Delivering a ‘New Normal’ for Bay Area Live, Work, Play Environments

Connect Bay Area pointed a spotlight on a commercial real estate market that continues to experience a remarkable growth trajectory due to continually changing disruptors. All cylinders are firing across the region’s market sectors, and that’s brought a host of challenges that emerged as topics of conversation at our annual conference in San Francisco, which drew an audience of more than 300 commercial real estate professionals.

In addition to four deep-dive panels, keynotes were delivered by San Francisco City and County Treasurer Jose Cisneros, as well as the Oakland Athletics’ Lydia Tan.

Panelists on the “Trends and Challenges in Live, Work, Play” panel, moderated by Mithun’s Anne Torney (pictured), debated the current trends and disruptors of the Bay Area’s CRE climate—from Oakland, to San Jose to Palo Alto to San Francisco. Pressing topics of that conversation included office demands and today’s work environments; investment activity and strategies; maneuvering the heated tech space; a surge of housing and multiuse megaprojects; transit demands and last-mile solutions; shifting demographics, and opportunities in the growing submarkets.

Mithun’s Torney noted that “As architects, we are finding that we are increasingly designing for the convergence of live, work and play. It crosses product types individually and becomes more evident in mixed-use projects, but each application is about creating community, connection and interaction.”

She pointed out how that shift is playing out in specific property type sectors. For instance, the “model of student housing as ‘dorms’ is long gone, replaced with living/learning communities with social and collaborative learning space mixed seamlessly into the residential environment.”

Torney says, “Workplaces are similarly designed for the whole spectrum of solitary creativity, collaboration, and socializing, from conventional offices and meeting rooms to kitchens, dining and landscapes. Housing is also incorporating that concept of ‘third place’ — places to meet, work from home — where you can hold large and small gatherings outside of your private living space.”

Amalia Paliobeis of Common,  a company that creates co-living properties, agreed that there’s a new normal in the Bay Area and it revolves around sharing. “Simply put: value and experience are growing more meaningful than ownership,” she said. “It’s no secret that people have been sharing their apartments with others to save money for hundreds of years, but now they’re seeing it as a long-term option. Sharing and renting for later into their lives allows people to save money while living closer to where they work. The norms are changing.”

An example of how live-work-play is evolving in the Bay Area is Panoramic Interests’ efforts to create a mixed-use project in Oakland that encompasses residential and retail uses. The company’s Zac Shore shared that they are moving toward final approvals of 500 Kirkham at the West Oakland BART station, which by unit count, would be the largest housing project in Oakland history, he notes.

An important design move Panoramic made was to break up what could have been a superblock development, into three buildings separated by two new pedestrian streets that provide retail opportunities, street-level activation and pedestrian access. He notes the project’s design evolution is a great example of increasing the live-work-play components of successful mixed-use project.

Westlake International’s Kristina Chang says they have also taken a more balanced approach to the various asset classes relative to many others in the space. “We believe the Bay Area is a very strong market. In areas where others have shied away, we have doubled down.”

Chang added that the company has invested in its own shopping centers and added new assets this cycle. Though, “On the apartment front, we don’t feel as if there have been material changes to how people really want to live, but some aspects reflect changing trends. So, while projects in our pipeline reflect fairly standard layouts and designs, we’re getting more creative with amenities.”

Chang says they “are seeing more parts of the Bay Area really come alive, especially in transit-oriented areas. This cycle saw certain parts of the Bay Area experience a true renaissance, whether that’s our downtown San Mateo office project, which is walking distance to Caltrain or transit-oriented destinations like San Leandro Tech Center, which sit right on top of BART. We believe this trend will continue in the years to come,” she says.

Browman Development Company’s Scott Bohrer notes they have done “substantial” work in retail, or the “play” aspect of the product mix. He says they are pursuing complementary project programs and tenant mixes in broader live-work-play environments, as well.

He points out, mixing uses is “critical to project success, though the definition of mixed use has a wide range of meaning in various settings.” He shared that the retail tenants that are having success in this “age of Amazon” tend to offer experience, building community, or offering major value propositions.

There are new uses and concepts that make the mix more interesting, and offers more to work with, notes Bohrer. Those might include co-working, new and traditional residential types, education-medical, fitness, and hospitality, which are all becoming critical tenants in the shopping center of the future. “Whether within the project or in the neighborhood, it can create a thriving mix,” he says. “One thing very important for us is finding good partners to fill experience gaps.”

For comments, questions or concerns, please contact Dennis Kaiser