DENVER — Mixed-use development has become extremely popular, but it is not the panacea for the American real estate industry.
That was one of the takeaways from a panel of prominent real estate entrepreneurs speaking at the 51st gathering of the National Association of Real Estate Editors (NAREE) conference in Denver Thursday. Moderated by journalist Joe Gose, contributor to The New York Times, the “Designing Quality Mixed-Use Projects” addressed such topics as the continuing trend to designing for millennials to the changing face of the retail sector.
While mixed use is gaining in popularity, said Jeffrey A. Bayer, President & CEO of Birmingham, Ala.-based Bayer Properties, a national commercial real estate firm, the whole world is not going to mixed use. “People still love living in suburbs, in midtown and other areas, and we have to be careful that we do not over do mixed use,” he said. “Sometimes developers become enamored of the latest trend. Mixed use is not a panacea. It is not for every one, but there is a large section of the population that wants it.”
Nationally known architect David Kitchens, Principal-in-Charge of architectural firm Cooper Carry’s Washington, D.C. office, agreed there has been an across the board plethora of mixed-use developments from high-density urban environment to suburban locations. “Younger people do not want to live in their cars to get to their jobs,” said Kitchens. “Millennials want to be smart in how they live. If you really get down to the fundamentals, we’re seeing all generations wanting to live smarter in mixed use environments.”
The American dream is evolving, Kitchens added. “Look around the country and you’ll see the changes,” he continued. “You used to have development concentrated around auto-dominate auto interchanges. Now, transit oriented developments (TODs) are the new interchange and mixed use is the new trend. Look at Tysons Corner in Virginia, which once was an office park and now is one of the largest cities in America. It’s happening all across the country. In Denver, you have Lodo, RiNo, where communities are gathering around great commercial elements.”
Creating walkable, mixed use, master planned communities on large-scale sites in greenfield locations that are in path of growth are one of the missions of developer Coventry Development said Keith D. Simon, Executive Vice President and Director of Development for New York-based Coventry Development Corp., which has provided development services for mixed-use projects in New York, Colorado, Guam and Texas, including Springwoods Village, a $10 billion mixed use development in north Houston and RidgeGate in Lone Tree, Colorado.
“We work for an European family who bought large tracts around the country with no debt and no idea or intent to develop them,” he explained. “The land sat for 35-50 years before we began development. Typically once you go out get land, you have debt and you have to go out right away to service that debt. We didn’t have to do that. We could plan and be patient.”
Jobs are the engine that drives development, he added, noting that Springwoods Village in the northwest part of metro Houston is the new home to ExxonMobil’s new 10,000-person campus and is also headquarters for another energy sector firm, Southwestern Energy. “We also have a hospital there, and under construction is a 10 story building as well as a campus for HP. CityPlace is our place making component at Springwoods Village. It is a 60-acre urban center with 4 million square feet of office, 500,000 square feet of retail two hotels and 2,500 residential units.”
Mixed use is not confined to greenfields. Bayer noted his firm took a department store in downtown Birmingham, Alabama that had been vacant for nearly four decades and is transforming it into The Pizitz, a 251,000 square foot development to include 143 multifamily units, a food hall on the ground floor with two retailers, modern co-working office spaces, and a cinema. “The building had been closed for 35 years, and we totally repurposed it,” Bayer said. “It’s helping to transform the downtown area in Birmingham. People from baby boomers to Gen X-ers to millennials want to be involved.”
In Lexington, Ky., Bayer built The Summit at Fritz Farm a gathering place to cater to influx of tourists since it’s part of though bred industry of the world,” Bayer said. “It’s an example of how we combine uses and create excitement in the marketplace.”
Responding to a question about the country’s ailing retail real estate sector, Kitchens noted that most of Cooper Carry’s mixed use projects are not retail dominant. “They are really more residential and office and hospitality dominated,” he said. “People who live in mixed use want to see activities on the street.”
What does the future hold for mixed use?
Bayer replied the main question is that as millennial grow older and have families, will they continue in that urban mixed use lifestyle and educate children in urban schools where they are living. “It’s a decision coming in most urban cities,” says Bayer. “Are the services going to be able to keep up demands of what they want?”
June 16, 2017 Realty News Report Copyright 2017