¿My property transformed into an urban farm?

The recent pandemic convulsed economic and labor stability in the world. Suddenly, millions of office buildings, warehouses and industrial buildings were left empty and disused. The owners of these spaces went from a stable income with a growing demand to a costly liability accompanied by a context of uncertainty and stagnation, since selling the property would mean selling it off and in turn losing what was once it was an asset.

In Mexico City, for example, there were problems with tenant payments and premature terminations as a sizable proportion of employees who were lucky enough to keep their jobs opted to work from home. The home office is here to stay, just like virtual meetings.

Restorations also showed a substantial reduction. Industrial buildings and warehouses adjusted their operating models, increasingly targeting online products. Home deliveries and electronic commerce fully entered to replace conventional methods and respond to the crisis. We live in cities governed by constant densification, in many cases uncontrolled, so the comfort of staying at home is a clear trend in almost all markets (Deloitte S-LATAM, S.C. -2020).

Many homeowners were hit hard by the pandemic. They had to rethink new uses for generating income from their properties. And I can say from my own experience, that many showed an exceptional interest in adapting and reconfiguring their buildings to turn them into vertical farms.

Urban agriculture has been a response to food and economic crises in the past, Cuba in the 80's and China at the beginning of the 21st century, both implemented urban farms in different ways that provide part of the food demand of the population in cities. Currently, the United States and Europe are joining the list, since agricultural production free of chemicals and microplastics, with unparalleled freshness and the use of resources, has shown to be capable of responding to market needs, and simultaneously responding to the climate and health crisis.

There are several ways to gain use of the spaces in a building to adapt them to agro-urban use. The most attractive scenario are the roofs, these tend to live in disuse and represent a maintenance and waterproofing cost. Growing crops in vertical systems can generate economic benefits that are just as profitable or even higher than rented office floors. Moreover, having a good densification of vegetation as a roof for the building serves to absorb solar radiation and keep the buildings cooler. In summer, a farm on the roof of a building can reduce the ambient temperature inside the building by up to 8 degrees Celsius. Maintenance and other running costs would be covered by the business and/or farm operator, so waterproofing and cleaning will be one less concern for the owner.

Citiponics, anu rbna farm located in Singapore - 2019

There are non-conventional ways of growing crops inside buildings. For example, adapting floors inside the building to grow crops using LEDs in controlled environments, proposing a more ambitious business model, since the investment and energy consumption is exponentially higher, but represents a bigger opportunity due to the allowance of growing almost all kinds of exotic products since there is absolute control of the climate, humidity and nutrients throughout the year without stopping production.

Another variant consists of adapting the facades that receive more sunlight as production walls, however, this model represents design challenges and, in many cases, a high initial investment. Covering the facades with a culture membrane would do wonders in terms of ambient temperature, energy savings and the aesthetics of the property. However, there are very few cases in which all the design and operational factors can really be resolved to bring it to reality considering all the imitations and construction regulations.

Urban farm building proposal by Mithun Architects

Despite the versatility of industrial and office buildings, the Mecca for economic opportunities is warehouses. These are immense spaces with considerable heights, easy to section and designed to make all logistics and transportation more flexible, allowing verticalization and operability to be maximized, allowing the implementation of a design that takes advantage of resources (water-energy-space) like in no other example. previously mentioned. In closed numbers, a farm of about 4,000 sqm can produce more than a million plants at the same time, which translates millions per month in gross income.

Warehouse urban farm in Chicago

Despite the surprising interest and the abysmal number of property owners of all types who sought me out to hear more about this idea, we were not yet ready to turn their spaces into farms capable of producing massive amounts of fresh food ready to be sold directly to retail.

¿Why no one gave a final yes?

Despite being a very attractive idea, many unfinished variants were presented, such as the lack of definition of the partnership with farm operators and harvesters, the maintenance of the equipment, those responsible for the sale of the products and the distribution logistics. Based on my own experiences, no property owner in the city is a farmer or dominates the food market in the city where they are located.

As an example, agricultural business in Mexico is based on exports to the United States, where the sale price of agricultural products is higher, while the model of technological farms within cities works through direct sales to the final consumer in the same city ​​and/or region where the farm is located. The profitability of this model is based on selling the product directly to the final consumer, supplying the last mile at higher prices as retail and outstanding thanks to a quality and freshness superior to that of the product from the field. Another considerable advantage relays the product being harvested and delivered immediately and needless to store it, refrigerate it, pack it or transport it long distances, which considerably increases the profit margin and gives flexibility to satisfy this market.

CDMX has the advantage that the model already exists on a small scale, hundreds of farmers in the Xochimilco area operate by selling their high-quality products in the areas surrounding their orchards within the lake. Startups have even been born in the last decade focused on solving a modernized and intelligent production and delivery logistics.

There are several startups in Mexico City dedicated to smart systems of local supply of agricultural products inside the City

Eventually, it all depends on 3 essential players to close the loop and run a profitable and sustainable farm: the investor - the owner of the property - the operating partner. Hand in hand, there are already providers of logistics and sales work to potential markets in the vicinity of each farm in question.

The climate crisis on a global scale that we are currently experiencing is changing the way we live; future industries will need to adopt a regenerative approach to ecology and also allow us to conserve and preserve the ecosystems that are still healthy. That said, urban agriculture is an example of a lucrative business model that provides benefits to both consumers and producers, generating new production chains and acting as a catalyst to reduce the ecological footprint of cities.

¿How fast will the urban vertical farming industry make the transition towards a healthier, smarter, and sustainable agriculture market?