Viewpoints

Viewpoint: Mixed-use developments important piece of future puzzle

By Mike C. Gray and Andrew K. Ryan

The United States is going through a dramatic demographic change that offers challenges and opportunities for land use and urban planning models.

For decades, the traditional model that city and county officials planned focused on a central business district with residential and retail centers radiating out from the urban core. A generational shift is changing that model.

The 2010 Census highlighted that Boomers and Generation Y/Millenials are fueling an urban renewal by living, working, and playing in the same general location. In other words, they are choosing to live in mixed-use developments where they have access to everything they need in one location. City and county officials must plan for this in order to stay competitive. 

For the past 40 years, Boomers have been the dominant force for transportation and land use policy. However, as they begin to age, transportation by car is becoming less attractive, according to a study by AARP. On the opposite spectrum, gas prices continue to linger above $3 a gallon, which has driven a large percentage of Generation Y to choose alternative forms of transportation. As these represent two of the largest population generations, this shift poses a complicated challenge for local officials. Both generations want to continue to work and recreate but neither want to be forced to travel far in a car. That is why mixed-use developments are such an attractive option.

Another challenge is that these generations are not only looking for ease of access within their immediate region but also throughout their state, country, and world. It will be essential for officials to arrange regional transportation authorities that can support the growth of mixed-use development while partnering with their respective state to create expanded transportation options.

Employment also continues to be a driving force for both generations. Young professionals are looking for opportunities to advance in a global economy. Boomers are not stopping either. Yet again, this is where mixed-use developments play an increasingly important role. No longer can officials expect young people to buy homes in the suburbs or retirees to move to retirement communities; they must support these individuals with new sets of expectations. That means creating new zoning infrastructure that allows office and residential to be adjacent to one another or as part of a master planned destination. It also means putting the infrastructure, such as waste water and electricity, in place that allows for this type of development. Increase in active employment will be beneficial for municipalities in the long run as they will collect additional tax revenues, but they have to ensure that the foundation is in place or they will lose out to other locations.

Boomers and Generation Y both spend a significant percentage of income on leisure and recreational activities. To successfully lure investment and new citizens, municipalities might have to rethink the location of their entertainment districts. For many places, this will not be a problem. Cities like Philadelphia have consolidated many sports and entertainment venues in a central location that has easy access by multi-modal transportation options. Leisure and recreational activities as part of a mixed-use project have proven very successful.

Mixed-use development is the response to generational shifts and will be a mainstay for decades. Although there will always be demand for suburban living, municipal officials must understand that there are significant sociological trends that are driving citizens to move in this new direction (there are even many popular mixed-use developments in suburban settings). Localities should be proactive by encouraging mixed-use developments and marketing potential development and redevelopment sites. Ignoring the mixed-use phenomenon will be detrimental for years to come.  

What do you think? Tell us in the comment box below.

Mike C. Gray and Andrew K. Ryan are partners with Commonwealth Partnerships Group, a strategic marketing, communications, and competitive intelligence firm that specializes in the real estate industry.

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