Down On The Corner: How Long-Term Thinking Can Help Developers Make The Most Of Every Square Foot

Master-planning calls for thinking long term — in particular, considering how developments can be maximized to their full potential and which asset types will bring value to a community. 

This approach is especially helpful when merging two assets, such as industrial and retail, into one development plan. Having a forward-thinking approach to the development would include industrial as the root and retail on the corner. This would significantly benefit developers who can capitalize on all available land, said Lee & Associates Senior Vice President Brandi Dees.

When Houston’s industrial developers, for example, are planning their projects, they should be looking outward and considering what the site’s highest and best use is, said Lee & Associates Executive Principal Thomas Leger. Not considering the bigger picture from the jump could mean leaving opportunities on the table, such as leveraging the high price of a corner property, which can be suitable for retail space.

“Some of the more popular areas to live and work in Houston are the newer master-planned areas,” Leger said. “These areas are thriving a lot more than those in the middle of nowhere with no guidance on the planning or vision for what the site will look like in the long term.”

Looking more broadly at the location’s demographics and surrounding area can help to maximize the site’s potential, he said. If this work isn’t done in advance and the project has already broken ground, it may be too costly to make changes.

Leger said that while not all industrial sites need to have a retail component, the ones that do could see financial returns, especially since retail brings in income from rent. 

Dees emphasized the importance of making an industrial location “amenity-rich,” or using the corner as an amenity for employees and users — something that retail can provide. This could be a fuel station, an eatery, a nail salon, a daycare or an electric vehicle charging station, for example. Having an added benefit of the retail development can be a convenience for both distribution and employees of these industrial sites.

“We want to make sure that every available corner can be utilized and maximized from an amenity standpoint to help enhance the industrial site,” she said. “This will in turn benefit the development and community around it. Also, corners will always be the most desirable location from a retail perspective because of the visibility it brings at any intersection.”

She said these projects can also add life to the community by helping to bring more jobs and traffic to the area.

When it comes to developing or selling these properties, Leger advises industrial brokers to be proactive in getting their projects maximized by connecting with retail brokers in their market and taking a collaborative approach to dealmaking. Retail brokers can assist industrial brokers by providing insight into the dimensions of a property and helping them advise their developer clients what they can sell their site for, especially a corner property.

“In CRE, we typically are taught to stay in our lane, but having certain lanes merge together is beneficial for everyone,” Dees said.

This article was produced in collaboration between Lee & Associates and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com.