February 7, 2014
Finding the Market for the Long-Term Vision
By: Melina Duggal, Senior Principal
Long-range projects, especially those in challenging locations, whether sponsored by the public or private sector, are very hard to plan. On the one hand is the vision—the far-reaching, often overly ambitious dream of what a place or a project can be. On the other hand is the current market—which may be dismal and suggest at best a low-density strip center. How can champions of long-term projects find the spot between the current market and the long-term vision that can actually be developed successfully? It’s what’s possible, but not necessarily probable.
RCLCO has worked on many of these types of projects over the years. They range from figuring out the development potential around stations of a future transit corridor in Charlotte to determining what the right mix of land uses would be for a new city in Florida. There are some great examples throughout the country of projects outperforming what the market at the time the project was initiated would have suggested. Who would have thought in 1964 that Reston, Virginia, would become what it is today? Or that downtown Chattanooga could be redeveloped so successfully?
Understanding the market for a long-term project, particularly one that is not consistent with current market conditions, requires different techniques than understanding a project that will be built in the next three to five years. RCLCO has an approach that considers long-term projections, case studies of successful projects in other areas, surrounding land uses, directions of growth in a region, the impact of transportation, and changing demographics. Here is what we have found that visionary, successful long-term projects have in common:
Working on long-term projects is exciting, and provides practitioners, champions, owners, the public sector, and developers a hand in shaping the future. Not all great places will be the same, and with a lot of patience, an understanding of the future market potential, and a little luck, we can continue to create great places where people want to live, work, and play.
Article and research prepared by Melina Duggal, Senior Principal.
RCLCO provides real estate economics and market analysis, strategic planning, management consulting, litigation support, fiscal and economic impact analysis, investment analysis, portfolio structuring, and monitoring services to real estate investors, developers, home builders, financial institutions, and public agencies. Our real estate consultants help clients make the best decisions about real estate investment, repositioning, planning, and development.
RCLCO's advisory groups provide market-driven, analytically based, and financially sound solutions. RCLCO's Public Strategies Advisory Group produced this newsletter. Interested in learning more about RCLCO's services? Please visit us at www.rclco.com/public-strategies