Interview by Randy Gladman
As a land developer at a real estate advisory service representing landlords of large-scale commercial and residential properties, I am becoming more and more concerned that accelerating technological changes in mobility are not being carefully considered and implemented into “future-proofed” site and building design. The implications of what some have called “New Mobility” – autonomous vehicles, taxi-bots, vehicle sharing, new energy distribution infrastructure — are massive and only vaguely understood or anticipated. At a time when commercial landlords are already being forced to adapt to changes in the retail environment and office workplaces wrought by advances in telecommunications, e-commerce, and the millennial-generation’s desire for flexibility in employment and new lifestyle concepts, expected changes in our automotive ecosystem add yet another complicated, disruptive, and costly layer of complexity to real estate asset management.
The facts are staggering: by 2030, 60% of the world’s population will live in cities and an additional 2 billion people will enter the middle class; automobile sales are expected to increase from about 70 million a year in 2010 to 125 million by 2025 and the current 1.2 billion cars on the planet’s roads could double by 2030. The total amount of urban kilometres traveled is expected to triple by 2050.
The design of urban infrastructure we have come to expect in cities is already failing and it seems widely accepted that it simply cannot accommodate the coming demand dynamics. Not only are more vehicles coming but they will be owned, used and stored in ways very different from today.
Innovations in mobility seek to accomplish two goals: 1. Improve the safety, cost, efficiency, and comfort of the transportation of people, goods and services; and 2. Reverse the unsustainable and deleterious energy and environmental impacts associated with transportation. These are admirable goals, certainly, but in a world that has largely been designed over the past century to accommodate the vast system of transportation now being rethought, a large number of landlords may be having a hard time seeing the design disruptions that will result from a paradigm shift that becomes more inevitable by the day.
James Carter is an Australian-born, Toronto-based Mobility Futurist who spends his days thinking, writing, and public speaking about the future of transportation and the many opportunities the coming changes will provide. With twenty years of industry experience at Toyota where he worked in product management, branding, and marketing around the world, he founded Vision Mobility, a consulting firm that specializes in helping a wide range of businesses impacted by transformation in transportation envision and plan for a very different automotive future.
I sat down with James in the last days of 2016 to ask him to help me think about New Mobility from the perspective of commercial landowners and land developers. While our conversation could easily have veered into similarly relevant topics like municipal-scale urban infrastructure planning, ride hailing, and public transportation, I tried to focus instead on the design implications for commercial sites and buildings and how new modes of automotive transportation will affect the operations of income producing property.
RG: Given the massive investments in autonomous vehicle technology and design we are seeing by some of the largest companies in the world, including Google, Apple, Mercedes-Benz, Tesla, and many others, it appears certain that material changes are coming to mobility in the not so distant future. Please provide your high-level view of what changes are coming, what they will look like, and what kind of a timeline we should expect.
JC: There is certainly a lot happening in autonomous vehicle research and development, as well as the other areas that make up the “New Mobility” space, namely electric vehicles, connected cars, and “mobility-as-a-service”. Right now most of these are in the research and development stage. What really interests me is what happens next. What happens in sales and marketing, how will people interact with mobility in their environment, and what are the impacts for our homes, places of work, and places we visit.
The general timeline for New Mobility, as I see it, is as follows: In 2017, Level 3 autonomous vehicles will go on sale. These are vehicles with fully autonomous functions usable in specific areas such as on highways. In 2020, electric vehicles will become as cheap to own over a typical 5 year ownership period as internal combustion engine vehicles. Multiple launches of Level 4 autonomous vehicles will take place in 2021. These are vehicles with fully autonomous functionality in “geo-fenced” areas such as places with highly detailed mapping like major cities. Taxi-bots will launch around the same time. Around 2026, Level 6 autonomous vehicles will start to be seen on the roads; these are fully autonomous cars that can travel on any road. New Mobility is expected to mature around 2030 with significant declines in private car ownership and mobility-as-a-service commonplace. By 2040 there will be very few vehicles available for sale with internal combustion engines; these will be for specific purposes only. I expect that by 2040 very few young people will bother to get a driver’s license.
RG: Parking ratios are sure to be implicated once autonomous vehicles become commonplace. Current design practice sees ratios as high as 5 parking spots per 1,000 square feet gross floor area for retail centres and 6 or more parking spots per 1,000 square feet gross building area for office buildings in the suburbs. This is lower in cities but, even in high-density communities, construction of parking facilities is a significant hard cost. How do these requirements change with adoption of self-driving cars?
JC: Autonomous vehicles don’t have to stay put! They can park anywhere that is a reasonable distance away from demand. It’s worth noting that New Mobility will come in gradually. It will be a long time before every vehicle is self-driving; there will still be parking requirements for quite a few years yet. The requirements will not go from one fixed ratio to another over night; there will be a gradual decline. But I do foresee a time when new downtown condos will have no or very limited provisions for parking.
RG: What are the implications for residential construction?
JC: While there will absolutely be less need to provide parking spaces, there will be a much greater need to design and incorporate easy and safe pick up and drop off areas. First time visitors may need directions and residents will need areas where they can safely load and unload children and purchases. These increased areas may have a semi-indoors or foyer design for drop off and pick up, especially in climates with cold winters. For houses, there will be a move towards reclaiming the garage and industries will be set up to convert garages into new, comfortable living spaces or apartments – or see a new emphasis on storage.
RG: What about ingress/egress design and the layout of buildings on sites? I can imagine a future where cars drop off passengers at the entrance of a commercial building then drive away to park somewhere else where they wait until they are needed again. Will site plans need to be drastically redesigned to accommodate increased pick up and drop off layby areas? Do parking areas lose the emphasis on visibility and immediacy and instead move to less desirable locations, rendering their current locations near the front of buildings available for redevelopment? What happens to the design of building entrances?
JC: Pickup and drop off locations will become as important as parking is today. While it won’t require the room of a parking garage or open area, significant space will be needed to appropriately manage traffic flows during peak mobility time periods, as well as ensure the safety of those getting in and out of vehicles. Parking location becomes much less of an issue as autonomous vehicles can park in a less-prime place for a much lower cost. For autonomous vehicles, the balance between parking cost and distance from potential pickups will become key. Infrastructure needs to adapt as electric vehicle sales volumes grow. Forward thinking developers will at least “rough in” requirements for EV chargers as well as plan suitable transformation that can handle the future loads or be easily upgradeable as needed.
RG: What percentage of future vehicles will be electric? If you see a very high percentage of vehicles running on electric energy, what happens to the mass proliferation of gas stations? Do these become obsolete and therefore prime for redevelopment?
JC: The percentage of electric vehicles will grow significantly, from very low numbers today, to universality by 2050. Several auto manufacturers have already committed to ceasing internal combustion engine production by then. Gas stations owners have the opportunity to transform their sites; that opportunity will initially be exploited by the provision of “flash charging” stations. However, I suspect that this window of opportunity may not be a big one as ultimately an autonomous vehicle can go anywhere to recharge, enabling valuable corner real estate sites to be repurposed entirely.
RG: I have already heard from large residential developers in downtown Toronto that the demand for ownership of underground parking facilities is falling and many of the stalls they have built have failed to sell to owners of the condos above. Do you see a future where these large underground spaces can be converted to better uses than warehouses of idle cars? Does the design of underground parking facilities need to be rethought?
JC: One of the critical needs of autonomous taxi bots is being at the right place at the right time. It might turn out that the best way to meet some of this demand is for these vehicles to wait in today’s underground parking structures. However, I see these car parks turning into warehousing of other things as the land is often too valuable to house cars that can autonomously move themselves elsewhere. This could be self-storage (ie giant lockers), commercial warehouses that require speed to downtown, clubs, new commercial floor space or offices. I think this reclamation will happen gradually over about 20-30 years. In 30 years time I believe new large tower developments will have minimal available parking. Owners will see today’s condo parking areas as general storage spaces, for cars or anything else.
RG: I work with a number of retail tenants, both small and very large. The loading areas associated with these types of tenants are complex, costly and demanding on space. Autonomous trucking seems to be developing at the same pace as self-driving cars, perhaps even quicker. What are your thoughts regarding the implications to the design of loading facilities for buildings and shopping centres? Do you believe drone deliveries are going to be part of this mix?
JC: Drone deliveries are very likely though I believe that ground drone delivery will be far more cost effective and common than air drone delivery. Therefore there will still be a need for loading facilities. Those facilities can be changed by adopting “just in time” delivery from smaller autonomous trucks. Only having to accommodate small trucks means that loading facilities can be that much smaller and more efficient. Giant turning circles for semi trailers will less necessary and side loading solutions will also be adopted. Loading areas in buildings will also be developed to accommodate autonomous warehouse drones. Interfaces of two autonomous vehicle systems will be common.
RG: I am hard at work on a number of commercial developments including super large distribution warehouses and high-density office buildings. A big focus of the design teams I lead is future-proofing these buildings so that they will be desirable for tenants well into the future, even after the first 10- or 15-year leases expire. We are currently trying to achieve this goal by implementing best practices in design, constructing to LEED Gold (or better) standards, providing empty conduits to accommodate potential future needs, and improving the energy efficiency dynamics of the sites and buildings wherever possible. However, the more I speak to you, the more I fear we may not adequately be thinking about the changes coming in mobility and designing accordingly. With such long product lifecycles, how are we to design buildings for the long term that address a mobility revolution that appears to be inevitable but may not arrive for 5 or 10 years? What kind of design features should we be incorporating now so that we can avoid costly physical changes in the mid-term future?
JC: This is the crux of the issue in my mind. Mobility is going to change dramatically over the next 5-30 years and every aspect of a building project that interacts with mobility needs to be future proofed. That means being able to easily and cost effectively upgrade the facilities to meet the new requirements as the time comes and need arises. I believe the best way is to design in inherit flexibility with any interfacing mobility component. There are some key areas that must be extremely adaptable.
Demand for parking will remain but decrease slowly over time. Thought should be put into how these parking spots can be easily redeveloped into something else that has revenue potential.
The demand for EV charging stations will grow strongly over the next 5-15 years and then decline thereafter as autonomous vehicles pick the cheapest location to recharge. However this electricity infrastructure could become very useful as the space is repurposed.
Drop off / Pick up requires space and a poor layouts will result in massive queues at peak times so designs need to be easily expandable.
We also need to understand how autonomous vehicles work and then reimagine what approaching a building may look like. With autonomous vehicles, people no longer drive so they have time for other things. Using smartphone cookies, user-targeted advertising with virtual reality and augmented reality can be displayed on a vehicle’s windows and internal screens. These messages can be reinforced as people approach buildings with relevant advertising to the person as they walk past. They can also show the wait time for pick up and directions to where you want to go inside the building and other information relevant to the person at the time. Using cell phone data, building owners and tenants can communicate how their building or site is relevant to the passers-by in autonomous vehicles or in taxi bots.
***
Sources:
http://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/urban-mobility-at-a-tipping-point
http://www.adlittle.com/future-of-urban-mobility.html
https://dupress.deloitte.com/dup-us-en/focus/future-of-mobility/roadmap-for-future-of-urban-mobility.html