Downtowns aren’t just for the 9-to-5 crowd anymore. Cities are drawing all types of people—and urban cores are experiencing a revitalization as they cater to the live-work-play lifestyle of the millennial crowd in particular.
The supply problemThis surge in residents and consumers brings about one problem, though: a lack of space. Downtowns are centralized areas of commerce that are typically confined to a handful of blocks. That perimeter can expand a bit, but options are limited.
With this in mind, many developers have taken the mixed-use approach. It essentially gives them the most bang for their buck as they can build vertically, incorporating retail beneath office, multifamily and even hotel components.
Part of the beauty of the mixed-use product type is that it draws a diverse crowd that benefits from these complementary uses. The office workers might soon find themselves touring the apartments above them, while those residents may take advantage of the new spin studio on the building’s ground floor.
Tourists and visitors who become familiar with the retail stores, restaurants, entertainment and public spaces associated with the mixed-use project may also find themselves inspired to live that lifestyle, or to at least book a weekend staycation at the property’s hotel. Part of the mixed-use appeal is also due to an increased emphasis on transit-oriented development and the many cities’ investments in public transportation options, which make these areas easy to access at all times.
Mixed-use rising in secondary markets as wellIt’s no surprise that mixed-use projects are springing up all over the country’s downtowns, then. While this product type has had some obvious traction over the past decade or so in the nation’s largest central business districts, its staying power can also be seen when you look to the secondary markets with growing downtowns.
- Downtown Lexington, Ky., just received final approval for a $72 million, four-phase mixed-use project along Midland Avenue.
- Construction just began on the 780,941-square-foot One Light Street mixed-use project in the Inner Harbor neighborhood of Baltimore.
- Plans have recently been filed for a $125 million mixed-use development across from CenturyLink Center in downtown Omaha.
- Knoxville, Tenn., is working on lifting an ordinance that bans residential development in commercial zones.
With more and more would-be residents, workers and visitors realizing the value downtowns have to offer, we should expect to see more of this product type in the near future. Use these collaborative environments to do a little collaborating yourself. A retail broker can soon learn the office market ropes by communicating with the listing agents on other project components. A multifamily broker can learn which retailers are expanding and targeting ground-floor opportunities by reaching out to retail brokers. The opportunity is yours for the taking.