Those of us living in Seattle can walk down any street in South Lake Union, near the waterfront, in the Belltown or Ballard neighborhoods, and typically see the same thing: an abundance of redevelopment.
Paladino’s headquarters city is known as one of the “sexy six” real estate markets for a number of reasons, including job growth, a population boom, and increasing opportunities for investment in mixed-used development.
It’s a familiar scene in other cities throughout the country. Hot spots like New York, Los Angeles, San Francisco, Boston, and Washington, D.C. are also experiencing rapid growth and development, fueled by high-demand jobs, technology, and a shift in the preference of many, including Millennials, to move into bustling, convenient city life.
Seattle’s urban fabric is changing all around us, and at a rapid pace. It’s happening not just within Seattle’s city core, but throughout the Puget Sound region with the planned light rail expansion. In particular, the city’s mixed-use development is helping to create communities that are vibrant and healthy centers of economic activity.
It’s not just our beautiful setting driving construction in Seattle. Growth in population and the employment base are the two primary market indicators that real estate investors and developers use to make decisions regarding mixed-use. Seattle is top ranked in both categories.
In 2014, Seattle had one of the largest population growth rates, due to people relocating to the area for its healthy economy and job availability. This means that others around the country see Seattle as a desirable place to live. Individuals relocating here are young, educated and following lucrative employment opportunities.
Seattle is also fostering a healthy start-up market, while anchor companies like Amazon are expanding their campus and spearheading large urban redevelopment in the city core. In 2013, Seattle was voted the number one city for technology jobs (Forbes, 2013), the eighth city in the U.S. for real estate investment (Urban Land Institute, October 2014) and eighth for a moving destination in the U.S. (U.S. Census Bureau, January 2013).
In addition, the Seattle/Puget Sound region is currently undergoing unprecedented transit planning and expansion, making it even more desirable for mixed-use development investment.
These factors, combined with a city focused on sustainable growth and transit oriented development, are all contributing to the region’s position as a target real estate investment market.
Growing a City Sustainably
Mixed-use development is, by nature, sustainable. A variety of uses and services are integrated into a single building or campus, which reduces development pressure on greenfields. These types of developments are typically located near or integrated with multi-modal transportation options, which reduces air pollution from cars. Mixed-use development also enhances an area’s unique identity and can promote a sense of place and community.
But the benefits and sustainable-by-nature qualities of mixed-use may not be enough to distinguish different developments in a crowded marketplace. In Seattle, most current developments have incorporated energy and water saving features to some extent, but by now that’s just considered table stakes.
A thoughtful sustainability strategy centered on the values of the community can differentiate a project and appeal to younger tenants who are more likely to demand green features in their homes and communities.
Building a Mixed-Use Sustainability Strategy
At Paladino, our approach is to evaluate the abundance of resources on the site and recommend how a builder can reuse, capture or grow them. If you are a developer, take the time to look at your investment holistically, from the people to your bottom line. How can you enhance current developments and achieve a high ROI on new construction? How can you improve the livability of your developments? What will help you obtain the fastest lease-up rates and beat out your competitors for overall dollar per square foot?
Paladino’s mixed-use market team will address these questions in an upcoming series of blog posts, shedding light on best practices and the latest industry trends. We’ll share lessons learned from our mixed-use projects and how they can help you find your niche that brings quality—and tenants—to your development.
You can expect to see the following topics in the coming months:
- How to leverage the focal point of a sustainable community: Finding the environmental marker of a community and designing your strategy around it.
- The impact of transit oriented development: A preview of development happening around the upcoming light rail in the Puget Sound and the impact on neighborhoods outside Seattle’s urban core.
- The power of resilience: Creating communities and buildings that are adaptable for climate change, varied space and use types, evolving space demands and tenant desires, among others.
Stay tuned for our next posts in this series for ideas about planning and implementing your mixed-use sustainable projects. To automatically keep receiving our weekly Abundance posts, please click on one of the subscription options below.
Julia Raish is a manager at Paladino Seattle and leads the mixed-use market team.