Suburbia, Soccer Moms, SUVs and Smart Growth RCLCO RCLCO – Public Strategies Group P bli St t i G Shyam Kannan, Principal and PSG Director skannan@rclco.com New Partners for Smart Growth | February 2, 2012
Practice Areas Urban Development Urban Development Community Development RCLCO is a land use economics Economic Development firm delivering real estate Management Consulting strategies , market intelligence , Offices and implementation assistance Washington, DC Los Angeles Austin Orlando AUSTIN │ LOS ANGELES │ ORLANDO │ WASHINGTON, D.C . RCLCO
THE STORY REMAINS THE SAME PRE-RECESSION ~~ POST-RECESSION Preference for Single- Family Detached Home • 23% of respondents 55-59 years of age most likely to purchase small lot age most likely to purchase small-lot 85% 85% 82% single family detached (14% of those 80% 60+ and 13% of those 50-54 do, as well) 75% 75% 68% 70% • Family and pre-family buyers distributed between increased 65% preference for townhome or condo preference for townhome or condo products and custom homes 60% 55% 50% Current Future Home Desired Home Home Source: RCLCO 2007 Source: RCLCO 2007 2 RCLCO
Americans and Smart Growth 3 RCLCO
MOVING TO MIXED USE 2004 NAR SURVEY – EXISTING VS PREFERRED LOCATIONS 15.00% 10 00% 10.00% 5.00% Gen Y Gen X 0.00% Boomer Downtown City, Residential Rural Small Town Suburb (Mixed) Suburb (Resi) Eisenhower Eisenhower -5.00% -10.00% -15.00% 4 RCLCO
MOVING TO MIXED USE 2010 NAR SURVEY – EXISTING VS PREFERRED LOCATIONS 15.00% 10 00% 10.00% 5.00% Gen Y Gen X 0.00% Boomer Downtown City, Residential Rural Small Town Suburb (Mixed) Suburb (Resi) Eisenhower Eisenhower -5.00% -10.00% -15.00% 5 RCLCO
SMART GROWTH PREFERENCE BY HOUSEHOLD TYPE 0 200 400 600 800 1000 1200 8A 85 216 116 8B 94 202 149 9 236 592 381 10 237 555 397 11 179 379 230 HH Single No Children HH Single, No Children HH>1 No Children HH>1, No Children HH>1 Children HH>1, Children 6 RCLCO
SMART GROWTH PREFERENCE BY HOUSEHOLD AGE 0 200 400 600 800 1000 1200 8A 136 121 96 64 8B 159 129 119 38 9 384 379 329 117 10 407 370 308 104 11 298 213 199 78 18-34 35-54 55-69 70+ 7 RCLCO
SMART GROWTH PREFERENCE BY HOUSEHOLD INCOME 0 200 400 600 800 1000 1200 8A 196 97 124 8B 222 77 146 9 619 236 354 10 604 204 382 11 420 142 226 Low Mid High 8 RCLCO
PSYCHOGRAPHICS 101 UNDERSTANDING THE PEOPLE BEHIND THE NUMBERS Psychographic analysis describes categorization driven by personality values attitudes by personality, values, attitudes, interests, or lifestyles. It can be contrasted with demographic variables (such as demographic variables (such as age and gender), behavioral variables (such as usage rate or loyalty), and firmographic variables (such as industry, variables (such as industry, seniority and functional area). 9 RCLCO
PSYCHOGRAPHICS OF SMART GROWTH NOT WHAT WE EXPECTED TO FIND! Smart Growth-Favorable LifeMode Groups 15.4 16.7 7.2 15.1 7.3 9.3 9.9 9.5 9.5 High Society Upscale Avenues Global Roots Family Portrait Traditional Living Senior Styles Metropolis Solo Acts Other Groups 10 RCLCO
GEN Y DRIVING THE FUTURE OF REAL ESTATE RE-URBANIZING AMERICA THROUGH RECOVERY RCLCO Consumer Research shows: 77% of Generation Y plan to live in an Urban Core, and is re-urbanizing America year over year This is where the future of growth is – capturing Gen Y will be critical to economic vitality through 2050 4,200,000 4,100,000 4,000,000 3,900,000 3,800,000 3,700,000 , , 3,600,000 3,500,000 3,400,000 3 400 000 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 1 2 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 Number of 22 Year Olds Same 22 Year Olds Turn 25 NOTE: Number of 22-year olds is based upon birth rate and does not factor in death rates and migration. SOURCE: U.S. Centers for Disease Control and Prevention 11 RCLCO
HOW BIG IS THE MARKET FOR SMART GROWTH? ALMOST HALF OF THE ANNUAL MARKET WANTS TO WALK 700,000 600,000 500,000 400,000 Gen Y Gen X Boomers 300,000 Eisenhowers 200,000 100,000 0 Prefer Downtown Prefer City, Prefer Small Town Prefer Rural Prefer Suburb, Prefer Suburb, Residential Residential Mixed Use Mixed Use Residential Only Residential Only 12 RCLCO
HOW BIG IS THE MARKET FOR SMART GROWTH? ALMOST HALF OF THE ANNUAL MARKET WANTS TO WALK 4,000,000 3,500,000 3,000,000 2,500,000 Gen Y 2,000,000 Gen X Boomers Eisenhowers Eisenhowers 1,500,000 1,000,000 500,000 0 Prefer Downtown Prefer City, y, Prefer Small Town Prefer Rural Prefer Suburb, , Prefer Suburb, , Residential Mixed Use Residential Only 13 RCLCO
Americans and Transit Oriented Development 14 RCLCO
WHAT DOES THE REALTORS SURVEY SAY? EXPLORING PREFERENCES FOR TRANSIT 18. In deciding where to live, indicate how important it would be to you to have each of the following within an easy walk: very important, somewhat important, not very important, or not at all important RANDOMIZE a ‐ j AND PUT CODES ACROSS THE TOP (Q18a) a. Schools (Q18b) b Grocery store (Q18b) b. Grocery store (Q18c) c. Pharmacy or drug store (Q18d) d. Doctors’ offices (Q18e) e. Cultural resources like libraries or theaters (Q ) (Q18f) f. Recreational facilities like swimming, golf, or tennis (Q18g) g. A hospital (Q18h) h. (SPLIT SAMPLE COMBINED) Public transportation by (bus/rail) (Q18h_a) h. (SPLIT SAMPLE A) Public transportation by bus (Q18h_b) h. (SPLIT SAMPLE B) Public transportation by rail (Q18i) i. Restaurants (Q 8j) j Ch (Q18j) j. Church, synagogue, or other place of worship h h l f hi Source: National Association of REALTORS, 2011, RCLCO 15 RCLCO
WHAT DOES THE SURVEY SAY? ONE QUARTER OF THE MARKET WANTS FIXED RAIL TRANSIT 23% 76% Households with preference for Fixed Rail Transit Households without preference for Fixed Rail Transit Source: National Association of REALTORS, 2011, RCLCO 16 RCLCO
WHAT DOES THE SURVEY SAY? ONE QUARTER OF THE MARKET WANTS FIXED RAIL Preference by Household Type Preference by Age Group 19.7% 22.5% 70+ 2+ with Children 21.9% 55-69 21.8% 2+ No Children 22.9% 35-54 28.7% Single No Children 25.9% 18-34 0 200 400 600 800 1000 1200 0 500 1000 1500 2000 Transit Preference Total Respondents Transit Preference Total Respondents Preference byIncome Level Preference by Income Level 21.4% High 21.1% Mid 25.7% Low 0 500 1000 1500 2000 Transit Preference Total Respondents Source: National Association of REALTORS, 2011, RCLCO 17 RCLCO
WHAT DOES THE SURVEY SAY? PREFERENCES IN METRO AREAS WITHOUT RAIL TRANSIT Transit Preference Among Respondents in Metropolitan Areas with No Existing Rail Transit 70% 60% 50% 40% 30% 20% 10% 0% 0% Low Mid High Low Mid High Low Mid High Low Mid High 18-34 35-54 55-69 70+ Single No Children 2+ No Children 2+ with Children Source: National Association of REALTORS, 2011, RCLCO 18 RCLCO
WHAT DOES THE SURVEY SAY? PREFERENCES IN METRO AREAS WITH RAIL TRANSIT Transit Preference Among Respondents in Metropolitan Areas with Existing Rail Transit 70% 60% 50% 40% 30% 20% 10% 0% 0% Low Mid High Low Mid High Low Mid High Low Mid High 18-34 35-54 55-69 70+ Single No Children 2+ No Children 2+ with Children Source: National Association of REALTORS, 2011, RCLCO 19 RCLCO
So, Who Are These Transit People, Anyway? 20 RCLCO
TRANSIT-ORIENTED CONSUMER SEGMENTS LIKELY SUSPECTS ARE YOUNG, SINGLE, MOBILE Source: ESRI 21 RCLCO
TRANSIT-ORIENTED CONSUMER SEGMENTS BUT ACTUAL SEGMENTS ARE QUITE DIFFERENT Tapestry Segment Response % 18% 15.8% 16% 14% 13.1% 12.6% 11.9% 12% 10% 8.9% 8.7% 7.7% 7.7% 8% 5.4% 6% 4 0% 4.0% 3.5% 4% 2% 0.7% 0% One quarter of the total TOD demand comes from non-traditional sources - SUV drivers who live One quarter of the total TOD demand comes from non traditional sources SUV drivers who live beyond the traditional “urban” areas who have bought into a transportation trap. How likely will we be in luring back into higher-density environs that transportation modeling suggests is transit-supportive? suggests is transit supportive? 22 RCLCO
TAPESTRY SEGMENTATION BY LIFEMODE “HIGH SOCIETY”: TOP SURVEY RESPONDENT CATEGORIES LIFEMODE SEGMENT L1: HIGH SOCIETY Affluent and well-educated Represent approximately 12% of US households G Generate nearly 25% of total US income t l 25% f t t l US i Professional/management positions Most ho seholds are married co ple families Most households are married couple families living in affluent neighborhoods, with a median home value of $320,000 One of least ethnically diverse groups but One of least ethnically diverse groups, but one of the fastest growing Travel extensively Source: ESRI 23 RCLCO
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