Whether centered on reset or recession, there is no shortage of provocative summaries about the game-changing new economy. As a legal practitioner who also writes about cities, I find the most value in on-the-ground intelligence of urban trends. In that context, a new, highly readable report from the Urban Land Institute fits the bill. [Disclosure: I am a dues-paying member of ULI and serve as a Vice-Chair of the ULI-Seattle District Council, an unpaid, volunteer position]. As co-author Uwe Brandes told me on Monday in Washington, D.C., "the reality is that we reflected the voices of implementation in today’s urban marketplace."
The report, What's Next, Real Estate in the New Economy, focuses on the relationships of demographic, financial, technological and environmental trends over the next decade. It explains how these trends are dramatically impacting urban planning, design and development practices, so much that "[t]he real estate world is hurtling into a different place and time."
Purposeful topic titles and subject areas outline how key aspects of "living, working and connecting" will change in major ways, primarily shaped by the values, preferences and work ethic of Generation Y. What's Next concentrates on six categories peppered with graphics, highlighted quotations and practical insights:
- Work emphasizes Generation Y’s ascent in the workplace, alongside baby boomers—who will stay in the workforce longer to make financial ends meet. The report also outlines the growing importance of medical and research institutions, and suggests that the most attractive markets for commerce and highly sought-after workers will be global in nature, with accessible education, recreation and cultural amenities. Other predictions forecast a decline in remote suburban work locations, new, smaller workplaces with open spaces for creative interaction and meetings, and premium value assigned for nearby international transportation access.
- Live examines changing housing preferences, geared to more compact communities of smaller homes of varying housing types. The report forecasts higher percentages of renters over owners because of foreclosures and defaults, and delayed purchases by Generation Y. According to the authors, Generation Y will continue to choose short commutes over more living space, which will increase single occupancy rental cost and demand. In addition, continued financial challenges and immigration will cause more extended family living situations, which may preserve some demand for larger homes outside of urban centers. The report also references the fastest growth among seniors, with "aging in place" or living with relatives resulting from limited incomes. The authors steer developers towards "age-friendly" residences and housing close to hospitals and medical offices, complemented by services and shopping in mixed-use developments.
- Connect discusses the dual nature of proximity, from urbanist and functional standpoints. In addressing the relationship of land use and transportation, the report honors the evolution from auto-centric development in favor of jobs closer to home and services. The report also acknowledges today’s technology-based ability to work from multiple locations, enabling different office configurations and demand.
- Renew considers energy sources, energy investment, and new, self-sufficient energy approaches to development and design to assure network connectivity and conservation. The authors explain how sustainable energy and water conservation programs can add to the bottom line, marketability and longer project life.
- Move stresses the growing desire for transportation choices, alternatives and consequent infrastructure investment demands, including expanding private funding to address new and decaying infrastructure. Consistent with other categories' recognition of home-work proximity, the report indicates the growing desire across generations for more transit-oriented development.
- Invest summarizes the dramatic changes to real estate finance in recent years and the limits on accessible residential and commercial capital, as well as the enhanced interconnection of world markets. The authors provide ten lessons learned from the recession, punctuated by the adage that "less may be more."
- Outlook summarizes prospects in Asia and Europe. The report provides an overview of Asian urbanization as a prospective economic driver, the growing Asian middle class, and the challenges of the availability of water and capital market evolution. It also examines European difficulties in accessing capital, and the importance of enhancing city strength based on six principles for transforming crisis to opportunity and modern transportation approaches.
What's Next is easily accessible and readable in one sitting, and projects the virtue of practicality, gleaned from a cross-section of ULI’s approximately 30,000 members. For a glimpse into the realities faced by the report’s intended audience, the report is well worth both review and reflection.
The complete, illustrated report can be downloaded here.
Photos by Charles R. Wolfe.