Ok, we get what you're thinking, how does Bruce Lee relate to demographics and real estate trends? Stay tuned, we'll tie it all together in a philosophical moment that will be sure to enlighten your day.
In 2016, the Urban Land Institue (ULI) contracted John Burns Real Estate Consulting to research the developing demographic trends shaping real estate. Two years later in 2018 a lot of what was identified in the report turns out to be very well predicted and envisioned based on the trends of then and where the real estate market and influencers are now. We are products of the times we live in. Simply put, the inherent beliefs, values, and reasoning behind a generation of people will be influenced by the environment of their world: financial, political, technological, health/age, and the list goes on in varying degrees of importance.
Below is a graphic excerpt from the John Burns Real Estate Consulting report that identified the four biggest demographic opportunities in real estate:
In addition to the above noted real estate opportunities, the report also identified trends in what has been ongoing for at least the past few years with the big decline in big box, cookie-cutter retail stores. The current rising demographic is driven by the millenials. Millenials are weary and bored of today's retail experience, or lack thereof rather, and are seeking newer, trendier, more unique methods of blending the things that matter to them: technology, sharing, and authenticity. This will mean retailers need to deliver more experiences via interactivity with the products they're trying to sell. Developers will need to create a balance of affordable housing and a carefully curated retail mix to accommodate for the wants and needs of their tenants/homeowners. And all of this will need to be conveniently located nearby public transportation and promote a pedestrian-friendly environment. The report coined this urban lifestyle within the suburbs as "surban" and would be the next biggest shift for real estate.
An example of a successful "surban" development at CityCentre in Houston, TX. An old run down mall site was transformed into a bustling new and focused center:
An example of a "transit mall" in South Korea called Yonsei-ro where through-traffic is blocked off, sidewalks enlarged for the safety and benefit of being pedestrian-friendly and walkable with numerous nearby transit options:
Cities like Barcelona in Spain are already trying to implement "superblocks" where large amounts of former streets are turned into pedestrian-only courtyards and plazas where non-motorized traffic will not be allowed.
By now you're probably asking about Bruce Lee, right? Many consider Lee to be the precursor to mixed martial arts (MMA). Lee had a strong philosophy about the direction he chose to go with his martial art, Jeet Kune Do. Basically having form without form, having no limitations on limits, stucture without structure. He summed it up best in his famous quote about how to flow: "Empty your mind, be formless, shapeless, like water. If you put water into a cup, it becomes the cup. You put water into a bottle and it becomes the bottle. You put it in a teapot it becomes the teapot. Now water can flow, or it can crash. Be water, my friend."
The tie-in? We as people from differing generations all must adapt and be open minded to see the flow of societal trends to stay pertinent. For us, it's real estate. Just consider: The rigid application of rules and closed-minded disregard of demographics led to the fall of many large retailers, many that have been in business with strong sales for decades. They were simply out of touch with reality and perhaps thought of themselves as too big to fail. The retailers, developers, and real estate professionals who can be mutable like water will be rewarded with enlightenment in this ever changing market.
How can we be like water together? Let us know!