One of the major problems developers face are the zoning laws that different municipalities have in place, restricting the uses of buildings, says Joel Skylar, a principal at Boston-based Samuels & Associates. "Traditional zoning doesn't work when you're trying to mix uses because traditional zoning was created to separate uses," he says.

Skylar's firm is building Hingham (MA) Shipyard, a development with 200,000 sf of retail, 40,000 sf of offices and about 90 condominium units and what he points to as a the type of dense development that people prefer today. "People are looking for a more compact lifestyle," he says. "The suburban experience of the last 40 to 50 years, a lot of people are realizing, has its limitations."

Though many people prefer living and shopping in mixed-use environments, developers that are looking for quick returns might want to reconsider building the projects, says Richard Heapes, a partner at White Plains, NY-based Street-Works. "If you have to ask how long it's going to take, you shouldn't be doing this," he says. "You need patient money. You can't think in terms of three-year refinancings and you're out."