Chris Leinberger, president of LOCUS, presenting awards to Senator Bennet (CO) and Senator Warner (VA) for their contributions to transit-oriented development for the next transportation bill. To the left is Christopher Coes, managing director of LOCUS, and to the right is Geoff Anderson, president of Smart Growth America and a member of the steering committee of LOCUS. The ceremony was in June, 2012 at the Dirksen Senate Office Building.
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THE STRUCTURAL SHIFT TO "WALKABLE URBANISM"
The building of the built environment (real estate and the infrastructure that supports real estate) is in the middle of a structural change, only comparable to the change that took place two generations ago following World War II.
The structural change that occurred in the mid-20th century converted real estate development into a modular, formula-driven industry, based upon access by and parking of automobiles and trucks. I refer to it as "drivable sub-urbanism". The real estate industry responded to the market demand of the day and the results yielded many benefits in the industrial economy. Yet we now know that it actually narrowed consumer options, consumed land at 6-8 times population growth and produced "could be anywhere" places, based upon the "19 standard product types". These drivable sub-urban formulas have been re-enforced by real estate finance, which has turned what for thousands of years was a 40-year asset class into a product with a 7-10 year life.
However, drivable sub-urban development became overbuilt and came to an abrupt collapse in 2007/8, directly leading to the Great Recession.
There are many unintended social, economic, health and environmental consequences resulting from how America has been developing its built environment over the past 60 years. These consequences include, among others:
• Dependency on a car/truck-only transportation system which is putting financial pressure on household budgets
• Social segregation and the secession of financial elites
• The dependency of about 1/3rd of the US population who do not drive
• Subsidized drivable sub-urban public and private infrastructure that is too expensive to continue building and maintain
• Lack of unintentional daily exercise which has partially contributed to the obesity and diabetes epidemic
• Indirect impact on American foreign policy which is skewed toward securing sources of foreign oil from countries increasingly hostile to the US
• Economic exposure to increasing oil prices
• Generating over 70% of greenhouse gas emissions and, therefore, the #1 contributor to climate change.
Over the past 15 years, many consumers have been demanding different options to the "one-size-fits-all" drivable sub-urbanism. While single-family homes on large lots and strip commercial will be a significant part of the American landscape for decades to come, its supply has been overbuilt for years to come.
Many households and businesses want something different; what I refer to as "walkable urbanism". This is where most daily needs can be met within walking or rail transit distance. The convergence of the rising Millennial generation and soon-to-retire Baby Boomers, half the US population, are on the forefront of demanding the walkable urban alternative. This includes downtown and suburban downtown revitalization, New Urbanism, transit-oriented development, green field mixed-use development ("lifestyle centers"), regional mall redevelopment, among other new ways of building. Public policy responses that allow for and promote this kind of development include smart growth, balanced investment in all transportation modes, strategy and management of walkable urban places, impact fees that "level the planning field", affordable & workforce housing development and engaging in scenario planning for the economic development and transportation future of metropolitan areas.
There is pent-up market demand for walkable urban development. We in real estate are fundamentally re-tooling how we design, plan, regulate and finance to serve this pent up demand. There has been much accomplished in this regard over the past decade, led by real estate developers, political and civic leaders, organizations such as Urban Land Institute, Congress for the New Urbanism, Enterprise Community Partners, Smart Growth America and my home organizations, LOCUS, Brookings Institution, University of Michigan and Arcadia Land Company.
Working with many like-minded people and institutions, we are formulating and implementing the next American Dream.