Declining economy, mixed-use, and local planning

[Prince George]

Really interesting article from Retail Traffic magazine: Despite the recession—or because of it—mixed-use sites get a new look. Long story short: with retailers less willing (or able) to open new stores, developers are taking a harder look at mixed-use ideas to improve their value proposition; in particular, they are looking at ways to provide mutually supporting uses, an "ecosystem" if you like. Some choice quotes:

As national retail chains pull back growth strategies ... mixed-use projects that had been in the works for years are suddenly being thrown into disarray. Retail, once the main ingredient in the mixed-use recipe, is becoming a garnish. ... Developers and architects are tossing new uses—a pinch of health services here, a dash of education there—into the mixing bowl to create a new model that, if successful, could prove to strengthen the mixed-use movement for the better.
...
Many so-called mixed-use projects that retail developers have built in recent years were not truly mixed-use, in the strictest sense of the term. The Urban Land Institute defines mixed-use as “projects that have three or more significant revenue-producing uses; significant functional and physical integration of the different uses; and conform to a coherent plan.” But some developers have pawned off residential towers with first-floor retail as mixed-use. In other cases, multi-phased projects where residential, retail and other uses are built next to each other in distinct zones have been termed mixed-use. It’s become clear that these projects are merely retail centers with ancillary uses tacked on. They are not actually integrated projects.

Testify, can I get an Amen! "Residential with ground-floor retail" applies to far too many of our developments over the last decade, while "residential and retail in distinct zones" describes the Encounter Bay "Village", for example.

True mixed-use centers, experts argue, are projects that have a life of their own and where the success or failure is shared because of the integrated nature of the projects.
...
In short, what developers and retailers are quickly learning in this climate is that the old strategies don’t work in this new economy. The key to success is deeper diversification while also being as creative as possible in terms of lease terms and financing and bringing in nontraditional tenants. Moreover, making sure the project is original and truly tied to the existing community is crucial.

Cookie-cutter mixed-use projects that appear to have dropped from the sky with no connections to the existing urban fabric are not succeeding. Ones that are more integrated are performing better.

So local context is back on the table, and generic, one-size-one-plan-fits-all development is asking for trouble (and I'm looking at you, Newport Quays). I think it's really exciting to see an industry rag saying things like "making sure the project is ... truly tied to the existing community is crucial". In the past there's been too much talk about increasing the "productivity" of development by reducing design costs (ie design once and build multiple times, like in tract-housing); now the talk is changing from that being a cost to it being an investment.

Which brings me back to involving the community more in development. Far from stopping people from turning a profit, I believe that it offers the chance to help them make money. The bulk of the cash flowing into a typical development comes from people living in the area around it (until you reach the size of, say, Marion) - getting those people involved in what to build there just plain makes business sense. An expert that is remote from the locality suffers the crucial weakness of lacking context.

[Aidan]

That seems to be long on buzzwords and short on meaning!

I think we could really do with more land to be zoned mixed use, especially along major roads in the inner suburbs, but who cares if it's truly mixed use in the strictest sense of the term? Do you really think there's anything wrong with residential with ground-floor retail?

[Prince George]

That seems to be long on buzzwords and short on meaning!

I think we could really do with more land to be zoned mixed use, especially along major roads in the inner suburbs, but who cares if it's truly mixed use in the strictest sense of the term? Do you really think there's anything wrong with residential with ground-floor retail?

Yes, I do, especially when it's practically the only thing that we build - the problem is that we tend to walk away at that point and think "job done, I must have a thriving community and an active street level now, because there is retail on the ground floor". I care about real vs faux mixed-use because the real stuff produces places that are better (more interesting, more vibrant, with better lifestyle and employment) than the fake stuff. This article is saying that developers should care too because the real stuff produces better financial outcomes than the fake stuff - that's what the New Urbanist people have been claiming for some time, and it's good to see that talk spilling over into the industry (even if only a little).

Take the example given at the bottom of the first page of that article - a 20,000 square metre development in Chicago that included medical services and a school to improve the value of it's location to it's anchor tenant REI

For REI, the outdoor lifestyle retail anchor on the site, medical services at the facility create a steady stream of traffic, and business, says Michael Drew, cofounder of Chicago-based Structured Development LLC, adding his retail tenant is “doing exceptionally well” as a result. “Having Towne & Country in the mix is attractive to other tenants,” Drew says.

The British School, another tenant, has 600 students, and offers REI an additional pool of potential business. Drew says parents drop off their kids at school or for an appointment at the doctor, and then end up shopping at REI. “Between all of these, we have created a more synergistic mixed-use center,” Drew says

The point of these efforts is to provide a reliable level of activity in the location, which likewise helps avoid the "deadzone during the week" that plagues so much of our single-use suburbs:

There should be a constant flow to and from the site for much of the day and not just during morning and evening rushes. Achieving this flow requires a true mix of uses that draws traffic at different times and for different reasons. Key connections to mass transit don’t hurt either. And an integral piece to this all—developers are finding—is bringing in uses that are not conventionally considered one of the main commercial real estate food groups (office, industrial, retail, multifamily and hospitality).

This all adds up to putting in more work when planning a development than just pencilling in a Witchery outlet under a set apartments. But the results are worth it: apart from offering lifestyle choices that aren't well supplied in our current crop of developments, the developer also has a better chance of surviving the current downturn. Again, I think of areas like Newport Quays and wonder how that might have turned out differently.

[Aidan]

That seems to be long on buzzwords and short on meaning!

I think we could really do with more land to be zoned mixed use, especially along major roads in the inner suburbs, but who cares if it's truly mixed use in the strictest sense of the term? Do you really think there's anything wrong with residential with ground-floor retail?

Yes, I do, especially when it's practically the only thing that we build - the problem is that we tend to walk away at that point and think "job done, I must have a thriving community and an active street level now, because there is retail on the ground floor".

No, they don't ever think I must have a thriving community and an active street level. It's not the objective, and nor should it be!

I care about real vs faux mixed-use because the real stuff produces places that are better (more interesting, more vibrant, with better lifestyle and employment) than the fake stuff.

Oh great, you're throwing in another buzzword: vibrant!

It's great to have a vibrant City, but why do you want the suburbs to be vibrant? And what makes you think mixed use development has better lifestyle and employment than the single uses in close proximity? Or do you count the latter as mixed use even if they're zoned separately?

When I say mixed use, I'm referring to the absence of heavily restrictive zoning regulations, enabling the property's owners to decide what to do with it in real time, rather than having to apply to the council every time they want to change the use. What do you mean?

This article is saying that developers should care too because the real stuff produces better financial outcomes than the fake stuff - that's what the New Urbanist people have been claiming for some time, and it's good to see that talk spilling over into the industry (even if only a little).

Residential with ground floor retail is as real as any of the New Urbanist stuff!

Take the example given at the bottom of the first page of that article - a 20,000 square metre development in Chicago that included medical services and a school to improve the value of it's location to it's anchor tenant REI

For REI, the outdoor lifestyle retail anchor on the site, medical services at the facility create a steady stream of traffic, and business, says Michael Drew, cofounder of Chicago-based Structured Development LLC, adding his retail tenant is “doing exceptionally well” as a result. “Having Towne & Country in the mix is attractive to other tenants,” Drew says.

The British School, another tenant, has 600 students, and offers REI an additional pool of potential business. Drew says parents drop off their kids at school or for an appointment at the doctor, and then end up shopping at REI. “Between all of these, we have created a more synergistic mixed-use center,” Drew says

I can't even tell whether that's really mixed use at all! It could well be different single uses in close proximity, just labelled as mixed use because they happen to be in the same development. We don't need that - we already have lots of different single uses in close proximity, particularly in the inner suburbs. Allowing more mixed use development would create more of it, but it's not itself mixed use development.

The point of these efforts is to provide a reliable level of activity in the location, which likewise helps avoid the "deadzone during the week" that plagues so much of our single-use suburbs:

Now that's just silly! Our "single-use suburbs" are generally quiet because that's how the residents like them. Although most of those suburbs aren't entirely single use - I can't think of any Adelaide suburbs that fit that description. I suppose some of the industrial suburbs could qualify, but could those really be regarded as a "deadzone during the week"?

There should be a constant flow to and from the site for much of the day and not just during morning and evening rushes. Achieving this flow requires a true mix of uses that draws traffic at different times and for different reasons. Key connections to mass transit don’t hurt either. And an integral piece to this all—developers are finding—is bringing in uses that are not conventionally considered one of the main commercial real estate food groups (office, industrial, retail, multifamily and hospitality).

This all adds up to putting in more work when planning a development than just pencilling in a Witchery outlet under a set apartments. But the results are worth it: apart from offering lifestyle choices that aren't well supplied in our current crop of developments, the developer also has a better chance of surviving the current downturn. Again, I think of areas like Newport Quays and wonder how that might have turned out differently.

Really? What else do you think they should have included?

[Prince George]

It seems to me that you want some definitions, let's try these on for size.

In it's most general form, "mixed-use" refers to areas whose planning/zoning ordinances allow a combination of uses or activities to be provided there; as opposed to "single-use" where the area is clearly delineated in terms of what may be built - residential clearly separated from retail, separated in turn from offices, schools, or recreation.

While any development that combines more than one use (eg apartments with ground-floor retail) can be called mixed-use under this very broad definition, the most vocal mixed-use advocates -- such as New Urbanist designers -- would prefer to use a stronger definition that includes the relationship of the different uses to each other. Essentially, they are asking "given that somebody is already in the area (living, shopping, or working there), how many other aspects of that persons life could be satisfied by that area?"

In this regard, they are particularly interested in the distances between different uses, especially as it relates to the average person's "walking radius". That distance is really very short: very few people will consider walking for more than 1/2 to 1 km except as part of a fitness regime, and even at only a few hundred metres the majority of people will drive. Another typical figure that people use is the 5-minute walk distance. So let us take as a working definition of a mixed-use area as being "an area that provides several different and complementary functions within a 5-10 minute walk of each other". We can apply that definition not just for the people who live there, but for those who work or study there too.

Notice that we apply this definition to an area rather than a development, there are some good reasons for doing this. First, a large development may encompass several areas, each of which should be considered on its own merits. Second, a small development may be just a single-use facility itself, but within the context of the area where it was built it may be adding an extra use. That's the way that old neighbourhoods and towns developed. Third, it helps draw attention to the boundary and relationship between the existing areas and the new development.

With that in mind, let's look at Newport Quays. Stage 1 was a straight single-use development, stage 2 managed a marginal improvement by including a small amount of a second use. That gives the people living in that area a single extra option (eating locally vs travelling some distance for a meal), what about the people that work there? For them there are practically no extra services that are close for them, so unless they happen to live there too, this is a single-use area. Similarly, what has been built has added very little of value to the people already living in the surrounding areas. Consequently, we may say that although it is a "mixed-use" area in that most general definition, under our stronger definition it falls very wide of the mark.

As I mentioned in the Newport Quays thread, I wonder how things may have turned out had the project started from the northern end, where there is the opportunity for better connections with the existing areas. Each of them can then benefit from proximity to the other one: the people living around there gain new services, businesses, or recreation choices; the businesses opening in the new area have a pool of customers that are already present (rather than having to hope that people move in); existing businesses in the area gain a new group of customers as people move in.

Or what about Mawson Lakes. Taken as a whole, Mawson Lakes has employment, retail, education, and residential aspects, it seems like it has good mixed-use credentials; but when we consider the scale of the 5-10 minute walk radius, these uses are separated into distinct areas. It would not surprise us, for example, if most people living in Mawson Lakes would drive to their "Town centre" just to buy a loaf of bread - that is a good indication that the area does not meet our stronger definition of mixed-use. The new areas to the north of the town centre (is that "Mawson Central"?) are showing signs of being an improvement on this. They have a range of useful facilities within a short walk of each other.

So these two areas have parts that are "apartments with ground-floor retail", but one of them looks promising and the other does not. What's the difference? Principally that at Newport Quays that's all that there is, and that the sample at Mawson Lakes has more around it to provide still further options for the area. This is the problem that mixed-use advocates have with something like Newport Quays; if it is allowed to call itself "mixed-use" then it may paint a negative picture of the whole concept - people may confuse the failings of a dubious example with being a failing of mixed-use in general.

Finally, there were a couple of places where I didn't make my meaning clear. When I said "I must have a thriving street-level now", I meant "I must have" in the sense of "I am certain that I have done this" (as in "I must have walked for an hour by now") and not "I must get this" (as in "I must have an inner-city stadium"). I believe that there are many developers/planners/councils who have been convinced (some by reason, some by compulsion) that they should be considering mixed-use elements, but that go no further than this most simple of mixed-use forms and think "well, I guess that's my job done". As the article was saying, there is no one-size-fits-all solution, and each place really deserves to be thought out on it's own merits. A building that works fine at Mawson Central may not work at Newport Quays.

Later, when I wrote "better lifestyle and employment" I was missing a couple of words from my intentions. It should have read "better range of lifestyle and employment options". The typical areas that we have at the moment support a single kind of lifestyle - driving almost everywhere. The mixed-use ideas that I'm talking about here aren't likely to eliminate that option, but they are going to add others.