Boundaries between live, work, and play are blurring. The desire to create dense, diverse, and flexible communities that integrate a variety of uses has revived mixed-use developments.
Prime location once defined coveted real estate. Today, amenities have become the new value creator. Developers are competing to win tenants by offering gold-star amenity packages, including sophisticated food and beverage packages, co-working space, and pet amenities. Developers understand that it is all about the experience.
Several developers believe mixed-use developers are generation agnostic, appealing both to millennials and baby boomers. In some markets, empty-nesters account for nearly 50% of the market. Additionally, designing for women is important as women account for 90% of home purchase decisions.
Critical components of a successful mixed-use development:
- Hospitality focus (regardless of use)
- Integration of quality finishes
- Abundant Natural Light
- Amazing share amenity space
- On-site retail
Authentic, mixed-use developments must include at least three product types. Not one product type can make-up greater than 40% of the total.
Split uses allow the various uses to share parking costs and share costs. Example: Office users need parking between 8 and 5 while residential needs parking mostly overnight.
Rising construction costs (up to 25%) have dampened the viability of some projects. Some developers are leveraging new technology like 3D printing and pre-fab, modular components to counteract the rise in costs.
As technology continues to evolve the commercial real estate market, city planners have suggested that buildings could be designed in a modular fashion that would allow adaptability in the future.
The goal of new mixed-use developments is to create the ultimate experience for a variety of users. A resident, shopper, office worker, and visitor should all have a seamless experience.
Link to full article: https://www.smithgroup.com/perspectives/2018/convergence-the-future-of-development