How Will New Design Address Post COVID-19 Development Living?

The impact of the pandemic is forcing the hand of real estate developers to adjust accordingly

By Diane De Felice

Builders and developers must now balance the call for sustainability and climate change with new health safety measures as a result of COVID-19. The landscape of urban centers, including residential and commercial buildings, will need to incorporate evidence-based solutions that address and promote public health safety. Procedures that facilitate social distancing and minimize contact with shared surfaces will be the new norm to minimize COVID-19 transmission. Will this mark the end of higher “density” development? Or can better planning achieve multiple goals?

While different states have varied compliance requirements, some states are joining forces, such as the Western States Pack, which announced on April 13th a staggered plan for transitioning from “stay at home” to reopening. Central to the plan is putting residents’ health first, applying health outcomes and science testing to shape decisions, and engaging with communities to assess existing health conditions.

Navigating new post-COVID requirements hinges on two main factors: project location and progress in the development cycle. An existing occupied building will face differ-
ent challenges than a yet to be constructed project. Most will involve re-designing features to comply with new safety measures, but occupied space will race to quickly implement measures to facilitate re-opening.

Mitigation for Existing Properties:

Strategic planning is required if a building manager or owner has properties that are subject to different regulations and guidelines. For example, an office building in a relatively rural area will face different mitigation hurdles than an office in a city center. For example, in rural settings, it may be feasible to increase natural air circulation by retrofitting windows but this may not be possible from a cost or architectural perspective for high-rises in urban centers that rely on system-based recirculation. Other common redesign measures to reduce exposure to COVID-19 include the use of touchless technology, such as sensors and voice-activated elevators.

Densely occupied buildings face additional occupancy control and timing hurdles to ensure social distancing. To accommodate crowd surges during the typical rush hour, new lobby entrances are being reconfigured, with signage to prompt social distancing and notify of elevator occupancy limits, and altering the flow of traffic in hallways. Some question whether even these new precautionary measures will satisfy the amplified health concerns of returning workers. Notably, the pandemic may put an end to the trend of open floor plans. For now, larger open space areas are being reconfigured with cubicles and/or plexiglass barriers. Incorporating antimicrobial materials, such as copper, may also see a resurgence.

When or If to Return to Office Buildings:

People fortunate to have remote work flexibility may weigh the health risks of returning to the workplace (and a long commute) against remaining at home full or part time. Many speculate the overall benefits of working remotely could lead to an overall reduction in commercial office space use.

This assumption is well founded given announcements by high-profile companies acknowledging they can successfully operate with less office space. Mark Zuckerberg told workers that within a decade perhaps 50% of Facebook’s employees could work from home. And Morgan Stanley contemplates similar space reductions for its almost 80,000 employees. How developers will plan for “urban” and office futures will no doubt take these into account.

The same concerns face multifamily build- ing amenities. The hospitality design concept for open space common areas and gyms has forced closure of these areas because of the heightened risk of contamination. With the closure of common areas, owners are ques- tioning whether increasing space in common areas at the expense of losing units will be necessary until a vaccine is discovered.

Efforts to jump start local economies while also facilitating social distancing has resulted in closed roadways to allow restaurant seating to spread onto sidewalks and public right-of-ways. Roadways are also proactively being closed to vehicular traffic to promote walking and biking in an effort to prevent crowded roadways as cities open back up since it is anticipated people will avoid public transit because of transmission fears. In Seattle for example, approximately 20 miles of streets are now permanently closed to most vehicle traffic and in Milan 22 miles of streets are being revamped to expand pedestrian and cycling spaces to mitigate the anticipated surge in vehicular traffic. Public transit may not prove to be the threat people believe, however. In Japan and France, none of the new coronavirus clusters were found to be spread via public transit.

While investors and developers will be analyzing Q2 results for valuation assessments, this year’s pandemic may shift dollars to product types more likely to be shielded from COVID-19.

Diane De Felice is a Land Use and Real Estate Shareholder at Brownstein Hyatt Farber Schreck, LL. She may be reached at ddefelice@bhfs.com

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