Turning Empty Office Buildings into Micro-Apartments
WGN News
[{'start': '4.537', 'end': '9.809', 'text': ">> THIS IS CHICAGO'S VERY OWN   WGN NEWS.   >> THERE IS A SHORTAGE OF   AFFORDABLE HOUSING ACROSS THE   COUNTRY AND HERE IN CHICAGO   RENTS ARE REACHING ALL-TIME   HIGHS WITH AMERICANS SPENDING   30% OF THEIR INCOME ON RENT.   THE PEW CHARITABLE TRUSTS   ALONG WITH ARCHITECTURE FIRM   GENSLER HAS STUDIED ONE   SOLUTION, TURNING EMPTY OFFICE   BUILDINGS INTO MICRO APARTMENT   COMPLEXES. JOINING ME NOW IS   WESLEY BLOCK IS THE STRATEGY   DIRECTOR AT GENSLER? HOW ARE   YA? I'M GREAT. HOW CAME UP   WITH THIS IDEA.   >> IT STARTED IS THE   BRAINCHILD OF OZ OR WAS IT   THAT THE PEW CHARITABLE   TRUSTS? AND REALLY AS A WAY TO   ADDRESS, YOU KNOW, DOWNTOWN   REVITALIZATION OFFICE VACANCY   AND HOUSING AFFORDABILITY,   KIND OF ALL THE SAME TIME.   >> NOW WE HAVE A LOT OF EMPTY   OFFICE BUILDINGS HERE IN   CHICAGO AS WELL AS OTHER   PLACE. I KNOW YOU GUYS HAVE   STUDY LAS ANGELES, HOUSTON AND   SOME OTHER PLACES. HOW DID IT   WORK THERE?   >> CITY IS DIFFERENT. THERE   ARE DIFFERENT INCENTIVES.   THEY'RE DIFFERENT STRUCTURES   IN PLACE. WHAT WE FOUND IN THE   CASE OF CHICAGO IN PARTICULAR   IS YOU MENTION LOS ANGELES AND   HOUSTON SIMILAR DISH SIZE   POPULATIONS OF THE 7 CITIES   THAT WE STUDIED SO FAR.   CHICAGO REALLY HAS THE DEEPEST   NEED FOR THIS KIND OF PRODUCT.   AND A BROADER RANGE OF   AFFORDABLE HOUSING. WE HAVE   OVER 600,000 FOLKS WHO ARE   RENT BURDENED OR SEVERELY RENT   BURDENED, MEANING THAT. THEY   SPEND 30 TO 50% OR MORE OF   THEIR INCOME JUST ON RENT.   >> YEAH. THE ESTIMATE THAT YOU   SET FOR RENT IN CHICAGO FOR   MICRO APARTMENT WILL BE $950 A   MONTH AND ABOUT HALF THE   CITY'S MEDIAN RENT, WHICH IS   1825, THAT'S A BIG DIFFERENCE.   >> IT'S A VERY BIG DIFFERENCE.   THE CASE OF CHICAGO AND THE   PROTOTYPES THAT WE LOOKED AT.   I WOULD ALSO INCLUDE I MEAN,   THE RANGERS CAN BE FROM $750   TO $950, DEPENDING ON THE TYPE   OF UNIT. THAT ALSO INCLUDES   ALL OF YOUR COST. IT'S PRETTY   THERE IS NO MOVE IN COST.   THERE ARE NO PROFESSIONAL   CLEANING. 24 7 SECURITY. IT'S   AN ADMITTED TIES BUILDING. SO   ALSO NO ELECTRICAL OR WATER   BILLS. IT'S ALL INCLUDED. SO   IT'S KIND OF A FULLY LOADED   COST TO LIVE DOWNTOWN AND JOBS   AND TRANSIT.   >> JI SUK YI: SO BASICALLY,   YOU'RE JUST PLAYING PAY THE   RENT. THAT'S IT. THAT'S PRETTY   COOL. ACTUALLY, NOT ONE OF   THESE PLACES LOOK LIKE AND   WHAT TYPE OF BUILDINGS OR WERE   TALKING. JUST REGULAR OFFICE   BUILDINGS THAT HAVE BEEN LEFT   BACON, ESPECIALLY DURING THE   PANDEMIC. SO WE HAVE.   >> ABOUT 25 MILLION SQUARE   FEET VACANT OFFICE SPACE   DOWNTOWN AND A FAIR AMOUNT.   THAT'S NOT GONNA WORK FOR   TRADITIONAL OFFICE RESIDENTIAL   CONVERSION. AND MAY NOT BE   SUITABLE FOR LONG-TERM OFFICE   USE. WE'VE IDENTIFIED. THAT IS   ABOUT 9 MILLION OF THAT.   25 MILLION SQUARE FEET. AND SO   THEY CAN WORK REALLY WELL FOR   THIS PRODUCT TYPE ACTION. AND   SO WE'RE TALKING ABOUT   BUILDINGS. I THINK IN THE CASE   CHICAGO, WE TOOK PROTOTYPICAL   BUILDING IS 10, 12 STORIES. NO   200,000 SQUARE FEET YOU KNOW,   EACH FLOOR WOULD DWELLING   UNITS ON THE PERIPHERY THAT   HAD ACCESS NATURAL LIGHT AND   THEN SOME CENTRALIZED   AMENITIES, INCLUDING   BATHROOMS, KITCHENS, AND   THINGS OF THAT SORT.   >> MICAH MATERRE: I GUESS MY   BIGGEST QUESTION IS HOW IS IT   BEING PAID FOR IT? THE RENT IS   UNCOVERING EVERYTHING. WELL,   ACTUALLY WENT THERE. I'M   SORRY. THEIR RENT IS COVERING   IT. BUT ISN'T THERE'S STUFF   THAT ISN'T BEING PAID FROM   THAT SMALL AMOUNT OF MONEY   THEY'RE PAYING.   >> NO, ACTUALLY THAT WHAT WE   DID AS PART OF THE MODEL    BECAUSE WE CAN FIT SO MANY   MORE FOLKS INTO THESE   PROPERTIES AND THE EFFICIENCY   OF THE UNITS ARE SUCH THAT   THEY ARE, YOU KNOW, YOU CAN   GET 3, 4, 5, TIMES THE AMOUNT   OF PEOPLE IN A PARTICULAR   FLORENCE. AND YOU GOT A   POPULATION LET'S SAY 30400   PEOPLE IN, YOU KNOW, THESE   INSIGHTS BUILDING, BUT NOT A   MASSIVE BUILDING. AND SO WHAT   WE DID TO ACCOMMODATE FOR THAT   IS INCREASED OPERATING COSTS   AND REALLY CHANGE THE MODEL A   LITTLE BIT. AND SO   >> THAT IS ACCOUNTED FOR IN   THOSE RENTS. AND WHAT ABOUT   SECURITY? AND WHEN AND WHEN   THIS START?   >> MIKE LOWE: GREAT QUESTIONS.   SO SECURITY. 24 7 PROFESSIONAL   SECURITY PROFESSIONAL   CLEANING. THIS IS ALL BUILT IN   TO THE MODEL ONE OF THE   GREATEST THINGS THAT YOU   TOUCHED ON THERE IS REALLY THE   SPEED TO MARKET. THESE CAN BE   DONE IN 12 TO 18 MONTHS AND   COMPARED TO A TRADITIONAL   GROUND-UP DEVELOPMENT. THAT'S   A PRETTY SIGNIFICANT   DIFFERENCE AS WELL AND A   TRADITIONAL OFFICE RESIDENTIAL   CONVERSION WHERE YOU HAVE TO   MOVE A LOT MORE OF THE CENTRAL   INFRASTRUCTURE OF"}]