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Real Estate - Commercial

Office Buildings Finding New Life

By Cece Nunn, posted May 6, 2022
The Foundry, a mixed-use project in Alexandria, Virginia, designed by architecture firm Cooper Carry, resulted from the redevelopment of an office building. (Photos by Judy Davis Photography c/o Cooper Carry)


Steve Smith would be surprised if the former PPD headquarters in downtown Wilmington doesn’t remain an office building as the company that purchased PPD considers selling the property.
 
“The design of the building has predominantly column-free space providing tremendous flexibility in office planning and layouts. I don’t think the life of this building as an office building is over by any means,” said Smith, an architect whose firm, Cooper Carry, was a master planner and design architect for the PPD headquarters at 929 N. Front St.
 
Ultimately, though, Smith said, the market will determine whether there is demand for office space of that size in the city.
 
Built more than 15 years ago, the headquarters of the global pharmaceutical firm stands 12 stories and contains nearly 400,000 square feet.
 
The property also includes surface parking, a parking deck and an underground garage. Cooper Carry worked with Cline Design Associates on the architecture of the building, the tallest in Wilmington.
 
The announcement in April that Thermo Fisher, which purchased PPD last year, is in the initial stages of potentially selling the building prompted a brighter spotlight on what has been ongoing speculation about its future use. Even before the COVID-19 pandemic sent workers at companies across the U.S. home in droves, many PPD employees were already working from home. According to Thermo Fisher, it has 1,700 clinical research employees living and working in and around the Wilmington area and many prefer a hybrid work model.
 
In that case, could the PPD building be turned into housing? It’s a complicated endeavor that comes with risk, the conversion of a structure from office to residential space, and in many cases, such conversions take place with historical structures no longer suited to office needs.
 
“I’d be surprised if it doesn’t remain an office building,” Smith said of the PPD HQ, “because the bones of it are great. It’s got a 45-foot clear span, from the perimeter back to the core, no columns in between. The amount of flexibility for anybody that wants to use it is tremendous.”
 
‘INTERNATIONAL TREND’
According to the Thermo Fisher news release announcing the news of a potential sale, the PPD clinical research business of Thermo Fisher “will seek new office space in Wilmington to support business growth and will explore opportunities to sell its property downtown. The multi-year initiative will enable this business to better match current and future workspace needs with flexible work models.”
 
The effort “reflects an international trend, accelerated by the COVID-19 pandemic, of companies reevaluating office space needs as technology and employee workplace options have evolved … ”
 
Still, despite office vacancies around the country, Smith said he still can foresee an ongoing return to the workplace.
 
“I think the question that nobody asks is, ‘Can we work as well remotely?’ And I know in a lot of cases, the answer is no,” Smith said.
 
CONVERSIONS ELSEWHERE
That said, however, the market will dictate what its eventual use will be, he said, and the current apartment market throughout the U.S., including in Wilmington, is extremely hot.
 
An example of a successful office building conversion, among many Cooper Carry has completed, is The Foundry, said Smith, whose firm has offices in Washington, D.C., New York City and Atlanta.
 
The Foundry project in Alexandria, Virginia, is a mixed-use development with 16 stories and 520 apartments that used to serve as a Department of Defense office.
 
“It was a 13-story office building, built around 1970. The original ground floor had no windows in it because it had DoD-sensitive components and we turned it into a 16-story, mixed-use building with multifamily, retail and parking,” Smith said, “and everybody shakes their head and says, ‘How does an office building get changed into multifamily?’ because an office building’s depth is about 120 foot. An apartment building is somewhere around 65 to 70 feet deep in a typical double-loaded corridor design. So there’s a big difference between those two as to how you can make that work. And we were able to solve that at the end of the day.”
 
Smith said his firm found that the building’s foundation could hold three more floors, which solved the problem of parking after the structure’s surface parking space was sold off to a separate buyer and turned into a different mixed-use project.
 
The Foundry proved popular, he said. “The first units came online in COVID,” Smith said. “Through COVID, 520 units were 97% leased so it was a huge hit.”
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