January 25, 2022
The New York Times over the summer published an article, "The Downtown District Was Vulnerable. Even Before Covid." The piece outlined the challenges facing modern U.S. downtowns and focused on the idea that center cities have typically been reliant on office use as the main driver of economic activity.
Over the past 20 years, downtowns have evolved into places of constant activity to create a more balanced mix of uses - to varying degrees of success. According to experts interviewed by the New York Times, " cities where “downtown” has increasingly come to mean more than offices are likely to be more resilient as they emerge from the pandemic." The downtowns that will be suited to thrive over the next decade are places where this is already a balance of office, residential, and retail use. From a real estate mix by square foot perspective, cities like DowntownFTL meet this standard.
"In some downtown business districts, 70 percent to 80 percent of all real estate is dedicated to office space." Traditional superstar cities like Boston, Washington, and Chicago have about 70% and more of its square footage allocated to office space. Cities like DowntownFTL by contrast are about 34% office, 55% residential, and 11% retail. Going forward, downtowns with this profile will be better equipped to meet the needs of the post-COVID economy.
Please note this analysis uses a different methodology than the approach used by the NY Times. Only multifamily units, office buildings, restaurants, and retail are included. For the purposes of this analysis, hotel is excluded.