Robert Grooters puts spin on office development
Industrial real estate firm banks on employers leaving downtown for cost-savings buildings in suburbs.
Moving employees seems to be the trend, but Robert Grooters Development is preparing for the reversal.
The industrial real estate firm long has dabbled in office space, including the development of Bridgewater Place downtown, but RGD President Robert Grooters recently has renewed focus on office space for the next generation.
Grooters long has offered the ability to build office space into the company’s large-scale industrial buildings at a lower cost than downtown buildings, but the concept now is meant to help companies attract and retain talent, while saving the tenant money.
“Office space is not a new concept, it’s something we’ve done all along,” Grooters said. “The difference is how we’re designing it. Our goal is to keep overhead low and make it work easy. That’s the formula we’ve used for a number of years and leased quite a bit of space.”
A shift for offices to move back to the suburbs isn’t radical or unique to Grooters.
In October, Colliers International Research Analyst Jeff Hainer told the Business Journal that office users and residents will begin to look toward the suburbs down the line.
Grooters said one of the major benefits of moving to an industrial park is the no-cost parking, as he called parking downtown “a diamond.” NAI Wisinski of West Michigan Broker Mary Anne Wisinski-Rosely told the Business Journal in October that parking cost already is a topic of discussion for clients when looking for space.
“We have to build parking lots anyway for the semi trucks,” Grooters said. “Competing against downtown, we’re free.”
For additional cost savings, RGD’s office spaces don’t include a common area, which often is unusable space for office use, Grooters said.
The concept can be implemented in any of RGD’s industrial buildings, which provides the largest cost savings because of the scale of the buildings, he said. The company can accommodate 10,000-square-foot office users but is better suited for larger office users where the savings are largest, he said.
Companies locating downtown often are looking to attract younger employees, but Grooters said he’s banking on potential employees liking a company and what it offers, not a location. The new design concept is meant to create vibrancy noticeable upon entrance.
The concept places a break area and lunch room at the center of a massive open concept office, with a walking track throughout the office. TVs and windows line the walls, and even potential meeting rooms in the space would have glass walls, potentially circular to give a full view of the office bustle.
It’s helped along by no support columns in the middle of the office and the entire space is on one floor, meaning all workers can be together.
There’s also an option for an outdoor patio.
“The thought is if you come in the door in one of these offices, instantly, you’re excited when you see the company,” Grooters said. “We want the whole office to be full of energy and sitting areas that are usable.”
Grooters said he’s been in discussions with several potential office users and is close to at least one build out. He said it’s older people in the companies realizing there’s a need to better attract and retain employees.
He noted Holland-based call center Dialogue Direct as a user happy with the concept and will base future call centers on the same concept.
RGD can operate the large industrial buildings at a cost, allowing them to offer a rent nearly 50 percent of downtown office market rate, Grooters said. The extra savings can help fund other pieces of the company, such as employee retention, attraction or marketing.
Vacant industrial office space is rare in West Michigan right now, and RGD is one of few firms building new, but this option helps diversify the company for the future.
“If we take some of the buildings and there is a demand for cheaper office space, we want to be able to supply that,” Grooters said. “In our world we can be flexible, and if we have a building planned for the future, we don’t want to be pigeonholed.
“We want to work in both markets.”