Placemaking, driverless cars and technology will greatly affect residential and commercial real estate development in the future.
These are the findings in the Emerging Trends in Real Estate 2018 report from pricewaterhousecooper and the Urban Land Institute. This 39th edition of the report was compiled from the views of approximately 2,400 real estate industry experts, including investors, fund managers, developers, property companies, lenders, brokers, advisers and consultants. Topics included real estate investment and development trends, real estate finance and capital markets, property sectors, metropolitan areas and other real estate issues throughout the United States and Canada.
Placemaking takes a piece of history (small-town living where everyone knows everyone else), combined with transit, and the concept is currently under construction in the southeast community of Mahogany.
Of placemaking, the report says “it is an evolution of the industry’s recent focus on mixed-use properties and creating communities — fusing residential, commercial retail and service properties. What makes placemaking different is that it’s more than a collection of different types of property. As one interviewee put it, place-based development is bigger than the sum of its parts: It’s about creating a unique experience and culture, an engaging environment that provides people with things to do throughout the day and into the night.”
Essentially, it’s a community you never have to leave, once you get home from the office.
Westman Village in Mahogany is a placemaking community, with a variety of multi-family homes, including rental, an upper-end restaurant and an amenity center that offers just about everything you need on a daily basis. To up the game, all homes are connected to the amenity center through tunnels, sort of an underground version of Calgary’s Plus 15 system.
If there’s a drawback, it’s the cost. Done properly, a placemaking community will run up a tab in the hundreds of millions of dollars, but it does open the door for multi-billion-dollar companies — I’m thinking Google, Amazon, Apple — to develop these communities for their employees (and others) to live in (my thought, not the report’s).
Technology is adding cost efficiencies.
“Technology is poised to reinvent the real estate industry by helping developers and investors uncover new opportunities with trusted and actionable data-driven insights,” says the report. “Analytics will allow companies to turn vast amounts of data into key insights and develop go-forward strategies that will enable effective faster decision making. And the evolution of technologies like automated vehicles, drones, and smart buildings is changing the way developers design buildings and communities. Technology and ‘big data’ are transforming all aspects of real estate, including how companies anticipate and respond to customer trends, manage, develop and lease their buildings, and serve their tenants.”
Placemaking and technologies are developing now, but the impact of driverless cars — or autonomous vehicles (AVs) as the report calls them — is further down the road.
“Technology and automotive giants are racing to get AVs on streets and highways and it’s a change that could radically transform cities and future developments,” says the report. “With AVs comes the need for fewer personal cars and surface parking spaces. What does it mean when residential, commercial and retail properties and projects no longer need the parking spots they once did?
“It’s likely that many companies will capitalize on their existing assets and redevelop excess space into new properties, generating new value and increasing urban density along the way.”
Canadians lead in the development of AVs. The City of Edmonton is exploring setting up a test track at the University of Alberta (that will get their minds off the Oilers’ season so far this year). And in Ottawa, a major car manufacturer is establishing a research and development center to develop AVs and connected vehicles.
‘Flying’ AVs are making a difference, as well.
“Drones are slowly but steadily gaining in prominence within real estate and changing how companies work,” says the report. “They’re being deployed by developers and owners to inspect construction progress, assess potential damage and help produce visuals for marketing materials. And with the rise of faster e-commerce delivery efforts across North America, they are another variable in the retail landscape.”
Without a doubt, the most important observation in the report is housing affordability and the effect it is having now and will in the future.
“Housing affordability concerns continue to reshape where and how Canadians live. They’re driving to smaller cities in search of a less costly lifestyle and causing those who stay to rethink homeownership. This trend reaches beyond the housing markets of Toronto and Vancouver, contributing to the rise of long-term renters.
“And while a rise in interest rates and government actions to curb foreign home buyers may push prices down in the short term, interviewees do not expect these measures to derail the real estate industry’s long-term growth prospects. One stated that the affordability issue moves beyond where and how Canadians live and is affecting the supply of labor and society’s general well-being.”
Author:James Watts Phone: 954-816-6019 Dated: January 3rd 2018 Views: 55 About James: Professional Real Estate Marketer with a successful record in consultative sales & marketing, entry ...
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