The real estate industry experienced a high-performing first half of 2022, but declining transaction volume and fluctuating rates have left the market unstable. Real estate prices are tanking, deals are falling through, and lenders are wary. For transactions that make it to the closing table, the assets are limited. To pivot alongside an evergreen market, investors are turning to adaptive reuse.

Adaptive reuse is exactly what it sounds like. It is a shift from demolition and destruction to repurposing existing structures. The practice has become prevalent as the inventory of choice properties and vacant sites reduces, according to GlobeSt. Not to mention, adaptive reuse satisfies the emerging demand for sustainable development and the need for efficient use of resources across the built environment. The reuse of building materials involves saving a high percentage of embodied energy. Finding new uses for older structures significantly reduces the energy consumption associated with demolishing a structure and building a new one to replace it. This is especially important as a large part of a building’s carbon emissions comes from its materials, from fabrication and delivery to assembly, as reported by ArchDaily.

The term “adaptive reuse” emerged and gained popularity during the mid-1970s and was introduced to address the increased anxieties about finite natural resources and development space. However, the practice dates back further than that, and some of the earliest examples are traced back to the Renaissance. Fast forward to the 21st century, adaptive reuse presents vast opportunities for communities, developers, and architects to find renewed purpose in vacant, underutilized, or even historically-significant structures. In recent decades, the types of projects carried out have significantly evolved. From urban industrial spaces into artist’s lofts to vacant retail anchors into massive mixed-use developments, the ability to tap into other spaces such as office, food and beverage, residential, and healthcare solidify a promising future for many communities.

Today, millions of square feet of interior spaces sit vacant each year. According to the Harvard Business Review, the government alone owns an estimated 45,000 underused or underutilized buildings, plus abundant surplus land. Not to mention, e-commerce is at an all-time high, and hybrid/fully-remote working is evidently here to stay—resulting in vacant retail and office properties. Fortunately, developers have taken over empty structures, repositioning and rebranding them completely, while others have repurposed the spaces they have to be used in ways that are more conducive to the current environment. Depending on the configuration of the existing space, retailers can repurpose vacancies in a manner that requires minimal disruption to the original infrastructure of the building. Some ways retailers are repurposing spaces and adapting to the evolving times include focusing on malls for medicine, commercial office spaces for multifamily residential, dark anchors for fulfillment centers, and malls for mixed-use developments.

Although adaptive reuse has proven to be an efficient way to revitalize communities and cater to a new generation of consumers, there are key factors to consider when evaluating whether a project is financially feasible. An existing building will likely have a strong foundation and a structurally-sound core, but if it doesn’t, adding steel reinforcement, beams, ties, or connections to supporting beams and foundation can be a significant cost. Thus, finding a building that is structurally adaptable fit for the end product is imperative. Aside from the internal framework of a building, wiring, plumbing, ventilation, and other infrastructure systems must be considered. There is a chance that everything will have to be torn out completely and re-installed to bring the systems up to code. According to GlobeSt, this single factor can determine the financial feasibility of a project. A thorough inspection and testing are required to ensure that adaptive reuse is the best option.

In addition to the possibilities we’ve witnessed thus far, adaptive reuse presents an opportunity for creative thinking and a chance to give back to communities, especially in underserved neighborhoods where services or resources are lacking. In addition to retail, mixed-use, healthcare, and industrial, architects are exploring the viability of converting obsolete office buildings to other potential uses, such as affordable housing, schools, and labs.

Given the significant change in consumer behavior and a yo-yoing real estate market, it is up to developers, urban planners, and architects to master plan communities that are resilient and flexible and look towards the future. With sustainability being a massive driving force behind strict building codes and practices, adaptive reuse is not expected to slow down soon. Last year, New York City passed the most ambitious climate target in the country—aiming to achieve carbon neutrality and 100 percent clean electricity by 2050, according to NYC.gov. As other cities follow suit, sustainable building practices such as adaptive reuse will be the go-to choice when building new is not an option. Putting sustainability aside, the fluctuating real estate market is driving developers to target underperforming or misaligned assets in dense urban markets—providing a much-needed product to the surrounding community.

As with all practices, adaptive reuse also comes with its own set of challenges. Due to their nature, these projects present complexities not found in other real estate development projects. Developers must ensure that existing structures can feasibly be transformed to accommodate new uses. Before construction can begin, developers must address and resolve a variety of roadblocks, including those relating to structural, environmental, land use, parking, and traffic circulation, reports REBusiness Online. However, the challenges are often outweighed by the benefits.

A growing population, a warming planet, and a pandemic have, without a doubt, propelled new building practices and methodologies to satisfy changing consumer lifestyles. And although adaptive reuse is not suitable for every renovation, the opportunities it presents for community revitalization are endless. Environmental and economic sustainability, decreased public and social costs, urban renewal, and preservation of local identity and sense of place have made it easy for developers to elect the practice over demolition whenever possible.

By Mark Levine, Managing Vice President, and Cheryl Smith, Vice President at NELSON Worldwide

Georgia Building Authority (GBA), Georgia State Financing and Investment Commission (GSFIC), and the Georgia Department of Corrections (GDC) have selected award-winning architecture, design, and strategy firm NELSON Worldwide as architect of record and design architect for a new Georgia Department of Corrections (GDC) facility in south Georgia. The largest project ever built by the State of Georgia, this correctional facility will provide secure infrastructure, modern technology and improved conditions for incarcerated individuals. This project win is representative of NELSON’s growing Civic, Community, Justice and Education (CCJ&E) practice across the country and marks the state’s first prison in over 20 years.  

“I attribute this win to the great relationship and trust we built over the years with GBA, GSFIC, and GDC along with our phenomenal team we’ve structured at the firm to design this new historic project for the State of Georgia,” says Brad Ewing, CCJ&E regional practice leader, associate principal and project director. “In all of our designs, we take a humanistic approach to create secure and safe spaces that improve the human experience in the built environment. We are thrilled GBA, GSFIC, and GDC have chosen us as partners to pave a new path for correctional facility design in the state.” 

The state-of-the-art, high-tech secure facility is expected to be approximately 800,000 square feet of housing, kitchen, and laundry, as well as spaces dedicated to religious, education, and vocational programs. It will also contain medical and mental health components for inmate wellness and treatment, particularly to support the aging population.  

In its approach, NELSON has conducted an in-depth analysis on current state prison population needs to determine how to best transform the facilities to be more treatment oriented, sustainable, self-reliant, and technologically advanced. With this project, NELSON endeavors to set a new precedent for correctional and detention facilities moving forward. The project will directly support the local economy, creating opportunities for local employment in the Davisboro area and beyond. 

Additional project partners include CGL, HDR, Jericho Design Group, Hansen Architects, Shear Structural, Thomas & Hutton, Conway & Owen, Barnsley Construction Group, Fisher Engineering, Contour Engineering, and SSA Food Service Design +Consulting. Construction is anticipated to begin in November 2023.  

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About NELSON Worldwide

NELSON Worldwide is an award-winning firm, boldly transforming all dimensions of the human experience through architecture, interior design, graphic design, and brand strategy. With more than 700 teammates across 20 offices, the firm’s collective network provides strategic and creative solutions that positively impact where people work, serve, play, and thrive. The team combines industry knowledge, service expertise, and geographic reach to deliver projects across the country and around the world. Visit www.nelsonworldwide.com to learn more.

Meet Amanda Smith, Senior Director of Brand Marketing at NELSON Worldwide. Amanda will develop and execute a holistic marketing strategy that builds awareness for the NELSON Worldwide brand.
 

Q: What inspired you to get into architecture/design/engineering/the work that you do?

Textiles. They were everywhere when I was growing up – my mother was a dressmaker, and my godmother was the design director for a well-known textiles manufacturer. I spent weekends with my mom in fabric stores going through hundreds of bolts of fabric, exploring textures, and learning what fabrics, trims, and notions were used for what. My love for fabric spawned into a passion for color theory, finishes and materials, FF&E, and in the long run, the impact of good design on the human experience.

My shift to brand marketing and strategy was a happy accident. Working for a small company early in my career as a retail design consultant, I was exposed to the inner workings of the business, including the marketing and sales process. As a result, I immediately gravitated to the balance of creative and analytical thinking and how brand positioning, SWOT analysis, audience segmentation, content development, and more could impact brand perception and the bottom line.

Q: Where did you grow up?

I was born 25 miles outside New York City and relocated to the Midwest with my family when I was eleven. At this point in my life, I consider myself 75% Chicagoan and 25% New Yorker, but proud to have been influenced so greatly by both cities. For the last 18 years, I’ve called Chicago my home, where I reside with my husband, son, and newest family addition, Dutch, our rescue pup.

Q: Have you ever been disappointed by something that happened at the time, but ended up being really good for you?

During my FIDER (now CIDA) portfolio review, a pipe burst in the room where student work was reviewed. My portfolio sustained catastrophic damage, and I lost two years’ worth of work. Additionally, I wasn’t selected to continue in the program. Not knowing what was next, I went home that summer, rebuilt what I could from my portfolio, and looked to apply to other schools. Ultimately, I returned to the school I attended previously where a semester later, I was invited to rejoin the interior design program.

Yes, it was disappointing, but through it all, I learned to manage crises, muddle through, and make difficult decisions. It also forced me to evaluate where my creative talents were best suited. I wasn’t the best at sketching or rendering, but I could absolutely sell a concept. Nearly twenty years later, I still love working in the A&D community and continue to thrive by collaborating with creatives.

Q: What is a song or album that helps pump you up or get excited?

First, this is a loaded question for someone who grew up in a house with an extensive collection of vinyl and music piped into every room. Second, I’m a hockey mom, so “hype music” is a big topic in our house. However, a solid single for any day would be “You Can’t Always Get What You Want” by The Rolling Stones. As for albums, there are just too many great ones, and I’m always up for discovering new ones.

In a recent work study with The Business Of Furniture, teammates Kristen Cerutti and Anne Gibson discussed how employers should shift their mindset from activity-based work to behavioral-based work to empower employees to choose how to work to perform at their best.

“There are no two people that think the same, that work the same, that utilize space in the same way. For me it’s less about labeling how many different people there are, it’s about getting employees and employers to understand no two people are going to function in their best capacity in the same way,” said Kristin Cerutti. “So, how can we provide space knowing that?” Cerutti describes neurodiversity a celebration and acceptance of the fact that no two brains think the same. There are groups of people that have enough in common neurologically to able placed into neurodivergent and neurotypical categories.

This leads to a concept designers at Nelson Worldwide have been exploring more lately— how employees are physically reacting to what they are doing. Anne Gibson, workplace leader at Nelson Worldwide explains activity-based working is focusing on supporting the task, which is important throughout the day, whether it’s concentrating on an individual assignment, collaborating with someone, or learning something in a large group setting. Behavior-based work adds a dimension of emotional support someone gets within the environment created. Read the full article here.

Account Leader, Industrial Adam Bortz, and Senior Project Manager, Industrial Monica Marulanda were featured in Commercial Property Executive to discuss current multi-story trends in the industrial sector.

Read more or listen here.

For every “fresh”, “vegan” and “farm to table” concept in Los Angeles, you will find a cupcake shop, cookie stand, or gourmet bakery to match it (… of course with a Soul Cycle in between). While each one is typically executed in trendy interior design cues, contemporary branding and graphic design, and usually a gesture of visual merchandising – more often than not, the “experience” leaves a lot to be desired. That said, upon a recent trip to LA I stumbled upon two unique “sweet concepts” that allow the experience to transcend the sweet treats themselves (albeit very good in their own right). 

Au Fudge in West Hollywood is where fresh food meets creativity and even features a classroom for hands-on learning for both mom and kids. The combination curated retail (“marketplace” as they call it), café space, and classroom (“creative space”) work cohesively to offer a lifestyle experience for all ages. The décor has an old meets new style enveloped in white space with brilliant accents. The customer journey unfolds with each room – starting with an amazing outdoor seating niche, welcoming guests inside to discover all of the facets and experiences of Au Fudge. The brand exudes a playful wit in color, material selections and merchandising offerings (who doesn’t want a hat that says Au Fudge?!) and makes guests want to take the time to explore and experience all that the space has to offer. Check out their “Commandments” on their website, a tongue-in-cheek conversation about the rules (especially when bringing kids) to Au Fudge. One can appreciate the clarity in the branding behind this concept.

Further down Melrose is Duff’s Cake Mix – while built out with more of a warehouse/studio feel, it is a bright, fresh space that caters to walk-in cake decorating and appointment based parties … fun, crafty, and smelled amazing! While Duff may be known for extraordinarily crafted cakes by his renowned design team, this concept store flips that idea on its head and allows the guest to become the designer. Offering pre-made cakes and cupcakes with a never-ending combination of toppings and assorted add-ons. The experience felt fun, creative, approachable for all ages, and best of all … low pressure!