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he Merriam-Webster Dictionary defines “flexible” as something that is “characterized by a ready capability to adapt to new, different, or changing requirements.” Many real estate strategists and planners consider it to be the word that best describes the concept of corporate campuses. In a discussion on campuses, it also translates into smart design, operational efficiency, and a means to solidify a corporate culture.
software engineers. Sun’s new Burlington, Mass. campus will accommodate 4,500 employees
At the International Development Research Council’s Spring World Congress in Seattle, in May 2001, I was part of a lively debate on the future of corporate campuses. Some were saying that the cancellation of large campus plans by Cisco Systems and Sun Microsystems are harbingers of the demise of the campus concept. I believe this is a misperception. The corporate campus is a sound and highly viable model in all economic cycles.
Cost Control Attributes
A company can gain tremendous flexibility when it controls a large land site for the purpose of creating and establishing a campus setting/environment. It starts with the financial flexibility of structuring a real estate solution that best suits your business plan. The scenarios of own, lease, sublease and sale-lease back carry with them distinct advantages depending on your short- and long-term goals and objectives. Land options and takedown rights can add further future flexibility.
According to Jim McLeish, a principal with Lehman-Smith + McLeish, Washington, D.C., the ability of a campus development to control costs and provide expansion flexibility is significant. “As growth becomes a central part of many corporations’ plans, having the ability to adjust your real estate capacity is fiscally shrewder than keeping office space vacant or attempting a short-term lease with a third party,” he maintains. “A campus allows for growth over time with multiple phases. Or, as is often the case, a company can sell a portion of their permitted land as a value play to help the company’s bottom line.”
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The new Gannett/USA Today headquarters along the Dulles Corridor in Tyson’s Corner, Va., is a project McLeish’s firm has developed in conjunction with Kohn Pedersen Fox Associates of New York. The master plan segments various diverse business functions into separate parts, allowing for different building types with different per-square-foot costs. This would be impossible in a single, large downtown building scenario. The advantage of having land and building your own campus is that you can control your destiny.
In Burlington, Mass., Sun Microsystems has a 540,000-sq.-ft. (50,100-sq.-m.) campus with another approximately 660,000 sq. ft. (61,300 sq. m.) scheduled to deliver in phases over the next 12 months. By having hardware and software engineers together, collaborating within the same facility, operating costs are better controlled from design through delivery. “As the economy slows,” says Sun Program Manager Mark Wartenberg, “it is important that our real estate functions better.”
When Sun’s Burlington campus is complete, it will be home to 4,500 employees. At full build out the company’s Burlington, Santa Clara, Calif., and Denver, Colo., campuses will be 1.2 million to 1.4 million sq. ft. (111,500 to 130,000 sq. m.) each.
Enhancing Employee Productivity
When you bring diverse work groups together in a campus setting, you are creating a workplace that fosters, nurtures and facilitates team-based work. When “time and motion” used to be the cutting edge of managerial efficiency, repetitive factory-like production was the norm. Now, we are seeing team-based work as the standard. Instead of a systematized program where the employee punches in from 9 to 5, the process and environment has changed, giving the worker more chance to interact with the team and be more engaged. This is today’s “Knowledge Worker.”
The hierarchy is becoming less clear cut, as teams are forming that include a large cross-section of the company structure. In this way, the nature of the work place has changed to better utilize the skills and value of the worker, and benefit from collaborative efforts.
Bill Yontz, vice president of corporate real estate at Capital One Services Inc., a leading consumer-based credit company, has commented that their current consolidation to create a new 30-acre (12-ha.) world headquarters complex in Tyson’s Corner, Va., brings staff functions, marketing, and an international group all under the same roof. He expects that this will result in greater operational efficiencies and lower long-term risk. (See the Site Selection cover story on Capital One’s campus strategy in the July 2001 issue.)
“We are a highly collaborative company,” Yontz explains, “
“Our campuses allow us to more easily leverage our management talent — a scarce resource in a high-growth company like ours,” he adds. “Our stockholders have been extremely supportive of the concept.”
Corporations that become good neighbors
become a source of pride for local residents.
This enhances the recruiting process.
New Design Opportunities
Controlling your immediate environment gives you both expansion and contraction flexibility. Regardless of economic and business cycles, you are able to better define and draw a circle around your campus environment and control your corporate destiny.
At Brewster Point, the redevelopment of the former Norwich State Hospital in Preston and Norwich, Conn., the master plan for the 470-acre (190-ha.) campus on the Thames River calls for various development scenarios with respect to buildings’ sizes, site layout and massing, focusing primarily on office and research and development uses while providing a natural environment for coexisting, concurrent recreational and supporting business amenities.
Alan Resnick, principal of Sasaki & Associates, Watertown, Mass., describes one of the planning principles of the Brewster Point plan: “We tried to capitalize on the land’s special relationship with the Thames River, the natural attributes, and mature trees. By virtue of the campus concept, we can fully realize the site’s potential and prioritize its use in creating a cohesive corporate community.”
I agree with Ed Friedrich, President of interior design firm Gensler, when he says that companies are getting away from the “organizational ego” that once drove campus design. “Now they are subsumed by good business practices and employee retention,” he notes, citing FedEx’s Information and Technology Division campus in Collierville, Tenn., which Gensler helped design, as a good example.
“While it is tailored to FedEx’s operation, it could conceivably be a high-end office park broken up into a multi-company scenario,” says Friedrich. “Single large buildings are simply not sensible for the long-term. They are awkward, unwieldy and often scrapped at the end of their life. As with FedEx, you have a single tenant in a potential multiple building campus scenario. In other words, a complex that can perform as a single campus; the flexibility is built in.”
The FedEx campus, home to nearly 1,500 employees, includes 1.5 miles (2.4 km.) of walking and jogging trails, a 10,000-sq.-ft. (930-sq.-m.) Wellness Center, a library, dry cleaning, Kinko’s, and coffee bars adjoining team work areas on every floor. The 500,000-sq.-ft. (46,450-sq.-m.) facility includes four state-of-the-art office buildings and a multifunctional convocation center in a Silicon Valley style setting.
The proposed Brewster Point campus is planned similarly, including educational programs with a local college, a waterfront trail system, and the existence of mature hillside trees. The Master Planning Principles for this property provide for a viable, resourceful plan that relates to the existing and emerging contexts of the surrounding community.
Urban planner Ken Greenberg of Toronto-based Greenberg Consultants Ltd., has also seen this trend toward built-in flexibility in campus design. “The corporate campus is becoming less homogenous — from accommodating a single use or user to becoming a part of a larger fabric. We are now accepting the notion of ‘indeterminacy’ in strategic planning,” he relates. “Large companies thought they were able to make long-range plans. They would start a plan then change when they were partially finished. Assumptions about use have to be weighed against the ability to confront change.”
If your company locates its campus where land is relatively inexpensive, you can control a large enough parcel to accommodate future expansion. The textbook example of this is Ross Perot’s EDS. Perot moved operations in the late 1980’s from Dallas to a 2,700-acre (1,100-ha.) site in Plano, Texas, that had been described as being “miles from nowhere.” He wanted to provide his employees proximity to quality housing and good schools, both of which are plentiful in Plano. The fact that the North Dallas Tollway extension was proposed to pass the site also prompted Perot’s decision. Other Fortune 500 companies, including Ericsson, JC Penney, Compaq, Intuit and Computer Associates have since followed EDS’ lead to Plano.
I have recently seen major changes in interior design within corporate campuses. There is a direction toward sustainable design that can meet the growth/retraction spurts, as well as the internal rearranging that is becoming the norm in corporations today. Friedrich points out that instead of 20,000- to 25,000-sq.-ft. (1,850- to 2,300-sq.-m.) floor plates with a core and perimeter offices, campuses are taking on larger plates with 30,000 to 100,000 sq. ft. (2,800 to 93,000 sq. m.) that is subdividable.
This idea of “horizontal connectivity” was studied by Tom Allen, Professor at the Sloan School of Business Management at MIT. He reported of the effect of distance on communication. Understanding this horizontal connectivity and the line of sight patterns allows for effectiveness in grouping teams. In this sense, campus design inherently permits larger floor plates, allowing emphasis to be on horizontal arrangement, and therefore better team arrangement and improved communication.
College Lessons
Today’s architects and planners are adapting from the college campus concept. Georgia Tech’s Bioengineering Center, for example, brings together the engineering discipline with the life science group. To actualize the potential interdisciplinary synergy, faculty and students undertake joint research programs wherein engineering principles are applied to problems in biology and medicine. As success is proven in the academic realm, corporations are creating the same symbiosis on campuses of their own.
Bringing different departments together, though, does not necessarily promote interaction. The interaction begins, as Dick Galehouse, a principal at Sasaki Associates remarked, “in the informal meeting and socializing space between areas of discipline.” He says his own firm, which includes a wide range of disciplines from landscape architects to urban planners, has profited from this type of cross exposure. “This synergy happens when you get people thinking together. You ultimately get a superior product and better services.”
Hence, on one level, corporations are following the collegiate example in format. On another level, there continues to be more cooperation between universities and companies. There is the pioneering Princeton Forrestal Center, which Princeton University initiated with its own funds 25 years ago and has since become a bustling campus with over 120 corporations and supporting amenities.
Yale University and Massachusetts Institute of Technology and others have formed offices to foster this variety of collaboration. Commercial partnerships are what have led many corporations to locate near universities, maximizing talent on both the student and faculty level, as well as constant innovation.
If business plans change, you want to be in a position
where you aren’t exposed to excessive risk. A sound exit strategy
is an important part of the long-term campus equation.
Branding, Retention and Recruiting
How does the corporate campus best express, actualize and embody the spirit or image of an organization? It is accomplished by the synergy that occurs when a large, diverse work force is placed in proximity to one another. Yontz says that Capital One is branded by its campuses. “This company has a strong culture. It is one of our most valuable assets, and we want to maintain it. It is easier to maintain the culture when our people can freely interact.”
The mini-city campus of Swiss pharmaceutical giant Hoffman-La Roche encompasses 125 acres (51 ha.) in Nutley, N.J., and provides some 5,000 jobs. The interior design team of Gensler, Hiller Group, and Hoffman-LaRoche’s own director of architectural planning has created a 225,000-sq.-ft. (20,900-sq.-m.) Operations Center that brings a distinctive piece of Switzerland to this town 10 miles (16 km.) outside of New York City.
From its inception, Building 1 was set up as a uniquely academic, team-based office building. It is clearly reflective of the corporate culture: orderly, elegant, open and collaborative. The objective of creating a work environment that fosters reduced time from drug discovery to market is being achieved.
The ability to attract, recruit and retain labor is vital. Your corporate campus can play an important part in drawing and keeping talent. The corporate campus provides a scale and amenities structure that employees are seeking.
Campuses can also give a company a positive identity and image in the community. Corporations that become good neighbors become a source of pride for local residents. This enhances the recruiting process. In Tampa, Fla., Capital One has been embraced by the community through its support of different charity and social activities. Yontz says they have created a buzz. “People want to work here,” he notes. “From professional positions to maintenance and janitorial services, we fill our positions with quality individuals.” Wartenberg of Sun has experienced the same thing in Massachusetts, enabling Sun to attract what he calls “a higher caliber of talent.”
When you aggregate people together, it becomes more cost-efficient to provide amenities that may be prohibitive in isolated locations. Capital One has analyzed the relationship of amenities to the attraction and retention of labor and has found there to be significant cost benefit. Amenities including food service, fitness centers, a bank office, Internet cafes, salons and a concierge station will be part of their 1.5 million-sq.-ft. (139,350-sq.-m.) West Creek Campus in Goochland County, Va. Occupancy is scheduled for early 2002.
An Exit Strategy Is Key
Providing for an exit strategy is important, because it prevents you from having a “white elephant,” essentially an overspecialized environment. But in doing so, you must strike a balance so as not to diminish the distinctive character of your organization.
The corporate campus in the context of the 1960’s and 1970’s was essentially a “Corporate Versailles.” Idiosyncraticism was part of the corporate identity. It was not adaptable, and made no pretense to be so. The lesson of that era, given the relative fluidity and change in the modern economy, is that adaptability is king. Thus the planning of an exit strategy from the start is important.
If business plans change, you want to be in a position where you aren’t exposed to excessive risk. A sound exit strategy is an important part of the long-term campus equation. Efficient, cost-effective, productive and very flexible, the corporate campus makes perfect business sense in all economies.
at Spaulding & Slye Colliers (www.SpauldSlye.com), Boston.
