Mixed-Use and Flexible Spaces

The pandemic rapidly reshaped how we live, work, and interact. Offices emptied, shopping malls became deserted, and homes turned into workplaces as people adapted to new lifestyles.

At the end of 2024, the office vacancy rate in the US was 20.1%. That is a 30-year high, with more than 84 million m2 [900 million sq ft] of office space empty — enough to fill New York City’s One World Trade Center 300 times ⁽⁶³⁾. More long-term, McKinsey & Company estimates a 13% decrease in office space demand by 2030 compared to pre-pandemic norms ⁽⁶⁴⁾. Similarly, retail space faces enduring challenges from the growth of e-commerce, with demand projected to be 9% lower by 2030 than before the pandemic ⁽⁶⁴⁾. In contrast, demand for residential space is expected to increase, driven not by a return to urban cores but by population growth that matches pre-pandemic trends.

This disparity highlights the need for more adaptability in spaces, where spaces are no longer seen as something fixed and permanent but as something dynamic.

The ability of a building to accommodate change is becoming a key factor in its longevity, economic success, and carbon footprint. As a result, demand for mixed-use and adaptable buildings will continue to grow.

Mixed-use buildings integrate multiple functions, such as residential, commercial, office, and hospitality, within a single structure to maximize space efficiency and adaptability. Combining different use cases in one structure offers unparalleled benefits for its occupants: increased traffic for commercial tenants and improved convenience for residential tenants. Mixed-use buildings also offer benefits to their landlords. This includes higher rents, as office spaces in mixed-use environments are able to command up to 33% higher rental prices and increased flexibility to shift spaces from one use case to another ⁽⁶⁵⁾. The shift to mixed-use buildings is already taking place. For instance, in the US, there were nearly 200 malls in January 2022 that had plans to incorporate residential units, repurposing vacant retail into residential space ⁽⁶⁶⁾.

This concept of adaptability extends to broader architectural solutions and flexible buildings. Flexible buildings include reconfigurable layouts with movable walls, enabling buildings to transition seamlessly between use cases. Reconfigurable layouts also contribute to a reduction of embodied emissions as the lifetime of buildings, or parts thereof, is extended. Supporting this flexibility, though, requires infrastructure such as modular wiring, plumbing, and HVAC systems that can adapt to different configurations or loads without extensive renovations. In Zurich, a case study demonstrated that incorporating movable walls and independent technical systems in an office building could unlock nearly USD 550 million in value by converting vacant spaces into co-working or residential units, reducing vacancy risks by over 70% ⁽⁶⁷⁾. Similarly, innovative elevator systems now allow a single elevator group to serve multiple applications, such as residential, office, or hospitality, making it easy to accommodate changing applications or passenger groups ⁽⁶⁸⁾. However, these flexible designs also present challenges. More complex wiring, plumbing, and HVAC systems often have higher initial costs and, if not implemented correctly, also higher energy consumption compared to customized designs. Balancing adaptability with cost efficiency and sustainability is critical to maximizing the longterm value of flexible spaces.