Urban planning community

+ Reply to thread
Results 1 to 18 of 18

Thread: Predictions about suburbs

  1. #1
    Member
    Registered
    Jan 2009
    Location
    San Francisco, CA
    Posts
    1

    Predictions about suburbs

    Been reading about the "perfect storm" that's supposed to hit mall retailers in 2009. Between that and some of the other dire talk out there--about gluts of unwanted McMansions, dying big box stores, etc.--I was wondering:

    What suburban cities or regions across the U.S., if any, do you think are most likely to be notorious candidates in the future for being hit with squalor and emptiness due to these factors? Kind of a newbie to the subject, so please pardon any ignorance inherent in the question, but curious.

    Not thinking so much along the lines of far-fetched "death of the suburbs" predictions as much as, what over-optimistically-conceived suburban regions in the U.S. are likely to become miserable foreclosure alleys by 2010? Any help much appreciated...

  2. #2
    Cyburbian Brocktoon's avatar
    Registered
    Apr 2006
    Location
    Promoting synergies...
    Posts
    3,558
    The states that will be the worst hit are the states that depend on sales taxes as their primary source of revenue since they were the regions that were most likely to overbuild retail. Arizona is a prime example. 2008 was the first time in 20 plus years that less than 1M of commercial/retail sq footage did not come online.

    Almost every state is dealing with foreclosures of houses of all stripes, not just the large Mcmansions.

    Remember that most of us believe in the business cycle and as things go down they also go up. During 1998 people were proclaiming the end of the business cycle. It was Dow 36,000 and we would never see another recession. After 9/11 things were bad and everyone thought they would be bad for a long time. In 2005 everyone thought that times were great and were never going to be bad again. In 2009 its terrible and its going to be bad for the foreseeable future. In reality we are in a longer than average recession but by 2011 everyone will probably be talking about how great the economy is and that what ever the current boom is will last forever.

    AZ, NV, FL, CA and the Rust Belt will probably take longer to recover but TX, and other extraction based states will recover faster once commodity prices improve.
    "If you don't like change, you're going to like irrelevance even less" General Eric Shinseki

  3. #3
    Cyburbian Raf's avatar
    Registered
    Feb 2007
    Location
    As far south of SoCal as I Will Go
    Posts
    5,289
    Quote Originally posted by Ron Smith View post
    what over-optimistically-conceived suburban regions in the U.S. are likely to become miserable foreclosure alleys by 2010? Any help much appreciated...
    Welcome to the Forum. I think all you have to do is take a car and go east my friend to along 580 and hit the central valley. A lot of folks here lived the suburban american dream on bad mortgages and thus has been heavily hit by the foreclosure crisis. With ag being the biggest industry job generator and next to that is the low wage service sector, it is tough to imagine this place coming out of the recession anytime soon. I don't think (along with many planners) that suburbia will die, or is dying as we speak because it has been driven in our heads for over 50+ years that we need to have a home, with a nice lawn and area in the back for the kids to play in, and thus the market demand for such housing has been on the rise since then. And now people who were priced out of the market will be snatching up the homes in suburbia at rock bottom prices and the cycle will eventually come around and home prices will rise and demand will rise and thus supply of these types of homes will increase eventually.

    Yes, the high oil prices had many people thinking about moving, but until people's preferences change to live in urban environments, home builders and our politicians will continue to build and approve these types of developments.
    follow me on the twitter @rcplans

  4. #4
    Suburbs are hard to generalize, just as central cities are. In general, the outer suburbs, where housing production moved way ahead of demand, where there are few services, and distances to jobs are great, may well have a decade or more of problems. Closer in suburbs, that are also job centers, have access to transportation and less of a supply demand balance, will probably pull through okay.

  5. #5
    Dan Staley's avatar
    Registered
    Dec 2007
    Location
    Front Range, CO
    Posts
    294
    Quote Originally posted by Gotta Speakup View post
    Suburbs are hard to generalize, just as central cities are. In general, the outer suburbs, where housing production moved way ahead of demand, where there are few services, and distances to jobs are great, may well have a decade or more of problems. Closer in suburbs, that are also job centers, have access to transportation and less of a supply demand balance, will probably pull through okay.
    Yes.

    There is also the possibility that businesses will recognize a latent demand for something other than bland McSuburbs and build some commercial to provide some services.

    The best way to ensure all is lost is to act like all is lost.

  6. #6
    Cyburbian Cardinal's avatar
    Registered
    Aug 2001
    Location
    The Cheese State
    Posts
    10,006
    I just completed an analysis in a community that has been averaging fewer than 200 residential building permits per year for the last decade, but between 2004 and 2006 saw an incredible amount of platting as developers all rushed to get the next subdivision in. There are more than 4,000 udeveloped lots platted - a 20 year supply. This is the kind of place that will be hit harder than most.

    From what I have seen, the housing problem is concentrated, but not in either suburban or urban locations. Rather, it is concentrated in area where there are a high percentage of homes that were developed or sold in the last few years. These are locations where people paid premium prices, often put down little money, and were more likely to use riskier mortgages. As a result, many of these homeowners are under water or are unable to refinance to a traditional mortgage. I have seen this in gentrifying parts of cities as well as on the developing fringe.

    The retail problem in the developing fringe is more serious than in established market areas. Often, stores will move in on speculation that a sufficient market will be created as development occurs. With new housing development nearly at a standstill, the store is unable to achieve the market density it needs to be profitale, or it is likely to be one of the less profitable stores in teh chain. As a result, it is a target for closure. These closures then make the mall a less attractive location. Landlords may be forced to renogotiate lower rents, or may not even be able to sign tenants. Without cash flow, the properties can go into default very easily. 2009 is expected to bring a wave of commercial mortgage defaults. The overall rate has already risen from about 1 percent to 2 percent of the total.
    Anyone want to adopt a dog?

  7. #7
    Cyburbian Richi's avatar
    Registered
    Jan 2008
    Location
    Tallahassee, FL
    Posts
    409
    Sone of the very old antiquated (pre any type land use control say late 50's 60's in Florida that took off a few years ago. These places often had mile after mile of streets paved with very thin asphalt and there was NO thought given to commercial nodes. Lehigh Acres east of Ft. Myers FL is a good example that a few months ago had a 25% foreclosure rate.

  8. #8
    BANNED
    Registered
    Nov 2008
    Location
    Templeton, Ca
    Posts
    417
    I would agree suburbs are suffering the most right now because the strip malls and enclosed malls are not doing so great.

    I would pressume once the economy picks up in 2010 the malls will slowly start to recover.

    Most malls aren't dying out because they have decided to change trends and use different marketing strategies. For example, outlet malls are getting stores commonly found in outlet malls and enclosed malls are getting outlet mall stores. The cities that have downtowns with streets full of clothing stores and eateries still seem to be doing okay.


    I am surprised right now that my area is still building shopping centers. Golden Hills Plaza in Paso Robles is under construction with Lowe's, Atascadero is close to getting approval for a Super Wal-Mart to be built, and in San Luis Obispo they are planning to build a Hyatt hotel in downtown. They also plan to break-ground on Prefumo Creek Commons, a shopping center in San Luis Obispo, that will include Target. I think my area is an under-served market, so that is why we are still getting growth.

  9. #9
    Cyburbian Plus
    Registered
    May 2008
    Location
    North America
    Posts
    1,991
    Quote Originally posted by urban19 View post
    I am surprised right now that my area is still building shopping centers. Golden Hills Plaza in Paso Robles is under construction with Lowe's, Atascadero is close to getting approval for a Super Wal-Mart to be built, and in San Luis Obispo they are planning to build a Hyatt hotel in downtown. They also plan to break-ground on Prefumo Creek Commons, a shopping center in San Luis Obispo, that will include Target. I think my area is an under-served market, so that is why we are still getting growth.
    urban19 - I'm in a difficult predicament here: on the one hand, I want new people to feel welcome at Cyburbia; on the other hand, you are painting a rather rosy short-term economic forecast for SLO County--a forecast with which few** informed people would agree.

    Would you care to offer an alternate economic forecast, or should I?



    **Exception: people vested in real estate there.

  10. #10
    BANNED
    Registered
    Nov 2008
    Location
    Templeton, Ca
    Posts
    417
    Quote Originally posted by Seana View post
    urban19 - I'm in a difficult predicament here: on the one hand, I want new people to feel welcome at Cyburbia; on the other hand, you are painting a rather rosy short-term economic forecast for SLO County--a forecast with which few** informed people would agree.

    Would you care to offer an alternate economic forecast, or should I?



    **Exception: people vested in real estate there.
    Please do offer an alternative economic forecast because I don't know how else to explain the growth.

  11. #11
    Cyburbian Raf's avatar
    Registered
    Feb 2007
    Location
    As far south of SoCal as I Will Go
    Posts
    5,289
    Quote Originally posted by urban19 View post
    I am surprised right now that my area is still building shopping centers. Golden Hills Plaza in Paso Robles is under construction with Lowe's, Atascadero is close to getting approval for a Super Wal-Mart to be built, and in San Luis Obispo they are planning to build a Hyatt hotel in downtown. They also plan to break-ground on Prefumo Creek Commons, a shopping center in San Luis Obispo, that will include Target. I think my area is an under-served market, so that is why we are still getting growth.
    I will take a stab, and this is a rosy assessment. The Lowe's and Super Wal-Mart have been in the pipes for years (and by years i am saying since the early 2000's when we examined these developments for courses) and the Perfumo Creek Commons has been delayed in definitely thanks to the inside sources i have (e.g. our chairman of the board for our company who spearheaded the project). The San luis obispo developments are urban infill projects, which although has slowed down, they are still on-going just not as gangbusters as it used to be. Basically the growth in SLO county is nominal since it is out in the middle of nowhere and grows very very slowly compared to the rest of this state. The area is like a bubble, you just can't gaged the economy based on a economy than is based on tourism and a large university.
    follow me on the twitter @rcplans

  12. #12
    BANNED
    Registered
    Nov 2008
    Location
    Templeton, Ca
    Posts
    417
    Quote Originally posted by CPSURaf View post
    I will take a stab, and this is a rosy assessment. The Lowe's and Super Wal-Mart have been in the pipes for years (and by years i am saying since the early 2000's when we examined these developments for courses) and the Perfumo Creek Commons has been delayed in definitely thanks to the inside sources i have (e.g. our chairman of the board for our company who spearheaded the project). The San luis obispo developments are urban infill projects, which although has slowed down, they are still on-going just not as gangbusters as it used to be. Basically the growth in SLO county is nominal since it is out in the middle of nowhere and grows very very slowly compared to the rest of this state. The area is like a bubble, you just can't gaged the economy based on a economy than is based on tourism and a large university.
    I understand. So, SLO county has it's own bubble that seperates it from the rest of the economy. Which is why we r finally getting these shopping centers.

    Golden Hills Plaza (Lowe's center) has already started construction, The Annex (Super Wal-Mart center) could start construction this year or next year, Prefumo Creek Commons (Target Center) is supposed to start construction late this year, and the Hilton Garden Inn in Grover Beach is set to start construction this year also.

    so by 2010, all of those developments will be finished.

  13. #13
    Cyburbian Cardinal's avatar
    Registered
    Aug 2001
    Location
    The Cheese State
    Posts
    10,006
    Quote Originally posted by urban19 View post
    I understand. So, SLO county has it's own bubble that seperates it from the rest of the economy. Which is why we r finally getting these shopping centers.

    Golden Hills Plaza (Lowe's center) has already started construction, The Annex (Super Wal-Mart center) could start construction this year or next year, Prefumo Creek Commons (Target Center) is supposed to start construction late this year, and the Hilton Garden Inn in Grover Beach is set to start construction this year also.

    so by 2010, all of those developments will be finished.
    An existing pipeline is only a part of the explanation of why these projects are being developed. The other part is the tenant. Walmart is doing well right now, although not so well as some thought they might do. That's OK, the analysts have been overestimating many things as they look for the companies or industries that buck the trend in this economy. Walmart is likely looking at this as an opportunity to tap a market where it has little presence, and will perform well there. The same is true of Target, if perhaps not to the same degree. The big question is who will occupy the smaller retail storefronts in these centers. The usual list of suspects - banks, restaurants, mid-box and small retailers - are not expanding.

    The hotel industry is another matter.Markets are mixed right now and there are no clear indications of where they are headed. Business travel is down and is likely to continue to drop off. Pleasure travel is down in some areas. With restrained budgets, though, people are more likely to vacation by car and to travel shorter distances. This could translate into more domestic hotel stays.
    Anyone want to adopt a dog?

  14. #14
    Cyburbian Plus
    Registered
    May 2008
    Location
    North America
    Posts
    1,991
    Quote Originally posted by CPSURaf View post
    I will take a stab, and this is a rosy assessment. The Lowe's and Super Wal-Mart have been in the pipes for years (and by years i am saying since the early 2000's when we examined these developments for courses) and the Perfumo Creek Commons has been delayed in definitely thanks to the inside sources i have (e.g. our chairman of the board for our company who spearheaded the project). The San luis obispo developments are urban infill projects, which although has slowed down, they are still on-going just not as gangbusters as it used to be. Basically the growth in SLO county is nominal since it is out in the middle of nowhere and grows very very slowly compared to the rest of this state. The area is like a bubble, you just can't gaged the economy based on a economy than is based on tourism and a large university.
    Thanks for elaborating.


    In addition:


    Ailing SLO County economy, with worse yet to come:
    For many San Luis Obispo County residents, 2008 didn’t end soon enough — with its painful housing market decline, falling stock portfolios, rising unemployment, growing state budget deficit, credit crunch and nervous consumers who curbed spending.

    But the worst may be yet to come as the county navigates through the most severe recession since the early 1990s.
    Other areas are expected to decline, though, including median home prices (for the county as a whole, as individual cities vary), real median family incomes and real taxable sales, an unwelcome development for local governments that depend on a healthy stream of sales tax revenue.

    As well, UCSB economists predict the county’s unemployment rate will peak at 7 percent in 2009, a level not seen here in 14 years.

    The unemployment rate in November — the latest figure available from the state’s Employment Development Department — was 6.6 percent, up from 4.4 percent the same month a year ago.

    Lesh fears that the troubles in Sacramento will exacerbate unemployment in the county, which has a heavy concentration of government jobs.

    “Our big concern for San Luis Obispo County going forward is potentially large layoffs in government,’’ he said. “If it’s just a job freeze, that would be nice, but we have concerns that it will be a job reversal.”
    http://www.sanluisobispo.com/news/lo...ry/574884.html

    __________

    Reduced air service for SLO County:
    Two hours from Santa Barbara and four from Los Angeles, San Luis Obispo, Calif., lost some, but not all, air service in November [2008].
    “There is an immediate effect on tourism but a longer-term economic effect,” said Bjorn Hanson, associate professor at the Tisch Center for Hospitality, Tourism and Sports Management at New York University. “They never reach the long-term growth trend that would’ve been achieved without the reduction in air capacity. Typically the bar is reset at a lower level.”
    http://www.nytimes.com/2009/01/10/bu...0airports.html

    __________

    Avocado crops in SLO County in trouble:
    Extreme temperatures June 17-22 [2008] destroyed an estimated 59 percent of San Luis Obispo County’s crop, said Brenda Ouwerkerk, chief deputy county agricultural commissioner. The loss is estimated to be nearly $17.5 million.

    Losses for this year’s crop are expected to be even greater — 82 percent. That’s because avocado trees flower at the same time the fruit is on the tree. The heat wave damaged the existing crop and cause even more damage to the blossoms, Ouwerkerk said.

    Losses for this year’s crops are expected to be more than $24.2 million. These losses prompted state agricultural officials to declare a crop disaster,
    http://www.sanluisobispo.com/news/lo...ry/584664.html

    __________

    Governator's proposed wine excise tax increase by 640%:
    Stacie Jacob is with the Paso Robles Wine Country Alliance. She said, "To target a specific industry, especially an industry that's growing and thriving, one of the leading industries - and to target an agricultural industry I think is just not the approach to go."

    Jacob adds that the wine industry in San Luis Obispo County alone contributes $1.8 billion into the economy and employees 8,000 people.

    Jacob goes on to say that a tax like the one the governor is proposing could be devastating to the wine industry on the Central Coast.

    "It really is one of the largest thriving industries in our area, and to have a tax like this is really one of those threats that could be detrimental to the industry," says Jacob.
    http://www.ksby.com/global/story.asp?s=9719144

    __________

    There's more, but hey, it's a Saturday night.

  15. #15
    Cyburbian Raf's avatar
    Registered
    Feb 2007
    Location
    As far south of SoCal as I Will Go
    Posts
    5,289

    The Wine Tax

    Although i don't agree with the tax, the wineries will get charged the tax, and just pass it on down to the consumer. Yea, the days of 2 buck chuck maybe numbered here, but seriously, will this stop me from drinking wine....



    Two words....




    HELL NO!!
    follow me on the twitter @rcplans

  16. #16
    BANNED
    Registered
    Nov 2008
    Location
    Templeton, Ca
    Posts
    417
    and don't believe everything you hear in the trib...ha ha

  17. #17
    Member
    Registered
    Aug 2008
    Location
    North Carolina
    Posts
    21

    Mid Atlantic hits

    The mid-Atlantic region has been rapidly expanding in the last decade or two and this downturn is both a blessing and a curse.

    It's a blessing because McMansions were being built without consideration of the water supply. Last year, places like Atlanta were counting down the days to being completely without water. At least now the growth is stunted for a while and maybe the water issues can get sorted-out. Frankly, all sorts of things can get sorted-out at for future planning and having a chance to stop and catch our breath has been useful.

    The curse is obvious. Here in NC financial centers like Charlotte are hit very hard as all sectors that relied on the financial world are hurt. University towns like Durham or Chapel Hill and military towns like Fayetteville seem to be doing OK. Overgrown cowtowns like Raleigh with their endless strip mall shopping will likely be crushed but I can't say I am all that disappointed. Strip malls are among the least aesthetically pleasing places on earth.

    While I thought rural areas in NC would shrink during this crisis I think they are actually growing. A lot of people have moved back with families where it is cheap to live without a job. Purely anecdotal evidence, that.

  18. #18
    Cyburbian Cardinal's avatar
    Registered
    Aug 2001
    Location
    The Cheese State
    Posts
    10,006
    I just completed a market study for a community on the fringe of a large metropolitan area. This community has averaged about 170 new homes built each year since the late 1990's. Beginning about 2004 there was a flurry of new subdivision activity and speculative housing construction. The result is an inventory of more than 4,000 undeveloped, platted lots. Even if they do maintain the average growth rate they will not build out this inventory in twenty years. Most of these subdivisions will sit unfinished, and some will go under. This is a perfect example of the kind of irrational behavior found in the market during the boom years.
    Anyone want to adopt a dog?

+ Reply to thread

More at Cyburbia

  1. Replies: 45
    Last post: 16 Sep 2011, 6:17 PM
  2. 1909 Predictions for 2009
    Friday Afternoon Club
    Replies: 12
    Last post: 15 Jan 2009, 8:51 PM
  3. Replies: 6
    Last post: 20 Apr 2007, 4:44 PM
  4. Replies: 0
    Last post: 10 May 2005, 10:45 PM
  5. So now what? Predictions for 2003
    Friday Afternoon Club
    Replies: 17
    Last post: 22 Dec 2003, 10:04 AM