Reinventing CBDs Post-Pandemic

As remote and hybrid working arrangements change the demand for office space post-pandemic, central business districts (CBDs) have the opportunity to reinvent themselves.

In North America, between 45% and 65% of workers are returning to the office — a lower rate than the 65% to 85% in Europe and 70% to 100% in Asia-Pacific, according to commercial real estate firm JLL’s report “The Future of the Central Business District.”

Cities must get creative. Instead of offices, future CBDs can use existing buildings to create a balanced mix of uses, improve amenities and invest in the public realm for sustainable design.

“After three years of dramatic shifts to how we live and work within CBDs, significant opportunity exists to reimagine how we use and interact with city centers,” said Phil Ryan, director of global research, city futures at JLL.

JLL wants to identify solutions to ensure CBDs remain viable as economic, cultural, educational and innovation hubs in the post-pandemic world, Ryan said.

As people seeking more space moved to suburban locations, town centers with a mix of office, retail, dining and residences emerged, competing with traditional CBDs. Creative, tech and R&D clusters are evolving in these submarkets, shifting investor focus toward the development of creative office, multifamily, boutique hotel, lab and curated retail space.

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What Does That Mean For CBDs?

CBDs will transform from being primarily places of work to being mixed-use destinations and capitalize on being at the center of transportation networks and complemented by an array of educational, government and cultural institutions.

Cities must find alternative uses for existing buildings, perhaps repurposing offices to residential, hotel, cultural or other nonwork functions. Floor-plate dimensions, mechanical upgrades and plumbing reconfigurations all factor into the financial and physical feasibility of conversions.

Partnerships between the private sector, governments and academic institutions will be vital to maximizing growth opportunities and speeding up the transformation of CBDs.

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Renovating existing buildings has a lower environmental impact than developing new projects, which will be important as cities move toward carbon neutrality. More than 10.8 billion square feet of office space around the world will need to be retrofitted by 2050, with 80% of the buildings that exist today still in use by 2050.

Creating pleasant pedestrian areas with inviting retail, green spaces and a variety of businesses will be key to making CBDs more attractive. Adding tree cover improves the street-level experience and lessens the adverse effects of climate change, such as excess stormwater and heat stress. Expanding on-street dining, closing streets to cars and other measures to reduce traffic also will become more common.

“Breaking up large-scale development sites into smaller blocks can not only improve public spaces and differentiate properties through design but can also improve the logistics of regeneration,” the JLL report states. “Smaller blocks allow for flexibility during the development process and enable greater adaptability to often uncertain market conditions.”

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