Welcome to the 15-minute city – an urban area that spreads key services evenly across neighbourhoods instead of separating residential districts from economic activity. In the 15-minute city, every community is a short walk or bike ride from essential facilities and shops; each neighbourhood has a variety of housing types and affordability with green spaces; and jobs are nearby.
These new-style cities are gaining popularity globally. Paris has already banned high-polluting vehicles, closed major arteries to private cars and created mini green spaces as it aims to be Europe’s first 15-minute city by 2030. Other major cities are changing too, but Saudi Arabia is building a new city on the 15-minute principle: Neom will be vehicle-free, with zero-carbon credentials and high-speed autonomous transport.
Such cities require a rethink by planners but also changes in the physical fabric of property. In future, truly flexible office space is likely to be priced on how much it is used, without the need to sign lengthy leases. And digital planning can allow office layouts to be continuously optimised to reflect usage.
The pandemic brought about the biggest shift in work practices for generations – working from home. As a result, cities will have to compete for people who now have flexibility over where they live and work.
But few workers want to work solely at home and the allure of city living remains, particularly for the young. Rural areas cannot offer the same jobs, convenience, culture, sporting events, entertainment or leisure activities. So the need for inner-city residential property will continue to increase, swelling populations there.
The drive to reconstruct cities as clusters of 15-minute neighbourhoods will increase demand to live and work in close proximity. We thus expect to see developments mixing home and work spaces, either vertically – with apartments on the higher levels, flexible office space below and retail at ground level – or horizontal schemes that combine several buildings offering similar uses.
Such developments permit greater housing variety and density, better energy efficiency, stronger neighbourhood character, improved integration with services such as public transport, and more flexibility to adapt to changing needs, thus increasing a building’s life cycle.
Meanwhile, booming e-commerce is forcing businesses to reassess their property formats. ‘Dark stores’, closed to the public, are supplying online deliveries while ‘ghost kitchens’ service only takeaway orders. However, ‘full-service centres’ are going beyond traditional shopping, offering a mix of groceries, healthcare, entertainment, leisure and gyms, besides retail.
Congestion is a major challenge facing cities, and the core aim of the 15-minute city is to minimise transport movements – particularly private cars. This may mean more cycle lanes, fewer parking spaces or charging to drive in certain areas.
But housing shortages are another challenge, especially in inner cities. Globally, more than a million people move to cities every week, making prices unaffordable for many.
Urbanisation will continue in emerging economies. However, high prices and hybrid working mean it is close to peaking in developing countries and cities will need to encourage people to stay by promoting better environmental policies or improving affordability by permitting smaller homes or taller buildings when land prices are high.
First published 11th October 2021.
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The following analyst(s), economist(s), or strategist(s) who is(are) primarily responsible for this report, including any analyst(s) whose name(s) appear(s) as author of an individual section or sections of the report and any analyst(s) named as the covering analyst(s) of a subsidiary company in a sum-of-the-parts valuation certifies(y) that the opinion(s) on the subject security(ies) or issuer(s), any views or forecasts expressed in the section(s) of which such individual(s) is(are) named as author(s), and any other views or forecasts expressed herein, including any views expressed on the back page of the research report, accurately reflect their personal view(s) and that no part of their compensation was, is or will be directly or indirectly related to the specif ic recommendation(s) or views contained in this research report: Stephen Bramley-Jackson and James Pomeroy.
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