The U.S. residential real estate market is undergoing dramatic change; its evolution influenced not by the largest demographic — Baby Boomers — but by their offspring, the Millennials. Neighborhoods and cities preferred by most of this generation are those that are planned and designed with innovative form-based codes.
These were some of the key findings FBCI Chairperson, Lisa Wise, delivered during the Global Cities in an Era of Change 2016 symposium, March 30-April 1, at Stanford University in Palo Alto, California. Attendees focused on opportunities and obstacles the real estate industry faces in working to ensure that the built environment meets the future needs of the increasingly urban global population.
Wise participated in a panel to discuss how cities need to be “fundamentally reinvented” to meet a burgeoning populations’ radically changing needs and expectations. She was joined by Andy Cohen, co-CEO of Gensler, Colin Shepard, CEO of Investment Management at Hines Office of Investments, and Ed Friedrichs, founder of Friedrichs Group, LLC.
Wise was among a few presenters who focused on the challenges the public sector faces in transforming deteriorating urban environments and isolated suburbs into more vibrant, accessible, multi-use communities. “Our cities require extensive new construction; much of the existing infrastructure needs to be replaced and this is especially true in the major cities. It is these major cities that pose the greatest opportunities and the biggest challenges. That puts us at a turning point: Do we take advantage of this opportunity to make a huge change in the way we shape our cities or stick to business as usual?” she asked.
Wise pointed out that the priorities of younger professionals are diverging significantly from those held by earlier generations. A growing proportion of the adult population has no desire to buy and maintain large houses on spacious plots in suburbs that are isolated from their offices or other activities. Millennials are increasingly living in relatively small households, with few or no children, and seek to buy modest houses on small lots or multifamily units. They also want to live near — often within walking distance — of shops, restaurants and entertainment and have easy access to public transit, cycling, and walking options rather than relying exclusively on car-based transportation, she noted.
Unfortunately, many cities’ current zoning frameworks do not permit mixed-use development on a broad scale, Wise pointed out. She explained that redesigning communities using a form-based code allows for denser, more connected and more attractive development and will help municipal leaders and planners streamline the permitting process, reduce bureaucracy and save money while introducing certainty and consistency into the planning process.
“Relative to more traditional zoning approaches, form-based codes provide more clarity and control of development outcomes, ensuring that the public’s preferences are expressed and realized,” she explained.
Wise’s presentation sparked considerable interest from the audience who followed up with questions about strategies for adopting and implementing form-based codes and how to gain acceptance in communities that are unfamiliar with them.
She said she was pleased to be asked to participate in the symposium, which gave her a chance to meet and exchange views with private real estate developers and lenders who hold a different perspective from those of public officials.
“This event was an excellent opportunity to meet people who provide private funding that will help us build more resilient, form-based-code communities, to hear what their challenges are, and to see their desire to effect positive change by contributing to sustainable cities and green infrastructure. I was also reminded, however, that their metrics for success are influenced by but don’t rest solely on doing ‘the right thing’. They are also looking for sound financial performance from their investments. Form-based codes can deliver this, too.”