Measures for Highest and Best Use of Buildings in Cities

There are a number of proposals and projects under construction as well as completed buildings around the world. A lot of completed buildings enjoy high occupancy rate and revenues while some don’t due to inability to make the most of the available built spaces.

One way to determine the highest and best use of a building is to look at its occupancy rate. Acquiring 100 per cent occupancy is said to be the most desirable, but in fact it is less likely to happen at every building at the same time. Having certain percentage of empty spaces, however, could benefit both the tenants and the owner/developer. Unoccupied spaces allow for flexibility for the current tenants in case they wish to expand because there is always space availability to consider. Having extra room also means that the owner/developer has an opportunity to find and advertize for new potential tenants, refurbish, or convert it into a different program that could generate a new income stream.

This could be another marketing strategy for company (re)branding and building more business networks. The owner can find ways to max occupancy by turning vacancy into new business opportunities, but to rest assured, the questions to always have in mind are what would be an acceptable unoccupancy rate and for how long.

In developing a high-rise project for instance, if the context suggests that the building be better off being a public one, a multipurpose building would be ideal (office spaces, commercial or residential-oriented or all) provided with effective vertical circulation. Each program would have its own area requirement out of the total building area. Multipurpose buildings in cities offer diversity of activities and social vibrancy. Being diversified and responsive to the context has the capacity to maintain the highest and best use of a building.

If a building is a multifamily housing project, a segment can be dedicated to permanently affordable units (with an incentive such as Multifamily Property Tax Exemption) while other segments may accommodate those willing to pay a little more for better units. Regardless of the classes, all units still have to fit in the “affordability” category in order to offer people of different incomes a range of financially accessible options. Increasing the number of units either by retrofitting or newly constructing could ease shortages. Affordability is another measure for highest and best use.

Developing multifamily projects in an urbanized area has at least one downside—for some people, they may feel too compact and lose the character of single-family neighborhood and privacy. To avoid losing such the character, the design itself plays an important role. The Courtyard Townhome in Seattle emphasized its design on balancing privacy and community engagement. It is a good example of how to utilize space to the fullest and at the same time, meet functional and aesthetic requirements. Good design and planning should be taken into account to boost highest and best use.

There are other case studies of commercial spaces and housing projects that are physically available, but the highest and best use has not been met despite all good intentions. “Ghost cities” in China where Paris and Manhattan to name a few, have been replicated but they are almost empty (whether or not these famous cities should be replicated is another debate), and suburban housing projects in Ireland—some units were subject to demolition whereas some were occupied but mortgage payments might have stopped due to substandard quality. Abandoned developments are never a single nation’s problem.

Building completely new towns and housing in excess elsewhere to secure sufficient supplies in the future sounds a workable plan, but no one is certain. Usable spaces and housing shortages are site specific and still today’s concern. New town developments located away from well-established major cities in these cases might not actually be the solution (yet, if a solution at all) because people still flock into those major cities. Not only is the number important, but also the right locations and time.

Not against sports, but some Olympic Games, Winter Olympic Games, and FIFA World Cup venues require huge investments and loans to host the games for only about a month long. These mega events may have left host countries’ economies crippled for years—not to mention abandonment, maintenance and other social, infrastructural priorities.

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