Two Design Principles to Boost Your Development Margin
Increasing the leasable square footage (SF) when all things are constant results in a direct increase to Notice of Intent (NOI). We will discuss a few quick tips to identifying these opportunities as well as maximizing your development and getting the most from it.
1. The Law of Wasted Triangles
This is a simple concept to apply, but many potential acquisitions sites, especially older developments, are not optimized using this rule. Once the principle is applied to potential acquisition or development sites, all the hidden value lost in the old orientation begins to show itself. There are often numerous orientation options available for a piece of land, but the key is to pick the orientation that results in the smallest wasted triangles. In larger developments, this may require several assemblies and drafts, each with their own distinct orientation. Integrating this analysis into the design workflow results in a significant increase in leasable SF, sometimes as much as 15%! This difference can drastically change the income of the landowner.
2. Double-Loaded Drives
All drive aisles should have maximum utilization on properties. In suburban development, this commonly means double-loaded parking on both sides of the drive. On the perpendicular access aisles, they should have head-in parking on one side (head-in parking around the perimeter of the parking field). Tenant requirements may prohibit this in some cases, but there are still numerous opportunities to add parking. Applying this design principle to an existing site may result in enough additional parking to add building SF. Identifying these opportunities on an existing site provides a direct path to increasing NOI that other investors may not have identified.
Estimating Leasable Square Footage (SF) – Keep the attached chart handy for a quick estimation of leasable SF as well as some of the factors affecting leasable SF.