July 17, 2024


Taste For Business

As office-centric downtowns struggle, suburbs cater to long-term remote workers

Placeholder while article actions load

On a recent weekday afternoon at Northern Virginia’s Mosaic District, a nail salon was two-thirds full, diners in business casual were clustered around sidewalk tables and remote workers tapped on laptops beneath an outdoor tent equipped with power outlets and high-speed WiFi.

In Leesburg, midday customers at a new golf simulator business scroll through emails and take business calls between swings. In North Bethesda, Zoom breaks take place at a dog park “social club” steps from trendy eateries and shops. Elsewhere, suburban shopping centers are adding WiFi to new outdoor plazas and, in at least one case, a bocce ball court.

While central business districts like downtown Washington continue to struggle as more than half of office workers stay away, many suburbs have rebounded by courting suburbanites who have settled in after more than two years of mostly working from home.

Losing the commute has left many with an extra 30 minutes to three hours a day to eat out, shop and relax closer to home, along with more money saved on gas, parking and transit fare. As many suburbanites happily cling to the flexibility of telework, developers say, some also are craving company and a change of scenery. Others want to avoid the office but seek refuge from distracting children or WiFi-hogging roommates.

As offices stay empty, downtown D.C. looks for post-pandemic identity

Suburban developers and retailers are working to provide ways to escape home, be around others, and, most importantly, spend newfound time and money.

“If they’re working from home Tuesdays and Thursdays, they’ll spend [nearby] when before, they spent that money near their work,” said Sebastien Aubouin, research director for McLean-based Rappaport.

They are new customers like Shannon Strang, who uses lunch breaks from her IT consulting job to walk and play with her rambunctious 1-year-old pandemic pup, Max. Strang said she moved to the Mosaic District shopping and restaurant development in Fairfax County from a Falls Church high-rise for a more fun place to work from home full-time.

She said she cooks more or grabs a bite from the Chipotle or Panera down the street from her apartment — time and money she used to spend getting to, and buying lunch near, her office in Tysons.

“I can spend more time working or with free time rather than being stuck in traffic three hours a day,” said Strang, 42. “I hang out here a lot.”

As offices reopen, some workers are rethinking taxing commutes that now seem avoidable

Neighborhood retailers are eyeing the money she and others are saving on the commute, in addition to the thousands of dollars that office workers typically spend annually in restaurants, bars, clothing stores, entertainment venues and other businesses. In many cases, coffee breaks, haircuts and happy hours that used to happen near downtown offices have moved to the suburbs.

“Downtown Bethesda has thrived while downtown D.C. has really struggled,” said McLean Quinn, CEO of Bethesda-based developer EYA. “That contrast has to be a function of the population shifting its presence.”

Opinion: Cities aren’t facing up to their ‘long covid’ crisis: Downtown is in deep trouble

In the Washington region and nationally, the trend is most striking in higher-income inner suburbs, where more residents have computer-centric jobs suited to remote work and money to spare.

Hailey Quigley, a consultant, and Rory Shinnick, a graphic designer, said they’ve been meeting most days for the past year to work together on their laptops at the Mosaic District — outdoors in good weather and in a coffee shop when it’s rainy or cold.

They buy coffee and breakfast most mornings and sometimes lunch — costs they said they’re willing to pay to work around and bounce ideas off a close friend while creating some separation between work and home. Quigley, 26, said she appreciates skipping the commute from Reston to her Rosslyn office and saving $16 each day on parking.

“All my meetings are still virtual and most of my clients are still remote, so there’s not much need to go in,” Quigley said, as she sipped an iced coffee in the development’s outdoor co-working space. Beneath the table, Shinnick’s lab mix, Benny, tussled with a boxer, Ziggy, whom Shinnick watches.

“It’s the human element,” Quigley said of working in public. “It boosts your mood.”

Why developers are creating “experiences” to attract suburbanites

The new weekday demand, developers say, has helped suburban shopping centers and entertainment districts reach and, in some cases, surpass 2019 sales. The pandemic also accelerated long-standing pre-pandemic trends toward walkable suburban developments and the “third place” — public gathering spots like coffee shops and bookstores, where people can connect beyond home and work.

The less frequent commute also prompted some city dwellers, particularly younger people and young families, to move farther out for more space and outdoor living during the pandemic, bringing new customers to the suburbs.

People desperate for more space fuel a pandemic real estate boom

Brian Cullen, founder of Ashburn-based Keane Enterprises, said weekdays around his downtown D.C. condo still feel relatively quiet, while “out in the suburbs, it feels like there’s definitely more activity.”

Tap In Golf in Leesburg, an indoor golf simulator facility that Cullen’s company opened this spring in Loudoun County, serves food, drinks and has high-speed WiFi. He said he wasn’t surprised to see weekday golfers arrive with laptops in tow and cellphone ear buds in place.

“I think people want someplace else to go, even if it’s not every day,” Cullen said. “It’s happening anywhere there’s good WiFi and a decent vibe … I think it’s just getting out of the house. Working from home all the time can get stifling.”

Co-working companies tap into work-from-home fatigue

Michael Majestic, of Bethesda-based Willard Retail, which owns and manages 20 mostly suburban shopping centers across the Mid-Atlantic, said he’s hopeful remote workers and others seeking “retail therapy” will sustain brick-and-mortar retailers hit hard by online shopping. Like many Americans, he said, suburbanites seem willing to spend more on coffee, cocktails or anything that connects them with others and combats pandemic-induced isolation.

Majestic’s company plans to add a bocce ball court with outdoor picnic tables and WiFi at its Cascades Marketplace shopping center in Sterling to entice remote workers to spend more time and money.

“It will be small,” Majestic said, “but sometimes that’s all you need to do to create a sense of place.”

Mosaic District’s developer set up “Mosaic Niche,” the outdoor, tented “community workspace” tucked amid shops and restaurants last fall. The developer, D.C.-based Edens, touts it as an “extended work-from-home space” and a “community buzzing with creative energy.”

The idea has been so successful there and at Edens’s Union Market in D.C. that the company has expanded it to Charlotte, and is considering it for more sites across the country. Every 1 percent of additional time spent on-site translates to 1.3 percent of additional money spent, said Edens CEO Jodie McLean.

“People want to innately belong to a community and feel part of something bigger,” McLean said. “We’re seeing, without question, more laptops at our places during the day. We’ve always thought of ourselves as a ‘third place.’ Now we also think of ourselves as a second place — as people’s home offices.”

Luxury brands flock to suburbs and vacation hot spots where the rich are riding out the pandemic

Stuart Biel and Mike Ennes of North Bethesda-based Federal Realty, said suburban developments also benefit from Americans reconsidering during the pandemic how to better control their time, including by commuting less and making shorter trips to shop and socialize.

Weekday foot traffic this year has been up about 10 percent over pre-pandemic levels at two of Federal Realty’s major developments in Montgomery County: Pike & Rose in North Bethesda and Wildwood Shopping Center in Bethesda, Ennes said. Customers also are spending 6 percent more time during visits, and tenants’ sales are up in the “high single-digit range” over 2019, he said.

Retailers are taking note. High-end restaurants, coffee shops, barber shops and boutiques that once focused on major downtowns like D.C. and Manhattan are pursuing locations in suburbs like Bethesda, Arlington and Darien, Conn., Biel said.

“I think they’re aware or realizing that their customers are likely to be spending more time closer to where they live,” Biel said.

How the pandemic is changing home design

Some suburban businesses are still fighting to recover from early shutdowns and regain cautious customers, including hotels, event spaces, indoor restaurants and gyms. Even before the pandemic, retail was suffering as the country had more of such businesses than the population could support, experts say. Suburban shopping districts that relied more on their own significant office space also have been slower to bounce back.

Developers say they’re not certain how long the shift from office to home will last. Many say they expect employers will take several years to reconsider their office space needs as leases expire and they determine how often workers need to appear in person. The timing, experts say, also will depend on the emergence of new variants and when a looser labor market might give workers less say in where they log on.

Corporate America is coming around to remote work, but more changes lie ahead

Bob Gibbs, a Michigan-based urban planning and retail consultant, said some suburban shopping centers faced foreclosures amid early pandemic shutdowns and a surge in online shopping. Now, he said he’s seeing suburban apartment complexes getting new coffee shops, small food markets and shared workspaces. Similar businesses are popping up at the edges of single-family home neighborhoods.

But most people working from home probably won’t spend as much as they did at their favorite coffee or lunch spot near their office, he said.

“People working from home have a lot of places to go,” Gibbs said. “When they decide to go out, they have cars and they can go anywhere. They’re not a captive market.”

Magda Jean-Louis contributed to this report