Codes, Parking Can Hamper Recycling
If no one loves you when you’re old and gray, could it be a consequence of the fire code?
If you’re an over-aged commercial building--sitting forlornly with your windows punched out on your little plot of Southern California real estate--the answer could be a resounding yes.
While the scarcity and high cost of prime land here has added new appeal to the recycling of infill commercial real estate--modernizing and upgrading old buildings to a higher usage--three conditions can throw a big question mark over many such candidates, according to Byron Pinckert of Irvine-based Hill Pinckert Architects.
“They’re not an automatic disqualifier,” Pinckert said, “but they’re certainly constraints that have to be looked at very carefully--the fire code, the seismic code and the parking requirement.”
Sprinkler System
In Orange County, for instance, he continued, a resolution was passed recently requiring any building of more than 6,000 square feet to have a sprinkler system. “And very few buildings will comply with that that have been built recently in the smaller neighborhoods. It has a tremendous impact, structurally, in terms of the added weight on the roofing system.”
Seismic requirements, which go back to 1933, but were tightened even further after the 1971 Sylmar earthquake, can seriously impact the economic feasibility of rehabilitating an existing building, but to what degree varies more widely by the type of building than conforming to the fire code does, Pinckert said.
“If you’re working with industrial buildings, where they have so much wall area, anyway, it’s usually not all that difficult to bring them up to standards. But with office and retail property, you’re usually getting into a much bigger problem, and frequently it’s a marginal decision as to whether it’s more economic to rehab them or tear them down and start over,” Pinckert added.
For the 7-year-old architectural firm, 80% of whose work is for commercial developers, gravitating into a specialty of recycling existing buildings is a natural reflection of its clients’ interest in a field where economic, social and demographic changes constantly fuel a market of buildings caught in the backwash--under-utilized, undervalued, or both.
Auto Agency to Mall
As a case in point, Pinckert cited a former car dealership in East Los Angeles where the changing character of the neighborhood had stripped it of its viability as a dealership--but which left it, still, with high visibility, good access, good traffic count and in an area where the population need had shifted to personal services.
The solution: conversion of the dealership to a three-level retail mall, Plaza del Sol, with parking on the upper level and the addition of 80,000 new feet of retail space.
“Fortunately,” Pinckert said, “because of its use as a car dealership, the parking was already in place. As a consequence, the developer saved about 40% over what it would have cost to go from the ground up, from scratch.”
Parking space, or conversely, the lack of it, is every bit as much of a constraint on rehabbing a building, as conforming to the fire and seismic codes are, he added.
Parking Requirements
“You’ve got to have a minimum of four parking spaces for 1,000 square feet of space,” Pinckert said, “and, if it’s a single-story structure, the building can’t cover more than 36% of the site. Or 45% for a two-story structure. Most older industrial buildings, unfortunately, have about one space per 1,000 square feet.”
Sometimes, then, this means demolishing part of a perfectly good building simply to gain parking space. “On one project,” Pinckert said, “we sort of partitioned the building down the middle, used half of that space for parking and then double-decked the other half with office space to offset it.”
It’s this parking space bugaboo that lights up a developer’s eyes whenever there is an outlying industrial site laying fallow and where upgrading the usage of it is feasible.
“We had this project for Cabot, Cabot & Forbes in Orange County,” Pinckert said. “It had formerly been a food processing facility--a long time before--for a pizza company. There was a 160,000-square-foot industrial building on a very large site, about 20 acres, that had never been used for anything but truck storage.
CC&F; bought it, and we began a study of how to use the land more effectively. We turned it into an office building, putting in a whole new second floor and doubling the space to 230,000 square feet. And we didn’t have to worry about the parking situation at all. It was a classic case of under-utilization.”
Site’s Character
Obviously, the character of a site--its environment--can be the final determinant of feasibility but, sometimes, in ironic ways.
“You wouldn’t be inclined to think of your normal industrial-type site as a logical place for a high-class retail operation, such as a Nordstrom,” Pinckert said. “But you’ve got a whole new school of retailers--Price Club, Buyers’ Club--and so on, who want the warehouse look . . . an out-of-the-way spot in an ugly block because it ties in with their image of discount bargains.”
And, as a rule, the Irvine architect said, converting an industrial building into a retail building “will save about 15% of the cost of building it from scratch.”
But it’s a saving that becomes increasingly difficult to realize in upgrading an office building where the developer is neither changing the usage nor increasing the space, but simply trying to attract tenants at the higher end of the economic scale,” Pinckert said.
‘Hidden’ Upgrading
“Some of it is largely cosmetic, of course, a matter of making it more attractive,” Pinckert said, “but so much of it is ‘hidden’ upgrading--of ripping out and replacing old, outdated mechanical, electrical and communications services. Simply bringing the building up to fire and seismic codes, alone, can take up to 50% of your budget.”
And, ironically, he added, recycling some office buildings is the only way to go simply because--regardless of the cost--tearing them down would be even more costly.
“The Fine Arts Building downtown is a case in point,” Pinckert said. “while it’s only 10 or 12 stories, it was completely hemmed it on all sides, and tearing it down and trying to rebuild something on a site like that would have been terribly complex and costly.”
But as Southern California spreads out farther and farther, the “born again” industrial real estate market makes increasingly good sense--backing up, recycling and reusing buildings that have already had one economic life span.
