News
OLD AND UNCOOL? HERE'S WHAT TO DO
July 30, 2012
| Office tenancy has been impacted by many changes: the recession, a younger workforce, mobility, sustainability, and contingent workers. And “The next three years will decide if Fairchester will be a viable community center,” said CBRE EVP Bill Cuddy, a panelist at Bisnow’s Future of Westchester and Fairfield Counties event last week at the Westchester Club. But what will it take? |
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| “You can make a living here, but there’s zero growth,” points out JLL managing director Ed Tonnessen, who moderated the panel. Today, the Fairchester office sector is mostly negative, and even in the good days, it was neutral. Most deals are re-trades, and buildings are getting significantly less because there’s no economic growth. The only assets that are doing well are the ones in the right locations. (Ask Michael Phelps about swimming in Lane 8.) “30 years ago, being near a train station was undesirable,” he says. “But now it’s a must.” |
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| Unless you can keep up from a design standpoint, people will vote with their feet, says Perkins Eastman principal Mark Van Summern. (We haven't even mastered those scantron ballots with our fingers yet.) There needs to be a tremendous focus on design from commercial and corporate real estate execs. For instance, you don’t need that 120 SF per person anymore because of a more highly flexible and productive workplace. |
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| A lot of properties are functionally obsolete, adds Blackrock Realty principal Kurt Wittek. “There’s a need for more cool places....Even people our age want to take part in something cool.” Why isn’t everybody doing everything in their power to make it faster to get to New York City? (Don’t worry, Kurt, we were promised hoverboards by 2015—just fly past those Metro-North delays.) Fairchester can make great strides with infrastructure capital, he says, pointing out that White Plains and Stamford are already much different from when he was growing up. |
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| Westchester and Fairfield counties have tremendous inventory, and it's a perfect time for the corporate and design communities to work with municipalities to start this change, Bill says. But where do you get the jobs? “There are 14 colleges with 30,000 students. We need to find a way to move them into our workforce,” he says. There are also small, early-stage companies that need to grow, so we need biz acceleration resources (both money and human) to supersize them. Bill, who’s chair of the Westchester County Association Blueprint for Westchester initiative, says the county has $200M of capital from local banks and 250 hours of professional services earmarked for such small companies. |
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| The tech, biology, and life science industries, in particular, have a younger workforce. The 25 to 35 set are collaborative, mobile, and looking for elements outside the 9 to 5 workday, says Normandy Real Estate Partners principal Justin Krebs. Normandy is looking to incubate such tenants, but how do you drive that kind of growth? Its solution: transforming older buildings into mixed-use product for a more vibrant workforce. (Our solution: giant biergartens.) Cities like White Plains and Harrison are now proactive and transparent when it comes to redevelopment, he says—building housing and retail can only be done with such cooperation. |
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| Such tenants desire easy access to and from Manhattan, as well as a live/work/play lifestyle, says Malkin Properties EVP Jeff Newman. That’s the thinking behind developments such as Malkin Properties’Metro Green TOD community in Stamford, which has workforce housing attracting people looking for a shorter commute and entertainment and dining options. (Stamford’s train station is the fastest growing in the state, he says.) There’s a real premium for location, especially buildings near transit centers. Check back tomorrow to hear more from our attendees. |
