Edward T. McMahon, ULI senior resident fellow
Changes in demographics, income dynamics and consumer behavior all mean big changes ahead for master planned communities. This was the conclusion of panelists at a session titled “Master Planned Communities 2020” at ULI’s 2010 Fall Meeting.
“To understand the future, you have to understand how demographics are changing the marketplace,” advised John Martin, Principal at Martin Associates. This theme was echoed by the other panelists including Perry Reader, President of Community Development at Crosland, Melinda Masson, founder and chief executive officer, Merit Property Management and Randall Lewis, executive vice president and director of marketing at Lewis Operating Corp.
Reader looked back to discuss the successes and failures of the master plan for Celebration, the well-known new urbanist community underwritten by Disney outside of Orlando. Celebration focused on five cornerstones: education, health, and technology, sense of community and sense of place. What worked? The vernacular architecture, the educational system, the health care center and wellness programs, the strong sense of neighborhood identity and community involvement. What didn’t work so well? The icon buildings by famous architects, which have had to be remodeled and repurposed and the big investment in technological infrastructure which became rapidly obsolete were deemed lessons learned.
Looking forward, Melinda Masson declared that “success in master planned communities will require out of the box thinking”. Understanding how lifestyle needs and desires are changing is paramount, particularly for growing market segments like older adults and woman with income, no kids (WINKS). The definition of family has changed in America and builders will have to create smaller niche villages to meet the wide-ranging needs of America’s increasingly diverse population.
Randall Lewis concluded the panel by setting out 20 predictions for how changes in the market, the industry and the world will reshape the location and design of master planned communities. His predictions for the market includes: more renters and fewer buyers, more ethnically diverse residents, more niche marketing (e.g., prayer rooms or spice kitchens), more single women buyers, a need for more on-site storage and a greater need for home offices because fewer people will drive to work, five days a week.
As for industry changes Randall predicted: denser, taller communities, more mixed-use product, more life stage marketing, more business model changes, greater emphasis on soft programming, more partnerships with both global funders and local builders and a maturing of the MPC industry.
Finally, Randall laid out five predictions of global changes that will help shape the new generation of master planned communities. These were: much higher gasoline prices, a greater emphasis on energy efficiency, environmental protection and other green features, growing water shortages, a 24-7 world that will demand amenities that stay open at night and new opportunities to partner with a wide variety of companies whose products and services will be wanted by the new generation of consumers.
Collectively, the panelists agreed that the way we plan and create master planned communities will change to meet the new demographic and global realities.