What is adaptive reuse of commercial real estate and why is it important?

In an environment turned upside down by the COVID-19 pandemic, real estate owners and operators have a duty to come up with strategies that remain forward-thinking and creative. Among these strategies is adaptive reuse

Adaptive reuse has become more relevant in recent years, as vacancies increase across property types and existing buildings outlive their utility. Adaptive reuse is a sustainable way to adapt and repurpose commercial real estate assets to suit new and evolving needs for years to come.

What is adaptive reuse?

In commercial real estate, adaptive reuse is the process of adapting all vacant, unused, underused and abandoned buildings to new, sustainable and better utilization. This could include turning an old brewery into a retail marketplace or renovating a historic mansion into a center for apartment amenities (such as The Abbey in Loring Park)—the options are endless.

The Abbey,  located in Minneapolis, Minnesota, uses adaptive reuse by restoring
 a 19th Century mansion into an amenities center for an apartment complex. 

When considering a building as adaptive reuse, there are three rules to abide by: 1.) it reuses all or a substantial portion of an existing structure. Tearing down an old building and putting up a new one would not be considered adaptive reuse. 2.) The existing structure has to have had some kind of functional or economic obsolescence. For example, abandoned mills, factories, malls and other structures that have surpassed their usefulness. 3.) Finally, there has to be a change of use. We see this with an old high-rise tower filled with offices turned into an apartment building or retail and experiential uses going into old manufacturing areas.

Why CRE companies should care about adaptive reuse.

Adaptive reuse not only benefits CRE owners, but the entire real estate ecosystem as well. Whether that be developers, investors, or society as a whole. When it comes to economics, industry data shows that compared with a new construction, adaptive reuse and restoration can be 16 percent cheaper in terms of construction costs and take 18 percent less execution time. When sustainability is kept in mind during repurposing, adaptive reuse can also improve overall building performance and valuation.

Socially, adaptive reuse is important for the community because it maintains cultural heritage while supporting the local economy. Adaptive reuse restores culturally significant sites that would otherwise be left to decay or demolished to make room for new buildings and jobs.

Environmental sustainability is another major reason CRE companies should care about adaptive reuse. Repurposing space is far more sustainable than tearing down a historic structure and redeveloping the lot. Adaptive reuse projects also tend to use far less building materials than a new construction project. As a result there’s less of a carbon footprint associated with transporting those materials.

Looking into the future…

As more and more buildings with rich histories are finding themselves in need of renovation, adaptive reuse is a thoughtful solution to building upon what currently exists and incorporating that into the goals and ideas of the future. 

All adaptive reuse projects start with a good team. At Monarch, we are able to design that team for exactly what you need throughout the process and into the future. If you have any interest in repurposing a building for viable new uses and modern functions, visit the build section of our website.  

Until next time,

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​​Brian + Ben


Whether we are building from the ground up or renovating a historic manor, we know construction! Contact us.