60 REAL ESTATE FORUM MAY 2014 www.forum.globest.com
Earlier this spring, ULI released the results of its “America in
2013” housing survey, which shows that these growing demographic groups, including Gen Y, African-Americans and Latinos,
strongly desire urban-style, mixed-use communities. For example,
most Gen Y members prefer diverse housing choices, 62% prefer
to live in developments that provide shopping, dining and even
office space, and more than three-fourths place high value on
walkability. And perhaps most significant for real estate developers, 63% of Gen Y respondents said they would move in the next
“The boomers have also changed,” McMahon says. “Their children have left home and many are interested in downsizing.
We’ve found that many want to live near their kids.” According to
the ULI survey, the majority of boomers want better access to
public transportation, and 72% would prefer shorter commutes
and smaller homes over longer commutes and larger homes.
Furthermore, nearly half want to join the younger generation
and live near a diverse mix of shopping, dining and office space.
“All of these things coming together are basically changing the
real estate world,” says McMahon. “It’s why we are seeing so much
multi-use development. One-size-fits-all won’t work for buying
groups that are so different from one another.”
The signs of that transformation are becoming more visible
every year and have even begun correcting past mistakes. The city
of Rockville, in Maryland’s Montgomery County, for example,
tore down its historic downtown back in the early 1970s in a fit of
urban renewal, and replaced it with a mall, McMahon says.
“Today, of course, they took the mall down and put the downtown
back.” The current Rockville Town Square has a more appealing
mix of boutiques, restaurants, condos, rental apartments and the
And in 2011, Fairfax County in Virginia won the Daniel Burnham
Award from the American Planning Association for its plan to
transform Tysons Corner, a huge suburban office park and shop-
ping district in McLean, into a 24-hour urban center connected to
public transportation where people will live, work and shop.
“Market analysis in the past was always backward looking,”
McMahon adds. “Today you have to really look forward and analyze
the demographic make-up and ask, ‘what do these people want?’”
The downtown of West Palm Beach, FL, for example, recently
was transformed by CityPlace, a New Urbanist mixed-use develop-
ment by the Palladium Co. First opened in 2000, it eventually
included about 600,000 square feet of retail, anchored by tenants
such as Macy’s and Publix, the first downtown office tower in
many years and about 1,000 private residences, McMahon says.
“A traditional market analysis would have told you that there is
no market for housing in Downtown West Palm Beach,” simply
because there was none there at the time, McMahon says. But
once it was built, “it sold or leased up overnight. You have to hold
your finger to the wind and figure out the inevitable; that’s the
secret to real estate today.”
“There have always been people who have done smart, sophis-
ticated analysis,” he adds. However, most of the housing in the US
was constructed by small builders who didn’t have that capacity.
But McMahon hopes that all developers can take inspiration from
the growing number of intelligent mixed-use designs.
“When Disney decided to build the town of Celebration,” the
company’s Florida showpiece of New Urbanist thinking not far
from its Disney World complex, “it probably did more market
analysis than anybody ever did in the US,” McMahon says. One of
the most important things it discovered was that “prospective
residents wanted an active community, not a bland one.” The
developers responded by building the retail component first.
“They wanted to create an active place and generate buzz.”
“Demographics are certainly important in our analysis,” says
Beau Arnason, executive vice president of Steiner + Associates, a
Easton Gateway is a 54-acre addition to Steiner + Associates’ Easton Town Center in Columbus, OH that will have more than 500,000 square feet of retail.