A WAVE OF RESIDENTIAL DEMAND IN CITY CORES HAS BEEN LAUNCHED BY THE YOUNG AND THE ELDERLY.
Adecade or two ago, urban planners were most concerned about “the donut.” That’s how they described what was happening in major cities. Nearly everyone was moving to the suburbs, and the center was being hollowed out. Once workers left their jobs at the end of the day, downtown cores were turning into ghost towns.
There were outcries of alarm. What to do about the situation? Surely it wasn’t healthy. Guess what? Political, economic and demographic factors have combined to reverse that trend. Much of a city's nutritional value is at the former “hole in the middle.” Many would argue it’s where lifestyles have taken their biggest leap forward. The first wave of change occurred when crime-fighting mayors turned downtown living into a safer experience.
Around the same time, and not so coincidentally, young newlyaffluent professionals were buying rundown and derelict properties and turning them into trendy loft apartments and “chic” row housing projects. However, the result still fell short of “Utopiaville.” Gentrification forced many of the poor and unable-to-cope out of their low-rent homes and into the streets. Immigrant enclaves that provided emotional support for new arrivals were broken up and scattered to the suburbs. A sense of shared community was lost.
Those reservations notwithstanding, the trend toward downtown living has accelerated, rather than slowed, since the turn of the century and is showing little signs of abating. A second wave of residential demand in city cores has been launched by the young (i.e., Millennials, those born in 1980 or later) and the elderly (i.e., empty-nesters).
Responding to their wants and needs explains the upsurge in mixed-use, often synonymously referred to as live-work, development projects that have been taking hold almost everywhere. To their credit, the young and the elderly have been quick to pick up on the benefits of living in proximity to all manner of shopping, dining and entertainment.
Check off those three boxes and add employment opportunities and you’ve captured the youthful IT and financial services crowd. Check off the same three boxes and add medical facilities and you’ve created the ideal living conditions for the still active, but retired set.
For many young adults, there also are solid financial reasons for moving downtown. Fresh out of school, and burdened with student loans, the cost of commuting is a fraction of what it might be otherwise.
There are fewer young people with the same love of cars that so gripped their parents. The “Happy Days” of TV land, filled with teenagers cruising up and down the “main drag” in a jalopy, is a bedrock memory of an earlier generation.
Today’s young adults know it’s healthier and better for the environment if they walk, bike or take public transit to work. Besides, they’d prefer to put their earnings into smartphones, laptops, tablets and gaming consoles. They’re cohabiting long before marriage and having children in their 30s rather than their 20s. (By way of contrast, the appeal of open spaces in the “burbs” has traditionally been strongest for families with children attending elementary and secondary school.)
The most interesting and important aspect of this change for our industry – construction - is the nature of the development projects it is engendering. It explains the plethora of residential-commercial projects that are proliferating from San Francisco to Miami and from Toronto to the major cities in Texas.
They incorporate shops, libraries, restaurants, cinemas, community centers, doctor’s offices and everything else common to a vibrant urban landscape. They work best when they are near or on top of – sometimes literally, as in the case of subways – passenger stations. There is a co-dependency that generates positive synergy.
Conveniently located near transit, high-rise living provides ridership. In turn, rail and bus links carry workers and shoppers to offices and retail establishments, to the delight of property lease-holders. Developers who promote such projects reduce their risk exposure. When a complex provides a multitude of potential revenue streams, they’ve placed their “eggs” in more than one basket.
The best of today’s cities offer plenty of green-space, public squares, dedicated walking paths and bike lanes. These complement LRT systems, subways, streetcar lines, buses and short-haul cab rides, such as Uber.
There’s also often easy access to a downtown airport used by day-trippers and the business elite. While they may quibble over funding sources, for the most part, politicians are fans of rapid transit projects.
Not only will commuters – which is to say voters – be served in a practical way, but the ravages of carbon-emitting combustion engines will be alleviated.
Let’s not gloss over remaining issues too easily. Historic neighborhoods are continuing to fight valiant battles to retain their identity from deep within the shade cast by next-door high rises.
Any list of the largest and most interesting upcoming non-residential building projects in the United States includes mixed-use structures.
ALEX CARRICK, chief economist with CMD Group, an Atlanta-based provider or North American construction data. CMD’s diverse portfolio of innovative products and technologies includes national, regional and local project leads, marketing solutions and market intelligence to provide insight to construction industry professionals throughout the United States and Canada. For more, visit cmdgroup.com.