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Rutgers dean: Suburban 'corporate palaces' no longer viable

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What do Merck, Realogy and BASF all have in common?

They either plan to leave or have already vacated each of their giant suburban New Jersey headquarters, or as Rutgers University Bloustein School of Planning and Public Policy dean James Hughes puts it, "corporate palaces."

Speaking Wednesday on a panel at the New Jersey State League of Municipalities Conference in Atlantic City, Hughes stressed the need to completely rethink suburban office spaces, saying that what previously worked for baby boomers no longer fits the needs of Generation Y.

Millennials increasingly want to live and work in denser, multidimensional spaces, Hughes said. It's evident, he says, by the growing number of companies that have chosen to downsize in recent years from their oversized suburban campuses.

What once were cubicles are now interactive team spaces and that's not going to change anytime soon, he said.

"We will never return to 1980's New Jersey," Hughes said.

Somerset Development president Ralph Zucker agrees that the suburban office market can be a "mind-numbing place."

Zucker, who also spoke as part of the panel, said that he's noticed from a development standpoint that people are now seeking "life between the buildings."

But a complete rethinking of suburban office spaces doesn't necessarily have to mean starting at square one.

Zucker, who was selected earlier this month to be on the NJBIZ Power 50, our ranking of the New Jersey's 50 most influential people in the real estate industry, pointed to his firm's redevelopment of the former Bell Labs site in Holmdel. A 2 million square-foot complex that when completed in 1962, it was designed for just one single tenant.

Initially, the community wanted to raze the structure, which most recently housed Lucent Technologies, and build recreational space. After years of discussions on its future, Somerset was able to drum up enough public support to move forward with its plan to redevelop the site into a mixed-use town center.

While the challenges of redeveloping each suburban office building are different, Zucker said in the case of Bell Labs, it was a matter of working with the community and utilizing a structure that he says is "as viable today as when it was built."

"There is a need for quality spaces that are in quality environments," Zucker said.

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Andrew George

Andrew George

Andrew George covers the Statehouse from NJBIZ's Trenton bureau. Born and raised in N.J., Andrew has also spent time as a reporter in D.C., Texas and Pa. His email is andrewg@njbiz.com.

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