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Mixed used developments – an industry perspective

Monday 3rd June 2013

Robert Soning of urban development specialists Londonewcastle, comments on some of the key issues as far as the new age of modern, mixed-use developments is concerned.

It is evident that currently, buyer expectations for new build developments are very high and far higher than they were only five years ago. Companies now need to address the challenges of more mixed use in property developments - for example, leisure uses onsite which bring in more people and operate for longer hours.

In today’s market, we need businesses which provide consistent luxury ‘hotel levels’ of customer service, which is likely to include 24-hour on-site concierge and ‘lifestyle management’ services such as restaurant bookings, theatre tickets, private dining, health and fitness services.  And this is just the beginning, as we are seeing many more developments where there will be additional sophisticated services such as dining and ‘club’ rooms, facilities for business meetings and leisure use, similar to private members clubs. I am certain that we will also see a growing range of leisure and entertainment uses located adjacent to residential units operating shared bars and restaurants .

A key challenge for the industry is to address how this affects staffing for these types of developments, with a need for the superior facilities to be managed by a skilled workforce over longer hours; this is the gap which needs to be filled in both residential and commercial management.

It will become increasingly important that at the design stage of any new build, social and private housing are separated as much as possible. Increasingly, property management companies will need to ensure efficient and consistent coordination between private and social managers.

Mixed use buildings provide an opportunity for consolidation in the market, with commercial managers stepping into the residential space and vice versa. I believe that we will see larger commercial managing agents starting to operate in residential management, either by adding their own offering or buying/merging with residential management companies.

Historically, as far as international purchasers are concerned, when investing in overseas properties, most buyers are used to high-rise, managed buildings with a level of expectation matched to the type of building. We will have to look carefully at service charges because nowadays too low a charge can run the risk of buyer concerns over inferior service levels and especially poor maintenance.

Mixed use is undoubtedly more challenging and our industry does need to focus on wider integration and maintenance issues. However, these schemes will be successful, having a positive impact on values, but only when well run and where the tenant mix is managed sensitively and controlled by the developer from the outset.”

              

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