Future Building: Will It Be Green?

Echoing worldwide reports that attracting and retaining employees is a key concern for business today, Erin Wendorf, a vice president with Transwestern, noted late last year that Minneapolis is likely to benefit from a “suburban to urban” migration because of the nearby amenities that a downtown location offers. The city’s strong economy, its robust absorption of existing office space, and the current projects already underway, point to continuing market strength, positioning the city nicely to respond to a need for more “personalized” office space.

A panel of experts that met to discuss the future of speculative building agreed that the future lies more in build to suit than in continued growth of the speculative market. That, in some ways, will offer even greater opportunity to local developers.

An October 2106 StarTribune article, quoted Weisdorf: “Amenities to attract ‘Generation Y’ users are becoming more important than ever. Organizations are leveraging their spaces as tools to attract and retain talent like never before. The cost of replacing employees is high, so investing in a downtown ‘unique statement space’ that highlights a company’s brand and culture is a big trend.”

Some analysts said that spec building in this area has peaked, and that the future lies in build-to-suit projects. If that is true, what will those future buildings look like, and what features are important? Is the future green and sustainable?

Green Is a Given

Minneapolis has for years been known as a “green capital.” There is no reason to believe that will change. Actually, the city in 2014 had more certified green commercial space than any other city in the country. At the time, the 2014 Green Building Adoption Index by the real estate firm CBRE Group Inc. and Maastricht University in the Netherlands, called the achievement remarkable, noting that “135 buildings in Minneapolis are certified green, representing more than 152 million square feet of office space.” The achievement was termed remarkable.

But, the report notes that part of it is cultural. “Sustainability is clearly integrated into the fabric and dynamics of the Minneapolis real estate market, driven by solid demand from corporate tenants,” it says. For both Energy Star Label categories and LEED certification, Minneapolis also held leading positions in both total number of buildings and actual square footage, both with rankings more than twice the national average.

A Commercial Building Rate and Disclosure Ordinance that requires Energy Star tracking of power and water use for buildings under 50,000 square feet is a part of Minnesota law. The city of Minneapolis actively encourages green building, and code requirements detail minimum standards for both residential and commercial projects. However, developers may pick options from a Green Building Checklist to improve the sustainability and energy-efficiency of new and existing buildings. Most include at least a sampling of “extras,” responding to customer expectations.

Changing Business Culture

Sustainable practices reinforce the emerging corporate culture that is more attuned to employee lifestyle and worker satisfaction than past employment practices allowed. Expectations of a younger work force and new technology have both changed the face of modern business, both on the physical plane and in terms of the way business is transacted. Offices will, by necessity reflect changing norms.

Not only are build-to-suit spaces likely to offer more flexible spaces and fewer rigid walls, but they are also apt to be brighter and more conducive to “group work” and less formal workspaces, perhaps with comfortable furniture, movable walls and spaces that are easily adaptable to small group meetings and collaborative encounters. Even manufacturing and laboratory settings are being designed with a colorful and comfortable vibe, responding to psychological findings that happy and healthy workers are more productive.

Whether the Millennial generation is responsible for the changes or it’s a matter of social science and medical research catching up with human needs is open to debate. But the fact remains that a business decision to remake office spaces into more pleasant environments is big business in itself.

Design Reflects Life Values

Again, in Minneapolis, business analysts view downtown revitalization as the flip side of a trend that has also produced the suburban business campus. The two may be quite different in expression, but the motivation is similar, according to Steve Shepherd of Colliers International. “Suburban offices can create their own amenities,” he notes, adding that investor interest continues to drive redevelopment.

The trend is toward repurposed and reimagined properties that will now include such amenities as “common area renovations,” locations with easy access to city parks and green space, and improved interiors that are visually exciting and technology rich. In the urban core, the most desirable offices are convenient to not only downtown condos and apartments, but also to shopping, entertainment, dining and leisure amenities. Edgy new spaces bring the outdoors in as well as allowing workers to get out.

All in all, Minneapolis remains a great, green place to do business.