Adaptive Reuse in Real Estate

Teaching an old building new tricks is a growing trend in the commercial real estate investment industry. Adaptive reuse is the process of finding an older building that once served a now-obsolete purpose and renovating it to take on new responsibilities. Historic buildings tend to be prime candidates as this makeover process preserves their architectural character and conserves their place in the community. There are many advantages to adaptive reuse which real estate investors may find intriguing, such as tax incentives for historical preservation offered by federal and municipal governments; potential cost savings on development, particularly in the current trade-war climate that is boosting foreign steel and aluminum prices; leverage associated with the historic angle these properties present; and the favorable location of these historic buildings, which tend to reside in densely populated cities with future-growth capacity. These structures also benefit communities as a whole, improving the streetscape and contributing to the feeling of a more walkable and accessible space. Applying Adaptive ReuseCompanies often snatch up historic real estate if they want to use it to their brand's advantage or to establish a unique presence in the market. But not just any historic building can receive this repurposing treatment. For a successful "Adaptive Reuse" project, properties need to meet certain criteria to be eligible for this process: The site must express strong historical value within the neighborhood in terms of its street-facing facade as well as its ability to connect residents to the era it represents. The property must represent some societal value that community members and visitors could benefit from. The site's structural integrity must be strong enough to support future use and its environmental conditions must be able to support renovations or other work. Tax credits and financial incentives can offset construction and renovation costs, the strategy's many other benefits appeal to investors and tenants alike: Renovating a building can be a much cheaper venture for companies than building a property from scratch. Many historically preserved properties are located in densely populated cities and prominent neighborhoods, which can benefit companies. These structures exhibit the character of other eras and create a more communal, urban space within the surrounding space, raising property appeal. Historic buildings, especially industrial properties, can be much more spacious and allow for a lot of interior-space manipulation. In light of new trade-war tariffs, renovation can help alleviate the costs of steel and aluminum required to construct brand-new properties.get this book to learn more about adaptive reuse and a guide to get starte