Colocation in Municipal Construction

In real estate terms, colocation simply means locating multiple agencies or facilities in one building or in adjacent buildings on a campus-style development. If a jurisdiction has the necessary vision and interagency cooperation, colocation can be a win-win situation for all stakeholders. Read about four reasons to co-locate projects involving public schools, branch libraries, recreation centers, and similar facilities.

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As private development continues to lag nationwide, municipal projects can jump-start economic growth and provide cultural opportunities that strengthen a community’s social fabric. Yet with tax revenues down and costs holding steady, there are fewer dollars available to construct and operate these facilities. Smart municipalities are considering nontraditional strategies to complete their projects, and few alternatives are as simple and beneficial as colocating complementary facilities in a single complex.

In real estate terms, colocation simply means locating multiple agencies or facilities in one building or in adjacent buildings on a campus-style development. Multimodal transit sites, in which several modes of mass transportation intersect at one location, serve a corollary function in the transportation industry. Construction and operating costs are reduced through shared support spaces, building systems, and parking. Residents enjoy easy access to services, increased interaction with their neighbors, and possibly reduced travel times. Everyone gains from increased pedestrian and vehicle traffic that can trigger economic development and the accompanying increase in a municipality’s tax base. If a jurisdiction has the vision and interagency cooperation necessary to make it work, colocation can be a win-win situation for all stakeholders.

Municipalities have been consolidating financial and administrative departments for many years, but they are just now starting to understand the benefits of co-locating schools, recreation centers, library branches, seniors’ centers, and other similar facilities. Certain steps are necessary to create attractive colocated facilities that cost less to build and operate, and which serve the community better than separate stand-alone facilities.

There are at least four reasons to co-locate projects involving public schools, branch libraries, recreation centers, and similar facilities.

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First, the combined building is smaller than the space required for several independent structures, resulting in lower total construction cost, utility use, and maintenance expenses. The building is smaller because redundant support spaces such as lobbies, mechanical rooms, and elevators can be eliminated if designers are smart about planning and adjacent uses.

In addition, major spaces can be used by different agencies at different hours of the day. Recreation centers rarely use fields during the school day: they can be used by an elementary school during the day and by the rec center after 3 p.m. and on weekends. A middle school in combination with a rec center might have a main gym and an auxiliary gym rather than two full-sized gyms that might be needed if they were stand-alone facilities. The two organizations prioritize use during overlapping hours yet enjoy far more space the rest of the day. Similarly, meeting rooms and computer rooms are often shared by a rec center and branch library, with priority assigned to each at different times of the day.

These efficiencies also result in buildings that are operational and vibrant 16 hours a day yet have lower construction and operating costs.

While there are many ways to share space in a colocated building, some limitations to the concept exist. For example, it is difficult to combine a branch library and a school media center: the library’s desire for an open-door policy is inherently in conflict with a school’s need for student security. When schools and branch libraries are under one roof, the school should have its own dedicated media center. Students occasionally go on “field trips” to the branch library downstairs, but they primarily use the dedicated media center built just for their use.

Second, colocated facilities are safer for children. Kids can move right from school classes to rec center and library activities when the dismissal bell rings; they do not have to worry about walking many blocks or finding transportation to after-school activities. In most jurisdictions, both car accidents and juvenile crime spikes between 3 and 5 p.m.; colocated facilities keep kids off the street during this dangerous period.

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First Above: the public library. Above: The
community entry to the public library and
recreation center, which is separate from
the school entries.

Third, if neighborhood schools are colocated with libraries and senior centers, they provide an easy opportunity for multi-generational programs that greatly benefit seniors and help form a neighborhood’s social fabric.

Fourth, colocation lowers site-work costs and reduces environmental impact. Shared parking needs are calculated using a diversity factor that accounts for different uses at different times of the day. Fields, green space, and courtyards are shared, often with different priorities at different times of the day. Smaller buildings and reduced paving result in less stormwater runoff, and colocated functions result in fewer vehicle-miles driven by the users. If a municipality values sustainability or requires certification under the Leadership in Energy and Environmental Design (LEED) program, colocation will support these efforts without additional cost or compromises elsewhere.

Ideally, the various agencies would come together and identify capital projects that could be colocated in a given neighborhood, but in reality leadership is needed from elected officials to encourage agencies to think about what can work well together. Once a combined project is identified, the agencies sign a memoranda of understanding (MOU) allowing funds to be consolidated and designating a lead agency to oversee design and construction. If a school is one of the colocated facilities and the school district is independent of the city, the financing arrangement can be tricky and may require construction by the school district and a long-term lease to the smaller agencies. But the project can work either way.

Colocated projects typically require two rounds of MOUs—the first laying out the overall plan and bringing in funding, and the second dictating the operating arrangement, including shared-space priority at different times of the day, security plans, trash collection, custodial service, and responsibility for utility costs, maintenance, and replacement reserve. In some ways, the MOUs build and operate the project on paper long before construction starts and lay the groundwork of interagency cooperation that will make the facility successful in the long run.

It is important that the county executive or mayor, school superintendent, elected officials, and agency leadership support a colocation initiative and that their support be made clear to agency staff who will be responsible for making it happen. There are many ways to build the project team, but typically an interagency task force is created that includes a representative of the executive office and each agency involved. The individual task force members are high-level staffers empowered by their directors to make decisions and compromises. They tend to believe in the idea of colocation and are willing to compromise on minor points for the benefit of the whole. The task force develops a shared sense of purpose that helps members overcome the inevitable challenges in interacting with designers, contractors, agency staff, community groups, and so on. The task force becomes the engine driving the project.

At first glance, colocated facilities bring a unique set of challenges, including more complex finance strategies, detailed operating agreements, and nontraditional adjacent uses. But these challenges are easily overcome through commitment and proper planning, and a set of best practices exists to help cities and agencies through the process.

Municipal facilities are an important part of the social fabric in any thriving community. Colocated municipal projects strengthen this fabric by bringing together residents of all ages and interests in vibrant, active buildings. They cost less to build and operate than comparable stand-alone facilities and deserve serious consideration from any municipality. Well-planned colocated facilities provide benefits that far outweigh their costs.

Sean Regan is managing director of Regan Associates LLC, a real estate project management firm located in Herndon, Virginia.
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