On the importance of integrating urban planning and real estate development

Check out this article that was just published in the October 2012 issue of Tracings, the American Institute of Architects' Santa Clara monthly newsletter! I was asked to write  a piece about urban planning for the AIA because I am on the steering committee of the Urban Land Institute's Silicon Valley chapter. As an urban planner now immersed in real estate investment and development, it is clear to me that planners and developers must collaborate more effectively if we are to create and sustain a truly successful built environment. Click here to access the full Tracings newsletter; or, here is the text of the article:  

Innovation through Integration: Urban Planning and Real Estate in the 21st Century

Changes are afoot in the fields of urban planning and real estate development, and the implications are exciting. In order to manage and enhance an increasingly built-out urban landscape in an economically, socially, and environmentally sustainable manner, it is essential that urban planners and real estate professionals collaborate in all aspects of development.

As an in-house urban planning analyst for a local real estate investment company, it has become clear to me that integrating each discipline’s way of thinking into the other is a win-win situation, yielding more effective solutions across the board. For example, sharing real estate development experience with city staff and elected officials about successful parking ratios, optimal commercial ceiling heights, or engaging storefront design, can help local government make more informed decisions about zoning changes or resource allocation to retail districts. In turn, an urban planning perspective can help developers realize that improving pedestrian accessibility or public gathering space can yield significant benefits both to nearby real estate holdings and to the community.

Unfortunately, these two sectors have often been siloed; they are traditionally taught and practiced separately, often breeding disconnect and misunderstanding. Yet urban planning and real estate are inextricably linked and are each critical to the other’s success. Both professions are motivated to create a successful and enduring built environment, which requires a deep understanding of the political, economic, environmental, and land use contexts of a place. Both planners and developers are keenly aware that whether buildings, infrastructure, or open space, projects must be appropriately placed and programmed else they fail - either disappointing investors and tenants in the case of developers, or the taxpaying community in the case of planners. Although the metrics for success are measured somewhat differently - planners may look for public benefit while developers may look to market returns - integrating both can reveal a more comprehensive picture of how and where to allocate public and private investment in the built environment.

Integrating Urban Planning into Real Estate Development

Real estate professionals can benefit from standard urban planning approaches in several ways. To best assess where and how to prioritize real estate investment, it is important to understand local planning and political processes. Keeping abreast of local politics, understanding the goals and priorities of the local government, and maintaining positive relationships with elected officials and city staff, can greatly inform the private sector’s decisions about existing and future development opportunities.

Second, adopting an urban planning attitude of “doing what’s right” rather than simply “doing what’s profitable” can go a long way towards creating successful development projects. It is useful conceptually to expand the client base for a development project to include the local community, regardless of the project’s actual function. Projects that have the support of the community often get approved faster, may require fewer costly revisions, and may be more likely to be well-regarded and thus increasingly desirable for occupants over time. Doing what’s right can often result in truly context-appropriate projects that are more likely to be successful over the long term.

Particularly here in Silicon Valley it will be the real estate professionals who embrace the interdisciplinary approach and comprehensive scope of urban planning, who will be able to create projects that endure successfully - in other words that are well suited to place, time, and community. Today the ramifications of ill-fitting commercial, office, and residential projects are ubiquitous, in the form of vacancies, high turnover, and bankruptcy. Thinking holistically and innovatively about not just conventional return on investment but also the quality of the pedestrian environment, transit access, proximity to open space, and local government priorities, may help make the difference between a short-lived problematic development project and one that continues to flourish over time.

Integrating Real Estate into Urban Planning

In turn, “urban planning 2.0” must collaborate with and value the development community as an important ally in our collective quest to better the built environment. With the dissolution of redevelopment agencies, cities still cash-strapped by Proposition 13, and more, city planners must increasingly turn to public private partnerships (P3s) to implement innovative and effective projects. Private development projects can typically be constructed more quickly and cost-effectively than public projects, and private funding can supplement limited public resources on projects.

Additionally, planners should better recognize and incorporate feedback from developers regarding their experience with project entitlements and permits. Developers have lived and breathed their projects and have valuable feedback about how zoning, land use, incentives and limitations influence development, and whether or not these planning tools actually have their intended effect on the built environment. Developers can recommend ways to streamline existing processes, and have the experience to insightfully critique local government policies that may be misguided or shortsighted. As a whole, the urban planning community would do well to solicit more feedback from local real estate voices, to ensure that it is optimally allocating finite public resources to the best projects that will yield the greatest positive change in the community.

The 21st century is seeing greater interdisciplinary collaboration across nearly all disciplines, as the complexity of problems in our built and natural environments increases. In the face of a sluggish economy, increasing urban population density, shifting demographics, and climate change, the stewards of the built environment - planners, architects, engineers, developers - must work together to ensure that our future cities are economically, socially, and environmentally sustainable.

Brooke Ray Smith is an urban planning analyst with the Passerelle Investment Company based in Los Altos. She holds a Master of City Planning and a Master of Landscape Architecture from UC Berkeley, and a B.A. in Biology from Williams College. A Mountain View native, she now lives in San Francisco and can often be found cycling down the Peninsula to work or playing ultimate frisbee.

Brooke Ray Smith

Urban Planning Analyst, LEED AP/GA

Urban Land Institute - Silicon Valley