Major real estate report: shift to urban living is “fundamental,” outer suburbs may “lack staying power”
Kaid Benfield, of the Natural Resources Defense Council’s Switchboard blog, brings us info on the latest “Emerging Trends in Real Estate” report. This report has been published for the last 30 years by the Urban Land Institute and PriceWaterhouseCoopers, and advises the real estate industry on “where to invest, what to develop, which markets are hot, and how the economy, and trends in capital flows will affect real estate.” The 2010 report is, as you might expect, something of a downer, but there’s good news inside it as well, at least for those of us who support smart growth and urban revitalization:
Throughout the report’s 80 pages, the tone is decidedly grim, with words like “abysmal” and “doom” sprinkled on almost every page. This is not a good time to have your money in real estate.
That said, it is clear that the authors, who surveyed over 900 industry experts – investors, developers, property companies, lenders, brokers, and consultants – believe that the prospects for investment are much stronger for smart growth than they are for sprawl.
Here’s an excerpt from the report:
“Next-generation projects will orient to infill, urbanizing suburbs, and transit-oriented develop ment. Smaller housing units-close to mass transit, work, and 24-hour amenities-gain favor over large houses on big lots at the suburban edge. People will continue to seek greater convenience and want to reduce energy expenses. Shorter commutes and smaller heating bills make up for higher infill real estate costs.”
Among other things, investors are advised to avoid suburban and exurban fringe areas “with long car commutes or where getting a quart of milk means taking a 15- minute drive.” There’s plenty more to read in Kaid’s summary, so check it out. He wraps it up thusly:
So, while it is impossible to call the report optimistic – on the whole, it is quite the opposite – we can take a little comfort in the fact that even industry analysts focused almost exclusively on dollar signs (“the most highly regarded and widely read forecast report in the real estate industry”) see the writing on the wall: no one should bet on sprawl anymore. The future is brightest for development that is smart and green.
12 Responses to “Major real estate report: shift to urban living is “fundamental,” outer suburbs may “lack staying power””
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Really? Because nobody ever ever _ever_ builds businesses to take advantage of sprawl and those who live there?
Yes, I’m being curmudgeonly. But to say “you know suburbs, the thing from the last 5 years? Doomed.” is ignorance.
This report is written up for the real estate industry, for its investors and developers and such. It is a reflection of a shift they are seeing. It’s not a “nobody will ever build anything in the suburbs again,” written-for-the-general-public thing. It’s a report from an industry that has taken a beating, due in no small part to its long-standing reliance on an unsustainable form, and they see the future leading them in a different direction.
Again, this isn’t just me prattling on – this is ULI and PriceWaterhouseCoopers, whose report is one of the biggest in the real estate business. This is all coming from a development and investment perspective.
How do you get from words like “trend” and “shift” to conclusions like “doomed?” I hope I never get curmudgeonly.
(unless that quote was in the linked report, which I didn’t get a chance to read…?)
I can’t say I find this surprising; more folks are realizing what a drain their privacy fenced and cul-de-saced life is on them, if not on their monetary budget then on their time budget.
I’m not sure–I just spent 4 days in Manhattan–and loved it–(stayed in a residential area)but I must say, I was pretty happy to get back to my cul-de-sac and green lawn suburbia.
Annie,
There is a huge range of options between cul-de-sacs and Manhattan. One does not have to give up a lawn to have access to sustainable, walkable urbanism.
My goal tommorow is to use “curmudgeonly” in a sentence.
You can have a green lawn in an urban neighborhood. Just look at Fairmount.
That was my point, you can have an in-town existence that doesn’t require you giving up outdoor or green space and can have gains in quality of life. Especially in a city like FW.
I love my suburban home. I love my neighbors. I love the fact that there are no stores or businesses near my home. I don’t mind driving to work, and the commute to Fort Worth isn’t bad. The people in my city (yes it’s a city) are as friendly as the people in Fort Worth. I like driving to the gym, and I don’t mind driving to the park to jog for exercise. I don’t believe in Peak Oil, Global Warming, or “sustainability” other than these being fads that “new urbanists” like to promote just because they are hobbyists and the dreamers amongst us. It’s ok because we do need improvements, but I think the suburbs are here to stay. Some might hate the minivans and school buses blocking roads and ballparks filled with parents, but I have as much disdain for smelly streets, the sound of city buses, and poor quality of air in downtown Fort Worth. I’m just sayin’ that I have an opinion too, and it’s not right or wrong. It’s different is all and a lot of people agree with me.
Johnny,
That’s fine. Nobody’s trying to take it away from you, just give people more options. This site approaches Fort Worth from an urban perspective, so we do not to cover/promote the suburbs.
Thanks for writing.
To really be urban I would say one needs a grocery store to walk to–none of which are near the downtown area (except SuperTarget). Heck, I’m closer to a grocery store out here in the country. Why is so hard to bring a grocer to the city?