Office space is changing in St. Louis. And that means challenges and potential for downtown
Downtowns across the country have largely struggled to return to how they were before the COVID pandemic, and St. Louis is no exception.
The business core of the region in downtown St. Louis has had a slew of companies announce they’re moving elsewhere in recent years, leaving vacant office buildings or ones that will soon be.
“What you’re seeing today is really a flight to quality,” said CBRE Senior Vice President Rick Messey, whose work focuses on office tenants and landlords in the St. Louis region. “Tenants are looking to upgrade their image, get people to return back to work, and they want fully amenitized space.”
In practice, that has meant companies choosing to move to newer office space in St. Louis County, especially in Clayton, Messey said.
“A lot of this has to do with bringing the employees back to work,” he said. “Companies want people to return back and start collaborating with their partners Tuesday through Friday.”
CBRE tracks office occupancy and vacancies in markets including St. Louis. Their second quarter figures post a total vacancy rate of about 20% for the nearly 11 million square feet of office space in the region’s central business district, compared to a 16% vacancy for the nearly 12 million square feet of office space in Creve Coeur and Clayton combined.
Amenities to bring workers back
Companies want buildings that can offer workers a range of additional perks, like gyms, full-service cafeterias or different settings where people can work, Messey said.
There needs to be a reason for employees to return to the office, since the pandemic proved remote work was viable, said Joel Fuoss, an architect and principal at Trivers Associates in St. Louis.
“It is thinking about the end user of not just housing workers, it’s not just a place where people come to work and do their thing and leave,” he said. “If you just want to get your work done, then people are going to opt to do that at home.”
Other local architectural and engineering firms have noticed similar trends with their clients.
“So much of what we’re talking about is: What is the company, the business, the clients?” said Margaret McDonald, a senior principal at the global architectural and engineering firm HOK. “What does everyone need from the workplace? What are the things that are going to bring someone into work?”
This shift in perspective is driving design and development choices that promote the benefits from sharing space face-to-face, like collaboration or mentorship, she said.
It’s also spaces, like larger conference or board rooms, that can be used by multiple tenants, Fuoss said. Trivers makes use of this at their current home of 100 N. Broadway in downtown, which they helped redesign, because the firm had doubled in size in recent years and had outgrown the conference rooms, he added.
“That was really beneficial for us to not necessarily expand our personal square foot but be able to use a shared space that we need only maybe once or twice a month as part of the amenities of the building,” Fuoss said.
Moving into a new space can also help a company redefine the image it presents, said Hany Abounader, who owns Third Man Development. His company is developing Brown & Crouppen’s new headquarters in a former factory in the Hill neighborhood.
The law firm had previously been housed downtown.
“This gives them an opportunity to modernize their space, to reset the entire firm, their brand and their culture,” Abounader said. “It’s not easy to retain or attract employees these days, which is probably the reason some of the law firms have left downtown.”
Challenges and opportunity for downtown
The challenge for downtown comes from the reality that newer, modern office spaces are limited, and it can be expensive to redo current stock, he said.
Downtown St. Louis also suffers from issues of safety and how that affects public perception of the area, Messey said.
“It’s an issue across the U.S. and most major urban areas and central business districts,” he said. “It’s crime. People are wanting to leave because of the crime that needs to be resolved.”
It’s something the Downtown St. Louis Community Improvement District is acutely aware of and actively working to address, said Executive Director Kelli McCrary. She added they collaborate with the city’s police department, which is primarily responsible for enforcement.
“Our collaborative effort is on supplementing those needs,” she said. “We deployed downtown ambassadors, we also have supplemental patrols, marked vehicles that say security or off-duty police.”
McCrary stressed these efforts are especially important when conventions bring in many outsiders, along with softer things like flower baskets and pots that add beauty to the district.
“What that means is that someone cares about downtown, right, you're not just coming to an area that is filled with debris, and it just looks barren,” she said. “We want our visitors and guests to recognize that we care.”
These efforts can help improve the downtown’s atmosphere beyond specific building interiors, which are also an important part of the equation, Fuoss said.
“Your office space is one thing, creating the amenities surrounding in your micro market is another story,” he said. “Creating places where people want to be inside and out is really the challenge of what we have to deal with when we’re talking about office workers.”
Along with the many challenges that St. Louis’ downtown faces with office space comes the opportunity to reposition the assets that are already there, McDonald said.
“The good thing about what we have downtown is these existing buildings, they’re really well made,” she said. “There’s a good quality to them that do lend to repositioning and to consider should it be an office? Or could the building be split and be office and hotel or office and apartment?”
It’s an idea shared by developers locally and in other cities across the U.S.McDonald explained that some buildings are more apt for retrofits than others, but the overall idea deserves attention and studying.
“As much as we can do to have people downtown from 9 to 5, but then also from 5 to 9 is the activity level that we need, to support businesses and to create more buzz,” she said.