American Mega Trends

Transcription

1 American Mega Trends Arthur C. Nelson, Ph.D., FAICP Presidential Professor & Director Metropolitan Research Center University of Utah October 28, 2009

2 America Grows 200 million in million in million in million in 2050 America adds 100 million people faster than any other nation except India and Pakistan But faster than China. Source: Arthur C. Nelson, Presidential Professor & Director, Metropolitan Research Center, University of Utah.

3 billion square feet 332 billion square feet 132 billion square feet 287 billion square feet 155 billion square feet Source: Data from Arthur C. Nelson, Presidential Professor & Director Metropolitan Research Center, University of Utah. Image from Architect magazine, premier issue, November 2006.

4 : Arthur C. Nelson, Presidential Professor & Director, Metropolitan Research University of Utah. Image from Architect magazine, November 2006.

5 Clearing Out the Excess Year Demand Supply Balance ,495k 1,603k 108k ,440k 1,705k 373k ,353k 1,848k 868k ,432k 1,956k 1,391k ,418k 2,068k 2,041k ,485k 1,801k 2,357k ,491k 1,355k 2,221k ,532k 906k 1,595k ,552k 600k 644k ,566k 900k (22k) Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah.

6 Squeezing Out the Excess Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah.

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8 20 th Century Metropolitan Form

9 Polk County FL Commuting Shed Dots indicate where residents of Polk worked in 2003 Source: Dwayne Guthrie, Metropolitan Institute at Virginia Tech, based on Longitudinal EmployerHousehold Dynamics, US Census Bureau.

10 21 st Century Megapolitan Form

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12 Getting Ahead of the Curve US Population 296 million 433 million Housing Units 122 million 179 million Jobs 156 million 272 million Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah.

13 Residential Development US 2000 to 2040 Growth-Related Units 65 million Replaced Units 38 million Total Units 93 million Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah.

14 Nonresidential Development US 2000 to 2040 Growth-Related Square Feet 35 billion Replaced Square Feet 102 billion Total Square Feet 137 billion Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah.

15 Life-Span of Building Function Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah, based on DoE Commercial Buildings Energy Consumption Survey.

16 Bottom Line Construction US Residential Nonresidential Infrastructure Total $35 Trillion $15 Trillion $10 Trillion $60 Trillion Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah.

17 Metropolitan Tucson Area Change Percent Population 925k 1,631k 706k 76% Res. Units 383k 676k 293k Replaced 102k Total 395k 103% Jobs 486k 937k 451k 93% Square Ft 205m 410m 205m Replaced 420m Total 625m 305% Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah. Population and employment figures from Woods & Poole Economics (2008).

18 Bottom Line Construction Tucson Metropolitan Area Residential Nonresidential Infrastructure Total $125 Billion $ 75 Billion $ 50 Billion $250 Billion Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah.

19 What About.? Telecommuting? Internet retailing? Emerging technologies? And their effect on future space needs?

20 Telecommuting Promises Higher productivity Reduce traffic congestion Reduce air pollution

21 Telecommuting Reality Cabin fever Reduces productivity Increases trips in am, noon, pm. Increases peak emissions with cold starts. Census work at home telecommuting: 1990 = 3.0% 2000 = 3.3%

22 Internet Retail Sales as Percent of Retail Sales, Source: US Dept. of Commerce, October 4, 2008,

23 Reality Check Space Class %Dif Total Glamour Space % [Retail, Office, Medical, Institutional] Warehouse & Storage % All Other % Non-percentage figures per capita based on Census estimates. Source: Calculated by Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah, from Energy Information Administration, Commercial Buildings Energy Consumption Surveys for 1992 and 2003.

24 How Does It Grow?

25 Market Analysts Finding Changing Preferences National Association of Realtors National Association of Home Builders Nationally Recognized Market Analysts Urban Land Institute Lend Lease/PriceWaterhouseCoopers Joint Center for Housing Policy at Harvard Golfing Buddies and Taxi Drivers

26 Households are Changing Household Type HH with Children 48% 32% 26% HH without Children 52% 68% 74% Single/Other HH 13% 31% 34% Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah.

27 People Turning 65 Each Year [Figures in 000s] Source: US Census Bureau 65+ in the United States: 2005; Wan He, Manisha Sengupta, Victoria A. Velkoff, & Kimberly A DeBarros. December

28 What Futurists Tell Us Bio-medical advances extend lifetimes. Census adds 20 years : 76 to 96 But that s not all Actuarial tables extend to 120. Adulthood nearing 75% in non childrearing Gen-X & -Y making family location decisions differently from parents

29 Buy-Sell Rates by Age Cohort Source: Dowell Myers & SungHo Ryu, Aging Baby Boomers and the Generational Housing Bubble: Foresight and Mitigation of an Epic Transition, Journal of the American Planning Association 74(1): 1-17 (2007).

30 Relocation Choices of Seniors Before After Housing Type Move Move Attached 24% 54% Renter 20% 59% Source: American Housing Survey New movers means moved in past year. Annual senior movers are about 5% of all senior households; 75%+ of all seniors will change housing type between ages 65 and 80.

31 BUY SELL Source: Dowell Myers & SungHo Ryu, Aging Baby Boomers and the Generational Housing Bubble: Foresight and Mitigation of an Epic Transition, Journal of the American Planning Association 74(1): 1-17 (2007). Figures for net buying or selling rate age.

32 Second-Home Market Overrated? Myth: Empty-nesters & seniors buy 2 nd homes Fact: Only 4% of HH 65+ have second homes 70% of second home owners aged Detached new second home demand: 1990s = 900k 2000s = 600k 2010s = 300k 2020s = 200k 2030s = 100k Reality: Wealth used for children s homes Source: Estimated by Arthur C. Nelson, Metropolitan Institute at Virginia Tech, from American Housing Survey and Second Homes: What, How Many, Who and Where? Harvard Joint Center for Housing (2001).

33 Housing Preference Surveys by Type, Unit Type Share Attached 38% Apartments 14% Condos, Coops 9%* Townhouses 15% Detached 62% Small Lot (<7,000 sf) 37% Large Lot (>7,000 sf) 25% Source: Low range of surveys reviewed by Arthur C. Nelson, Planning for a New Era, Journal of the American Planning Association, Fall *Toll Brothers shifting product mix to 15% condominium; WSJ 12/06.

34 Trend Demand % Attached (apartment, TH, condo, etc.) 30% Detached small/cluster/zero-lot 20% Conventional large-lot subdivision 80% = Traditional Urban Density Even in Plano, Texas

35 Source: Arthur C. Nelson, Presidential Professor & Director, Metropolitan Research Center, University of Utah

36 Home Ownership Bias Can Backfire Headlines Indianapolis most affordable metro in But Median Home Value in 1991 = $143,000 Median Home Value in 2005 = $125,000 Change, 2005 Dollars = -$ 20,000 Rate of Return Over Period = -13% Source: Adapted from National Association of Home Builders, All figures in 2005 dollars.

37 Household Growth HH Type Growth Share All 105m 132m 27m With Children 34m 37m 3m 11% W/o Children 71m 95m 24m 89% Single 27m 37m 10m 37% Senior (65+) 22m 40m 18m 67% Source: Adapted from Martha Farnsworth Riche (2004), How Changes in the Nation s Age and Household Structure Will Reshape Housing Demand in the 21st Century.

38 New Housing Market Realities Sub-prime mortgages are history Alt-A mortgages no more FHA-like conventional mortgages king Jumbo loans expensive and difficult Demand for $1million+ homes in 30 largest markets has tanked from >10% to <5% Meaning Smaller homes Smaller lots More renters

39 Shifting Tenure Implications US Year Units %Owner Owner Renter M 67% 84M 41M M 64% 86M 48M Change 9M 2M 7M Share 25% 75% Units are year-round and include occupied, vacant, transitional, and other units meant for year-round occupancy. Figure for 2008 estimated from American Housing Survey for the United States Source: Arthur C. Nelson, Presidential Professor & Director, Metropolitan Research Center, University of Utah.

40 Retired Location Preference City or suburb close to a city 51% Suburb away from a city 19% Rural community 30% Conventional suburbs away from cities are not where seniors want to be. Source: Adapted from National Association of Realtors & Smart Growth America, National Community Preference Survey 2004.

41 Emerging Urbanity Preferences Source: National Association of Realtors, American Preference Survey 2004.

42 Suburban Fringe Mortgage Time Bomb? Source: Michael Hudson, The New Road to Serfdom. Harpers (May 2006), p. 46. This graph depicts the total mortgage market as viewed by Hudson.

43 Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah, based in Zillow analysis by Ceylan Oner. Fringe Values Eroding: Phoenix Average Annual Appreciation

44 Fringe Foreclosure Pattern DC Metro Subprime Oversupply Devaluation Energy prices Metro Rail Access Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah.

45 U.S. homes lost $2 trillion in value in '08 Les Christie, CNNMoney.com staff writer. Dec. 15, 2008: 11:02 AM ET

46 Do the Math Percent HH wanting transit access 40% Households m Households wanting transit m Households with transit m Household transit growth 64m Households m Household growth m Source: Arthur C. Nelson, Presidential Professor & Director, Metropolitan Research Center, University of Utah

47 The Opportunity The New Promised Land?

48 Tear Up a Parking Lot, Rebuild Paradise Large, flat and well drained Single, profit-motivated ownership Major infrastructure in place 4+ lane highway frontage transit-ready Committed to commercial/mixed use Can turn NIMBYs into YIMBYs Slide title phrase adapted from Joni Mitchell, Big Yellow Taxi, refrain: Pave over paradise, put up a parking lot.

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51 The Future Speedway?

52 Re-Building Capacity Calculation Result Ripe Redevelopment Acres by M Minimum Share Redeveloped 25% Redeveloped Acres 1.5M ,800sq.ft sq.ft. 1.5FAR Percent Residential Absorption min. 67% Percent Employment Absorption min. 75%

53 Transit Oriented Development Template 10-minute walk or about feet The speed of a saunter or a walk-in-the-park. Source: Calthorpe (1993) District Boundary Definitions in TOD Ordinances Source: Community Design + Architecture (2001)

54 Walking Distance Benchmarks Source: Ewing (1999)

55 Rethink TOD Planning Areas 10-minute business walk = 1km 1km radius = 6 times the planning area of ¼ mile radius 800ac v. 125ac Source: Marc Schlossberg and Nathaniel Brown, Comparing Transit-Oriented Development Sites by Walkability Indicators, Transportation Research Record 1887 (Washington, DC: National Academy Press, 2004) 40.

56 Dallas Area Rapid Transit

57 Downtown Plano, TX

58 National TOD Opportunity Rail transit accessed 6M HH in 2000 By 2025 existing & planned rail may access 15M HH By 2040 rail may access 30M HH 60% of total new housing needed Source: Figure from Reconnecting America, Realizing the Potential: Expanding Housing Opportunities Near Transit.

59 Source: Arthur C. Nelson, Metropolitan Institute at Virginia Tech, based on Nationwide Household Transportation Survey, USDOT, Figure is VMT per driver. Suburban Center + TOD Densities Offset VMT Gains of Growth Exurban Suburban Fringe Suburban Limited Transit Urban NET 20 du/ac GROSS 10 du/ac Transit Urban

60 Mountain Mega TOD Market Absorption 1km planning radius = 800 acres Megapolitan 10du/Ac Albuquerque 20% Denver 22% Las Vegas 10% Phoenix 19% Salt Lake 57% Mountain Megapolitans 24%

61 Tucson New Urbanity Demand 1+% Downtown demand 15,000 people 1+% Secondary center demand 15,000 people 5+% Other urban transit access demand 75,000 people 25+% Suburban transit access new community demand 400,000 people 70% of new all development must be in New Urbanity options to meet demand for the 1/3 rd wanting them in Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah.

62 THANK YOU