02. 01. 2024

A new standard for the construction of industrial projects is coming

Boxes along motorways have become synonymous with industrial complexes and logistics centres. Over the last 20 years, these have started springing up in the Czech Republic like mushrooms. After privatisation and the restructuring of industry and other sectors, production was discontinued in a number of factories and the associated growth in unemployment demanded a solution.
Markéta Šimáčková
She has been working as the COO in Urbanity since 2020 and is also currently responsible for Business Development. She graduated from the University of Economics in Prague, where she also earned an MBA with a focus on commercial real estate and their valuation. She worked as the General Manager and Executive Director of the TORINO-PRAGA Invest real estate group. She also has experience from the international company Cushman & Wakefield, among others.

Attracting foreign investors and investment incentives were some of the ways to get the country’s economy going again. This was connected with the construction of buildings, particularly in greenfields, that should meet the requirements of investors: production or storage spaces with adequate equipment and the necessary facilities for employees. Today, however, construction on greenfields is a thing of the past, the demands of investors have become stricter and the knowledge economy is giving them a new form. We talked about how with Ing. Markéta Šimáčková, MBA, the COO and Business Director of Urbanity.
Modern warehouses, industrial halls, industrial buildings, but in your opinion, they are not synonymous with your industrial campuses. How do they differ?
Our company is involved in the construction of a new generation of industrial campuses. Why do we call them that? It's very simple. There are not only industrial properties, but also all the associated facilities and services that you can find right on campus and that make it unique.
We do not build these campuses on greenfields, but on brownfields, building on the historical heritage of suburban production complexes, which we revitalise in a sustainable and socially-responsible way.
By creating these attractive campuses, we help our tenants to be preferred employers in the given location. So, we also deal with their personnel issues secondarily, since the number of agency employees in our campuses is close to zero. If a company newly comes to a region, it does not have to complicatedly convince employees. Through us, it offers them a job in an environment that they won’t find elsewhere.
So, we could say that you create a functioning community?
Definitely. The foundation is the first-class functionality of the industrial halls, the quality of the working environment and the sophisticated design of the entire campus in symbiosis with the effective implementation of the ESG strategy.
Our campuses are integrated into the town and are located within walking distance to its centre. They include services such as a children's group, a doctor, a café, a grocery store, and hotel-style accommodation. Our campuses have excellent transport services. A mass transit stop is located directly in front of the main entrance, the campuses are within walking distance to the town centre instead of on motorway exits and they are connected to bike paths. The key availability of a workforce is important because people do not have to travel far to work. On-site services save them time. For example, a pre-school child is left in a children's group on the way to work and can be picked up again at the same place after work, which contributes to overall work efficiency.
We try to customise all our products from a number of perspectives.
We cooperate with the local authorities; we try to accommodate their needs and requirements as much as possible. Companies that use the campuses are our long-term partners, since we conclude contracts with them for 10 to 15 years. Therefore, we address their needs together from a long-term perspective.
We also place an emphasis on the architectural aspect of the campus, because we get irritated by the grey boxes we see along our highways and wish that industry could also have its own unique architecture.
We want the people living in the regions to which we are coming to also see us as long-term and responsible partners because they will know that we will be bringing new services and aesthetic solutions that are a perfect fit for the local environment.
Are the services on campus available to the wider public than just the employees of companies that are leasing from you?
Yes, they are accessible to the general community, which fully fits into our vision. At the Tachov campus, most of the services will be located in a multifunctional building, which is right at the entrance to the complex. We’re an integral part of the city, so going to a restaurant on campus for lunch or exercising in the gym is the same as going anywhere else in the city.
What are the main reasons that led you to take this path? Is it your concept or are you basing it on experience from elsewhere?
We are living in a period of upheaval, with a focus on digitalisation and sustainability. Innovation is an integral part. Building campuses that harmoniously fit into towns and have high added value is our vision and goal.
Investors are increasingly demanding what is now the norm in Western countries in our country as well. In Western countries, for example, it is quite common for industrial structures to feature architecture. The clients’ customers and partners are much more interested in the conditions under which the given product is created. But the main aspect that has recently affected their decision-making is primarily sustainability.
These companies decide for us because we can offer them the required standard.
Are you building on greenfields or using brownfields?
I have essentially already answered this question. Our projects are built on brownfields in former industrial zones. In Tachov, we also have a unique location, where we reconstructed two buildings from 1967 under the full operation of the tenants. When you arrive at the campus today, you can’t recognise that these are buildings that are almost 60 years old. The great advantage of these historic industrial sites is that there are large-capacity connections, so we do not run into the problem of utility limits. On the other hand, we need to be very considerate so that the construction of the building would negatively interfere as little as possible with the life of the inhabitants of the city and the activities of our tenants.
Do the original buildings after reconstruction meet the energy efficiency parameters that tenants demand today?
For the existing buildings, we’ve reduced energy consumption by more than 80 percent. This means significant savings for manufacturing companies, where energy and utilities comprise a significant cost item. This is also one of the reasons why the companies that worked in the original buildings have remained in them to this day. Today, these sixty-year-old buildings are in the energy performance class A – extremely economical. Meanwhile, when reconstructing production facilities, achieving such a classification is much more demanding than during the construction of a new industrial hall.

Your campuses are in Tachov, Bruntál and Korunní Dvůr. Tell us about them.
I’ll be very brief. Each one of them would fill an extensive interview.
Urbanity Campus Tachov is the first complex in the Czech Republic to receive the prestigious BREEAM Communities certification for sustainable parts of cities and public spaces with an “Excellent” rating and it won a number of awards in 2023. Its area is over 200,000 square meters. In addition to the services mentioned above, it also offers tenants and communities the possibility of a private 5G network, solar energy combined with battery storage and individual solutions for the recovery of waste heat from production. Another campus of ours also has these services.
Urbanity Campus Bruntál is located 300 meters from the town centre and offers more than 55,000 square meters of industrial space combined with associated services. We should start building this campus this year.
Last, I would like to mention Urbanity Korunní Dvůr, which was our first project in the portfolio. Today, on the site of the former royal brewery in the heart of Vinohrady, there are representative office spaces offering deluxe units starting from 40 square meters. The clients can use the private terrace in the courtyard or shared meeting room, underground parking and reception.
Are you planning to build more campuses?
We are looking for interesting opportunities in other cities, including Prague and Brno. We have some projects where we are in the preparatory project phase and we will publish them when the time is right. But we are also looking outside the Czech Republic for acquisitions.
If you were to get an offer from Olomouc, for example, that would be connected with housing construction?
We certainly would not be against it. It’s an interesting location. Our projects are comprehensive, so it isn’t a problem for us to combine industrial and residential construction. An example is our campus in Tachov, which also includes the construction of residential villas with a preschool. We are trying to develop the city’s infrastructure. Our campuses are attractive for companies and at the same time increase the standard of living of the population, because they bring more qualified jobs, expand the offer of social facilities, for example, in the form of preschools, and also try to keep the young generation in the region. By cooperating with secondary schools, we try to have a positive effect on education and thus ensure sufficient quality and professionally prepared employees in the future. Students have the opportunity to be connected with specific production at school and to prepare themselves for their future profession. We see this as one of the ways to support a high-tech economy.
In Tachov, you also want to build a residential section in the vicinity of the campus. Is this one of your original intentions?
It’s an integral part of the complexity of our campuses. We have had this intention since the beginning of the project. This includes a full-fledged preschool. For employers, this will also be an opportunity to provide their workers with affordable housing near their jobs, as part of employee benefits, for example, and the residents of the city will have a higher capacity for preschool education, which can have another synergistic effect, being the possibility of the second parent being employed. The residential area will therefore be open to the general public.
You also demand a high standard and first-class quality of work from your suppliers and subcontractors. Have you encountered any problems with this?
We choose them carefully. We are happy to work, and repeatedly, with those who work well. Of course, these are often suppliers in the form of large companies, but we also try to use local companies together with them as much as we can. In Tachov, for example, we also worked with the local secondary school, where the local students studying carpentry made us a customised insect hotel and birdhouses, which we placed on the campus.
You mentioned electricity many years ago. Back then everyone used large sources. These days we’re going in the opposite direction - towards localisation and thus towards energy independence. The campus in Tachov is a shining example of this. Can you be more specific?
The storage of surpluses of green electricity in the newly launched battery storage system with a total capacity of 1.4 MWh will contribute to the energy independence in Tachov. It is connected to a rooftop solar power plant with a capacity of 5 MWp, which is the largest of its kind in the Czech Republic. The energy produced will cover up to 40% of the annual consumption of the production complex. We plan to significantly expand this storage capacity in the coming years.
These days it is already possible to use the green energy produced from this rooftop power plant effectively right on the premises. The storage is connected to a community energy block, so that all the industrial zone operations, including charging stations for electric vehicles, can work with its capacity.
When managing heat energy, our clients use waste heat from production technologies that are connected to heat exchangers.
Water management is also on an advanced level, with the use of detention basins, seepage furrows and retention tanks are used, and in the future all the drinking water will be covered from the complex’s own wells.
To manage the individual technologies, a smart energy management system based on the online optimisation of energy flows is gradually being expanded.
We are also looking to the future. We have developed a hydrogen strategy and I believe that in a few years we will be applying technology to its production. We are collecting wind data, and testing potential equipment to use it. Within the campuses, we are considering the possibility of the application of smaller wind power plants, for example, in vacant sites.
The project in Tachov also includes a data centre, as the site has sufficient backup resources and several independent data connections.
How do you perceive the industrial environment in our country, what needs to be changed from the perspective of a company like yours?
We need more projects that are sustainable, have more greenery, include associated services and offer a comfortable environment. In the Czech Republic, industrial construction took place quite recklessly, so today we see a minimum of greenery in industrial areas today. Such projects wouldn’t hold up in our case.
What clients were demanding in offices ten years ago, clients are demanding today in industrial environments. This means interiors of a higher standard, which will be close to those in office buildings. We, for example, offer our clients pre-defined architectural designs of in-hall offices and they just choose which design they like the best.
If you were to compare URBANITY with similar companies to the west of our borders, what can we learn from them and vice versa, what can they learn from us?
I don’t think there’s that big a difference between our vision and projects in the western world. The point is to learn from each other and to inspire each other and use the experience gained. In the European space, meaning the EU, we are increasingly connected not only legislatively but also technologically, which gives us a great chance to assert ourselves in markets beyond our borders.
Fortune favours the prepared, how are you preparing for the new challenges that are knocking on the door?
There are several challenges that we need to be prepared for or are preparing for. They are mainly related to digitalisation and sustainability in order to transform the Czech economy into a knowledge sphere, which needs to be supported. We see the opportunity for us in the transition of small and medium-sized enterprises to a higher level and the effort of companies to robotise and automate. This will place requirements on the appropriate facilities.
I’ll give just one example in EU legislation – electric vehicles. According to this legislation, by 2025 there should be at least one electric car charger in public garages for every 20 parking spaces. Companies are therefore asking how the buildings are ready for parking and charging electric cars. A number of large international companies are scheduled to completely switch to an electric fleet of vehicles within three to five years. Access to chargers for them is part of the ESG objectives. Similar to other sustainable aspects of operation, they expect the cooperation of the building owner here and they consider it to be a matter of course. As far as we are concerned, we have thought of this well in advance and today we do not have to deal with construction preparation, which will allow the number of charging stations to expand in the future.
The sustainable approach and eco-friendly operations outlined in the ESG strategy is a hot topic. You have counted on them from the beginning, which has borne fruit. In part in the form of a number of awards, but above all it is a great advertisement that opens the door to the world of those who are not indifferent to the future of our planet. Can you be more specific?
Sustainability is an integral part of our projects and requires comprehensive and sophisticated solutions. Not only do Urbanity production campuses meet the demanding ESG criteria, but they are subject to the prestigious international BREEAM Communities certification designed for sustainable neighbourhoods. The fact that we are on the right track when building campuses can be seen in the independent evaluation of the University of Economics, where we ranked among the top 10 in the ESG rating for 2023.
The foundation was the creation of an ESG strategy that allowed measurable criteria to be implemented in the functioning of the whole group and set targets for the next period. We are primarily concerned with the impacts on climate change and their mitigation. We regularly evaluate the data, for example, in terms of the energy efficiency of buildings, including the efficiency of the technologies used, the composition and durability of the materials used, waste management with regard to its reduction and the degree of recyclability. We also deal with drinking water, rainwater and waste water management and we also pay attention to landscape planting, greening and biodiversity. We are planning on significantly expanding the reporting in the future.
In addition to the international BREEAM Communities certification, Urbanity Campus Tachov won first place in the Best of Realty competition in the category of Industrial and Logistics Facilities, two first places in the 2023 Estate Awards in the categories of Sustainability and Ecology and Industrial/Logistics Project of the Year.
We place a heavy emphasis on building sustainable production campuses that use recycled building materials, reduce their energy intensity and use technologies producing energy from renewable resources. As our co-founder and CEO Roland Hofman has said in interviews:
 “The real estate market accounts for almost 40% of the total annual carbon emissions, of which 70% is allotted to real estate operations and 30% is construction. Improvements in sustainable development are therefore of great importance to society and are a challenge for us. That makes us all the more pleased that independent experts have reviewed and appreciated our ESG strategy, making us the first real estate firm to score in the ESG Rating.”

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