PlaceMakers blog – a collection of urban planning types – put out an article by Nathan Norris “Why Generation Y is Causing the Great Migration of the 21st Century”
Norris quotes Robert Schiller: “Just last week, Robert Shiller of the Standard & Poor’s/Case-Shiller Home Price Index made the dramatic statement that, with our growing shift to renting and city living, suburban home prices may never rebound in our lifetime.”
There is a population of young people, the peak of the cohort is 22 right now, we call Generation Y. Social observers and planners are noticing they are moving to cities at greater rates than previous generations. There are some major reasons suggested by Norris: they want more adventure than the static suburbs they grew up in. They need the connectivity and serendipitous interactions that occur in dense areas, rather than their managed, play-dated upbringing. Young people want the convenience of urban cores where stores, entertainment, etc are readily available without needing to drive. And this entire generation is averse to cars, to wit: General Motors has hired the marketing arm of MTV to try to get young people more excited about owning and auto.
The article is focused on the residential dimension: where will people live and is basically responding to the Schiller remark, which made waves in the suburban residential brokerage market. I believe the same forces are going to dramatically challenge suburban commercial real estate. If crime and schools can be taken care of in cities, young people will remain in these denser mixed-use areas, and the need for suburban office parks will transform. Of course many owners will re-position assets, and it’s not like the burbs are disappearing overnight. But the trends are significant and the long bet is on the return of the city as the locus of economic activity. The car-dependent suburb will have to adapt to meet people’s needs for saving time, stimulation, and a long-term sense of community.