So much of what happens in the land, brokerage, construction, and real estate development business is about understanding market trends with a heavy focus on longevity. It is up to the experts to note how lifestyle works long-term, where people will want to live in proximity to their jobs, what sort of transportation is available to them. And infrastructure matters. We in the business ask, “Where is the staying power?”
While we often point to Over-the-Rhine (OTR) and The Banks as the region’s showplaces, the reality is that the majority of residents in this 14-county region live and work outside of these areas. They are car-dependent, working longer and later into life, and reinventing themselves.
Those who work in the commercial real estate and residential development businesses follow housing trends. Today cross-generations live next door to one another, and our current workplaces reflect the same sentiment. This means that new structures must appeal to a diverse population.
Generations Living Together
The industry primarily serves two different demographics, the millennials entering the workforce, and the baby boomers who are approaching retirement, which is a vibrant dichotomy with the live, work, play type of community. There are 25-year-olds hanging out with 70-year-olds. This happens both at home and at work. Not to mention that as housing costs rise and occupancy levels near 100% in decently populated areas, the demand for more housing that can accommodate people of all ages is in high demand. Commercial real estate brokers are seeing more and more investors looking at residential development projects away from city centers, because that’s where people want to go. They want more space, the ability to house multiple generations of family, but with the conveniences of being in proximity to resources like commercial corridors and public transportation.
Folks in our business must accommodate preferences that appeal across a large swath of living. We make a well-educated decision on what will work best in the future. Again, what will have staying power?
Our industry connects the dots and the data from the past and the future, and not just with living situations. Real estate development companies have to consider all aspects of daily life when investing in new projects. In doing so, we look at places such as restaurants and where their industry is heading. This speaks to seating and types of layouts necessary for food establishments. With the onset of COVID, restaurant and retail spaces need to accommodate different layouts. This has implications for large and small businesses alike. As a result, we’re seeing a significant and abrupt change in what constitutes the best small business growth strategies as well as corporate company expansions. Everything is a delicate balance of achieving that staying power but retaining the ability to adapt to an ever-changing residential and commercial real estate market. This is something that we consider as we recommend commercial projects and their success. It’s all about living and working together.
Going Green Matters
We are also living in a time in which sustainability and “green” construction matter. These are no longer buzzwords, but requirements. Schueler Group is currently constructing its second building for Melink Corp in Clermont County; Melink’s initial building was the first gold-LEED (Leadership in Energy and Environmental Design) building in Southwest Ohio. Melink is a national leader in sustainability. They understand that what they build today is a precursor for both work and the overall environment tomorrow. Melink is a serious leader in what is now a long-term movement. Our work with them is changing the face of industrial and commercial construction alike; we are trying to solve the problem of how to expand industry while reducing or eliminating its environmental impacts. Again, it is staying power with a heap of responsibility.
Where is the Most Growth?
While it is not often a media focus, there is tremendous growth in the outer belt and the suburbs of city centers. In Northern Kentucky, it’s the Amazon effect, so developers are looking for large tracks of commercial land to develop and build 500,000-, 600,000- or a million-square-foot buildings. This has transformed the commercial real estate market in Northern Kentucky as well as the region’s economy.
Warren County is also an important place that offers an incredible quality of life. It has a very diverse economy in Mason and Lebanon with tourism, Western & Southern Tennis Open, Kings Island, bike trails, and recreation along the Little Miami River. It combines high-end residential communities along with industrial properties, and considerable business growth in those areas. For these reasons, Northern Kentucky and Warren County, Mason, and Lebanon specifically will continue as high growth and desirable areas.
So How Does a Company Decide Where to Locate?
It is critical that we stay vigilant and not become too consumed by the big sexy projects and the “in places to live and work.” While Covington has been on the upswing, they are also losing jobs because of the closure of an IRS office. While this might sound minor, it will impact the region.
Good minds working together can mitigate the negative impact of any trend modification, be it employment or development. At the same time, we advise clients about stable areas that are primed for growth. CEO Mike Schueler says, “This business is a bit like gambling.” On one hand, commercial real estate development companies and growing businesses alike need to stay on top of market trends with constant research and monitoring. But on the other hand, as 2020 and on has shown all of us, you can’t predict everything.
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