Before delving into the specifics of mixed-use development, it's crucial to understand the current context. This is a truly unique moment in the real estate cycle, where the industry faces an almost unprecedented mix of secular and cyclical shifts. Cyclical shifts such as higher interest rates, rising construction costs, and temporarily slowing demand are accompanied by secular shifts like the change in office space usage in a remote world and increased demand for more experiential spaces. The bar has been raised, thanks to technological advancements that will shape how people live, work, and invest in real estate.

Top Success Factors for Mixed-Use Developers

Right Anchor Strategy

In the past, the anchor was simply the tenant filling a large portion of a development's space. However, today, it means something more. Successful developers are defining anchors more expansively and setting a higher bar. It could be a major sporting or events venue as a central draw or a collection of great restaurants, specialty food shops, and food trucks creating a compelling food scene. By stepping back and thinking deeply about the area's unique value proposition, developers can set a differentiated "right to win" and connect it to the anchor strategy. For instance, in an arts ecosystem-focused right to win, anchors might include an important museum along with galleries, dance studios, and street musicians.

Some of the only large-scale projects attracting investment today are those approaching anchors strategically. This approach can continue to differentiate projects even after market conditions stabilize.

Thoughtful Programming

A successful anchor strategy needs to be complemented by intentional curation of events and experiences. Multifaceted programming makes mixed-use areas active and vibrant, drawing people around the clock. It could be art installations, live music, seasonal events, or pick-up flag football games. The public space should be viewed as another experiential tenant and a core part of the brand.

Real estate developers now need a new set of skills in the operations team, including experience and digital engagement. The experience team should constantly think about the customer, offer excellent add-on services like a wedding planner, and be involved in project planning from the start. Digital capabilities are also essential, such as an app for residents to arrange services or for visitors to learn about events.

Bringing Nature In

This trend started before the pandemic and is even more important now. People don't want to be completely disconnected from nature in urban areas. There are recent developments in midtown Manhattan with fantastic roof decks and green spaces where people can sit outside and enjoy the city view. Developers need to intentionally integrate nature or an outdoor experience into the development.

These spaces prove that a mixed-use development doesn't have to be near a nature preserve. It shows that by integrating nature, developers can enhance the living and working experience.

These success factors may add costs, but they pay off. In the last few years, we've seen a significant divergence in property performance. Outstanding experiences, especially digital ones, lead to higher NOI and enhanced renewal rates. This dynamic holds true for mixed-use districts as well.

Success is a virtuous cycle where people are drawn to an area, companies follow for talent, and businesses come for the activity. At the core is an attractive place where people want to be.

The Cornell Program in Infrastructure Policy (CPIP) plays a crucial role in exploring various policy aspects related to infrastructure deployment. From design and construction to operation and maintenance, CPIP ensures the efficiency, cost-effectiveness, equity, and inclusion of infrastructure assets. It also encourages the integration of the latest technologies into new infrastructure projects, such as sensors, robotics, artificial intelligence, cybersecurity, low-carbon materials, and data analytics.

Unleashing the Potential of Infrastructure through Innovation

Policy Aspects of Infrastructure Deployment

CPIP delves deep into the policy aspects of infrastructure deployment. It covers a wide range of areas including design, construction, operation, maintenance, procurement, funding, financing, and recycling of assets. This comprehensive approach ensures that infrastructure is developed in a way that meets the needs of society while also considering environmental and social factors. 1: The program recognizes the importance of a holistic approach to infrastructure development. By exploring these various policy aspects, CPIP aims to provide policymakers with the necessary tools and knowledge to make informed decisions. This includes understanding the economic, social, and environmental impacts of different infrastructure projects and developing strategies to address these issues. 2: For example, in the design phase, CPIP considers factors such as sustainability, accessibility, and user experience. In the construction phase, it focuses on ensuring quality and safety while also minimizing environmental impacts. During operation and maintenance, CPIP emphasizes the importance of efficient management and the use of innovative technologies to extend the lifespan of infrastructure assets.

Incorporating Latest Technologies into Infrastructure

CPIP actively encourages the incorporation of the latest technologies into new infrastructure projects. These technologies include sensors, robotics, artificial intelligence, cybersecurity, low-carbon materials, and data analytics. By integrating these technologies, infrastructure projects can become more efficient, sustainable, and resilient. 1: For instance, sensors can be used to monitor the condition of infrastructure assets in real-time, allowing for proactive maintenance and reducing the need for costly repairs. Robotics can be used for tasks such as construction and maintenance, improving safety and efficiency. Artificial intelligence can be used for predictive analytics and decision-making, helping to optimize infrastructure operations. 2: Low-carbon materials can be used to reduce the environmental impact of infrastructure projects, while data analytics can be used to analyze usage patterns and optimize resource allocation. By embracing these technologies, CPIP is helping to shape the future of infrastructure and make it more sustainable and resilient.

Scope of CPIP

The program's scope includes heavy civil infrastructure such as roads, bridges, tunnels, airports, seaports, drinking water systems, wastewater treatment facilities, and energy systems. This broad scope allows CPIP to have a significant impact on various aspects of infrastructure development. 1: CPIP recognizes the importance of these different types of infrastructure and works to address the unique challenges and opportunities associated with each. For example, in the case of roads, CPIP focuses on improving traffic flow, reducing congestion, and enhancing safety. In the case of energy systems, it focuses on promoting renewable energy and improving energy efficiency. 2: By covering such a wide range of infrastructure types, CPIP is able to provide a comprehensive perspective on infrastructure development and help policymakers develop strategies that address the needs of different sectors.

Founder and Academic Director: Rick Geddes

Professor Rick Geddes is the founder and academic director of CPIP, which started in 2012. He focuses on peer-reviewed research, teaching, and public engagement and outreach. His 40-member industry advisory board represents some of the most distinguished people in the infrastructure world. 1: Rick Geddes is a leading expert in infrastructure policy and has made significant contributions to the field. Through his research and teaching, he is helping to train the next generation of infrastructure leaders and promote innovation in the industry. 2: His industry advisory board provides valuable insights and expertise, helping to shape the direction of CPIP and ensure that it remains at the forefront of infrastructure policy research.

Climate Engineering and New Materials

Among CPIP teachings is 'climate engineering,' a term Geddes said Cornell University developed to emphasize the new technologies in the infrastructure world. One example is the work of Cornell University Materials Science and Engineering Professor Emmanuel P. Giannelis, who developed new materials for roads and highways. 1: These new materials, such as those incorporating clay nanoparticles into asphalt, offer significant improvements in mechanical and thermo-cycling performance. They lead to roads with longer-lasting surfaces, even under extreme weather conditions. 2: The technology is currently being scaled up and tested in real applications, demonstrating the potential of these new materials to transform the infrastructure industry.

Future-Proofing and Policy Challenges

Another policy topic CPIP investigates is 'future-proofing.' The idea is to ensure that infrastructure projects are designed and maintained in a way that can adapt to future changes and technologies. However, there are challenges in implementing this approach, such as the lack of proper pricing of transportation infrastructure. 1: Geddes notes that it is difficult to price all roads immediately, but incremental steps like congestion pricing in New York City are a start. The program is also working to address the political challenges associated with transportation policies. 2: For example, it is important to ensure that all stakeholders are involved in the decision-making process and that policies are designed to meet the needs of society as a whole.

Road Usage Charges and Tax Revenue

Geddes backs the idea of switching to a road usage charge, such as used in Oregon. This would separate the use of the road from the fuel used, addressing the issue of EV drivers not paying for the use of the roads. However, there are challenges in implementing this approach, such as the lack of political will. 1: The current system of funding transportation infrastructure through the gas tax is regressive, hitting poor families more than rich families. As the uptake of electric vehicles increases, this inequity problem is likely to become more pronounced. 2: By switching to a road usage charge, policymakers can ensure that all road users pay their fair share and that transportation infrastructure is funded in a more equitable way.

Reform of National Environmental Policy Act

Geddes talks about the reform of the National Environmental Policy Act, which requires federal agencies to assess the environmental effects of their proposed actions prior to making decisions. He argues that this act has become a barrier to the efficient delivery of infrastructure in the United States. 1: The delay in projects caused by this act increases costs and slows down the adoption of new technologies. CPIP is working to address these issues by promoting more efficient and innovative approaches to environmental assessment. 2: By reforming the National Environmental Policy Act, policymakers can ensure that infrastructure projects are developed in a way that balances environmental protection with economic and social considerations.

Public-Private Partnerships and Infrastructure Delivery

Geddes advocates for more public-private partnerships in infrastructure delivery. He notes that private partners are often more willing to take risks and have the expertise to deliver infrastructure projects. However, there are challenges in encouraging public-private partnerships, such as the balkanized ownership of infrastructure in the United States. 1: CPIP is working to train the public sector to be more comfortable with innovative contracting and to protect the public interest in public-private partnerships. 2: By promoting more public-private partnerships, policymakers can leverage the expertise and resources of the private sector to deliver infrastructure projects more efficiently and effectively.

Resiliency in the Face of Climate Change

The issue of road reconstruction due to climate change is a global concern. Recent events have shown the catastrophic damage that climate change can cause to transportation infrastructure. CPIP is working to address this issue by promoting resiliency in infrastructure design and construction. 1: This includes enhancing the reinforcement of roads, boundaries, and embankments and building in parallel pipework to draw water away. By taking a proactive approach to resiliency, CPIP is helping to ensure that infrastructure can withstand the impacts of climate change. 2: Smith notes that all local and national governments need to make greater progress in ensuring infrastructure resilience and adaptation is integral to annual spending plans. By doing so, they can reduce the risk of infrastructure damage and ensure the continuity of essential services.