EFFECTIVE PUBLIC REALM INITIATIVES CAN DRAMATICALLY IMPROVE WELLBEING AND INCREASE REAL ESTATE VALUES
Effective public realm intervention can dramatically improve human wellbeing and real estate values as well as supporting long-term resilience. This is one of the key findings from a study released today by global real estate advisor CBRE together with Gehl Architects.
The study reviewed 11 placemaking initiatives in the UK, Australia, USA, Italy, Denmark, Germany, France and South Korea all of which have a specific public realm intervention at their core. Gehl assessed the way in which public spaces contribute to the human experience of urban areas whilst CBRE examined the commercial effect from a demand and supply and real estate values perspective before and after the public realm intervention has taken place.
The study indicated that creativity and investment can improve the public realm in such a way that the human experience of a place is materially enhanced. By focusing on this aspect, and assuming effective infrastructure public realm initiatives create greater desire to visit, an increase in dwell time, more expenditure and in turn greater demand amongst visitors, workers, shoppers, and residents to locate there permanently. In this way, public realm improvements have a very positive impact on commercial real estate values.
In London Granary Square, King’s Cross and Duke of York Square, Chelsea formed part of the study. The results demonstrated in Granary Square are of particular interest. From a real estate perspective, the stand-out performers have been retail and residential. While average house prices in prime Central London rose by 48% between 2011 and 2016, average prices in King’s Cross have increased by 61%. There has also been a marked improvement in retail quality. It is likely that without high-quality design of the public realm, this vast new area of development would struggle to establish a reputation in the market as a desirable location for retailers, employers and residents alike.
The global study demonstrates the importance of creative placemaking. For planners, it means facilitating design towards enhancing the human experience. This means maintaining any good-quality public space that exists through innovative measures keeping up with new trends, and embarking on a quest to make more of it available. It also means that proposed new developments should be judged on their ability to enhance public life.
For developers and investors, value resilience depends on the success of the place. Not all developments will have the ability to create an outdoor public realm that is free to use, but some will. Where opportunity exists, with the ability to enhance the brand of a building and location, should be taken. Where it is not available, there should be a clear contribution to the public realm that exists.
For occupiers, who are concerned with recruiting and retaining increasingly scarce talent, proximity to great public spaces is important. The boundaries between work and leisure time are ever more blurred, so the walls of the workplace become ever more permeable. The public realm and the work-anywhere culture are inextricably linked.
This study has demonstrated how well thought out placemaking initiatives can have positive impacts on both the quality and human experience of urban spaces.It is no coincidence that good placemaking can, in turn, realise positive incremental effects on real estate values. As a business, we recognise the importance of identifying, creating and delivering a holistic approach to development opportunities and an important contributor to that is paying attention to the characteristics and intrinsic benefits of placemaking to drive demand and create value longevity.