The years following the onset of COVID-19 have led to a series of changes in the wider economic landscape. These then prompted the real estate industry to adapt to the pandemic\u2019s many ripple effects, including the current inflationary environment, the rise of interest rates following a decade of quantitative easing, and fears about a looming recession.<\/p>\n
Yet, in spite of these changes, the Foot Traffic Ahead 2023 report \u2014 commissioned by Places Platform LLC and Smart Growth America (with Yardi Systems as one of the research partners on the study) \u2014 found that Americans\u2019 love for walkable urban areas remained strong. In fact, they were even willing to pay a premium to be a part of or bring their businesses into such communities.<\/p>\n
The report distinguished between four types of urban spaces based on how they scored in terms of walkability or drivability, as well as size: The categories included type I walkable urban places; type II walkable neighborhoods; type III drive-ins; and type IV drivable sub-divisions.<\/p>\n
Gauging the walkability of the 35 largest metropolitan regions in the U.S., the analysis found that amenity-rich, dense, mixed-use communities that could be reached through public transit and crossed easily on foot often came with a significant markup in price.<\/p>\n
Notably, this premium was largely due to limited supplies because, generally, less than 5% of a region\u2019s land can be considered walkable. As a result, many of the people who would benefit most from the advantages of these communities were priced out.<\/p>\n
Meanwhile, as far as real estate assets, the price of office space was most likely to be influenced by its location within a walkable urban location.\u00a0For instance, the office premium was as high as 105% in New York City; 83% in Boston; 56% in Chicago; and 36% in San Francisco.<\/p>\n