Cohabiting With Work : Developers Combining Living and Office Space

Myrna Naegle’s quaint boutique is filled with women’s clothing and accessories from Italy, Egypt and Guatemala, and with antiques she has collected from her travels.

Naegle’s customers say her shop feels homey. They’re right.

Naegle’s architect husband, Dale, designed the building that houses the shop and the two-story, two-bedroom apartment they live in upstairs. Though combining retail and living space is an idea rooted in 19th century tradition, it took Dale Naegle 25 years to bring this “shopkeeper” concept to life in Southern California.

“We feel it will be the home of the next century,” said Naegle, who has a computer, fax machine, photocopier and drawing table in a small office behind his wife’s Shoppe at 2210 in tony La Jolla Shores. “It has the technology of the next century but the charm of the last century.”

The Naegles are on the leading edge of a new way of working from home. Rather than converting spare bedrooms or kitchen tables into makeshift home offices, a handful of developers are building well-equipped offices right into houses, apartments and condominiums across North America.

They are betting that the spread of affordable technology and the competing demands of careers and family will encourage more people to combine their work and living space, and they want to attract buyers by catering to their special needs.

In the Toronto suburb of Orangeville, River Oaks Homes has built 150 single-family detached houses with office space built into the basement, on the first floor or in a third-floor loft. The neighborhood, called Montgomery Village, is zoned for home-based professional businesses. Many of the offices have separate entrances, and all are wired with high-speed ISDN lines and fiber-optic cable for faster telecommunications capabilities.

A similar project is planned for an apartment complex in Bakersfield. In addition to having offices with ISDN lines, the Fuller Apartment Homes @ The Polo Grounds will have a community center with meeting rooms and facilities for video teleconferencing. The Ventura-based builder plans to break ground by December and have units ready to occupy by summer 1997 at rents ranging from the high $500s to the mid-$700s.

At the Playa Vista development--which will house the DreamWorks SKG studio along with 29,000 residents--apartments and condominiums will be wired with fiber-optic cable, making it possible for anyone whose job depends on high-speed access to a computer network to set up a suitable office at home.

And in Frederick, Md., a developer has plans to build shopkeeper-style apartments in the retail center of a 4,000-resident planned community.

“It’s a lifestyle thing,” said Eric Wegler, president of River Oaks Homes in Toronto. “It cuts down on commuting time and allows you to spend more time with your family. It gives you more control of the work you do. And there are economies in terms of not having a separate office you would pay for if you are a doctor, a lawyer, an accountant or other professional.”

That’s how commerce was conducted before the Industrial Revolution, when many farmers and shopkeepers abandoned self-employment and went to work in massive factories. But the downsizing of recent years has cut many people loose from large corporations, helping the pendulum to swing back.

In the United States, nearly 27 million people run full- or part-time businesses out of their homes, according to IDC/Link, a market research firm in New York. Another 11.5 million complete their office work at home after hours, and an additional 8 million workers telecommute from their homes. Telecommuting experts say roughly 60% of all workers could do their jobs from a well-equipped remote site.

Andrew Fuller, chief executive of Fuller Apartment Homes, said those patterns prompted him to consider building a “tele-community” such as Polo Grounds.

“We started thinking about this 3 1/2 years ago,” Fuller said. “People in our company were telecommuting and saying they liked it and that they were more productive. We were also having a good track record with our innovative designs, so we decided to do it.”

In addition to telecommuters and home-based business owners, the apartments are also good for what Fuller calls “tele-students,” people who earn advanced degrees through correspondence classes over the Internet.

Fuller said the company selected Bakersfield for its first tele-community in part based on the success of an older development there, where about half the renters have a home or notebook computer that they use in their apartments. Plus, more than 6,000 people a day commute from Bakersfield to jobs in Los Angeles, a two-hour drive away, he said.

Before finalizing the design for the Polo Grounds apartments, the company solicited opinions from telecommuters on America Online and CompuServe. They told Fuller they wanted to keep their home and work lives separate, so the apartments are designed with offices near the front instead of in the middle of the home. They also said it would help to have general business support services, so Fuller added a courtesy shipping and receiving station to the community center.

Most people who work from home do so because they want to be in neighborhoods, but that is not a viable option for people who depend on foot traffic to generate sales, said Paul Edwards, an expert on running home-based businesses. Naegle’s shopkeeper concept allows retail stores to get into the home business act.

“It would be very desirable to be in a development like that,” Edwards said.

Myrna Naegle sure thinks so. The former real estate worker and first-time shop owner attributes her store’s success--$60,000 in sales in the first year, which is double what she expected--to the fact that it is connected to her home.

“This gives me the option of inviting very good clients upstairs to lunch if I’m trying to close a sale. My competitors can’t do that,” she said. “I’m here 24 hours a day and many of my clients who are special know they can knock on my door even if the shop is closed.”

Running a store out of her home relieves some of the financial pressure that other stores face, which she says gives her a competitive edge: “I can afford to be very selective in what I purchase [for resale].”

The boutique’s convenient location also makes it easier for her to keep up with inventory and other paperwork.

“There are times when I work till perhaps 11 at night, and I can just come upstairs and fix dinner, then go back downstairs to work,” she said. If the shop were in a traditional retail strip, “there’d be the fear of going into a commercial area at night when it’s deserted. I don’t think I could do this if the shop were away from where I lived.”

Dale Naegle--who began his architecture practice out of his home 42 years ago and has long yearned to build a residence that would once again accommodate his practice--is working with a developer to build a cluster of 12 to 20 shopkeeper homes in Fresno, which will sell for about $300,000. Naegle is also investigating sites in San Diego and in Breckenridge, Colo., a ski resort southwest of Denver.

“We see these happening at the edges and perimeters of established communities,” he said. “It’s a perfect buffer between residential and commercial areas. Perhaps it will bring life and friendliness back into our towns.”