![]() ![]() We need to ask questions like: “How are we making coming to the office better than staying at home?” Creating more space that caters to less traditional office space requires increased flexibility to maximize both efficiency and comfort. ![]() Coworking spaces, technological advancements, and remote work have pushed us forward in terms of how we think about office space. So, what are the needs of the post-COVID economy, and how can we position all classes of office space for the future? Without claiming to have a crystal ball, some preferences and policies are emerging that we can get in front of now. Retrofitting an underutilized building-even if it’s basically just the shell-will often be 50% less costly than a new build, not to mention more environmentally friendly. This leads to a need (and an opportunity) to change how we think of those lower classes of real estate and to reposition them for new uses. In the post-pandemic world, high-quality HVAC systems and more space will simply be more desirable. I wrote in more detail on the different classes of commercial real estate here.Īs companies look to reduce their footprint, resulting in more affordable A-class spaces, B- and C-class spaces are unlikely to come back to widespread office use. B-class and C-class are older and sometimes difficult to retrofit into a true A-class space. A-class space includes the most modern facilities with higher ceilings, efficient large floor plates, more elevators, modern HVAC systems, and often a LEED certification-all more desirable post-COVID. While there isn’t an exact standard to classify office space, there are three classes that are generally used. Project office space upgrade#Making that upgrade will be cheaper than any year in recent memory. Choosing to upgrade office space is appealing on several levels: location, amenities, efficiency, prestige. The flight to quality is exactly what it sounds like-companies making the move to newer and nicer offices. I do, however, clearly see an accelerated flight to quality office space, something I wrote about previously. There are more questions than answers out there when it comes to dealing with fallout from the COVID-19 pandemic. There’s no point in mincing words, we are in crisis mode. First, an honest assessment of commercial real estate Planning tools at our disposal can disentangle rules, policies, and overlays, while quickly repurposing and refinancing buildings for different uses.ĭoing so will create greater business certainty, leading to business investment and long-term prosperity for municipal coffers. ![]() The good news is that we can start building a roadmap to get ahead of the problem. The National League of Cities recently estimated that US cities could face a $90 billion shortfall this year because of commercial real estate decline. As I pointed out in a previous post, while downtowns average just 1-3% of city land, they account for 10-30% of citywide tax revenue. When we talk about downtown commercial real estate, the stakes are high. ![]()
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