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Old 03-10-2018, 12:27 PM
 
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One big factor not mentioned, is the fact that it is a lot easier to fight a fire, etc. in a shorter building than one three times as tall. This fault alone, is important as it can effect the insurance rate on the buildings.

City building restrictions outside of the down town core a city like Denver, may limit the height of buildings, because of cost to provide fire protection is much higher for tall buildings than those of a lower height.
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Old 03-10-2018, 01:00 PM
 
Location: Aurora Denveralis
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Originally Posted by oldtrader View Post
One big factor not mentioned, is the fact that it is a lot easier to fight a fire, etc. in a shorter building than one three times as tall. This fault alone, is important as it can effect the insurance rate on the buildings.
Which answers (well) the reason for height limits... but not for building one large building of the same height on the footprint of several.

My small town in CT was faced with a development proposal that was furiously debated. What finally sank it, on the we-need-tax-revenues booster side, was the $500k cost to outfit the town FD with equipment for an 8-story fire. (They could handle 3.)
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Old 03-16-2018, 12:29 AM
 
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Originally Posted by Quietude View Post
Which answers (well) the reason for height limits... but not for building one large building of the same height on the footprint of several.
My small town in CT was faced with a development proposal that was furiously debated. What finally sank it, on the we-need-tax-revenues booster side, was the $500k cost to outfit the town FD with equipment for an 8-story fire. (They could handle 3.)
One building gets a fire on the ground floor, and the damage is extensive, and all businesses in the building are unable to functionion. Have 4 buildings and 3/4ths of the businesses still O.K.
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Old 03-18-2018, 07:52 AM
 
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Originally Posted by Quietude View Post
Around Denver, I've noticed the same thing I've seen in many cities: two or three or more buildings in a group, architecturally identical (or at least matched), often built at the same time, often with less than 100 feet separating them. Very common model.

Why? What's the advantage to building duplicate buildings, at the same time, so close together? Why not just make them one building, with as many "cells" as needed to meet architectural or use standards?

I have one working theory- that buildings are built in series to stretch out financing and occupancy. However, I've watched more than one set go up and take leases more or less simultaneously.

So why a set of buildings, in the same location, instead of one large one? Wouldn't efficiency of scale, lack of redundancy in systems like elevators and HVAC and cross-access be more important than... making some kind of architectural statement?
I think you need to understand how commercial real estate gets done.

First, such complexes are mostly speculative and there's a much higher probability that you'll rent to several mid-sized tenants than one large one. Further, no potential tenant beyond a certain size simply walks into your suite of vacant offices and says, "Great, we'll take it." They always request buildouts and modifications.

Second, such developments are most often built in phases and backed by investors. If you have a five-building complex, you might erect buildings 1, 2, and 3 this year and finish out the rest two or five years from now depending on demand. It is a very rare situation where you simply erect a massive building and lease out the entire thing in one fell swoop. A large building typically requires a couple of years to fill up in a good market. And when you realize that the break-even for most commercial buildings is somewhere around 70-75% occupancy, that's a long time to be hitting up your investors for additional kick-ins until the building begins to cash flow.

Third, really large tenants are mostly build-to-suit. As in from the ground up.

Fourth, people want to enjoy easier access to parking. It's far easier to develop a site plan to accommodate that with several mid-sized buildings with mid-sized parking lots than one large building with a massive parking lot. Meanwhile, parking decks and parking garages are several factors more expensive than parking lots. With a parking lot, you just need more acreage. Plus the TIC costs on maintaining a parking deck is often cost-prohibitive.

Fifth, tall buildings introduce an entirely new dimension of problems from the elevators to fire control systems to city building codes to FAA requirements and a host of other factors. I mean, all you have to do is understand what it takes to put a crane on site and you'll realize what I mean. Given where such developments are built, it's far more cost-effective to spread out than go up. The land is way cheaper than the construction.

Last edited by MinivanDriver; 03-18-2018 at 08:16 AM..
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Old 03-18-2018, 11:54 AM
 
Location: Aurora Denveralis
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Originally Posted by MinivanDriver View Post
I think you need to understand how commercial real estate gets done.
I understand it quite well, actually. But there were some aspects that boil down to "flexibility" that weren't occurring to me when I drive by these cookie-cutter building sets. They've all been explained and explored pretty well in this thread.
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Old 03-18-2018, 01:43 PM
 
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Originally Posted by Quietude View Post
I understand it quite well, actually. But there were some aspects that boil down to "flexibility" that weren't occurring to me when I drive by these cookie-cutter building sets. They've all been explained and explored pretty well in this thread.
If you understood it well, you would have never asked those questions in the first place. Just saying.

I mean, hey, if you are curious about it and want to pose the question, that's perfectly fine. That's what the forum is for. But don't ask a bunch of questions and then later lay down some BS on us that you really understand the biz. It's okay to not know.

Last edited by MinivanDriver; 03-18-2018 at 02:02 PM..
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Old 03-18-2018, 02:02 PM
 
Location: Aurora Denveralis
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Originally Posted by MinivanDriver View Post
If you understood it well, you would have never asked those questions in the first place. Just saying.

I mean, hey, if you are curious about it and want to pose the question, that's perfectly fine. That's what the forum is for. But don't ask a bunch of questions and then later lay down some BS on us that you really understand the biz. It's perfectly okay to not know.
Hey, don't cop a 'tude on me because you jumped in after fifteen people had already given plenty of input, nicely summarized in your weeks-after contribution.

For one thing, most of the answers covered things I already did know - height restrictions, different ownership etc. - and more than one reply assumed different conditions (one 30-story building instead of 3 10-story) - but it's a more subtle question and answer as to why you build multiple buildings in the exact same footprint of one contiguous building and very often at the same time - and that was well-answered before you wandered by.

But gee, thanks anyway.

Last edited by Quietude; 03-18-2018 at 02:11 PM..
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Old 03-18-2018, 02:22 PM
 
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Originally Posted by Quietude View Post
Hey, don't cop a 'tude on me because you jumped in after fifteen people had already given plenty of input, nicely summarized in your weeks-after contribution.

For one thing, most of the answers covered things I already did know - height restrictions, different ownership etc. - and more than one reply assumed different conditions (one 30-story building instead of 3 10-story) - but it's a more subtle question and answer as to why you build multiple buildings in the exact same footprint of one contiguous building and very often at the same time - and that was well-answered before you wandered by.

But gee, thanks anyway.
I copped a 'tude with you because you asked some very rudimentary questions and then handed me a dose of attitude when I responded. Without wading through four pages of answers, I gave you a pretty good answer based on my background in the biz, which spans a period from when I was sitting around the dinner table listening to my dad talk shop to being an investor myself to being married to someone who is a CFO in the biz. My answer was then met with a "Thanks, but I already know commercial real estate pretty well." Well, reading a handful of answers on a message board doesn't make you an instant expert.

And your most recent answer demonstrates that you still don't get it, even though you're trying to bluff your way through it. Erecting a commercial building requires a ton of steps before the first spadeful of earth is turned. You have to round up investors, conduct absorption studies, determine phases of construction, and an entire other range of considerations that determine the size of the building, footprint, et al, without even taking into account factors such as building codes and height restrictions.

Last edited by MinivanDriver; 03-18-2018 at 02:30 PM..
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Old 03-18-2018, 02:33 PM
 
Location: Aurora Denveralis
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RFC, that's all I can say. Seems like you've been around long enough that ignoring the whole flow of a thread to do a pompous brain dump - and then wondering why all your hard effort ain't 'ppreciated - would be something you'd learned to avoid.
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Old 03-18-2018, 02:43 PM
 
3,974 posts, read 1,601,299 times
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Originally Posted by Quietude View Post
RFC, that's all I can say. Seems like you've been around long enough that ignoring the whole flow of a thread to do a pompous brain dump - and then wondering why all your hard effort ain't 'ppreciated - would be something you'd learned to avoid.
Seems like if you'd quit being the poseur and behaving like the instant expert on everything you wouldn't get these reactions.
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