Gas Prices and Development
Well, it has finally happened. As we all know, gas prices have shot through the roof, and it is hitting us all in the pocket book. In my opinion, we have been living on borrowed time for a long time with relatively low gas prices, and it is finally time to pay the bill. People have been asking me a lot lately what this will mean for the development industry that is already down and out for the most part. To me, it basically means that most of the things I have been predicting for the last decade are finally going to come true, and we will have a paradigm shift in the way people live their lives. We are finally going to have to recognize resource conservation, and not just gasoline. Anyway, here are a few of my thoughts.
DOWNSIZING
No, I am not just talking about the empty nester’s who don’t need all that room now that the kids are gone. People are going to start realizing that they don’t need the McMansion’s on the hill, 5-6,000 square feet with 1 acre and more lots. Not only is this a lot of house to heat, cool, and maintain, but that is a lot of ground to maintain, water, fertilize. People are going to look for smaller homes, I say in the 1,800 to 3,000 square foot range on smaller lots. They might even become adjusted to raising families in townhomes, condos, or other high density living areas. The “Not so Big House” phenomena will become the norm, not just the latest fad.
But even more importantly, people are going to downsize there neighborhoods. They are going to want to live, work, and shop in relatively small geographical areas. People are going to become increasingly more willing to live in New Urbanism style developments with mixed income, mixed product, and mixed lifestyles all wrapped together. The one size fits all mega-burbs with the look-alike homes are going to be a thing of the past. People really want a sense of community and belonging. And the with cost of transportation, they won’t want to drive 5 blocks to the pool, or 5 miles to the grocery store. They will walk or ride there bike.
Which leads me to my next point. I think we are going to see the rise once again of the corner grocery store…in the 10-30,000 square foot range. This supports the concept of sustainability and not having to drive for miles to pick up a gallon of milk. Of course, only denser development can support this kind of store.
This is happening now. As proof I offer up Stapleton, Lowry, and a host of other New Urbanism projects. In a down housing cycle, these projects are still selling well, and at a premium also. Stapleton is now about 1/2 built out, in only 6 years.
SUSTAINABILITY
Of course, this is hardly new, as being “green” is what it is all about. But there are multiple levels of sustainability. One level is building homes and commercial buildings that are energy efficient. This has been happening for some time now, and it keeps getting better. Of course, when I started building homes back in 2000, I was focusing on energy efficiency. Back then though, nobody wanted to pay the premium for that. I am always ahead of my time it seems.
However, another level of sustainability involves land conservation, redevelopment, higher density development, reduced sprawl, water conservation, etc. I think we will see community gardens become more popular. Maybe we will see edible landscapes. People are going to have to get used to more native and wild landscaping…and not the manicured lawns with lollipop shrubs.
We are already seeing recycling becoming a way of life…now people are getting into composting. All of this keeps stuff out of the landfill. I think we are starting to see a paradigm shift of quality versus quantity. People will buy things that will last for years, and not look at products as being disposable. If it breaks I will just get a new one. I know I have been guilty of that myself.
Anyway, I had some other thoughts, but at the moment they escape me. Of course, none of this will come about overnight, but I do believe that with the cost of transportation now, it will happen faster than it would have otherwise.
