Return of the Mixed-Use

In last 18 months, I had opportunity to travel across various parts of England and attended several important Real Estate forums. Two contradictory observations, I find:

-       There is huge shortage of housing

-       Vast land across England without population

I am sure, same would have been observed by several others in many countries. For a layman the solution seems to be simple, build houses for the people in this vast pool of land!

Why doesn’t it happen?

Before, we ponder over answer to this question, it is important to quickly scan through the history of settlement of humankind. Civilizations flourished around places, where it was easy to do farming and farms required water, hence an early settlement happened around water bodies, like lakes, rivers, etc.

Cultivation led to bartering and that led to trading. This developed locations from villages into towns into cities. Till this primary economy stage, people continued to live and find livelihood in the same location.

While cottage industry like cheesemaking, shoemaking or manufacturing of small agricultural tools stayed closer to the settlement, the wave of industrialization forced workspaces outside the settlement due to various reasons such as the requirement of larger space or associate challenges such as pollution, etc. Over a time period, the entire ecosystem such as labour pools, supplier concentration and logistics hubs complemented the industrial ecosystem in the outer periphery of the cities, the distance between living zone and working zones started increasing. This helped in improving the manufacturing outputs but it started reducing the personal time for the workers and a typical worker would invest a significant amount of time in daily commute for livelihood.

However, as tertiary sector started emerging, professions like finance, legal and medicine, required a limited amount of space and hence sprung near human settlement. However, as they started growing due to their better profit margin per head count, they started buying living spaces and people started moving out to places which were livable and accessible but not marred with problems of traffic, pollution and noice,etc. In this case, the Central Business District grew for services sector and human resources came from far and wide to work here during the office hours.

Depending upon the growth, availability of land space and acumen of people responsible for shaping the urban landscape, each city evolved differently. For example, cities like Bangalore which is one of the major IT Centre of the world, two sizeable destinations outside the city are ITPL and Whitefield. On the other hand, cities like London which is one of the major financial centres of the world, continues to hold major financial institutions in the central zones.

It is quite common to see that in Bangalore, thousands of workers go outside the city to work and in London thousands come inside the city in the morning and this gets reversed in the evening.

At the same time another parallel phenomenon occurs, these bustling work centres become deserted during non-work hours. These locations with super high investment in real estates, do not operate 24 hours. On the other hand, more people travelling to work leads to an increase in investment in the public infrastructure such as roads, rails, water supply, electricity, internet, hospitals and banks, etc in not only in the work zones but also where people live. Essentially on the one side there is less usage of investment in one place and on the other side there is more demand for such services. This brings pressure not only on the fiscal aspects but also on social aspects.

Emphasis on revitalization of high streets, conversion of an office building into residential, purpose built to rent projects are some of the attempts to address these issues.These are reactive approaches to the evolution of live-work-play space imbalance.

The proactive approach is to return back to the Mix-Use Real Estate Projects, that’s where it all began.

Mixed-use real estate projects have two or more of the combinations, among residential, commercial, retail, entertainment, cultural, institutional or industrial uses.

To address my earlier two contradictory observations, there is a shortage of houses in the areas where there is livelihood and vast land is available where there is no livelihood.

Emphasis on mixed-use by planners and practitioners have answers to resolve this live-work-play imbalance to create sustainable economy and sustainable cities.

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Prakash Singh is currently Chief Operating Officer of Strawberry Star Group. Views are personal. Edited by daughter, Sarah Singh.