The Creative "Viz"

Hello and welcome to the creative viz podcast where we talk about topics in architecture, real estate and visual design. Today. I've got the pleasure of speaking with Lauren Zinkan she is the director of marketing and communications with Martin Selig real estate in Seattle, Washington. Welcome Lauren. Great to see you. Thanks for having me. Absolutely. I understand you are primarily operating in the office market and that is especially challenging these days. I'd love to hear your perspective. What are you seeing? And if you can tell us a little about any hopeful signs you might be seeing in the commercial office market these days. Definitely. It's no secret that the commercial market is moving a little bit slower than it used to. The general trends that we're seeing is an uptick in activity. But instead of having, the super large requirements where, tenants are looking for 80, 000 square feet. Instead, they're looking for, 20 or 30. We're also seeing, more flexibility in the spaces that they want. Instead of having a lot of, individual offices built out, except for, more traditional industries, like the legal industry we're seeing a lot of hot desks. We're seeing a lot of open floor plans amongst all of the buildings we're seeing this; amenities arms race where especially older buildings are trying to compete with the new class a building a bunch of amenities and are, trying to create this pull to get businesses in and offer, more competitive rates and offer, similar to the same amenities at, a lower cost because of, it being an older building.  Are you finding that tenants are, reducing their footprint. is that something that you're seeing on the ground? I would say, yeah, especially the super large tenants that, we're occupying, entire buildings or multiple floors. We're seeing across the board, just a reduction of space. We're seeing Amazon giving up buildings and changing where their offices are located. Another thing that we're seeing within the urban environment is that those spaces are being hit a little bit harder. Because when covid hit and everyone spread out to more of the suburbs we saw a lot of satellite campuses open to be closer to the employees. And I think that with the return to office mandates that are happening and, with people having to, start commuting again, we're seeing companies try to meet employees in the middle and say, our leases are up, or we're going to reduce our footprint, but we're going to come closer to you, or we'll offer more options where you can go. Interesting. So even if you're in the office, you might be working remote with other teams. Yeah. And I think that taking that approach of companies that have multiple locations, across the U. S. or across the world, they're saying, instead of having one office in Seattle, we'll have, one in Seattle and one in Bellevue and one in Tacoma and just dispersing a little bit more, but keeping the overall footprint. So, the overall footprint may not have changed all that drastically, but it is going into different places. Then just extrapolating from that. Do you think that some of the submarkets are overperforming? Are they actually benefiting from this trend?  There's definitely been some submarkets that have grown from this. I'm based in the Seattle area. So, I am most versed with that. But I know that Bellevue has been a hot topic and especially with COVID and, moving over to the East side a little bit more. We've seen a lot of companies at least consider that as an option. We're also seeing, a lot of growth in Tacoma.  Seattle is coming back pretty substantially. From Amazon requiring employees to come back in office. Also, just from the day-to-day foot traffic that I see downtown. We're definitely seeing a trend of people coming back to the city. The Tacomas, maybe Kirkland's of the world might be benefiting in the short term while the, center city markets are still recovering, Definitely. The 1 thing that noticed is that the city is still remaining as, the hub of where everything is. That's where all the headquarters are but we're seeing growth in, satellite offices more dispersed throughout the region. As a result of all this would you say that tenants looking for short term leases more than they might have a few years ago just to maintain flexibility. I would say that there's honestly, two camps that are happening right now. There are companies that have, decided what their real estate strategy is. They know what they want to do and they're confident signing, 10 to 15, maybe even 20-year leases. Then kind of in the other camp, we have companies that typically tend to be, smaller or more midsize companies Are waiting to see what everyone else does. And from my observation, what I've seen those companies do is they're more inclined to kind of extend their terms and they'll, extend their lease for, a year to five years because they want to see how the market shakes before they make any large decisions. Let's get back onto marketing. Love to hear just kind of your approach. Now I understand you're primarily office. Do you put together marketing packages for other building types, residential, mixed use anything else? Currently I do office and one mixed use building. In a previous role, I oversaw multifamily assets. So, I have a little bit of experience with both. I would say that they are, completely separate entities in terms of how they're run and, what you're looking for. I would say, speaking from the office side of things I think it, poses, the biggest opportunity for a marketer right now. But also, it's the biggest hurdle because there is so much on the market. It's really a question of, how do you stand out? How do you, call attention to yourself and also looking at the financials of how much are you willing to spend on a campaign to get back what you need? From, digital side of things, the major trend we're seeing is that a lot of companies are putting a lot of marketing dollars into their campaigns and they're buying, the highest tiered listings on, the MLS platforms. And if you can afford to that's great. On the flip side, if you're, trying to be. More efficient with you spend, how else do you approach that? I think that has kind of been where I've landed, to me, I can't justify spending that amount because, the conversion rates just aren't there. And so, what I pivoted to is taking a more retention-based strategy because if you think about it, the cost of, going and getting, a new lease and a new tenant, not only are you paying, for the marketing and the space planning and all of those things, but then you have, the cost of the build out. And it's a long time to really get that tenant in and start paying rent versus if we, turn inwards and say, how do we keep the people that are in our buildings, even if they want to, downsize, how do we keep them with us or within this space? It could be more cost effective just to work on the retention. Both in multifamily and in, commercial real estate in my opinion, I think tenant retention is, one of the highest indicators of, a good business strategy, but also from a financial performance standpoint, that's where priorities should lie. As a marketing professional, do you put together campaigns for existing tenants? As their Lisa starts a sunset, like, hey, you might be thinking about X, Y, Z. Here's why you should stay. So, when I joined, this wasn't a strategy that we had been using previously. So, I looked at, what does a tenant experience, what are all of our touch points when, they come in with us. And, from the move in to when their lease is up, however many years later that is, how many times do we get to interface with them? What materials are they getting? And what is that experience? It really came down to, there's a move in, there's a thanks for being here. We're excited to have you. And then, down the line it's, hey, do you still want to stay? In my mind, that has been successful and that's worked since you're working with companies versus, individual residents. You don't need as many touch points. But there's really a big opportunity there. I have brought in I call them; tenant retention events and we've used them to circle around our company values and try to, align both of our tenants and provide them something fun to do and build community, but also kind of show who we are as an organization. It's been really fun. We've been able to get, our sales team out there and interface with everyone. We've done anything from, holiday events to philanthropy and community service. We've done, local discounts for either vendors that we have within our portfolio or, neighborhood partners. Fun games. We've done, Surveys with raffles, anything that we can do to, interact, gain feedback, understand what we're doing well, what we can improve on and then really taking that information and saying, okay, well now how do we act on this? We know that there's an issue here. We know that we're doing really well here. How can we make that better? how can we fix something that we've identified is, a common weakness? Can see that feedback could be a real problem. On the commercial side, if you may not talk to them for years. And so, you may not really Have that many opportunities to hear from them directly. What are your concerns here? Like you said, what's working, what's not. Whereas, an apartment building, you might get that every year. You'd be released and stuff. You're going to hear it. Something's not working. You're going to hear about it right away. If you think about it, in an apartment building, you're your own representative, right? If you have, a leak or something's broken, then you're going to say something about it. In the commercial market, you have one contact. And sometimes, it's an office manager. Sometimes if it's a smaller business, it's the owner. What I have learned is creating the survey and sending it out to whoever is the representative that, gets the information from, the ownership group, but bringing those in person events and bringing, all of the employees out. It's amazing what you learn and what you find. Once you start talking to them. That's great. As a marketer, I'd love to hear some of your strategies for personalizing campaign. It sounds like, you're working small all the way up to the biggest what's your mindset when you go into a sales launch or leasing campaign? How do you do your research and tailor it, to the situation?  The general rule of all marketing is know your audience, know what they want to see, know what they're looking for know how they want to be communicated to and if there's a specific client in mind, there's a lot of research involved and it's, how do they present themselves? How do they communicate? What have they established their values are, where are they funneling their energy? And then we can take a look at that and create a tailored approach to it. Some fun projects that I have been a part of have been for. A social media client, we created the pitch deck to look like their social platform. They were interacting with it like they did their software. That was a really fun project. It was also really hard for me to get in the mind of, how do I design this? I'm sure they're going to find a million things that I messed up in here, but I hope it looks, 90 percent there that's a fun one. It's also about knowing, the people that you're working with. Sometimes it might not always be a pitch deck and sometimes it might be more of that relationship approach what does this person value and what are they interested in? As someone who's kind of all in on digital marketing, do you go into campaigns with notions of we're going to do X amount of social media, we're going to do website, other digital assets versus, we're going to Do events. We're going to invest in, face to face marketing, maybe print or physical investments that you might make. Do you go into campaigns with that in mind or does that come later after, of the research has happened? Would say that is More of how it starts and then the research fills in my approach of how I do it. When I'm initially setting, a campaign or deciding what we should be doing, it's, what are the business objectives and, what are the marketing objectives that I need to reach in order to support those. If we're trying to gain more exposure, maybe I'm going to put more emphasis on, our social platforms, or if we're trying to, generate more leads for our sales team, then I'm going to focus more on. The digital channels and more of, the MLS platform and broker relationships and things of that nature. I create a giant document basically that says, what does the company want to achieve? What do I need to achieve in order to help us get there and then break it down. It is a very large document, but basically at the end, it's a page called outputs. And it says what do I need to produce very boiled down anything from, we need 10 social posts a month on each channel. We need, one blog written about, one of our values or how we're interacting in the community. We need one positive PR piece, in a regional market. And then, maybe per year we want, one mentioned in a national outlet. And, go down there and say, these are all of the things that we need to achieve. Then just start chipping away at how and then the research comes into place. It can sometimes be really intangible. Obviously, there's getting the other party to sign on the line, but in other ways, how do you measure success? do you know if you've achieved success? Up to that point I'm primarily a data driven person.  Marketing without any data is just gambling. I always like to see that, the figures are aligning with, the strategy and checking in to make sure that we are growing, at an appropriate amount for the amount of effort and spend that's being put into something. Aside from that, big thing to me is, what is that impact? And what are you hearing and kind of listening to the chatter on the market?  What does the community, think of us and, what can we do to, build this relationship even more or, stand out from other groups? It's having an ear to the ground, having, connections and saying, behind closed doors, what are people saying regardless of if it's good or bad, it's always important to know because then you can change whatever you're doing or enhance it. That's great. As we wrap things up, any other thoughts you had on that. like to end on something hopeful. Any predictions, for 2024 any hotspots things that are going well these days. I would say overall predictions, in the headlines, the main tagline has been, quote, unquote, survive till 2025. I think that's when the market is predicted to stabilize and things will, return to their new normal. Normal.  The new normal is definitely the phrase that we should be using, but that's my own personal opinion. Overall, the market is definitely picking up not quite exponentially, but almost there in places that you'd have, only a couple tours. Now there's a ton.  Companies are finally starting to get the confidence. To return back to the market.  Return to work policies have stabilized for the most part where companies have either decided, you're hybrid, you're in all the time, or, you can be fully remote. And because of that, we're starting to see more curiosity going on. We're seeing a lot of, requests for flexibility in terms of, how much space can we take? What if we don't need that? Having, more open conversations of, what does this look like? There's a lot of people that are unsure because there's still, this push and pull between the employers and the employees because there's very different, wants and needs there. It's a very intricate dance of how do we, Get our employees in and make them happy. How do we, achieve what we want to and how do we, not create tension over it. The biggest thing right now is just, having an open line of communication. Being able to, have a big picture idea and be open to ideas or things that. Aren't traditional because with most of the office spaces that we're seeing, be built and open up today, they don't look anything like they used to, they're coffee bars lounges and living rooms. They're not, cubicles or offices. We were talking about the third space just a minute ago and, how employers, are feeling like that's a big draw for, their staff is to give them that space to socialize in ways that they may not have through the pandemic. Definitely. Remote workers are wanting somewhere to go, but they don't want to go to an office yet, that's definitely, a way to meet in the middle and say, okay, well, it's not, quote unquote, an office, but how about you, hang out where everyone happens to be employed by the same person and you get a free cup of coffee. I believe that that's going to be the winning strategy going forward in this market. So many insights today. Thank you so much, Lauren. Really appreciate you joining us today. Anything else you'd like to add? Any causes close to your heart that you'd like to share with us? I would say that for any woman that's interested in commercial real estate, there is a great organization called crew. They do a lot of great work, across the U S and it's been a great resource for me. I would encourage anyone who's interested to check it out. That's great. Thank you so much, Lauren. Really appreciate your joining us today and for our listeners, be sure to follow us to stay on top of all of the latest developments in architecture development and visual design. Till next time, I'll see you later.

Hello and welcome to the Creative Viz Podcast, where we talk about topics in architecture, development, and visual design. Today, I'm pleased to have Alex Kolodziejczyk. He is a Vice President of Development with CIM Group in Los Angeles. Welcome, Alex. Great to see you. Morning, Scott. Thanks for having me. Absolutely. Love to talk about housing development, particularly multifamily housing in your neck of the woods, Southern California. One of the topics that comes up so much these days is affordability. I'd love to hear kind of your take on where the market is right now and what can be done to try to tackle the affordability problem that's so acute right now.

I've been developing commercial real estate here in Los Angeles with CIM for the past seven or eight years. And things are definitely getting a lot more challenging. The way the interest rates are, the way the cost escalations coming out of COVID are still very prevalent. Adjustments and staffing, both on the private side and the municipal side certainly makes things difficult and, in some ways easier but it's definitely getting overall harder and a lot of different ways and from an affordability side we were all hoping that the rental growth of the past few years would keep on, marching along but as we kind of seen in the past 12 months rental rates have kind of topped out in most major markets and coastal markets, especially LA. It can't really get much higher for a standard market rate product and with the interest rates purchasing sale for condos is not exactly a viable option at the moment. And so, we're kind of in a standstill at the moment.

You mentioned some things might be getting easier. Is that something you can talk about? Well, I can say from a municipal perspective, the city of Los Angeles has really tried to overhaul their plan check process. And they've gone electronic on many things which for basic level applications and reviews makes things a lot easier. Just having to go through an online portal and upload plans and not having to wait in line and sit at a counter and kind of pull a ticket and try to get a plant checkers attention certainly helps in that regard. But there's some challenges associated with that electronic system. Sure, I can imagine. Pros and cons, always, right? Yeah. I'm thinking something else that might be changing for the better. The city of LA in particular is looking at increasing upzoning sites near transit. Is that something that you're seeing and could potentially be helpful? Yeah. I mean, the state's density bonus program has always been alive and well. But now with TOC, there's extra incentive for development around high transit areas whether that be a bus stop, future train, stop major nodes throughout the city. Each program has its own little nuances but generally speaking the TOC applicable areas are definitely a good place to look at for the extra incentive. Absolutely, so do you find then that it's competitive for these somewhat limited sites that are near transit? Yeah, it definitely adds a lot of value to a site for a ripe redevelopment or new construction project you have a lot of opportunity to think about. In terms of density, parking reductions everything from setback adjustments. And there's a pretty long list of incentives. And I think the local communities through community plans and overlays have been starting to adopt their own sort of interpretations. Of the TOC areas for better or worse. I think it's really competitive. And much as zoning likes to push things forward, the state reducing the parking requirements is always an interesting benefit and gives a developer a lot of flexibility. But in some ways, we're still asking ourselves the question are we really ready to put up a new multifamily building with minimal, if not any parking?

Right, are tenants ready for that? And then are you seeing any shifts at the community level? Nimbyism has been such a problem throughout the country, especially in California. Are you seeing any shifts there? People may be more open to new development than they might have been in the past. I can say that historically, L. A has been very traffic focused. And so, the traffic impacts of anything you planning to do on a site is highly scrutinized. So, interpreting the 2035 mobility plan in Los Angeles and, having that constant struggle with pure engineering in terms of expanding roads versus widening sidewalks is always kind of a juxtaposition there with the city's rules. But from a community perspective, I think there still is some apprehension about putting commercial traffic on local roads, depending on where these nodes are throughout the city. But generally speaking, there's a lot of food deserts out there still, especially throughout South LA. And so, you have to improve the infrastructure and you have to bring in that traffic to get a major retailer or some real, commercial focus to those areas. There's a tension between getting the foot traffic, but yet the traffic on the roads for the neighbors. Are you having success? Are there specific things that the neighborhoods communities are looking for in new development? I can say that there is definitely an apprehension towards any above ground parking, city planning, through community involvement has really put a restriction on above grade parking. They don't want to see it. They don't want to feel it. They really understand that it's, not the most visually pleasing and it's, left to the open market. We'll probably not make it the most beautiful parking structure out there. So, there's a big push and kind of incentive to put parking underground which has its own costs and implications. I think that's probably the most notable, storefront percentages certainly scrutinized in a lot of community plans. Of course, setbacks. At any time, you're building commercial next to residential, there's always some transitional height impacts relative to maybe some residential across the street. And how that impacts height restrictions. It's just always interesting. These things that are nice to have that we want, but end up adding costs to the projects, moving parking below ground makes the units more expensive. And then, it's just the circle of affordability. it's especially tough when you have that income stream somewhat restricted at the moment it starts to make the underwriting a lot more difficult.

Are there things that new development can bring to these communities that would be an asset? And not just, looking at things from the liability I think the right tenant mix is really the secret sauce to any sort of redevelopment of an area not just a Pacific particular site, but an area and community. I think, asking around, talking to your local community, figuring out, what really the needs are the idea of bringing in a major. Grosher sounds great and it probably will add a lot of traffic and access to cheap, affordable food, but at the same time, it could also displace a lot of local businesses and restaurants that have made the community what it is years. And so it's a balance, it's a balance of both but reaching out to community, understanding their needs, I think is the first step and seeing what's viable options relative to the right type of tenancy in the right, area. Is there a lot of effort then on personalizing the project to the community doing pre, planning meetings with the neighborhood groups. What is out for you guys? It starts on many different levels depending on the process. I can say that LA has definitely made a name for itself in terms of having a lot of different stakeholders as part of the process. And so getting out in front of that early on will definitely help smooth out the process. The last thing you need is a bunch of different community members showing up at an entitlement hearing and voicing opposition for various different reasons. And so really getting ahead of that. And identifying, who these key stakeholders are and what their needs are and what the community sort of evolution looks like and what your plans are. And aligning the development plan with their goals is usually a step in the right direction. It can really streamline the process.

Absolutely. I'm thinking about some of the older buildings that might be rehabbed. Is that something that you guys are looking at as well? In terms of not just cost standpoint, but carbon footprint infrastructure that might be in place for some older buildings being, older residential buildings being repositioned or older buildings of other uses being converted to residential. Adaptive reuse is an ever changing policy in Los Angeles. I think they're actually in the process of overhauling the current ordinance now and expanding it beyond the downtown historic area. It certainly has a lot of advantages, there's usually a speed to delivery. You don't have to tear down a building, you don't have to dig a hole, you don't have to build a superstructure so that speed of what you're doing is usually a little faster and can shave some money off the cost of the project. But at the same time not every building is equal. And assumptions of the things that can really kill the design and construction process. Every time you peel back a layer of the onion, it might get uglier and uglier every time you get closer to the center. It's certainly a different process. If you're looking at an existing building and looking at converting it, repositioning it, really doing a lot of due diligence and not making very many assumptions and going into it conservatively is the right approach. Everything from a failing structure to a failing roof to leaking basements to aging MEP systems or outdated electrical service. There's situations where utility providers are saying, you're connected on a very old circuit and that old circuit can't support this proposed use that you're planning on doing whether or not the service is grandfathered or not. And so literally everything needs to be highly scrutinized to have it be viable because you really don't want to start a project like that and then get caught with your pants down halfway through it can really, make for an ugly situation.

I can imagine we don't have as much of a track record for rehabs as we do for ground up new construction. I mean, seismic retrofit has been pretty standardized in LA since, 94. But the seismic retrofit process is one of many in terms of everything you have to look at an existing building. Is there a particular type of building that, would be a good candidate for reuse? Are you seeing any commonalities in, what's out there? Yeah, you have to kind of look back at the fundamentals, If you're thinking about converting a building from office to residential, is that community really supportive of residential use? Is that ground floor street presence really conducive to ground floor apartments? What is that parking looking like? Where did these residents go? It's not just providing parking throughout the day, but also at night. So the parking question is almost inverted. Is there enough services and amenities in the community? Is there a place to get coffee? Is there a place to go to the grocery store to pick up your dry cleaning in the area? Those are questions that we get a lot. And then from a building, structure perspective , most people don't want to live , in a converted office building with a glass tower, and so architecturally does it support kind of a more warm and friendly residential purpose. But also the floor plate size, what does that vertical transportation look like? No one really wants to sleep in a dark bedroom, but there's creative ways that you can bring light and air into a deeper unit, given the floor plate. But there's always design challenges opportunities in some ways, depending on the floors. And overall efficiency, most adaptive reuses are not as efficient as new construction. And so what are some creative uses that you can do with that sort of middle, dead, dark area in the center of a building, whether it be storage or amenities, or, way to cluster the new MEP infrastructure around the core, or, common bathrooms, depending, so understanding the bones and the premise of the building, both on the exterior skin perspective, but also from the interior floor plate. Is usually a good place to start if the community can support the use that you have in mind.

Exactly. Such an interesting challenge. Do you think are we seeing the beginnings of this as a trend? Or is it, kind of a passing thing? I think there's some great examples of some successful adaptive reuse projects in LA, especially on the historic side of things. There's been a lot of movement downtown. There's a lot of good advocacy groups out there trying to help raise awareness and streamline the new decision makers relative to adaptive reuse because it's not The same as new construction, there should be a, specialized expedited process. Not everything applies when you're dealing with different agencies. Yes the fire department has very specific code or requirements, but at the same time, when you're dealing with a hundred year old building that may be historic or not it's really just not conducive. I think the community and the city at large needs to make a decision. Are they going to support adaptive reuse or are we the type that, we're not going to be flexible on some of these codes and we just have to tear it down and start over? It's sometimes boils down to being that simple. When it comes down to cost and the limited income that you can get from some of these projects , all the different bringing systems up to current code is sometimes just not viable.

Certainly. So do you think that the municipalities are they playing catch up right now, trying to figure out the processes I think most are. There's a lot of beloved buildings in every community and understanding what those are as soon as you file a demolition permit for a building you can get a lot of uproar from the community. And so at the same time, it's like, okay, well. We need your help to renovate this building to keep it for what it is and to reuse it in a simple way and whether it could be something as simple as parking requirements or setbacks that, in some situations, these older buildings could be overbuilt which is something that you couldn't build if you tore it down and started over. And so there's a lot of opportunity there and unlocking potential value.

As we kind of wrap things up, what would you say then are some bright spots out there for the housing market? I'm seeing the interest rates are, kind of flattening now. Things are maybe stabilizing. Are you feeling like some of that pent up demand still there? Are, we looking at a better 24? I guess it depends on the market and exactly kind of which sector you're talking about. I think multifamily is certainly going to have some headwinds ahead of it, even throughout 24.

A lot of the analysts are saying that, maybe we'll start to see some uptick and, restoration of some of these rental growths that we saw the past few years towards the end of 24. Right now it's still looking like a downtrend. But then again, that's on average nationwide. Every coastal community is a little bit different. Even some major cities in the central area as well. I think, understanding what the market dynamics for apartments are understanding what flexibility you have unlocking some of those incentives and those TOCs type of areas. Or value extracted from an existing building can really help. Normally in these situations, there's a fleet to luxury product and trying to juice as much as we can on the income side, but even that has its own limitations. The supply chain and construction costs , there's some things improving. I think the market is getting more competitive out there. The projects permit starts are certainly starting to slow down. So the competition is coming back, but there still are some supply constraints, especially on the electrical component side. It's very difficult to get any major electrical equipment in the better part of 12 to 18 months. There were so many cranes up for so long and I think builders just got used to, a certain level of development. Now, the things have slowed down for a time. Are you feeling like they're getting a little hungrier? Are there rates coming down at all?

As the financial markets kind of tighten up the flexibility of new developments certainly slowing down. And I think as that pipeline starts to slow down on the construction side that competition starts to come back. So there's always a push and pull there. As much as they don't want to realize that it's all cyclical. And I don't think we've seen the worst of it yet in terms of the interest rates that have been rising over the past few years. I think it's going to get a little bit worse before it gets better. Well, fingers are crossed. We'll see what happens. Thank you so much, Alex. I really appreciate your insights. It's such an interesting time particularly multifamily in your world here. So thank you. there anything else you'd like to add before we step away? No I appreciate it. I think, everyone's opportunities are a little different in every market, but , it's times like this, there's opportunity out there as well. And so it's really a reliance on fundamentals and not making too many assumptions out there. All right. Well, we'll leave it there thank you again, Alex. Be sure to follow the podcast for more developments on architecture and visual design. We'll see you next time.

Hello, and welcome to the Creative Viz podcast, where we delve into topics surrounding architecture, development, and visual design. Today, I have the pleasure of speaking with Aun Qazilbash with Capital Developments, and he serves as a manager for pre-construction and design in Toronto, Ontario. It's great to see you.

Thank you, Scott. Thanks for having me.

You bet. Today, we've got a lot of ground to cover. Toronto's a huge market. There's a very active, busy market there, particularly for residential. So, lots of topics. Want to touch on, I think, top of mind here is, to hear about projects that you have going on. You mentioned that you are very active in the center city, as opposed to the wider GTA, greater Toronto area. I'd love to hear your approach and, like I said, just touch on a couple of the projects that you have going on right now.

Yeah, absolutely. Some of the projects we're working on right now is 8 Elm, for example, in downtown Toronto. That's very close to Dundas Square Eaton Center. And it's a 69-story building with a three-level underground, very unique tower. It's one of the first buildings here at Capital and one of the first in Toronto that will have an automated parking system, actually. So that's a very innovative technology that's being implemented in that project. And being so close to the downtown core, many challenges that we've encountered. So I'll give you an example. One of the main parts of the approval for that project were there's a heritage component to it. So we had to do a heritage retention, panelization, and restoration, which is quite a difficult undertaking and from an engineering point of view, challenging. So that's an example of one logistic challenge we encountered. The other solution we implemented on that project is we utilize a temporary slab. It's essentially part of the permanent structures like a slab installed at an early sequence in the project, but essentially the purpose being it helps with logistics and lay down and providing some area for actual construction activity, whether it's for equipment or staging to take place. So those are a few of the challenges of building. This is going to be in excess of 200 meters when it's all said and done. Building in Toronto downtown and being very conscious and aware of the neighborhood, the surrounding traffic, obviously, and everything that's in and around.

That's awesome. Toronto is especially noteworthy for the height of these towers. There's so many very tall buildings, underway all through the city. Do you feel like there's enough expertise locally to build these very tall buildings do you run into a problem of the builders being stretched a little too thin with simultaneous projects?

I think there is a mixed category of builders, obviously. One of the key areas for success on a tall building is your pre-construction and planning when you are designing your buildings, whether you take it from schematic to design development to actual tendering and construction set of documents, you want to make sure that how you're designing is always overlaid with what are the cost implications of certain things? What are the logistical implications? Everything's going to be kind of within the realm of what you're trying to finally deliver, right? Financially and from a scheduling point of view. So a lot of the successes depend on making sure that you are able to attain and achieve schedules that you've forecasted and built into your proforma. The other is obviously the budgets and that's where a lot of the failures lie. A competent developer, if you look at Capital Developments a zero building last year is a 32-story tower that got completed last year, 350 units during COVID and it hit schedule and budget. So it's just an example of the pre-planning that went into that project really carried out into the execution. And, at the tail end, you come out successful. Whereas, if you look in the headlines in Toronto recently, there are a few projects that are out there that are not doing so great in terms of being able to achieve those key

Right. It's a difficult market for sure. I can imagine with all of the scheduling impacts. There just has to be so many added costs for developing and really tight spaces within the city. Do these tall towers command the premium for the cost that goes into them versus some of the outer areas where logistically may be easier to build?

Absolutely. I think there are premiums. For example, 8 Elm. One of the towers we're doing, it's going to have an RCS system. So it's basically an enclosure around the tower that climbs after you've crossed the podium level of the building. And that provides a safety enclosure that you could build and perform that work in a safe manner. So that's a premium that is on a project. One of the other solutions on that project is an interior hoist. So a lot of times the hoist that will be utilized for material and labor manpower handling is on the outside. When you implement on the inside, it kind of frees up a lot of the outside. So it gives you a bit more flexibility on maneuverability inside your project. But then, it comes at a premium. There are definitely those additional premiums. But when you weigh it against the schedule benefits sometimes, or the overall objectives of the project, you do the analysis, it works out in your favor a lot of times. Otherwise, you wouldn't do it, right?

No, absolutely. For sure. I'm thinking there must be certain thresholds where not only do you think about different kinds of structures that go into a tower, but also different types of units or different amenities or the tower itself might have a different program once you exceed, say, 40 levels or 50 levels. Are there thresholds that you see currently with the different projects, like different sweet spots, if you will for different types of towers?

Towers are definitely getting a lot taller in Toronto, and it is more challenging. And, the instinct might be that more density, higher towers are more profitable and easier to build and less on construction costs. But the reality is there is a fine line. Anything between, I think, 30 stories to 50 stories is kind of like the ideal height, I would say, for towers. 8 Elm, which is 69, for example, there was an analysis that was done if it needed a mass damper at the roof. So this is a big structural member element that's on the roof and it helps to stabilize the building because you're exposed to a lot of wind forces at the top. So we were able to avoid that just by being able to be within the height tolerances, but those are some of the challenges you will encounter as you climb taller. When you work at those heights, productivity, everything from getting material up there, everything from considerations on your building, there's a lot more that needs to be taken into account. I think it's progressively a bit more difficult when you exceed the 50-55 story. You start getting into unique challenges above that height.

Yeah, that's interesting. And I imagine it's, like we were saying a second ago, those units up there, they must come in an extraordinary premium to make it all pencil.

There's definitely a premium. Anytime you're at the top of the tower and you have a much nicer view. And a lot of time on these taller towers, you'll have a nice amenity up there as well. You'll get the terraces and the balconies sometimes as well. So there is a premium associated with it. Just purely on that principle, but there is a fine line between how much premium you could actually request on a product like that versus if there's going to be a market demand. Right? So there's a fine line. You've got to work within it for sure.

And with all the density that's come to Toronto, have the neighborhoods embraced the new developments, these really tall buildings perhaps in areas that didn't have them in the past, and how do you navigate that landscape of making sure it's a good fit for the neighborhood?

There's always reluctancy a lot of times in neighborhoods that you add density. NIMBYism is a quite active force that works against you many times. So nobody likes density in their neighborhood or in their areas. It's a sensitive topic to navigate around. I think you just have to be really conscious about being there and doing the right thing for the community. You need to know that, yes, you're providing density, which is housing for people. That's a value add. I think in general a net positive to society, but also you want to give back to the community. So whether it's in the form of a parkland dedication, whether it's an additional amenity that you're offering, or an initiative that you're carrying out for the community, or as you're navigating through the entitlement process, I'm mostly on the construction side. So I see it more at arm's length, a lot of times it's really just listening to what the community concerns are. And then going back to the drawing table and figuring out, these are the key things that the community really cares about has voiced their concerns. So what can we do to accommodate that? It's really keeping your ears open being receptive to what the community has to say taking that into account, not just spearheading only your vision through, right? It's a collective process for sure.

And I imagine there are ways to do this without adding cost to the project.

Yeah, that is always a challenge there are ways to do it. But you go to the drawing board, you assess everything, you look at the cost and then you come back and you have these discussions, really valuable discussions. A lot of times you do end up being out of pocket as a developer, but you know that it is overall the better good for the community, and it's addressing a concern that has been really voiced in community meetings or by the neighborhood or the counselor in general. And you kind of work through those things.

I understand Capital is very focused on the downtown core of Toronto, the spine essentially along Yonge Street. Is that a conscious decision or have you explored other projects, other opportunities within the greater Toronto area? Is that something you're looking at in the near future?

I think it's a constant discussion inside our office. I'm close to a lot of the acquisition people, and there's definitely a consideration to look at projects outside of the city of Toronto. A lot of the projects have been on Yonge Street between, what is Eden Center and say North York, which is Yonge and Finch. This is literally the artery that runs north-south in the city. There has been an approach to look at projects, but nothing has penciled out till now. You want to tread really carefully when you go into another market. There's other challenges, other municipality challenges, that will come in play as well, but there are some pockets that are emerging. So if you look at the Vaughan Metropolitan Center, for example, that's an area outside of Toronto North. That's like the northmost subway stop that will go from downtown and there's a whole pocket of condominiums. That has emerged. Pickering Town Center, there's another just east of the city of Toronto has a development that was announced this year. That's going to see about 10 buildings coming in that area, which is very high density. I think it's about 6000 units. So there's a lot of projects that are coming in the GTA. I think the approach of Capital for now has been open to the idea, but it's got to be the right opportunity, it's got to be something that really pencils out and makes sense. And then you go from there.

Yeah, it's interesting. And then something else I wanted to touch on is mixed-use development as a new model for certainly urban sites creating diversity and program keeping the activation that we have in our center cores. Is Capital looking at mixed-use projects? Do they have any underway? Is that something that you guys are exploring as well in new development projects?

Three years ago when I joined Capital, the biggest one that comes to mind is Art Shop. Art Shop is a mixed-use development. It's near the Yonge and Eglinton nodes, so a little bit north of downtown. But it's got about 25, 000 square feet of retail. It's got an anchor tenant in Farm Boy, so anytime you have a condo with a grocery store anchor tenant, I think there's an immense value. If you're a resident, it's very convenient for you to go down and even for the neighborhood, right? To be able to have that facility available to you. That's got a restaurant, Retta, an Italian restaurant, which is very nice. It's got Staples. So there's some key retail that are in that building. So that's an example in our other projects. There's a retail component to it. We haven't explored a major project, for example, like an 18-story hotel or something of that sort. Again, open to the idea. I think here at the company, but you want to tread carefully because you want to make sure that it all works out at the end.

Of course, it's difficult. The first one's always the hardest.

Absolutely. So then, let's take a look. What do you see on the ground? Are there any trends in Toronto looking ahead? When I see the market, the towers just get bigger and bigger and taller and taller. Do you think that will continue to be the case? There's been discussion of the housing market kind of taking a breath here, kind of catching up to demand. Are you seeing any of those types of things from your perspective?

Yeah, I think the biggest challenge has been, the Bank of Canada has raised the interest rate by 450 basis points, right? So what it was in 2022 at half a percent, it's now 5%. So financially, a lot of developers have to look at their proformas and the predictions and the forecast and make sure it makes sense financially, right? So I think that's been a big challenge. But on top of that is an overlay, which is you have a housing shortage in Toronto. Immigration is continuing to grow. The population is continuing to grow in Toronto. Canada, you have three, four major cities. You have Vancouver, you have Montreal, you have Toronto, and then maybe you can include Calgary or Ottawa in that category as well. So with the population increase, density absolutely and required, but it's got to make sense. One financially. So with the interest rates, that's challenging. I would say that's a big headwind that the industry is facing. And the second is the navigating through the regulations and the municipality and the approval for the entitlement and how long it sometimes takes from the time you submit your first application to the time you get an approval for your development, it's quite frustrating sometimes, right? Because, once the clock starts ticking, you have expenses, you have loans that you need to take care of. So once, that clock starts ticking, it's very challenging. So those two issues could maybe get a little bit mitigated or improved. I think there's always going to be opportunity in Toronto. Toronto is a thriving economy market city. There's a lot of dynamic nature to it. I just think those are a few challenges that are really right now in the industry.

Temporary challenges, it sounds like, but the demand is more permanent. That's the impression I get.

In the long term, for sure. I think historically, if you look at a statistic where in the last 15 years, year over year, pre-construction pricing has always gone up year over year. This was the first year it actually went down, oh really? just because of some of these challenges. So that just shows if you look at a historical chart, you'll always see a linear incline. And now that's kind of stabilized, right? But if you look at the future, I think it's going to continue to grow. There's going to be a demand in the city, but one of those things when you have such a high cost to produce right now, really have to look at it. But one of the great things that have happened recently is the government just announced on rental buildings, they're giving a tax break. So if you are pursuing a rental project, the 13 percent that you would have incurred as a tax implication on that project, you could avoid that. So now many developers are looking at the opportunity where maybe the condominium doesn't make sense, but a rental tower makes sense. It's a whole different pursuit, but that's an approach a lot of developers are looking at.

As I think historically the majority of new units delivered are for sale, condominiums. So do you see a change in rental properties becoming more available?

That's definitely the idea with this new initiative that has been introduced into the market. You want more rental housing available, and this will incentivize a lot of developers to do it, right? So if you could get a 13 percent discount on your costs, this tax break definitely looks a lot more lucrative. Right? So I think the answer is should improve. The amount of shovel-ready projects that you'll see in the future and potentially the amount of projects that come into the market that are going to be rental it's still early days. So, with any initiative that is implemented, it takes a little bit of time to really see what the overall impact is going to be. I think the next 12 months to 18 months would bring that to light. I think a lot of developers are seriously looking at rental as a pursuit.

That's really encouraging. I know affordability has been such a challenge. So hopefully, that will take some of the sting out of entering the market, being able to afford to live in the center city of Toronto.

Absolutely. And just about bridging the gap. The amount of houses that are introduced into the market right now are substantially lower than the amount of people that are coming into the city. So whenever you have that delta, you're going to automatically see, just the forces of supply and demand are going to force rents up and the cost of housing up. If you could shrink that gap between the amount of units that are being delivered by the city versus matching the quantity of people that are coming then in theory should improve the situation.

I hope so. It's been challenging here, especially in the major cities of Canada. I'm sure we could revisit Toronto. There's a lot of interesting developments certainly what I believe North America's fastest-growing city at this point, Toronto. Thank you so much, Aun, for giving us insight into construction, affordability, all of these factors that go into creating these amazing new towers in Toronto. Thank you so much for joining us. Be sure and follow us to stay on top of all new developments here at Creative Viz.

Thank you so much, Aun.

Thank you for having me, Scott.

 Hello  and welcome to the CreativeViz podcast where we delve into topics related to architecture, development, and visual design. Today I'm really pleased to have Dodie Preston here on the podcast. She is the Director of Creative and Experienced Design with Berkshire Hathaway Home Services and Fox and Roach Realtors. She represents the Mid Atlantic region and today we're going to talk about her role with Berkshire Hathaway, what she's seeing in the markets and,  a few other topics related to marketing and sales and different types of new developments. So with that thank you, Dodie. It's great to see you.

How are you today?

I'm very well. Thank you. Happy to be here.

I'd love to learn a little bit more about your day to day role with Berkshire Hathaway, Fox and Roach. We had talked earlier about how your position lands somewhere between the development teams and the sales teams. How do you position your marketing efforts?

In a nutshell, what does a typical day look like for you?

The B2B and the B2C business one supports the other. So as a business, we're designing things strategically for the agents to be able to promote their business, both as an agent and for each individual home that they sell and advertise.  To the best of their ability and fast and on the go agents are always on the go there seldom working hours that anybody else works holidays, they work and all of that. So it's a, it's a business that needs to support them from wherever they are on the road. So the landscape from whenever I started in this business, I won't, without dating myself, I won't say just exactly how I've in this business, has changed a lot and it's so exciting to be and to see, to be in it and to evolve with it and see what's next. We as Fox and Roach Realtors have a hundred year history. On the upper, North Atlantic areas so we have a lot of clout, a lot of tenure here.  There's a lot of trust built with our name and having Berkshire Hathaway behind us as well is huge.  We can lean on that brand the agents can lean on that brand and we support them with a lot of materials that continue to build that trust.

Right. Is there anything that kind of jumps out recently I'm thinking of, ChatGPT, other AI tools potentially. Is there anything like that? That has been a big change for you and your team?

Well, certainly our marketing development team has jumped on that bandwagon of ChatGPT and helping these agents to, be able to build a description for a home using ChatGPT. We have webinars that are set up and it's amazing how quickly they did that. Our SVP has his finger on the pulse of that at all times, and it's been impressive to see. We're trying to support them in the best way we can with that. Some of them embrace it. Some of them do not, whatever serves them best.

Dodie what kinds of properties are you typically involved in, in marketing? Is it primarily housing? Are there other types of properties you're involved with?

We do have commercial also have a new homes and land development division as well. That rolls under our purview.  It's all very fascinating to watch.

Oh yeah.

 As, you know as an architect, home ownership and home purchasing and the building of a home or the redesign of a home is all emotional. This is where your memories are. We strive to, align whatever we're marketing and to help the agents align with the strategy with a purpose and then design with a strategy. So we align with the purpose of the home getting to know the back story if there is 1. We have loads of historic, deeply historic homes here.

It's amazing.

Those are always fun to walk into whether it's on the page or on the website or physically. So we have those we have urban development, lots of small studio apartments to luxury penthouses and things like that. Then we also have the beach, New Jersey shore, Maryland shore, Delaware shore homes like that, whether they're 2nd homes or they're retirement homes. So we run the gamut.

Yeah. That's great. How much of that would you say is new ground up new development versus existing properties. 

I'm not sure I can give that a percentage.

Oh, okay. 

We don't, as a brokerage, work directly with the developers, but the agents do. So what we define for them as marketing materials is so that they can approach a developer that they have or have not worked with before.

I'm just thinking about the challenge of trying to position a property that doesn't exist if it's still on the boards or under construction you're having to communicate that to a potential buyer. Get them to visualize something that doesn't exist yet.

That can be, that can be really challenging.

That's where a rendering comes in.

Yay.  Yeah.

You're familiar with renderings?

I sure am.

Is that's part of your kit?

It is part of our kit.

Are there things that your buyers are particularly attuned to I'm imagining a scenario where they're looking at a new development versus an existing development in the same neighborhood, what sort of factors might they be considering between the two?

Yeah, that's.

I know that's big.

It depends on how much you want to dive into what affordability is.

Right, right.

Maybe the builder is offering something more in their package of a new home than a home owner can possibly do.

Existing. Yeah.

Although we offer financing. So the agents get more into that.

They get more into that.  For your role, this is where I get fuzzy. So thank you for that. How do you know, the materials that you're putting together, the, the package , the positioning, shall we say the property, how is that different new versus existing or urban properties versus suburban or resort, locations, What are the factors that or the elements that you consider when you're putting together different positioning packages?

Whatever I'm working with, whatever type of product that I'm promoting, whether it's a home or a new development, I'm creating a mood,  I'm creating the story to let them know what the back story is on a historic home or the home.  Maybe it's been lovingly owned by one owner for 45 years and it's been super, super well kept. Or a new development what the future could be in this development, what the builder holds out as their story, there's a storyline to it tap into that to create that feeling for somebody to have a connection that they can see themselves in a home. That’s my goal. So partnering with the marketing team with the agents and knowing their back-story. Even the history of an agent, they might  have history working in certain areas. So they know it very well. They have a legacy there, so they can speak to that as well. And it just, it's creating that mood and it's what works. It's the beauty of it that comes forward of the storyline.

 Absolutely.

Oh, I love that. That's, really interesting. And it truly is personalized to the property. Everyone has their own nuance, right?

Right. So it is customized. We provide the agents with a lot of materials that they can work with. But when we work to customize marketing materials, portfolios, books,  online, everything, literally, it is a custom feel to it because  we're not like any other brokerage out there, we’re not. Our agents are as individual as any other homeowner.

Right. Right.

I, as a creative I never stop thinking about how it can be better. I can go two weeks, two months, two years, come back and go; I wish I would've tweaked that a little bit more. When the agent or the homeowner or the executive when they're happy, when my team has hit that mark of what they hoped this would look like, what this would say, and the design expresses what they hoped to push into the market. That's when we stop.

Yeah.

And then if they think about it 2 days, 2 weeks. They'll come back and say, wait a minute I've rethought that. We always start with a creative brief and the creative brief gives everybody who touches that product whether it's a writer or a designer or it's a social media person, they understand, what needs to push forward, and what needs to be developed, and released.

And then  you're sort of making sure that all these different pieces come together and create something,  bigger than the sum of the parts, right?

Well, we try.

Yeah.

That is the goal. And I will say that we work very hard to hit our mark.

I imagine.

These assets that you're creating, do they have another life beyond the potential  sale?  Do people, keep  the photography or, the story elements that you're talking about  producing? Do they have another life?

I have a 25 year library.

Oh my gosh.

Before I started, the digital library started 25 years ago. So I've been keeping that updated. We have a lot of legacy stuff.

That’s got to be amazing.

Keeping specific notes on properties usually is held with the agent.

Okay.

They have more of it than we do, but I have loads of pictures and images and renderings and all kinds of things. Aerials, you can see put an aerial side the before and after that all that kind of stuff.

Oh my fascinating stuff.

Are there any over that period of time that are outstanding for you? Obviously nothing, confidential or anything like that do you have a favorite? I love to see the changes from Center City, Philadelphia.

Oh, yeah.

clearly, where they've might not even have anything to do with housing, just to see the development of certain areas Avenue of the Arts.

Oh my gosh. Yeah.

Nothing, you know, it's full of theaters and venues and all kinds of things. I do love the luxury homes. They're so elegant. I love reading and filtering in the history of something that started somewhere in the 1700s has been added on to and looking at the architecture and seeing where the original house was on the property. Even tiny little homes that have carriage homes and, little capes, they all have such charm.

 I also wanted to touch on the aspect of affordability. That's going to be, top of mind for a lot of people, particularly with housing. We would  love to hear your thoughts on the challenges that you see. And obviously you're going to portray affordable projects in a very different way than,  a luxury or historic. What are some of those challenges for you?

Well, the affordability aspect has both helped us and hindered us. We're no different in that respect. We are no different than any other brokerage. We do have many things that we can offer clients that are unique to our brokerage, The full gamut of anything that you could want for buying a house, not only with our agents with tenure and how professional they are but title insurance financing, mortgage financing, we offer that as When rates were low and inventory was low, that was a massive impact across the board now that rates are higher and there's still little inventory.

Right.

That's impactful for our bottom line the difficulty that agents are having out there. So we try to support them as best we can.

Yeah.

Are there things that you and I can do or Berkshire Hathaway can do to help the supply problem if that's going to be part of the solution, you know, changing the affordability matrix.

I think with making sure that we treat each individual property with the respect it deserves, moving it forward, you never know who's going to be able to afford. It's not my job to say this luxury house has more emphasis or should take more of my time. That's really all I can offer on that.  Continue doing the best I can.

As the markets are changing as it's becoming more difficult to enter the market, do you feel like other areas within your region urban, suburban, other areas are becoming more attractive to say young buyers trying to enter the market.

You seeing any differences in that way?

It hasn't crossed my Desk in that way. I haven't seen anything like that for our brokerage. Now, we are expanding our focus with commercial a bit and that's been interesting.

What are the challenges then on the commercial side? We're talking what office I imagine?

We  don't do high rise office. We low rise office.

Low rise.

And strip centers. I don't know where the plan is to go in the future so I can't speak to that, but commercial's taking a hit as well.

Absolutely.

I mean, you're at home. I'm at home.  What are you seeing? What's your take on how that is affecting the office market? Are you seeing return to work or are tenants having tougher negotiations as a result.

We're not in the property management side of commercial. We're in the sales part of it. Our particular department has gone back hybrid.  We spent a couple of days a week in office. It's about team collaboration. We still have people in our department who are in other states that can't make that. It's been a blessing to be able to work from home for me, personally and other people that I've spoken with.

It'll be difficult to go back.

Full time in office was very difficult but we get a lot done. Remotely I know people on our team that just don't stop. They just work all the time. Sometimes it's very late nights over here at home.

Yeah we all have them. Of course well let me maybe re ask that question as it relates sales. Some markets are still quite depressed for office space. Are owners are they getting squeezed? Do you feel like there's more perhaps urgency to loading an underperforming property or is there any kind of shakeup, in the market? I'm thinking particularly like in the B and c class that are getting really, really hit right now.

I am curious to see where that lands. I do think that building owners are being squeezed to move property in some way, maybe even to repurpose a property.

Was going to ask you that too.

I'm very curious to see the future of that.  I think it's still new, post-Covid.

There's a lot of talk about urban office, development, older urban office buildings, converting to residential, hotel, other uses. Is that the case for the low rise? Have you seen any kind of inklings of that yet?

I have not seen that yet. I can imagine that in Philadelphia since it does have such an urban, living population, I can imagine that a number of buildings would trade out at least part of their building for housing.

I was talking to somebody, they're talking about urban farming, you know, converting some of these, really under, but well located buildings to completely different use. Getting really creative with all this infrastructure that we suddenly have in our hands.

That serves two things.

Not only for the building for the neighborhood. Farm to table right there.

Absolutely. I like that.

Thank you, Dodie. Is there anything else we should  touch on before, before we wrap things up?

I don't think so.

Terrific thank you again. It's been a pleasure to have you on. Really appreciate your time and joining us today. Thank you so much and take care. 

Scott, it's been a pleasure. Thank you so much. 

Welcome to the Creative Viz podcast, where we dive into topics on architecture, development and visual design. Today we’re tackling a transformative topic in our field: the integration of AI and real-time rendering. Generative AI is top of mind for many of us in creative industries, and I have actually held off on broaching the subject here for a little while as it has been evolving too quickly.

A year on from the introduction of ChatGPT 3 and the wider adoption of generative AI tools like Midjourney and Stable Diffusion I believe we have a better sense of where things are headed now and hopefully we can start to make sense of it all. But by no means will this be the last word on AI & archviz - stay tuned as I’m sure there are new surprises just around the corner.

For now, let’s explore how these technologies are reshaping our industry, from enhancing creativity to revolutionizing workflows. We’ll start with the promise of AI, then explore some of its limitations and go on to discuss important ethical considerations as well. I’ll weigh in on whether or not AI will replace you, and finally gaze into the crystal ball to make some guesses as to where this could be heading.

So… in the world of Archviz (architectural visualization), AI and real-time rendering are more than just emerging technologies; they represent a paradigm shift. Gone are the days of static, time-consuming rendering processes. Today, AI’s infusion in our field is leading to groundbreaking changes. Real-time rendering, powered by advanced AI algorithms, is not only speeding up our workflows but also allowing us to experiment with designs in ways we never thought possible. It’s an exciting time for architects and visualizers, as we stand on the brink of a new era of digital creativity.

What does this mean for the traditional methods we’ve relied on for so long? Well, it's not just about replacing the old with the new, but rather enhancing and augmenting our existing skills with these powerful tools. AI and real-time rendering are enabling us to push the boundaries of architectural visualization, offering a glimpse into a future where our ideas can be visualized almost as quickly as we conceive them.

AI is already assisting in complex tasks like lighting adjustments, texture creation, and even generating entire scenes autonomously. Real-time rendering, once considered to be the holy grail of rendering, is now a daily reality for many of us, offering immediate visual feedback and drastically reducing the time from concept to visual representation.

For designers, these advancements are not just about speed; they're about the opportunity to explore and ideate like never before. With real-time rendering, iterations that once took days can now be explored in hours, if not minutes. This rapid turnaround is changing the way we approach design decisions, allowing for a more iterative and dynamic creative process. It’s a liberating shift, freeing us from the constraints of time-intensive rendering and opening a world of creative possibilities.

For visual artists, real-time rendering can remove much of the tedium associated with creating realistic textures and the imperfections that make a digitally-created image look more photographic. Entourage - that is people, trees, and cars in architectural scenes - benefit in particular from the ability to use generative content instead of relying solely on 3d content. It doesn’t work every time, but replacing 3d “props” with generative substitutes can substantially speed up the process of adding entourage to a still image. Additionally, there is a notorious lack of diversity in existing entourage libraries, and AI algorithms can do a much better job of creating figures that bring a sense of realism and scale to the scene.

Having said all of that, there are significant limits to what is possible today and what will likely be possible for some time with AI content. When you look at an architectural rendering, many of the textures and almost all of the entourage in the scene are stand-ins. That is, they are important elements but could be swapped out for a substitute very easily with little or no effect on the scene as a whole. This is where AI really shines.

Most of the fixed elements in the scene however, are truly custom one-off pieces. No building is the same as another, and very few interiors spaces are the same - if they were, then you wouldn’t need a rendering? So the architectural spaces themselves need to be invented every time with exact fidelity to the design documents. In additional to the building itself, many elements within the space are unique as well. There are often custom furniture, art pieces, and objects specifically designed to inhabit the space to be visualized. These all must be modeled in 3D and assembled according to the architectural and interior design.

Another thing to consider here is that the location of the new building in its context is usually a crucial part of the messaging. For an exterior rendering in an urban setting, the existing adjacent buildings often need to be rendered with as much care as the new one in order to give a faithful representation. Early-phase development will be granted approval or not based on how well the new building is perceived to confirm to the guidelines and requirements of the particular site.

For interior renderings, the view outside is often an important part of the story - consider the value of the view from a penthouse apartment. Although there are certainly times when a generic stand-in created by AI will do, in nearly all circumstances, depicting the view as accurately as possible is essential to the authenticity of the image. A lot can depend on this in a marketing campaign for instance. 

In both of these examples, this unique context must be created in 3D or with photography, or sometimes a combination of the two. AI is simply not up to this challenge - at least not yet.

Rendered archviz images need to be accurate of course, but they also need to be visually pleasing if not beautiful. There are existing algorithms that can go some way towards recognizing or even measuring beauty, but it is still up to the artist to compose the image properly. At best, the working with AI tools to generate a beautiful image can mean sifting through lots of options that need to curated and judged for quality. It remains to be seen if AI can actually speed up the process of setting up and composing an image that a viewer would find pleasing.

Then there is the problem of AI generated content being self-referential. The current set of AI tools are trained on existing content to generate something “new”. Most of these libraries are cut off in early 2022, just prior to the launch of the tool itself. As a result, we cannot expect AI to give us something we haven’t already seen before in many ways. Already, there is a certain look to AI generated images and it’s incumbent on the artist to not rely too heavily on AI in order to avoid creating something stale and lifeless. Therefore, true innovation in image-making is still very much up to the artist.

I also want to touch on the important ethical questions surrounding the use of AI imagery, especially around the authenticity and ownership of these visuals. As we integrate AI into our workflows, we must be mindful of ethical implications. We need to consider issues like copyright, the authenticity of representation, and the potential for AI to replicate existing designs or elements without proper attribution.

It’s crucial for us as professionals to stay informed and conscientious about these issues. We must establish and adhere to ethical guidelines that respect intellectual property and the integrity of our work. This responsibility is shared among developers, users, and the broader creative community. As we navigate this new terrain, let’s commit to using these powerful tools in a way that respects the artistic and intellectual labor that goes into architectural and visual design.

There are of course broader implications here well beyond archviz. I am hopeful that the AI algorithms will not get ahead of the creative process and that the creators of original content will continue to be fairly compensated for their work. For now, it’s important to be aware of the potential for this problem and be diligent about knowing where the content that you are using is coming from.

The integration of AI in Archviz also brings up questions about staffing and production efficiency. There's a common concern that AI might replace human jobs, but in my experience, it's more about shifting the nature of our work. AI can handle repetitive, time-consuming tasks, freeing up human talent to focus on more creative, high-level aspects of visualization. It’s not about reducing staff but empowering them to be more creative and strategic.

On this front, I am much more hopeful, as I believe AI can lead to more job opportunities in our field. As we can produce higher quality work more efficiently, the demand for skilled professionals who can leverage these tools creatively is likely to increase. The key is to adapt and evolve, to learn how to work alongside these technologies, harnessing their potential to enhance our skill set and the unique services that we offer.

So let’s take stock of where we are right now. For artists, if you haven’t done it already go create a free account, dive in and start making things. If you are used to creating images in 3D, you may astounded by the responsiveness and speed with which AI images can be created from scratch. You may also be astounded by the visual mistakes these tools can make. But dig in a little deeper and investigate ways to integrate AI into your existing workflow, especially for adding entourage and props.

For a client looking to commission visual design, it’s a good idea to be aware of the possibilities that these tools provide. But, be wary of any solutions that claim to automate the entire process. Ensure ethical sourcing of AI content and maintain open communication with artists about how AI impacts their production.

Looking ahead, the possibilities for AI and real-time rendering in Archviz are boundless. We’re already seeing the beginnings of what these technologies can do – from creating immersive virtual environments to aiding in complex design decisions. But we are clearly just getting started. In time, we could see a complete transformation of how we conceptualize, visualize, and interact with architectural spaces.

Imagine a future where virtual and physical spaces are seamlessly integrated, where clients can step into and experience a design in real-time, making changes on the fly that are instantly visualized. This level of interactivity and immersion could redefine the entire architectural process, from ideation to presentation. It’s an exciting prospect, one that promises to elevate our industry to new heights of creativity and innovation.

As we wrap up, it's clear that AI and real-time rendering are more than just tools – they are the first steps into a new era in architectural visualization. They offer us a glimpse into a future where our creativity is limited only by our imagination. So, let's embrace these technologies, explore their potential, and continue to push the boundaries of what’s possible in Archviz.

As I mentioned, we're going to continue to talk about AI developments in future episodes, but for now we’ll leave it there. I hope I’ve given you a lot of think about on the very important and timely topic of artificial intelligence.

Thank you so much for listening. Be sure to give us a follow to stay on top of all the latest developments and I will see you next time.

 Hello, and welcome to the creative viz podcast, where we dive into topics related to architecture, development, and visual design. Today's episode, get the pleasure of talking with my longtime friend and client, Sean Slater, who is a senior principal with RDC heading up their San Diego office. Sean, thank you so much for joining me today.

I know you're a crazy guru in the world of retail and architectural design I just wanted to get the, conversation started today talking about what you're seeing in the retail world and how, things may have changed post pandemic. You know what works today that might not have worked quite so well a few years ago.

Sure. Thank you, Scott. It's a pleasure to be here with you. And as you said, we have known each other for a very long time back when we used our hands to

 I know crazy, right?

Yeah. That is a blast from the past so interesting topic, because I think that for the last 10 years, this retail apocalypse is all that anybody could really talk about.

And, you know, since that's so central to my career and what we've been doing, it's been kind of scary, of course. The reality is that we've gotten into mixed use and there are many assets to retail, design and development that weren't impacted by the sort of the Amazon effect and the online ordering.

But I will say the first few months of the shutdown scared me to death because I thought, here we go. Everybody's going to get so used to this, to having everything delivered to their doorstep, instant credit cards. All of this is going to create such friction that we may not see any more retail development.

This may be it. And I'm happy to say, you know, however many years later we are now that was wrong. I don't think anybody could have really predicted the social impact of that isolation. And in that shutdown, as we sort of went through year one and then Omicron and anxiety started to build.

And then you could start to, I mean, at least we could in our firm, the discussions, there's going to be pent up demand here. There's got to be a moment where people are going to want to get back out and shop again and we started hearing, you know, anecdotally, people would say like, yeah, every day I get like 12 boxes on my.

Doorstep and it's all this cardboard and it's all this stuff and I have to send it all back and you know, I'll get three of the same thing and only one fits and I send it back and it's just this big hassle. And gosh, remember the good old days when you went in, you tried something on it fit, and then you bought it, when I started hearing that and I started realizing, oh, even women who have kids and families and are just busy, busy, busy, they would still rather go to Target. They would still rather go to the mall and shop for back to school clothes. There are certain things like. Dog food that you probably don't have to go get dog food at a store, but the things that you want to try on the things that you want to see if that color looks good on me. I mean, there are just a million things that in person experience and shopping could never be replaced online. And I think that what COVID.

I mean, I think what covid ended up doing was actually the opposite of what we thought. And it's really sort of prompted people to get back into the nostalgia of being around people and shopping. And of course, food and beverage is a huge part of it. And that's kind of the biggest change over the really the last 15 years.

 So I think that this is, it's been a really good several months. Let’s say last six months. We've started to really feel and the statistics are starting to prove it out that people want to go back that bricks and mortar retail is really strong. It’s also has to do with the lack of other.

Avenues for investment right now. So with office kind of catering with residential construction being extremely slow right now. People are putting their money into retail projects. Whereas before there were a lot of industrial sort of sucked all the energy out of the markets for a while. That's kind of hit a good spot, I think, as far as supply and demand. So they're looking for avenues for development. As I tell my team, all these developers have to develop. That's what they do. If they don't develop, they don't have a job. So they're looking at our sector now, the mixed use and retail sector and saying, well, there's still opportunity there.

And now that we're seeing people shopping again, let's put our money back into that. So it's been an interesting sort of ride over the last three or four years, but really the last 10 years has been what's really been interesting.

Yes. Many questions here. So from the real estate, development, aspect, you think that there's more, money moving into, retail mixed use for, kind of short term investments or do you think they're looking more long-term?

I think both. I think there's always this renovation market

Oh, sure.

Properties need to be upgraded every 8 to 10 years or they fall apart. So that's sort of a steady thing, but I think what the difference is that we're, starting to see. The big developers look at their assets and say, we're not just going to upgrade it.

We're going to transform it now. We’ve been doing the cosmetic stuff for 10 or 12 years as we've all been worrying about. Is this even going to be a market in 25 years. Well, now I think that the confidence that we've got a good piece of property here.

We have good tenants. Now we need to make it a place that people want to come and stay. And that's been, the mainstay of the mall really has been dwell time that you could get people. It had enough shops. It had the anchors and activities and programming that you get somebody on site and they're there for hours.

That's the goal. So even smaller developers are starting to see that instead of just painted up, fix it up. They need to add. Trees, they need to add benches and water and play areas for Children and grassy areas just to soften the space up. So a lot of what we're looking at right now with existing properties is that and new, construction has been much slower because we are way over retail as a society and especially in the United States.

So I think a lot of it really is just rethinking current properties. and then the mixed use part we'll talk about

 So the types of retail, you touched on this with food and beverage, but I can imagine, things like trying on clothes, an AR app will only get you so far, do you types of, retailers, thriving, versus some that, you know, electronics stores, as a classic example of something, it just may not be what it was 10 years ago,

 And that, that's okay. The evolution happens within any market. Interestingly, the two markets that were the most very negatively impacted cinemas and fitness. When the pandemic first started, restaurants could go outside.

 That was a wonderful kind of urban experience for a lot of people would eat outside for the first time, even in snowy. Northern climates I want to go out to eat. I got to sit outside. So I think they were able to survive the peril, their online platforms had been built out.

 You could still buy Nike. If you couldn't go to the mall and get it. But fitness, you got to be there to work out. And as we all saw with some of the online fitness apps and a lot of the online stuff, Peloton being the poster child for this, they just went like this and then they went immediately down.

 That means people went back to the gym. They didn't just get fat like me. They went back to the gym and in a serious way, the cinemas, however, the investment that folks made into their home. Setups their home theater setups. That’s a grandiose term, just a big TV with a good sound bar, really.

 Then what the cable companies and all of the streaming companies putting original and first run content on, I don't know what's going to happen with that market. And that was such a mainstay for entertainment districts. It worries me fitness back. For sure, back, cinemas, not so much apparel has been struggling for a while.

I think it's probably in the same place. The folks that do it really well, Nordstrom for men, for instance, they have maintained their customer base. I think that a lot of the more boutique and really luxury always kind of rises to the top. When you go to South coast Plaza in Costa Mesa, California, there's a line outside of.

 Versace. There's a line outside of Ferragamo. It’s insane, so there's still very much a market. It's the commodity stuff, t shirts and underwear that used to go to Macy's to get. You don't need to do that. And nobody wants to do that. So I think that sort of the really commodity clothing, you can go to target and get the same quality now when that was not a.

Thing that happened about 20 years ago. So I think that the bifurcated markets, very luxury fitness experience oriented. And then there's really just perfunctory daily needs stuff. They're both really strong. The other thing I'll say in our firm is very involved in the grocery store market.

And again, when it first hit, when COVID first hit, I thought, Oh my gosh, what are we going to do with this? Nobody's ever going to go back. Well, it did two things. It requires much more physical. Real estate to do delivery. So you have to have whole rooms for people to do the shopping and collect the bags and then, infrastructure to get it to cars.

So we, our firm was doing a lot of that, taking parking lots and taking two or three parking spaces and figuring out how would you do delivery. From the inside of the store to the outside of the store, the physical space inside whole departments kind of went away to create room for that delivery piece of it.

 That’s been an interesting thing to watch. I think that's probably here to stay when you think about it, going to the grocery stores. Often not the most fun thing. You know, whole foods or one of these beautiful Erewhon markets, which we do, those are fun. Those are purely about shopping for food.

And I think that's an experience that people absolutely love, but getting your post toasties and all of that stuff, you could do that online. You can just tell somebody to put it in a bag for you. I personally don't do that, but I know that the time saving for a mom to just kids in the back of the car, just grab your bag.

Curbside and take off man. What a, great innovation that has been.

Oh, absolutely. So, so you're in touch with these retailers. Do you hear from them that, people are shopping in person more often, versus doing, the Instacarts you know, people are, they're shopping more and they're carrying fewer bags. I guess that's the story that I would say they're back in their numbers are back. And in fact, probably ahead of where they were in 2019, as far as pure foot traffic, but sales in store have not recovered, but that's okay.

They're buying online. They're there to see something, to feel the product, to feel like they're part of a brand. So the upfront, let's say the first 20 feet of a retail store is not product necessarily. It's a story they're trying to tell about their brand, about who you are when you come into their space.

So we have a store design group that, does rollout, but then also does bespoke design. And they've. Then booming also because the thinking about is the experiential nature of it. It's much less merchandise and they don't need back of house really, because you don't need every size of everything because they're just going to order it online.

So it's really about how do we present who we are as a brand, bring you in, make you loyal to this brand, and give you a good experience. You know, before the pandemic, the. Shinola is one that I always use. The watch is made out of Detroit. You’d walk in and the first thing you got was a beer.

And if you're a guy shopping, that's kind of a nice thing in a chair to sit in. And I just always thought they're starting to understand that if you want people to come into your space and spend you get whatever that experience of if it's a tea shop, you're for sure getting some tea, right?

You know, what do you do in a clothing store? How do you bring people in with that? And there are many, many methods that different retailers use, but it's about getting that traffic back in knowing that then they're going to go on their device or they're going to go home on their desktop or laptop and make the purchase.

But the loyalty was built really in the in person physical shopping.

But there's still an allure to coming to the shop. Do you feel like that is that’s still a problem for a lot of retailers. Okay, we got you in, but the point of purchase might be happening. You might go back and buy the thing on Amazon

 I think anecdotally the Macy's at Horton Plaza, for instance, was doing more in returns than it was in sales for years. So that's a bad balance right there. That just says that the physical real estate's not working for that particular retailer and that a smaller format or a different location or something was really called for.

 And department stores have been they're not coming back. I would say in there, 1980s format. They're not coming back. They have much smaller footprints. They're really a fulfillment center. Honestly. You want to be able to go and return your stuff or pick up, you know, the right size shoes that you ordered.

I think that, a small format. Macy's just opened here in San Diego and I thought, what in the world is this going to be? And it's the weirdest thing because it's a little bit of everything for everyone, because you're not literally buying the thing on the shelf. You could, but you're seeing what range of product they have.

Then you're going on the app or going on your desktop and then you're buying. So they've kind of, they understand now they get it that the consumers are not. Going in there to buy, you know, a packet of socks necessarily, they are going in there to kind of see the full range of socks. You've got then they can go back home and buy it.

So it's kind of an acknowledgment that world has changed.

And they're able to do it with a smaller footprint,

Exactly. And you don't need the back of the house. You don't need 27 people working. You don't need a shoe infrastructure. If you think about it, the usually have a huge. Either downstairs or in the back of house every size because if you don't,

 Somebody going to not buy.

So you don't need that. You just need for people to be able to see your options in some cases, try stuff on, but, otherwise they can, go home and do that. It comes to their doorstep. So it's this interesting hybrid has been created where it's more important than ever to have a great physical space.

So beautiful, great, engaging, very open, very themed and brand centric, but then don't expect people to buy, they're going to go home and buy, they might buy there, but that's not why they're building these things out.

Looks a little different.

It looks different. Exactly.

Well

So as an architect, what do we do with all of these big spaces? A lot of the tenants we're talking about have very large footprints, high ceilings, department stores, cinemas, underperforming retail today, you know, potential big box, locations.

What do we do with all that space? Our landlords, re imagining them, you know, what kinds of, opportunities do you see, there?

Good question. You know, again, going back to my comment about how. Problematic some of the other big vertical markets are the office market. Port plus is a good example, but there are many others department stores are built like tanks. They're really robust structures. They were, owned and built by the company or by Nordstrom.

 So they took pride in them, and they have very high Florida floors, 18 feet, often Florida floor height. So you have great lofty spaces. That, you know, very regular column grids. You have that sort of donut in the middle where the escalators are that you could open up to the sky and put skylights down the middle.

So office is a great use for it. Biotech life science, because of the plenum space for the sort of air evacuation, but those markets aren't currently growing very much. So I think a lot. Of the department store boxes are going to be probably fallow for a while. I hope that developers don't just tear them down because of the.

Embodied carbon waste of that, but also I do think that market will come back. I think that, you know, the creative office, which is what we were all talking about, you know, until March 20th of, 2020, that evaporated because Silicon Valley was one of the earliest ones to say, you don't need to come back and we'll just send you your infrastructure home.

Now, all of those tech companies are starting to lure their people back. And we're all realizing, and I've called, you know, an architecture firm tech adjacent. So we have a concierge, office experience coordinator for a 200 person architecture firm so There's always a party. There's always something going on.

There's usually a huge potluck, at our office. It drew people back into the office. Well, we didn't think this up. The tech companies really thought it up. So I think the first people to take some of those department store and larger formats will be, creative office

 The idea of a room full of brains, working together is just so compelling and it's been proven to works, for innovation forever. I think that hopefully we'll start to absorb some of those spaces. Some will be torn down. Been doing retail subdivisions of those boxes for many years.

I think that's probably at the end that some of that will still happen, but most of those boxes have been divided up, however, they're going to be divided up. And then the number one thing that's happening is that they're being torn down and apartments are being built in their place. So malls.

Are being now sort of spotted with apartment complexes when those department stores go down, then they build an apartment community, and then I guess the idea being that at some point, it's a full ring of apartments with some residual retail in the center as an amenity to the apartment.

Interesting. So, mixed use truly.

 Yeah, I think that's the most likely solution for a lot of people is to go mixed use,

That's great. So leads me to the next question. What does retail look like in mixed use, development, environments versus retail only, you know, we're all very familiar with what the mall is. And what the anchors and the subtenants might be, but what's the mix like for, the project that's envisioned as mixed use?

you know, it's interesting, Scott, we are brought in more and more often now to take a look at those ground levels and help them figure out what the heck they built, you know, they built a bunch of apartments, they built a bunch of condos, whatever it was that they. Build the developers built.

It was almost like just a loss leader to put that retail. And I've heard that over and over again from residential developers. I don't know retail, but the city makes us do it. So we'll just put some retail and what they built is terrible, terrible retail. So very shallow depth, sometimes lots of columns right in the middle of the space.

No loading doc. And the worst thing that they do, often it's very low ceiling. Restaurants really have to have a 18 or 20 foot ceiling in order to get all of the ventilation in order to create that ambience that you want when you go into a restaurant.

We're building spaces with, you know, a typical 12 foot, floor to floor

retailers don't want that space except unless you're a dry cleaner, unless you're a nail salon, So what we would call sort of, you know, higher end retail, apparel, retail, They're not going to take that space.

So I think that what we often do is like, say, we'll go outside the building and pop up if you can, if you've got any sort of amount of room to get a taller ceiling to get that piece

Okay. Yeah.

 Or. The natural thing to do post COVID is just really push all of that activity outside onto the

Sidewalk, if possible.

 At Texas medical center in Houston, Texas, there's a 6Million square foot, tech campus being built research campus being built and. Gosh, you know, it's probably been under design and development for a decade. So it's been through the entire retail apocalypse story and it's opening now and they're realizing, oh, we didn't think about this.

We weren't thinking. We built these beautiful parks. It's a pedestrian environment. It's got thousands of highly paid doctors and research scientists up above that are going to come down and we didn't give them. A great place for their wives to come visit or their husbands to come visit them and then on the weekend to come back to.

So we have, gone through a process of sort of taking each of their office buildings, which are beautiful, beautifully designed research buildings and saying, but your ground floor isn't working. So how do we engage the park? How do we create a restaurant space? That's going to work. I would say that, like, over 50 percent of mixed use.

Ground level is food and beverage now, and that's those are expensive deals. They're expensive to fit out I think. The latest statistic that I see, it's still 50 percent of restaurants fail within the first year, more than soft goods, which don't have the sunk cost into it. So I think it's a risk and it's the risk that most of our clients are willing to take because they know if you don't hit people kind of in the stomach in the place, their hearts and their stomachs where they want to engage, then you're not really.

Hmm.

So if you've got the cool pub, if you've got the great sushi place, if you've got, you know, the place that the kids just make you go to, that's going to work and it's worth the investment into the food and beverage spaces themselves. So it used to be like 10 to 20 percent and developers hated those restaurants because they were such expensive deals.

Now it's 50 to 60 percent and they're still hard,

 The turnover is harder, they're more custom, there's a lot of equipment, there's all kinds of overhead, that works for them, because it's, getting enough foot traffic, yeah.

It's also the way to bring in local. so one of the things that in my career, which I'm nearing 30 years on now has been, we've always had a really hard time. So developers need national credit. That's kind of one of the things that they've always said that they're not going to take the risk on a mom and pop at a large percentage.

So when we would design regional malls, they would start with the story of, oh, 20 percent is going to be local. Never happened. And if it was, they didn't make it and they turned over pretty quickly and then just your national tenants went in. Food and beverage is an exception to that.

 Every city has its own sort of set of great local restaurants and many of them would love a new outlet, a new place to go, but they're not national. They might be regional, but they're not national. So they do have credit. They have sort of proven themselves that they've been open for 8 or 10 years for a restaurant.

That's pretty great. If they're ready for a 2nd or 3rd outlet, that's a risk. I think that developers are willing to take and embrace because it's got name recognition within a community. It's probably going to make it if the food has been vetted for a decade, it's probably going to be good and people are going to enjoy it.

So, you know, to put in another Chili's now, it would be a negative. You bring in a mom and pop from downtown that's moving, into a neighborhood. That's a positive.

 You’ve got that built in sort of constituency that already knows the name already wants to come there.

 Then you can take some risk. Then the ice cream guy that's just starting up, you can take a small risk like that. I think that's a really big shift. That’s got to take place in mixed use developments, and it is taking place in mixed use developments that the nationals don't draw people the way that they did when they were all under one roof at a mall.

A standalone gap, a standalone J crew just doesn't work very well. It needs to be in a mall setting, but, a taco shop from San Diego that's got a huge following.

 You know, put it in, in the ground floor and you're going to have people there and drinking beer and having fun.

Awesome. Well, you mentioned a minute ago you're looking at converting these spaces, is tend to be an additive solution or is it possible to make it work with, the structures that you have, or is it maybe a combination of the two?

Usually it's a combination, but I guess the, easiest solution, it all has to do with the, ceiling height. If, you've got a good ceiling height, there's a lot of room to move what we do a lot of time. We’re often constrained by our sidewalks. So if you have a 10 foot sidewalk and you have a tree great and then there's parking or live street, that's really not enough room to get much patio seating.

So you're not going to be able to extend your brand out. So we say, move the storefront back underneath the building. So you've actually got outdoor space undercover. Before you get to the door of the restaurant. So then you've kind of doubled your patio space and that's specific to restaurant and food and beverage.

Soft goods retail can be made to work in a lot of mixed use. If it's a 600 apartment complex that ground level is most likely going to be service. So the things that people need a wine shop, things that can kind of live within that and then restaurants.

And if you can pop people outside, then the ceiling doesn't matter.

And then, how do you deal with parking, with the, radical change of use like this, because food and beverage has a higher parking requirement than soft goods, right?

Yeah, there are many complicated formulas, but the biggest complication now is that many cities and I'm sitting in one are creating these overlay zones, which requires zero park. We’re in a crisis, a climate crisis, and I think that the world, especially elected officials are waking up to this in a way that they realize we have to take drastic action.

San Francisco, when I lived there had a zero parking requirement. San Francisco is a really special place in the world. I kind of get that. But I mean, Dallas, Texas, places like that are going to start adopting zero parking requirements. Now, a retailer is going to say something different.

They're going to say, I need 10 spaces per thousand square feet. And the developer is going to say, well, I'm required to give you zero. You want 10. Can we settle at five? And there will always be a need for parking, either onsite or proximate if you're not near transit. A really vibrant transit, not just kind of a bus stop never really brought a lot of people.

 I think that parking solutions, regional parking garages. So, when you find a really great mixed use district, and often these develop over a long time, Pearl Street in Boulder, something that we all talk about just a beautiful place. They have regional parking. So, the solution is you don't need to go park for that tenant.

You park in every third block, there's a pretty sizable parking garage just like you would at a mall. That's how you shop it. I think that in apartment villages, and I think that some developers probably should start looking at using some of their land to build serious parking garages that could serve a larger area than just their block or half block because a, there's a lot of money to be made in parking and B, there's going to be a demand.

And if a regular apartment developer just puts kind of traditional retail at the base, they're not going to give you maybe one spot for each place. So how do those people park? They're not all living upstairs. So they're going to need a parking solution somewhere in the vicinity. They'll walk a block. They don't necessarily have the performer to build enough parking on site for every single retail and then food and beverage, is. Really 10 parking spaces per 1000 square feet, is what the U. L. I. as an average. And often we can't do that, certain markets, Texas, Florida.

You’ve got

But not San Diego.

Hot, really cold, really rainy, but not San Diego, not the West coast.

Yeah. Yeah.

 There’s sort of transition happening where people are getting their heads around the fact that we may not build any parking for the retail. And will it be successful?

And then you have to think of all of the other ways to draw people

 Yeah, then it's a chicken and egg. What kinds of retailers are going to be able to survive in a zero parking, environment, or a low parking environment. Yeah. I guess one of the last things I want to touch on is, kind of the territoriality of this. So you might be dealing with one developer to develop the retail as you're doing mixed use.

Are you working in partnerships or are, developers sort of getting out of their own box and, creating their own formulas for different uses.

 I say, 20 to 10 years ago, it was all about teaming so you had your apartment guys; you had your retail guys and let's get together and do a project. I don't see that much anymore. I think that people are the mobile piece. So the developers themselves will move.

So if you're. Avalon Bay or an Amelie apartment developer. You may have a guy that came from Simon or who came from Brookfield who knows retail on your team now; instead of we need to team with Brookfield because the margins are just too skinny to have a partner of that scale. So I think what's happening is that no, it's gone the other way.

It's more we're going to do this in house if we have to build the capacity and then hopefully they lean on us as architects to help them. Solve these problems. I mean, that's what we do. So I think that more and more, maybe we're seeing companies take on the whole bundle now in a way that in the past, it would have been more of a collaboration or a team and they lean on us and they hire, you know, hired guns, essentially in the development world who know how to put together a complicated process, they work on that project, maybe they work on one more and then they go off and work for another company.

So it's a, it's a little bit of a different model than we would have seen over the last couple of decades.

I guess I'd like to think it's less designed by spreadsheet you know, cause those easy sites are, are spoken for at this

They're gone.

It's a

Yeah, they're pretty much gone. The low hanging fruit has been taken up, not always by the best use, but it's certainly been taken up. And so creativity, urban infill, there's just a lot of exciting sort of one off. Projects, and then I guess the last thing I would say about that is, and it's been very interesting.

We are seeing private wealth. Invest in real estate in a way that's never really happened before. if you want to put your money in the world, somewhere safe, it's United States real estate you know, the land here has held its value. And if not grown, better than anywhere else in the world.

And for sure, better than a lot of stocks and bonds and a lot of other investment. So people, investors from around the world and families that have, you know, large trusts are putting their money. Into real estate and they don't know how to develop. You know, they came from, sharecropper.

I don't know what, whatever field they came from. They made their money and they're asking us and they're asking their, friends, how do I do this? So they're hiring. These kind of hired. Guns in the development world that don't go over to the Middle East. They actually stay here, work with these families or these trusts that have billions of dollars and start to actually develop projects.

Horton Plaza was not developed by a development company. It's developed by a capital fund. And they hire developers to, like I said, 1 or 2 people, 3 people can do a half a billion dollar project within the organization of a large capital fund, rather than building out a whole Brookfield to do projects.

So it's a lot more agile and, it's personal money, which also stockholders are the family. Not anybody. So it's a little less pressure to make that money immediately to get your stock, keep your stock price up. A CEO is not going to lose his job because they made an investment. That's going to take 10 years to pay off and. I don't have 10 years. I got to make that ROI now

Yeah, that's a really interesting point, that the horizons are longer for these types of projects,

They have more patients, the capital fund. If they're going to invest their money, it's a long term investment in the bonds. So it's a long term investment into real estate. So I think that those are very analogous places to put your money, and a very safe thing to do. But again, they don't know how to do it.

They've never done it before. So they're either hiring a developer or they're hiring us and a developer to kind of help walk them through that process and use our experience and tell them the truth. The truth about how hard it is a to do it and be how important it is to do it right and that you can, invest that money any way you want.

If you don't do it right, you're not going to get the return that you want and that your family members or your organization wants. So the quality has to keep going up and I think that the internet has been the great equalizer. You can Google Ferragamo right now and see what a Ferragamo store is.

And before only a. 1 percent knew what that was. So everybody knows quality when they see it. Every single person who shops understands quality in a way that they never have before. So what we always preach is you've got to bring it. If you think you can do this cheaply, your consumers know that and they are going

It's not good enough.

TN on that and they're not going to come back and they're going to say, I don't like that

It's competitive.

And it might be visceral or it might be literally tiles falling off

The

No, there's that too.

A wide range, you know that if you don't pay for it up front and really invest in that, then you haven't made a very good investment.

So to me, that's a great sign

 I think that's just about all the time we have today. I could spend another hour.

For hours, right?

A great topic. Thank you so much, Sean. I'd love to have you back on again.

Once we've got some, new things to talk about here. And I'd love to hear about anything else that might be top of your mind.

Like to sort of say that, ULI, fall meeting was in Los Angeles a couple of weeks ago. I really felt a change in the atmosphere. I felt there was energy. There was a keen. Search for knowledge. I felt that maybe has over the last several years, even pre pandemic has been a little stale.

I felt like the energy is back. I feel like there are a lot of new players in the field. So, to me, it was very invigorating. I'll be at the center build conference, which is a conference at the end of November. And I expect to feel the same thing that the. Development world is waking up to kind of a new way of doing things and that COVID has just dramatically changed the way we think about real estate and that it takes new thinking.

And that's very exciting for me because I'm always trying to change and innovate. So I think it's a, great moment to kind of be in our world. I think things are going to change. And I think in a very positive way.

I think so too. Always good to end on a positive note. There's so much glim and doom out there, in real estate otherwise. I'm with you right there. Thank you so much, Sean.

Avoid the news and watch Scott's podcast.

Hey, thank you so much.

There we go. Love it. Thank you so much, Sean. Make sure you guys follow, to keep up to date with all of this and we will see you next time.

Thank you so much.

Thank you.

"Hello, and welcome to the Creative Viz podcast, where we dive into topics related to architecture, development, and visual design. Today, we're going to be talking about digital twins in the built environment, going beyond the buzzwords to explore the intersection of archviz and digital twins, both today and in the near future.

A digital twin is a virtual replica of a physical object or system. Created using real time data for our purposes. We're going to limit the dissection to new development projects or individual buildings, but it's important to know that they're often used to simulate transportation networks or even entire cities, digital representation of a building or a site allows for simulation analysis, optimization of the actual entity that it mirrors.

Bridging the physical and digital realms. If we consider that the role of archviz is not just to make a new development look pretty, but to be more legible, then the opportunities for these two fields to overlap becomes clear. So in some ways we can think of Digital Twins as being an evolution of traditional archviz . Archviz is primarily focused on creating static visual renderings or animations for architectural projects.

Digital Twins, on the other hand, offer dynamic, Real time digital representations. And while archviz offers a visual snapshot of a design concept, digital twins can integrate real time data. analytics and simulations, making them more interactive and informative.

When we think about increased engagement, archviz tools, typically VR or AR, are increasingly being used to provide immersive design walkthroughs. When combined with digital twins, these walkthroughs can reflect real world conditions, modifications and impacts, giving clients Investors and end users, a much richer experience becomes possible then to not only view a property, but to interact with its digital representation, altering parameters, observing changes, and even predicting future challenges.

So then there are many opportunities for collaboration In early phases of development, archviz can act as the front end visualization layer for digital twins. Realistic renderings can be paired with the data driven back end of the digital twin. As architects and designers iterate on a project, changes can be instantly reflected within the digital twin, with all stakeholders able to see updates in real time.

During construction, archviz can be useful to communicate the final design to stakeholders. Typically, this will be during the sales or leasing efforts. Both in commercial and residential settings. However, there can also be used for training purposes in industrial, research, and even educational projects.

Another thing to be aware of is the feedback loop that's possible. In the life cycle of a building, archviz is most useful in the pre occupancy phase, whereas Digital Twins are utilized both before and after construction. Once the building is complete and operational, digital twins can collect real world data such as energy usage or occupant behavior. This data then can inform future projects to be visualized, creating the feedback loop that makes designs more attuned to real world performance. a logical extension of this feedback loop is that the buildings themselves may move beyond the static entities of today. Using the insights and data collected from the digital twin, future building facades will be able to respond to weather conditions in real time. Exterior spaces can be reconfigured to accommodate user preferences.

Of course, this is just the beginning. There are a number of possibilities for future integrations between the two. The convergence of archviz and Digital Twins is indicative of the broader trend and technology integration within the architectural realm.

As we look ahead, future architectural software may not need to distinguish between traditional visualization techniques and digital twin functionalities. Instead, they may offer a unified platform where designers can move fluidly between conceptual design, Detailed visualization, real time data analytics, and simulations. this integration can significantly streamline the design process, ensuring that decisions are made with both aesthetic and practical considerations in mind.

So to wrap things up, It's clear that the intersection of digital twins and architectural visualization is revolutionizing both real estate and design. From their inception in early NASA space missions to their present day applications, digital twins are expanding our architectural capabilities, merging tradition. With innovation with Archviz bringing these visions to life, we can not only envision, but truly experience the future of our built environment. This is a very exciting time in both fields. I am sure that we're going to revisit this topic again, as it, as is ripe for further exploration. That's it for this episode. Thank you so much for listening. Be sure to like, and subscribe, stay on top of all the latest developments. See you next time. "

"Hello, and welcome to the creative viz podcast, where we dive into topics related to architecture, development, and visual design. Today's topic is a crucial one for professionals in our field, how to craft compelling presentations that not only inform, but inspire the audience. Given the importance of visual communication in our industry, getting this right can be the difference between a successful pitch and a missed opportunity.

Let's start with storytelling. This is a term that's often overused in our field. But it's very important nonetheless. Begin by understanding your audience. Who are they? What are their pain points and aspirations create a narrative that aligns with their needs and desires. Every property or design has a story - make sure to tell it whether it's the history of the location, the inspiration behind the architectural decisions, potential future of the space. Weave all of these things together. Take advantage of modern visualization tools. Traditional drawings, images, and models are still useful, but integrating state of the art digital tools can elevate the presentation.

Stay on top of the latest technologies like real time rendering to give a lifelike immersive experience. For interior projects consider using augmented Augmented reality that's AR or virtual reality VR to create interactive walkthroughs These can make your audience feel as if they are truly inside the proposed space to balance the data that you have with visuals, real estate and architecture are data driven fields. However, bombarding your audience with numbers can be overwhelming. So use infographics, charts, other visual aids to simplify this complex data. Let visuals lead the story. Use data to support.

Think of the phrase "show, don't tell" as much as possible to create a lasting impression. Content can be engaging and interactive. Interactive content can make your presentation memorable, so be sure to integrate interactive site maps, 360 degree views, or audience engaging questions or quizzes to maintain interest and encourage participation. Be sure to personalize and adapt to your audience. No two presentations should be exactly the same. So personalize your approach based on the audience. Whether you're pitching to potential investors, clients, end users, adjust your focus. For investors, it might be ROI. For end users, it might be the usability and the aesthetics of the space. So here are a few takeaways as we wrap things up.

Crafting a compelling presentation in the world of real estate and architectural design. It's a blend of storytelling, modern technology, data visualization, interactivity, and adaptability. It's not just about showcasing a space or design, but about making a connection, evoking emotions. And painting a vivid picture of possibilities as the industry continues to evolve, stay updated with the latest presentation techniques as the industry evolves, staying updated with presentation techniques like these will be pivotal in making an impact. Remember, it's not just what you present, but how you present it. So that'll do it for this episode. Thank you so much for listening and be sure to like, and subscribe to stay on top of the latest developments. I'll see you next time."

Hello, and welcome to the CreativeViz podcast, where we dive into topics related to architecture, development, and visual design. Today, we're going to be talking about real time rendering technology and look at its broader implications for architectural visualization and real estate marketing.

This is invaluable for international or remote clients who may not be able to visit the space in person. Sales representatives can instantly showcase different finishes, furnishings, or design options tailored to a client's taste, making their pitch. More personal and engaging. When clients can virtually explore properties through real time archviz, they often find it easier to emotionally connect to the space. While a static image provides a snapshot, navigating a realistic digital environment offers a genuine, sense of belonging. And immersion, it allows properties to be displayed under different conditions, such as varying times of day or during specific events. This flexibility provides clients with a deeper understanding of the project, illustrating the properties, practicality, and the different scenarios that it can accommodate, Post COVID, real time rendering can facilitate virtual open houses where multiple clients can explore a property simultaneously from the comfort of their homes. Virtual tours can integrate clickable hotspots to create more information, showcase amenities, or even direct users towards a booking page.

In a saturated property market, offering real time rendered visualizations can differentiate a real estate company from its competitors, positioning them as tech forward or innovative. Properties showcased with state of the art visualization techniques may be perceived as more valuable or premium, potentially commanding higher prices. By tracking how potential clients interact with real time rendered environments, marketers can gather data on what features or spaces attract the most attention, guiding future marketing strategies, or even providing feedback for design modifications. Based on user interactions and preferences, marketing professionals can fine tune their advertising campaigns to target specific client demographics more effectively.

For a deeper discussion on this topic, And the larger world of digital twins, be sure to check out that episode. So to wrap things up today. real time rendering may be considered a technological advancement within the world of archviz and real estate marketing. It truly is a paradigm shift. Clients now have the ability to virtually walk through spaces, experiencing them under different conditions, genuinely feel the potential of a property. Moving forward, we expect that real time rendering will continue to develop. It'd be more widely adopted and these virtual scenes will become even more lifelike and immersive. Think about metaverse. We'll have to save that discussion. Think metaverse, but we're going to have to save that discussion for another time. That's it for this episode. Thank you so much for listening. Be sure to like, and subscribe, stay on top of all the latest developments. I'll see you next time.

Hello, and welcome to the Creative Viz podcast, where we're going to dive into topics related to architecture, development, and visual design. In this episode, we're going to discuss the high level subject of architectural visualization itself. That's Archviz. What exactly is this, and why do I need to know about it?

Archviz is simply the method of communicating To any stakeholders, what a proposed new building or renovation might look like. This has a historical basis going back to fact, all the way back to the middle ages, when the master craftsmen would draw plans for cathedrals that might take hundreds of years.

They had the vision and they needed to be able to communicate it to the community. And then also to the people who were going to be. Building the structure, in some cases, many years after they were gone. When we think about architectural visualization, this is a relatively new industry as it exists today.

It really only dates back to about the mid 90s or so. As I mentioned, it is rooted in traditional architectural design and illustration. The growth of the industry has been very closely tied with the development of photorealistic rendering software.

Today, the leaders would be V Ray, Corona. , as well as real time engines such as Unity, Unreal Engine and emerging options such as Twinmotion and Vantage. In the early days of ArcViz, renderings were quite crude. They relied heavily on very basic 3D models, oftentimes were hybrid renderings, that is, mixed computer and hand drawn illustrations to create final renderings.

As the software evolved and became more powerful, New opportunities opened up a big one in the early 2000s was the development of global illumination. this rendering method calculated bounce light and made renderings much more realistic, much more lifelike and true to photography.

That was a big turning point for the industry. And we're in the midst of another big turning point as not only real time rendering is taking hold, But also the emergence of AI, as in so many other creative fields, is starting to change how Archviz artists create images and also how they're conceived from the beginning.

That's a big topic. I think we're going to save that one for a later one. But important to know that the industry is definitely a state of transition. The other thing I want to mention about Archviz is that as the industry has evolved, it used to be primarily done within design firms.

Say an architect would be responsible for the design, the development, the construction drawings, and also the rendering, communicating the design. As the software matured, it takes longer to create the renderings. So the field became much, more specialized.

And that's where, the notion of an Archviz consultant specialist really came into being. The nature really of Archviz has continued to evolve to include styles and rendering techniques that might've been formerly associated with Hollywood.

Things like cinematic framing, storytelling, the use of live actors against a green screen, and special effects, VFX like pyrotechnics, water simulation. Particles. All of these used to be very much in the domain of high end, industrial light and magic type companies. And of course, now these are well within the reach of even smaller Archviz companies.

These techniques are really specialized and much more than, architects, designers. Can, normally account for in their design effort. So it makes a lot of sense to hire an outside consultant at certain points during the project, when it's important to communicate the design. These typically come early phase, something like, well, they're, they're going to be a couple of different scenarios for early phase development.

That's going to be potentially pre award like an architectural competition. Sometimes it's useful to bring in a consultant to help. With the, rendering conception and design, sometimes a fresh eye can, make all the difference in winning or not winning that competition. That's certainly one common scenario.

The next one, as the project would move forward and it's lifespan. Would be internal or community review, design approvals, things of this nature.

That can, that can be internal to financial stakeholders. And then potentially that, could also encompass design review boards, city councils. This is the, oftentimes the first time the public has a chance to review the project and critical that as a developer, you're putting your best foot forward.

And very commonly point in time when you want to bring in a specialist that can create these high end visuals, something that might not be good enough if you were just to take something off the boards, as it were, from from a creative, as you move forward through the process, a large project may have.

Some visualization needs as you go, particularly for interiors. These high end visualizations can be used to test certain aspects of the design. And this starts to touch on another topic we're gonna delve into a little bit later. That is the digital twin concept. , there's a pretty big overlap between ArcViz and digital twins.

So, like I said, we'll get into that. Those tend to be mid phase and then as the project, continues to move forward, potentially point of groundbreaking, this is where marketing campaigns, sales, leasing efforts begin, and it's very important to have your highest quality visualizations at this point.

To not only explain and communicate the concept, but truly to sell it to, your stakeholders are going to be first at, let's say, a residential project, maybe buying their home. And so it's very important that they understand what this project, their home is going to look like even before it's built.

That can help speed up sales, save a lot of money in terms of financing and approvals there. As you move over to the commercial side, it's also important to. Accelerate leasing efforts. It's a very competitive environment, and, these visuals can make or break a leasing campaign, say, for a shopping center or retail space.

If you're looking to attract tenants, they often want to know what this project is going to be like. Well in advance of occupancy and of course the owners want to have deals in place well ahead

So as I mentioned arcvis has really matured and this is has come to encompass renderings But multimedia examples and all the way up the range to full fledged short films Many studios are creating Short marketing films as part of the sales campaign to generate interest intrigue for an upcoming project.

And, these not only are incorporating some of the things that we may have formerly associated with Hollywood, but they're introducing concepts like storytelling, marketing. And sales into the campaign. This is, another emerging field for archivist artists and studios.

This is another avenue that owners, developers, stakeholders should consider for larger projects, really generating high quality visuals for outreach to potential buyers and community stakeholders.

That's a really high level overview of what Archviz is all about. Hopefully that's been helpful. Like I said, we're going to continue to explore some of these topics in more depth with later episodes, but for this week, I think that's going to be it. Thank you so much for listening. Be sure to like, and subscribe to stay on top of all the latest developments and I will see you next time.