Convenience at a Price

All the new apartment construction in-and-around the convention center in Washington DC is another example of sterile neighborhood development sweeping through our cities in a rush to create profitable 24-hour environments. You can see the same approach in downtown Toronto and downtown Los Angeles, in Houston and Atlanta as well as other major markets. The idea prompting this new development is to build high-end apartments near office districts and satisfy demand for convenient lifestyles sought by upwardly mobile millennials and well-heeled older executives looking for pied-a-terres. In fancily appointed apartments with various gym amenities and providing concierge services you can be steps from work instead of stuck in traffic during time-sucking daily commutes.

At Washington's City Center, condominium residences in sleek mid-rise boxes start selling in the million dollar range. Filling adjacent office buildings, major law firms and lobbyists have moved east from redoubts in the traditional K Street corridor now closer to where they can conduct business on Capitol Hill. The likes of Burberry and Hermes showcase stores here, stylish restaurants with signature chefs draw lunch and dinner crowds, and the nearby Metro stops are some of the busiest in the city.

Simply, it's been a total makeover, a stupendous transformation at the core of the area south of New York Avenue between the White House and Union Station. Developers have turned a once “don't-go-there” zone of dilapidated buildings and trash-strewn lots, into a sought after commercial center with affluent residents owning and renting apartments in spanking new buildings.

But what has been wrought and what kind of staying power will these projects have? Will millennial renters stay here when they marry and decide to have children—there are no parks, playgrounds or schools? Building gyms are designed for adults trying to stay toned and youthful, not youths looking to burn off steam. Skate boarding and touch football on these sidewalks will not be welcomed by conventioneers and office workers.

While the location certainly offers convenience you can hardly describe this as a neighborhood. Floor-to-ceiling windows from apartments provide rather banal views of similar horizontal projects—squat rows of hotels, office buildings, and more apartments along this part of the District's undistinguished streetscapes—famous monuments, the Potomac and Capitol Dome are nowhere in sight. Sure you can buy silk ties and chic hand bags, but what about supermarkets and finding a hardware store when you need one? There are upscale bars and gourmet menu dining, but no butchers, bakers, or green grocers. How can mom and pop retailers afford the rents? That's just not the idea.

Developers understandably want to maximize profits so they target the affluent and high end, and leave as little open space behind as possible. City politicos, who seek tax revenues and like campaign contributions, pay little attention to neighborhood planning and enduring place making.

Maybe the scene works for transient Washington where politically connected workers cycle in-and-out-of-town every four to eight years with changing Presidents and new Congressional delegations. That's because you would think living in the heart of what looks and feels like an antiseptic commercial district would lose its appeal quickly, especially during long hot summers when the city bakes with the intensity of a pizza oven.

By the time the novelty wears off, Hillary or Jeb or who knows who will be settled in the city's famous columned mansion and many of the apartment developers and their investors no doubt will have happily cashed out.

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A marketing communication strategist who turned to real estate analysis, Jonathan D. Miller is a foremost interpreter of 21st citistate futures – cities and suburbs alike – seen through the lens of lifestyles and market realities. For more than 20 years (1992-2013), Miller authored Emerging Trends in Real Estate, the leading commercial real estate industry outlook report, published annually by PricewaterhouseCoopers and the Urban Land Institute (ULI). He has lectures frequently on trends in real estate, including the future of America's major 24-hour urban centers and sprawling suburbs. He also has been author of ULI’s annual forecasts on infrastructure and its What’s Next? series of forecasts. On a weekly basis, he writes the Trendczar blog for GlobeStreet.com, the real estate news website. Outside his published forecasting work, Miller is a prominent communications/institutional investor-marketing strategist and partner in Miller Ryan LLC, helping corporate clients develop and execute branding and communications programs. He led the re-branding of GMAC Commercial Mortgage to Capmark Financial Group Inc. and he was part of the management team that helped build Equitable Real Estate Investment Management, Inc. (subsequently Lend Lease Real Estate Investments, Inc.) into the leading real estate advisor to pension funds and other real institutional investors. He joined the Equitable Life Assurance Society of the U.S. in 1981, moving to Equitable Real Estate in 1984 as head of Corporate/Marketing Communications. In the 1980's he managed relations for several of the country's most prominent real estate developments including New York's Trump Tower and the Equitable Center. Earlier in his career, Miller was a reporter for Gannett Newspapers. He is a member of the Citistates Group and a board member of NYC Outward Bound Schools and the Center for Employment Opportunities.