Kobylski remembers when there were lots of people living in her eastside Detroit neighborhood. There aren’t as many anymore — and haven’t been for a long time.

“Right now, on our side of the street there are probably only 10 houses. Should be 50, 60,” the 78-year-old Kobylski said Monday after the city announced a plan to bring to her neighborhood solar arrays, which are blocks of ground-based solar panels.

Detroit is using something it has plenty of — vacant land — to produce something the city needs — clean and relatively inexpensive energy.

Pending approval by the City Council, Kobylski’s Gratiot-Findlay neighborhood eventually will see solar arrays on about 23 acres (9.3 hectares) of land. Not far away, another eastside neighborhood is to get arrays on nearly 41 acres (16.5 hectares), while a third will get arrays on nearly 40 acres (16.1 hectares).

Five other neighborhoods are finalists to also get solar arrays. Resident groups had to apply to be considered for the program.

The city is looking to build solar energy arrays on about 200 acres (81 hectares). The arrays would produce enough clean energy to offset the electricity used currently by 127 municipal buildings.

Detroit will use $14 million from an existing utility fund for up-front costs that include acquiring and clearing the land. The solar fields are expected to ultimately save the city $4.4 million per year.

“We have seen property values and income tax revenues grow dramatically in other neighborhoods where the city has made investments,” Mayor Mike Duggan said. “I’m confident our $1.1 million-a-year investment in these long-forgotten neighborhoods will produce a real recovery in these communities.”

The city touts its Solar Neighborhoods project as a national model for finding solutions to climate change. Duggan revealed plans a year ago following a challenge by President Joe Biden for cities to use more solar power while taking advantage of the Inflation Reduction Act, which provides federal tax incentives of 30% or more of the costs to cover renewable energy.

Over the past year, neighborhood groups held meetings to consider hosting solar fields. Those selected will receive $15,000 to $25,000 in community benefits to pay for energy efficiency upgrades. They can choose to use the benefits for new windows, roof repairs, new energy efficient appliances, new furnaces and hot water heaters, better home insulation, smart thermostats, energy-efficient lighting and battery back-up for outages.

Duggan said he hopes to break ground on the project by the end of the year.

Donna Anthony, 63, also is in one of the three neighborhoods announced Monday. She wants to get new attic insulation, vinyl siding and a new generator for her home. Anthony also looks forward to not having vacant lots and abandoned houses nearby, which often become sites for illegal dumping.

“When you come outside you get depressed when you see all this trash being dropped,” Anthony said of discarded tires and construction materials. “You go out and clean it up and it’s right back there the next day.”

Under Duggan, the city has made leaps in stabilizing and fixing up neighborhoods that had been deteriorating and in advanced stages of blight. Primarily with federal funds at its disposal, Detroit has demolished at least 24,000 vacant structures since 2014, according to the mayor’s office. Hundreds of others have been transferred to the Detroit Land Bank which has fixed up many houses and resold them to families. Dozens of vacant lots — left by the razing of homes — are being sold to people living next door to maintain and beautify what otherwise would become overgrown, weedy eyesores.

Secure solar farms could also be an aesthetic benefit in these areas, according to Sarah Banas Mills, director of the Center for EmPowering Communities, Graham Sustainability Institute at the University of Michigan.

“There are not very many communities that would say ’You know, the thing that would make this better is a solar farm,’” Mills said. “A neighborhood might want a solar farm there to effectively fight illegal dumping. That’s a really unique way of thinking.”

“On more developed land, places that aren’t green field right now, solar is sometimes perceived as a negative change to the landscape,” Mills continued. “In places that already are industrial, it is as an improvement.”

About 633,000 people call Detroit home — more than a million fewer than the 1.8 million who lived in the city in the 1950s. What Detroit may lack in population, it makes up for in land. Currently, about 19 square miles (49 square kilometers) of the 139-square-mile (360-square-kilometers) city is vacant.

“The challenge with solar is that it’s an industrial investment,” said Anika Goss, chief executive of Detroit Future City, a nonprofit focused on improving the lives of the city’s residents through community and economic development. “Unlike trees or some sort of stormwater management, it has its downsides,” she continued. Since the panels absorb energy from the sun, they can also create heat islands — or parts of cities with higher average temperatures than the surrounding areas — “in places that might already have challenges with heat islands.”

Goss also said she is disappointed that the energy produced by the solar arrays will not be used to lower utility bills for residents in the selected neighborhoods.

“The checks that they’re giving as a community benefit for energy, I think that’s a good thing,” she said. “They can use it for window upgrades. They can use it for their own stormwater management. It’s not enough for a new roof, but it could be enough to put something in that could make their own home energy efficient.”

The city says 21 homeowners in the selected neighborhoods have chosen buy-outs to allow for demolition of their houses to make way for the arrays. Renters will receive the cost of relocating and 1.5 years of free rent when they move.

Link to article: https://apnews.com/article/detroit-solar-energy-array-which-neighborhoods-f84e5c4cc7c62fdc845bc74e901d637c

Archive for month: August, 2024