Investing In Suburban Mid-Rise Office Buildings

For those looking to invest in office buildings, this recent article, Why Mid-Rise Buildings Are the Future of Office Investment,  by Tim Lee a VP with the Olive Hill Group on the National Real Estate Investor site (www.nreionline.com)  has some excellent insight on the benefits of considering mid-rise office buildings as a real estate investment strategy.

The article makes some excellent points, especially with the look at how you can re-work these older office spaces to meet today’s tenant demands for additional amenities and the ability to potentially add a co-working space to further increase NOI and reduce vacancy outside Philadelphia.

Better suited for creative office and other amenities

Because of the increasing demand for creative office and co-working space, today’s office owners and investors can charge premium rents for office spaces that offer the latest and greatest in creative office and co-working amenities. Many of these amenities are much better suited for low- to mid-size office product rather than high-rise office buildings.

The office campus type feel that many companies and firms look for in their office space is essentially impossible at a high-rise building.

Examples of such amenities include:

  • Outdoor co-working spaces
  • Bocce ball courts
  • Barbeque areas.

(These outdoor amenities are often located on the ground floor.)

In a high-rise, these amenities become exponentially more difficult and less convenient to access for a tenant on the 25th floor.

Renovations to turn a property into creative office space can become increasingly time-consuming and costly at a high-rise development.

Community creation and inter-office connections

Smaller office product is also simply easier to manage and to create a sense of community in. By fostering this feeling of a tight-knit office community between tenants, owners can foster loyalty to a property, which increases tenant retention and NOI.

This interaction between multiple companies and firms leasing office space at the same property is virtually impossible to achieve at a high-rise development.

As this demand for inter-office connections and for the community feel becomes increasingly popular, more and more office investors will turn to mid-rise properties as the best product for providing this environment.

Creativity in Value-Add Office Building Investments

The whole article is definitely worth a read, but as a real estate investor looking for strategies to improve suburban office building investments through creative value-add strategies like adding a co-working space, thinking outside the box is going to be a key.

About the Author Philly Area Real Estate Investor

Philadelphia area real estate company who is looking to buy commercial and residential properties in PA, NJ, and DE. Currently, we are looking for houses, apartment buildings, office buildings, and warehouses. Call us at 215-987-4561 to sell your real estate quickly.

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