A bite out of the Big Apple
Urban renewal, innovation hubs, affordable housing, proptech and the future of work were among topics on the agenda for the 40 Property Council delegates who spent last week in New York.
The group visited some of the world’s most ambitious development and infrastructure projects. Among these were Hudson Yards, the largest private development project in the country’s history, and the World Trade Center’s transportation hub, Oculus, which has attracted the world’s attention for its dove-like design. Delegates also rubbed shoulders with some of New York’s most influential urban development thought leaders and policy makers.
Delegate Marc Colella, AECOM’s structures lead, has previously lived in New York and “understands what makes it tick”.
He says the New York City government is “cranking up” urban regeneration and precinct planning. And it’s no surprise that, in the city that never sleeps, these precincts are active 24/7.
“It’s not just a ‘live, work and play’ mantra in New York – office, residential and retail. It’s also about cultural attractions that create a point of difference in the precinct.”
Colella points to the much-loved High Line, “which adds commercial value to Hudson Yards” and the new $1.4 billion Essex Crossing development, which will be home to a three-block-long underground marketplace called the Market Line – the largest market in the country.
Essex Crossing will ultimately hold around 1,000 residences – per cent of which will be affordable housing, and Colella says “the government was very descriptive about the type of development it wanted”. He points to the trial of an affordable apartment model as an example, where qualified buyers can purchase under the condition that they don’t on-sell the apartment for a profit.
Affordable housing in the Big Apple isn’t just for people on the lowest incomes, Colella adds. “They cover a wide spectrum of incomes, so that key workers, like teachers, can afford to live in the neighbourhoods where they work”.
Colella says the delegates were also impressed with how New York City is advancing innovation clusters. AECOM hosted a tour of a neighbourhood known as Industry City, just south of Red Hook. The project includes the refurbishment of 12 “massive existing manufacturing buildings” and construction of some new buildings to create a “highly active innovation precinct for creative design firms, technology providers, light manufacturing and retail, coworking, start-up incubators, and events”.
“Combining light manufacturing with the food and beverage sector has driven activation to attract tenants, tourism and create an out-of-hours destination,” Colella says.
“And by bringing together heavy design firms and tech firms with light manufacturing, the project is creating an innovative platform that cross-pollinates ideas.” It’s a new take on office curation.
Proptech under the microscope
Speaking of office curation, EY hosted a panel discussion on trends and technologies disrupting the workplace at its EY Hoboken Learning Centre.
The panel, which included representatives from private equity firm Cerberus Capital Management, tech accelerator MetaProp, Australian proptech company Equiem and EY, examined space as a service, flexibility and investment in technology.
One of the key messages from the discussion was that companies have “no choice” but to “actively participate in the technology revolution”, says session moderator Heather DaSilva, a global analyst with EY focused on digital, disruption and innovation for the real estate sector.
“To watch, wait and let others innovate likely means you will miss the opportunity.”
DaSilva says EY, with more than 700 offices worldwide and an average employee age of 26, must remain agile.
“Not only do we factor in changing demographic and technological advances like robotic process automation. We recognise that the way we work is also changing.
“With around 40 per cent of the population in the ‘gig economy’ and more people choosing flexibility over stability, EY has had to find ways to compete for and retain talent. Our office footprints are smaller, but thoughtfully-designed and highly amenitised – with lighting, air quality, food, dynamic use of colour to optimise mood, options like sitting or standing desks and collaboration space.
“Technology has been the enabler for us to create spaces that people want to be in.”
Also on the panel was Equiem CEO, Gabrielle McMillan, who pointed out that new benchmarks in workplace experience, together with flexible working, smaller footprints, more distributed workforces and shorter lease terms, was putting pressure on landlords.
“Landlords need to move from the traditional ‘real estate provider’ mindset to one of an ‘experience provider’ and find ways to drive deeper engagement with all customers in the building – not just one person per tenancy,” McMillan says.
In the New York office market in particular, where vacancy has been increasing as a result of new development supply, landlords are embracing this approach. “Equiem has recently expanded to New York, having been originally founded in Australia and has already rolled out its model across 17 office towers in Manhattan, allowing its landlord clients to connect with their customers and deliver the services and experiences today’s workers are looking for.
“The Property Council’s Ken Morrison says the tour was an opportunity to “learn from some of the best in the business” at a time when Australian cities were experiencing rapid growth.
Morrison says the tour underscores the work ahead for Australian cities in the ‘metropolitan century’, and reinforces the findings in Creating Great Australian Cities, a series of reports by Professor Greg Clark commissioned by the Property Council.
“New York has undergone rapid social and economic transformations over the last decade, and there is much we can learn about how New Yorkers are embracing technology, entrepreneurship and innovative models of development to reinvent one of the world’s great cities,” Morrison says.