As we reflect back on our 2 day visit at National Harbor during ICSC’s 2013 Mid-Atlantic Conference, it’s hard to think that only a few years ago, we were sketching master plans and building models to create this very destination. As always, DDG embraces the discussions that occur at the conferences we attend as it is a good way to stay in tune with the industry trends. That being said, here is our take on what we saw and heard in our latest show participation.
1. Washington D.C./Maryland Corridors’ Enticing New Opportunities
The conference’s main focus rightfully centered around Washington, D.C., Virginia, and Maryland’s underserved retail market. The median sale price per square foot for retail properties in the Washington metro area is at their lowest in three years according to loopnet.com statistics. Washington, D.C. is one of the top five commercial real estate markets in the United States. While neither D.C. nor our own state of Maryland have been fully spared the economic downturn, our region has fared well. D.C. in particular, due to its strong economy based largely on tourism and government activity, continued high expected population growth, and low unemployment rate, continues to be a hub of retail activity.
It has been noted before when overseas retail brands are looking to venture into the states, New York City is the primary gateway for their retail launch. It appears that Washington D.C. is quickly stepping up as a more optimum alternative due to greater opportunities and a large underserved population with disposable income. One doesn’t need to look further than the busy streets and shops of Bethesda, Maryland or Georgetown in Washington D.C or our Harbor East in downtown Baltimore, Maryland. A quick survey of the average median income for the surrounding opulent areas clearly paints a picture of the market base. Foreign retailers stand to make a greater profit entering the U.S. retail market through our region.
2. Transit, Transit, Transit
As our communities continue to change, we focus on crafting the ultimate environments meeting the needs of every individual. The growing population and changes of our communities, transit mixed use developments are what is and will continue to be the focus and priority for the region. As our population grows, it is exceeding the capacity of the highways and inadequate public transportation options. As a result, in the past few years there has been an increase in public transportation solutions across the Mid-Atlantic area cities. A renewed interest in the pedestrian experience is changing the way developments are planned.
We spend a lot of time in our cars – examine the list of worst commutes in the U.S. The way we spend our time is also changing and where we choose to live is shifting. More and more individuals and families are moving into areas where they can live, work and play with ease. Motivations not equal – for some it’s about saving money (both parking and gasoline), for others it’s reducing emissions and living a more sustainably responsible life, for another it’s simply saving time and providing convenience, and for many more it’s about creating a connected community. Whatever the reason, commuting in various ways is encouraging a great focus on our transit environments.
As transit mixed-use developments are being embraced, the developers are paying attention. More projects like Station Park in Farmington Utah, are springing up around transit hubs than ever before emphasizing the commuter and pedestrian experience. It is no surprise that when new developments are being planned and designed even in a more suburban setting, establishing methods of connecting these through transit to encourage attendance is at an all time high.
3. Urbanizing Suburbia
Did we run out of space in our cities? No. Do people in suburbia increasingly want conveniences that city living embodies? Yes! It seems as more main streets are revitalized they become arteries for larger, more thought-out projects encompassing ever more amenities, and spaces better designated for how we function day to day and not just during the week or the weekend.
As we have seen the past few years, a lot of malls in mature suburbs have been remade into open-air mixed-use developments that feature many components of a traditional downtown area and retrofitted to be a main street style of living (i.e. Peninsula Town Center). Increasingly, more suburban thoroughfares are now being thought and designed towards an urban downtown style of living. A mixture of components to create the ultimate mixed use areas with proper infrastructure are catalysts for turning suburbia, like Fairfax Corner in Virginia or National Harbor in Prince George’s County Maryland, into urban style environments and establishing edge cities. Areas with low offerings but a high potential population that is underserved are being redeveloped to increase revenue and produce performing assets while also creating areas better suited to retain and attract population. These suburban zones are shifting to better fit their communities and are creating new opportunities along the way.