Commercial Investment Real Estate is the magazine of the CCIM Institute, the leading provider of commercial real estate education. CIRE covers market trends, current developments, and business strategies within the commercial real estate field.
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COMMERCIAL INVESTMENT REAL ESTATE 10 July | August 2017 Shifting Landscape T he transportation industry stands on the cusp of a remarkable evolution involving the deployment of many technologies that promise to revolutionize how people move about and potentially use land to support those technologies. Vehicles will communicate to one another through vehicle-to-vehicle connectivity and vehicle-to-vehicle infrastructure. That will facilitate communication of safety issues, such as accidents ahead and near-collision circumstances. Connected commercial freight vehicles will platoon to maneuver as a chain of trucks, drafting behind one another to create fuel savings. Vehicles also will become more and more automated, relieving the driver of many duties, such as imminent hazard braking and lane choices. Potentially, these vehicles will be driverless. The increased mobility anticipated by implementing autono- mous vehicles creates many possibilities. Until user patterns and preferences emerge and stabilize, the related effects on commercial real estate development are tough to predict. Nonetheless, the ramif ications are potentially dramatic. Three broad real estate trends and their potential changes may reasonably arise from adopting autono- mous vehicles. Urban Development Historically, urban development has followed the location of transportation centers and corridors. Implementing autonomous vehicles, however, could reduce dependency on traditional public transit. People may possess greater ability to live and work wherever they like. The need for city or commercial centers also might be reduced, causing suburbs and other traditional residential proper- ties to increase in popularity. Residential areas may be more accessible to work locations with the availability of autonomous vehicles, either used alone or in conjunction with transit. Additionally, with less need for parking, pedestrian areas may increase. Parking lots may turn into infi ll buildings. Building Design Both residential and commercial buildings will dedicate far less space to parking. With less parking required, some developers may elect to simply reduce the size and cost of buildings. Other developers, however, might prefer to increase the amount of space used for other purposes. Since parking in buildings can be particularly expensive to e-anjei/GettyImages Changes in transportation are poised to transform commercial real estate. by William J. Kohler and Ross J. Altman MARKET FO R ECA S T