On June 8th, 2022, Coldwell Banker Commercial held CBC Chatter, a virtual quarterly series hosted by Senior Vice President and Managing Director Daniel Spiegel to discuss hot topics in the world of commercial real estate. This event focused on the Future of Cities where panelists discussed myths such as the “death” of cities, trends in larger urban areas and how those trends are affecting secondary and tertiary markets, and how technology is shaping the future of cities.
Daniel Spiegel was joined by the following powerhouse panelists:
- Greg Lindsay – Senior Fellow at MIT Future Urban Collectives Lab
- Tracey Hadden Loh – Fellow at Brookings Metro, Anne T. and Robert M. Bass Center for Transformative Placemaking
In addition to discussing the many implications of COVID-19 on cities, the panelists touched on a variety of topics from sectoral differences, zoning issues, and social issues, all of which are affecting how cities operate and how its citizens carry out their lives. Viewers were able to gain a deeper understanding of domestic migration and the forces driving these trends:
The “Death” of Cities
- There have been many claims that cities are “dying”, especially coming off the pandemic when many residents left larger urban areas and relocated to suburban or rural areas.
- Tracy discussed that this is not a new phenomenon, but it was just supercharged by COVID-19. She detailed how the U.S. has been suburbanizing for some time now which offers residents urban experiences without the hassle and cost of city life.
- Greg discussed how this migration to the suburbs has largely been due to a lack of housing in larger cities, not for lack of interest. Cities are full, but they are constrained. Using Denver as a case study, it may appear to many as the ideal city for living but in reality, there is not enough housing available, thus forcing people into the suburbs.
- Panelists then discussed the issue of zoning and how it’s affecting new construction in cities – many codes are outdated and do not reflect the current realities of urban living. Dan observed that it’s actually the smaller cities that are pushing the envelope to create change and are serving as a model for larger cities.
Demand for Office Space
- The shift to remote work because of the pandemic was felt across industries and was a major factor in worker relocation.
- Tracy discussed that pre-pandemic, the top ten office markets were already experiencing systemic decline in square feet per worker, and this spread to every size market during the pandemic. Due to the changing nature of work, industries that use offices are growing and will continue to utilize these spaces, however, a lot of office space is obsolete and requires innovation to be productive.
- The need for office space also depends on the sector and culture of the city. A lot of workers are still hesitant to return to office but crave city culture. Tracy mentioned that cities are not just playgrounds, but they are platforms for residents to care for each other.
- Both Greg and Tracy mentioned the room for growth and innovation and that we are looking towards a renaissance of working. This will combine multiple ways of working and truly cater to each sector and city culture, resulting in the highest productivity and happiness. However, commercial real estate financing and management need to adapt before widespread change can occur.
- The panelists discussed affordable housing and how it is the defining crisis of this time, coupled with climate change and social issues.
- Although you can still buy a house for $20,000 in legacy cities, job opportunities exist in their respective hubs where housing is not as affordable. Tracy mentioned that the tech and finance hubs (both of which are based on the coasts) create a political and social issue that ultimately constrains innovation. As she observed, housing does not adapt as quickly as the economy.
- Greg went on to discuss how cities that are prone to natural disasters will likely see a decline as climate change ramps up, allowing for an influx of residents to inland cities.
You can watch the full recording of the fourth CBC Chatter, here.