Real Estate Industry News

The car industry as we know it is changing. Peak car is on the horizon; automobiles are predicted to become largely obsolete by 2035, and two-thirds of Americans expect most cars to be driverless in the next half-century.

In the wake of this transportation revolution is a new mobility renaissance that is impacting our world. This reality marks the most profound change in the real estate industry: the opportunity to reimagine cities without cars and take the streets back for people. As cities prepare for the changes to come, two things are certain. Cities that prepare for the new mobility order will have the opportunity to enhance the human experience, and those that don’t respond will halt their growth as they make their way into the future.

When I first began to contemplate what the changes in mobility would mean, the first signs of disruption had just begun. In 2010, the innovation of ride-sharing hit the streets. Since then, much has changed with the movement to introduce more bike lanes and the mass migration of electric scooters on urban streets. But what has become most apparent is that the ride-share and micromobility economy are simply precursors to the biggest game-changer of them all: autonomous vehicles. Viewing these mobility changes through an architect’s lens, I began to ask myself how mobility and the driverless car would change the foundation of the built world.

Until recently, most people have focused on the evolving technologies of mobility companies. We, on the other hand, wanted to analyze how the foundation of our cities and the real estate industry would need to change to become vibrant places to live, work and play.

The Mobility Opportunity: Transforming Our Cities

The opportunity to reimagine cities as places for people has been a real estate gold mine since the first great inflection point of mobility, which was the introduction of the Model T. When Henry Ford created and popularized the car, the world changed indefinitely. The streets had originally been lined with people and merchants, but with horse carriages falling to irrelevancy and the speed of cars becoming dangerously fast, cities began to reconfigure to suit the car. The tradition that started in the early 1900s has continued since then, but with the onset of a new mobility ecosystem, there is an opportunity on the horizon.

Mobility Today

While some cities have been created for pedestrian use, such as New York City, which turned Times Square from a car zone to a pedestrian zone, the truth is that many more cities are not made for people. In the U.S. alone, as of 2017 there were roughly 272 million cars registered to a population of about 325 million.

While there is no denying that these cars perform a service, what cannot be ignored is that, for the most part, cars simply take up space. On average, a car in the U.S. is parked 95% of the time, and that’s just the tip of the iceberg. In Jackson, Wyoming, there are 27 parking spaces per household. The opportunity lies in taking the spaces made for cars and creating people-centric spaces.

Upending Real Estate

The driverless car is the crux of the new mobility ecosystem, which includes public transit, bikes, electric scooters and other vehicles that are still beyond our imagination. As mobility changes to become more accessible, people will demand even more vibrant, robust, mixed-use communities, all of which function best when served by multiple transit options. With the availability of new space, there will be a new era that’s focused on shifting city planning from vehicle-focused to pedestrian-friendly. The challenge (and opportunity) lies in preparing buildings and infrastructure today for what’s coming down the road.

Transforming Not-So-Prime Real Estate

When cars are no longer in use, the spaces that they occupy will be open for reuse. Most experts agree that most, if not all, driverless cars will be electric and that they will be programmed to exchange batteries in central locations. If cars no longer need gas, this leaves the 111,000 gas stations found across the U.S. open for redevelopment — not to mention car dealerships, car washes and repair facilities. For example, our firm is in partnership with a fitness apparel brand on plans to repurpose abandoned gas stations as fitness hubs where people can prioritize their mental and physical wellness.

Adaptive Reuse Of Parking

There’s no doubt that there will be new spaces primed for redevelopment, but tearing down buildings and then rebuilding goes against resilient practices. Instead, designers and cities have the opportunity now to future-proof buildings, like parking garages, that may one day be rendered useless.

What I’m encouraging clients to do is build flat-floor parking structures with either helical ramps on the outside of the structure that can later be removed or one-way ramps. I’m advising them to enclose these spaces to make heating and cooling easier down the road and to build higher floor-to-floor distances that can later be used for vents. These layouts allow for the flexibility and adaptability necessary for future use.

The impact of self-driving cars on the mobility ecosystem will lead entire industries to change, and people to change the way they think about how they navigate the world. Cities will continue to seek the democratization of their spaces to create more vibrant, accessible centers with a wealth of uses, including green space, retail and pick-up and drop-off areas. The downscale of traditional cars and upscale of driverless car technology will only help push those goals forward. It’s going to be a radical change in scale and a reimagination of how we allocate space. The transformation starts now.