Creating Communities from Scratch: The Era of Placemaking
One thing became abundantly clear at DLA Piper's 2017 Global Real Estate Summit: placemaking's not just for architects anymore.
"The art – and it's very much an art and not a science – of creating a welcome place where people want to be is nothing new," said Don C. Wood, President and Chief Executive Officer, Federal Realty Investment Trust. "What's changed is the prioritization of the practice."
CRE's recent increased emphasis on placemaking – matching sought-after activities, high-end restaurants and open space with a diverse retail product mix, housing and offices, all in one location – was the focus of "Real Estate Innovation and Creativity: A Discussion on Placemaking," moderated by Mitchell N. Schear of JGB Smith at the Summit, held on September 26, 2017, in Chicago.
"What is your brand of placemaking? How do you create this ‘third place'?" Schear said, alluding to the common belief that, outside of their home and workplace, people crave an engaging place where they can feel engaged, comfortable and stimulated.
Generally speaking, real estate today is about creating spaces where people want to be. While placemaking is most often characterized, and celebrated, for unique amenities, residential units more often than not play a crucial role in financing these projects. With busy schedules, people – individuals, young families, seniors – are looking for ways to maximize their time and experiences, panelists said.
Strategically determining which uses will resonate with the local community is critical, and CRE leaders have to get creative.
"In San Francisco, we started with Twitter feeds," said Deborah Ratner Salzberg, president of Forest City Washington. "Where are people tweeting? What are they doing there? What are they tweeting about? What do they want?"
The next step is localization. What restaurants would excite the community? Are there new brick-and-mortar merchants that might be a good fit?
"You have to make it engaging," said Shobi Z. Khan, president and chief operating officer of GGP Inc. "Now that you've created these unique amenities, people will want to live and work there."
Addressing the retail sector's well-known struggles, Salzberg said that storefronts remained a major component of multiuse CRE projects. "I do think [brick-and-mortar] retail might come back," she said, mirroring findings of DLA Piper's 2017 State of the Market Survey report. "I think we will get creative and there will be interesting solutions, we just need to get there."
Dramatically whipping his phone from his pocket, Wood said that "technology has made us lonelier, but the idea of ‘being lonely together' is huge. There are parts of our developments where you see people interacting with only their phones, but they're surrounded by other people doing the same thing. This is causing us to think differently about place and public space more than ever."
"When projects are done right, they can change an entire market," said Jeff T. Blau, CEO of Related Companies. "Developers with the right foresight and means can create entire communities nearly from scratch."
Schear concluded the discussion by asking a hypothetical question: "How do you sell the dream of either something that hasn't been built yet, or the future of an existing space?"
It's the question at the heart of placemaking for CRE, and there are no easy answers. But as industry leaders look for ways to conduct placemaking effectively, it's clear they understand its growing importance.
"It's a cliché, but it works – live, work, play," Blau said. "The good news for us is that when you put a lot of different uses together, you create more value."