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— Property Management Quarterly — January 2016
M
any property managers
are discovering that clos-
ing up an open-office floor
plan after a tenant vacates
the property can be chal-
lenging, especially if the original
build-out was for a more traditional
company. Open-
plan character-
istics can vary
widely, but most
consist of 12-foot
ceilings (or higher);
exposed ductwork;
perimeter win-
dows, if available;
very low or no
walls; and concrete
slab or other hard-
surface flooring.
Throw in sprinkler
realignment, sus-
pended lighting, and a general aes-
thetic cleanup of excess wiring, old
paint, dust and dirt, and the open
plan bears virtually no resemblance
to the standard office grid, which
still is favored by the vast majority
of today’s tenants.
If an open-plan tenant moves into
a new building, the landlord has the
significant benefit of building out
that space for the first time. Once
that tenant’s lease is up, the man-
ager essentially has two choices:
leave the space as is and market its
existing assets to a similar open-
plan tenant, or flip it back to its
original condition and market it
as standard office space. The latter
obviously requires “closing up” that
space.
That’s the typical approach in
a new building. It’s another story
altogether if the landlord leases
space to an open-plan tenant in an
existing building. In that case, the
landlord must rip out what usually
are perfectly fine finish materials
to satisfy open-plan requirements,
and potentially build the space
back out as a standard office five
years later when the tenant’s lease
runs out. Older buildings pose even
more challenges to this method,
especially when managers are not
exactly sure what lies above grid or
when accurate documentation may
be lacking.
Confusing? It certainly can be.
Why would a landlord even con-
sider such an extreme demolition-
to-build-out cycle after such a short
lease term? And who pays for it all?
The answer is in the market. In fact,
it’s always in the market.
Managers need to fill their build-
ings. Period. In order to accomplish
this, they must be prepared to com-
pete, which means appealing not
only to the majority of tenant types,
but also to those who represent
a trend or, certainly, a paradigm
shift in which the American office
market still finds itself. That is not
Design
Tia Jenkins
Principal/architect,
Kieding, Denver
Photo by Ron Johnson Photography.
Open-plan spaces can be converted by landlords into conventional office space and back again in as few as five years.
