The Great Outdoors

The New Age of Commercial Outdoor Space

By: Dusty Muck, Rubbermaid Commercial Products

The evolution of the workspace prior to the pandemic was evolving greatly as a new generation of workers were entering the workforce. The economy was buzzing and talent recruitment was critical in this competitive environment. The commercial real estate industry was playing a pivotal role in this process with their tenants. Properties were called on to provide the right environment to help engage the new talent entering the workforce.

The incoming generation of workers had ideas different from those of the past. Motivating factors such as pay increases and healthcare benefits were not topping new hire lists. Instead, younger employees were looking for flexibility in scheduling and working environments. They were looking to be a part of a community and wanting to be a part of something larger than themselves.

The CRE industry responded with open floor plans, collaborative work spaces, gardens and coffee shops. When the pandemic hit, thought leaders and experts rushed to compile and understand the data and what the consequences would be for the CRE industry. Moving in to 2021 and looking at 2022, we now have a clearer understanding of what the office will look like moving forward. Talent acquisition and retention, despite a global pandemic, remain a top priority for commercial real estate professionals across the country.

A perfect example of the avant-garde is Stream Realty’s newlyconstructed property, The Interlock. The Interlock boasts of 200,000 square feet of office space coupled with retail, bars, hotel, a roof-top restaurant, and swimming pool, and even a state of the art, funky putt-putt course.

“We really come from the focal point of retail. Which means we want people to drive by and see energy. You are more likely to come back and be a part of that. The idea is, I want people out eating, drinking, having fun. We were most focused on that,” Jeff Garrison, partner with SJ Collins Enterprises said.

Garrison continued,”We always promoted patios and plazas, but we couldn’t get people in Atlanta to activate and gravitate (towards) them and spend money on them and it drove me crazy. Why? It was a lot of money and Atlanta is hot and they just didn’t put enough time and effort into it and there were not enough done really well that showed them the pathway to success. What happened is, COVID-19 has opened their eyes, they’ve seen how successful you can be and with very little money, you create a very active outdoor space. One that is not too hot, because Atlanta can get too hot. But they now know how to do it.” Tiffany Wilson, Director of Business Development, Gray Contracting, is experiencing this same change in philosophy. “Prior to the pandemic we were mainly focused on interior renovations, such as bathrooms, hallways, common areas. Now we are getting many requests for outside,” she said. “We even have very industrial spaces requesting green spaces of sort. The requests vary from awnings, benches, to lighting, and music and even food truck parking lots with eating spaces outdoors. “

Generations previous had limitations on their ability to create such environments but technology has brought advancements that have helped bring this development to life.

The advancement in technology has created a major difference in structure and openness of properties. Higher ceilings and larger windows can create a sense of togetherness even in an indoor space. This is all due to advancements in technology and structural design that have changed the ways property teams can design and utilize their spaces.

Jeff Garrison continued, “So in this building, the parking deck has 15 foot ceilings. If it is a traditional seven feet, that does not feel open and inviting. That technology didn’t exist when my granddad built their office space. It allows the indoor and outdoor space to blend and if I need to cut it off, it can be. They couldn’t build windows over a certain size, because structurally they didn’t know how to do it. Technology has allowed it. Part of it is technology advancements that structurally allow you to build indoor/outdoor space. “

“Take for example, this patio. We actually left this patio open. When you are walking on that corner, I want you to see these people having a good time. They used the space we wanted them to, by leaving it open. The hotel is the same. The building is linear, but we actually bent the building back, and from here, you can see the hotel and you can see the lights. That was purposeful, because from this corner, this is the busiest corner, we have like 75,000 eyeballs a day that are going to be looking at this. If those 75,000 are like, I don’t know what is going on at the Interlock, but it looks super cool. I want to know what is going on,” Garrison said.

Garrison remarked on how building an outdoor community space goes beyond what is inside the property. He said that even the side walks need to reflect the collaborative and energetic environment a property team is trying to portray. By removing manhole covers, carefully pruning the trees and creating 30-foot wide sidewalks, it creates a space that feels safe, open and walkable.

Photo of The Interlock’s outdoor space. Credit: SJC Ventures

A project such as this does not come without some significant hurdles. Investors may look curiously and suspiciously at plans with such large open spaces. Ultimately, investors want to see profitability.

Thus, they want to see profitability in every square foot and open designs with outdoor spaces means some space is not earning a rent in the short term.

“What they (investors) first need to know is, the investment will pay dividends. People need to understand it does have value and it’s an intrinsic value which is creating energy and community for your place. It is tough for them to put a price on it, but when we will have an event, and people are having a great time, they are going to want to be here and they are going to spend money, but you really can’t underwrite it. So that is the challenge,” Garrison said.

The challenge is, they have to show that it does build value and how that, in turn, will lead to higher rents. Garrison said that when you are creating positive energy, those community spaces can covert into sales.

“The challenge is they have to show it does build value But having that energy, that vibe, people start paying higher rents. If you are dealing with a person who is primarily budget minded, it is a very challenging task. These community spaces create energy and that energy does convert in to sales. But it may not day one, right?,” Garrison said.

Jess Moore, a property manager with Stream Realty said the key to a successful outdoor space is the property management. The team needs to be ready to show people how to use the space, how the space is different and create events that convince people to come to the space in the first place. “You have to activate it,” Moore said. “You have to hold the events, bring people there, make them feel comfortable, until they are ready to venture out on their own.”

Garrison said that the activation can also come from the tenants. In an active outdoor space, tenants may devise ways to help the property management team cultivate the culture they want at the property. He said that this can be the extra mile a property manager goes to activate the space. Property teams need to be thinking about how existing tenants and products can contribute to a larger vision for the property.

“The energy comes from a retailer expanding their space for open air eating. It activates the energy. A space to itself is just a dead open space. You need to go out and look at existing product and see how they are building value,” Garrison said.

Creating an engaging outdoor space starts at the building design. Garrison said it would be difficult to do what they are executing now without the intentional design behind it. He said that you never want to get caught in a situation where a great idea comes after the property is built. That intentional thinking can be the difference between a fun space and a game-changing property.

About the Author

Dusty Muck is an Account Manager for Rubbermaid Commercial Products, providing washroom solutions, cleaning, waste/recycling, material handling, and food service products to Commercial Real Estate, Healthcare, Travel/Entertainment, Manufacturing, and Education facilities in Georgia. Dusty is currently Chair of the Membership Committee, a member of the Editorial Board, and works on the BOMA Government Affairs Committee, assisting strategies on legislative and regulatory matters affecting the commercial real estate industry in Georgia.