Raising the Value of a Building from Scratch: Why Floor Plans Matter

Do you know why blueprints are called blueprints? In 1842, an astronomer/mathematician turned chemist discovered a way to photographically copy a drawing. The process was called cyanotype because the chemicals used in the solution turned a copy cyan blue. Engineers quickly adopted this process to reproduce complex mechanical designs and the blueprint was born.

For more than a century, drafters physically sketched on often huge sheets of paper to create and modify building floor plans. Eventually, these plans would transition to digital format. While it helped improve the review process during construction, these digital versions share a common problem with their blue paper predecessors: they still live hidden in the corners of a property management office of older buildings. The problem is that floor plans, digital or not, are not easy to find and are even harder to confirm their validity.

Floor plans are often abandoned in a relay race, falling when building ownership changes, new property managers are hired, or new renovations render current versions obsolete. Property owners and managers are feeling the impact more than you might think due to how often they are needed in day-to-day operations, especially given what is happening in commercial real estate today. .

Plan the future of a building, not just its current state

Without knowing what’s lurking in the bones of the building, it’s hard to know what changes will cost, whether they’re capital improvements or usage conversions. Abby Caldwell, Director of Operations at Floorwire, explains, “It costs real estate companies 17 cents per square foot to redraw lost plans, update rental space calculations and answer basic questions like where the HVAC or how a floor is divided into suites. ”

Building changes and upgrades happen all the time, but that rarely means a floor plan has been updated with it. A tenant can move a wall or add a new interior door to separate their square footage into smaller spaces. These undocumented changes introduce issues for both asset management and the tenant experience. For example, leasehold improvement allowances are difficult if not impossible to calculate without knowing important details about electrical or HVAC systems. Given this constantly changing state of commercial floor plans and the important architectural data they contain, floor plans should be treated as living documents, reviewed and updated as changes occur. are brought to the physical space.

Floor plans: Cloud-based floor plans are the key to better building operations

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Another consideration: the rise of adaptive reuse and conversions

As owners and developers consider expanding their portfolios in 2022 and beyond, they are considering potential acquisitions with redevelopment and conversion in mind. This not only means that the floor plans of many buildings will change, but their product type and purpose will also change.

According to data from Yardi, 20,100 residential units were created in the United States from multifamily adaptive reuse last year, nearly double the number converted in 2020 and 2019 combined. Office-to-lab conversions are also at an all-time high, driven by unprecedented investments in life sciences and the cost per square foot of lab space, especially in key markets like Boston and San Francisco.

Real estate companies performing adaptive reuse and conversions face one of three scenarios when it comes to floor plans. Best case scenario, but also least likely: they have current digital floor plans for the entire building. In the worst case: there are no digital plans and the paper plans are the originals that can only be found in the building or the inspection department of a city. The third scenario is the most likely: there are versions of floor plans available, but the team does not know if they are accurate.

Owners and developers may choose to go into it blindly, but they’ll just discover unexpected challenges and eat away at emergency budgets faster than expected. Angela Aeschliman, senior vice president, Property and Asset Management at Missner Group, a vertically integrated real estate company based just outside of Chicago, stresses the cross-functional importance of having up-to-date digital versions of floor plans every stage of the real estate life cycle. “As an owner-developer, natural silos can exist between construction, development, ownership and asset management, but we all need current digital versions of our floor plans to collaborate internally across our departments. and externally with owner teams, joint venture partners, and external project team members like our architects and construction partners,” she said.

The Missner Group owns, manages and develops various types of properties, from offices and industrial to retail and healthcare. This diversification means that asset managers and property teams like them need to understand how these building types vary and what that means for day-to-day operations. Aeschliman points out that digital floor plans can be a useful training tool for property managers. “I want my property management team to understand and learn our buildings at plan level, so they can be as knowledgeable as a landlord team on this asset. They, in turn, bring more value by identifying ways to breathe new life into the building for the future. »

A useful comparison for digital floor plans is to consider the impact digital twins now have on building modeling. Both technologies allow real estate companies to understand how a building and its interconnected systems operate, so teams can make better decisions about the future of the asset. We’ve come a long way on the path of draftsman poring over giant hand-drawn building plans. But getting floor plans in digital format is still just the start. For floor plans to reach their full potential, they will need to become living documents that can mimic the complexity of their real-world counterparts.