A couple of years ago, it was trendy to buy a Louis Vuitton bag. Then, the hippest folks were buying miniature dogs that fit inside Louis Vuitton bags. In 2006, General Growth Properties, a real estate investment trust with headquarters in the West Loop, is attempting to cash in on a trend becoming hot with the kids these days — New Urbanism.
For the uninitiated, there’s nothing new about New Urbanism. New Urbanist neighborhoods are walkable and contain a diverse range of housing and jobs. New Urbanists “believe these strategies are the best way to reduce how long people spend in traffic, to increase the supply of affordable housing and to rein in urban sprawl,” according to the non-profit Congress for the New Urbanism.
As young professionals make more money, begin families and invest in property, more and more are refusing to do what previous post-war generations did — move to the suburbs. Plus, it’s so hot right now to be all anti-suburban sprawl, though even in the ‘burbs (at least the inner-ring ones) new developments these days tends to be centered around public transporation and walkable downtowns.
General Growth has New Urbanist projects throughout the country, and company representative Lynier Richardson told Yo that a mixed-use development of the same type is on the drawing board for a site at 63rd and Western, on the edge of Chicago’s West Englewood and Marquette Park neighborhoods. Construction will get underway in about a year, according to Richardson, who promised more details about the development in spring of 2007.
Ironically, General Growth is responsible for some of the sprawl it says it is now working against. The company is the second-largest REIT in the U.S. and owns more than 200 regional malls. A couple of years ago, it purchased Columbia, Md.-based Rouse Co. and gained a handful master-planned urban communities. Now, seeing the light of New Urbanism, General Growth is aggressively redeveloping those properties.
Matthew Shannon, General Growth senior development director, told the Chicago Journal that the company’s new projects combine retail, residential and office real estate in an American Apparel-like vertically integrated format. Plans call for apartments in towers and above retail and “liner” townhomes, used to shield views of parking structures that don’t add to the streetscape or ambiance.
Cashing in on a trend that has yet to hit its peak can be profitable, too. Although building costs can be 10 percent to 25 percent higher with a New Urbanist approach, the demand for walkable areas is high enough in an era of rising energy costs and growing environmental concerns that General Growth sees the potential for making serious money with this approach.