How to succeed in mixed use development – Part 4 of 4: The primacy of Ground Floor uses

Last week I spent a morning in a thriving town not far from London with a commercial developer and a specialist residential developer. The reason we were walking around both their own scheme, and those of others nearby, was to get a proper understanding of which ground floor uses what would give their project an edge.

Working out ‘right’ ground floor uses doesn’t have to be overly-complicated, as some commentators suggest. It involves going back to basics, to quantify what will create demand from the people who will work and live in these developments. What is trickier, I admit, is ensuring that demand is met over time. Ground floor uses need to be carefully curated (and I make no apology for that word, as it is very relevant here) – getting the ground floor ‘right’ isn’t a one-off, job done and walk away task.

Earlier they had asked me if there was a P-THREE formula for the best use of ground floors in mixed use developments. My response was that there is no such thing as a one-fix-fits-all solution, which is why our walkabout was so important.

What we can say definitively is that for investors looking at growing long-term value over time getting the mix of ground floor uses right is crucial for the long-term success of upper floors and surrounding areas. Although determining what is ‘right’ is scheme- and location-specific, it is possible to give some broad pointers on what is likely to be successful.

For schemes with a strong office element on the upper floors, creating a sense of excitement on the ground is going to be crucial in a post-Covid environment, where office-based working is no longer taken for granted. This is essentially a people issue – understanding what the talented individuals that make up workforces (and who are expensive to lose) now expect from their workplaces. It is no longer enough to have a ‘cool’ office – the proximity of fun and interesting places nearby is now a major factor for workers who have increasing job mobility.

Similarly, for schemes with large BTR elements, the availability of a wide range of engaging destinations on residents’ doorsteps will be a significant draw. In a market where BTR is becoming ever-more prevalent over freehold residential, particularly in mixed use schemes, investors who grasp this point early on will have a commercial advantage.

Working out ‘right’ ground floor uses doesn’t have to be overly-complicated, as some commentators suggest. It involves going back to basics, to quantify what will create demand from the people who will work and live in these developments. What is trickier, I admit, is ensuring that demand is met over time. Ground floor uses need to be carefully curated (and I make no apology for that word, as it is very relevant here) – getting the ground floor ‘right’ isn’t a one-off, job done and walk away task.

And a word of warning: for some schemes where independent and emerging local store group ground floor occupiers are desirable, it may take time (which will have a short-term impact on income) to establish the optimal mix for that location. Design also has an important part to play: creating a human scale environment, with clear people flows to and from the ground and upper floors, enhances desirability to inhabit those spaces.

Ground floor uses can’t be viewed in isolation. They need to be worked through in the context of the other key factors covered in the earlier parts of this Perspectives series: creating a ‘halo effect’, while truly collaborating and properly understanding the essence of community.

Above all, there needs to be some originality of thinking around mixed use schemes coming out of the ground right now. Simply signing up a coffee shop and micro-brewery (a choice insanely – yet inadvisably – popular at the moment) really isn’t the answer. If we learned anything from Clone Town Britain it must surely be that individual locations need individual solutions. Avoiding mixed use Armageddon depends on it.

Article by Justin Taylor & Thomas Rose, Co-founders, P-THREE

Photo credits: Unsplash