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ULI Member Outlook for Attracting and Retaining the Creative Class

By Ron Nyren via the Magazine of the Urban Land Institute

Experts discuss what creative professionals look for in cities, how municipalities and developers can create environments that are likely to draw creative individuals and industries, how to address housing affordability challenges in these areas, and other trends.

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What aspects of the urban environment particularly attract creative professionals and creative industry companies?

David Israel: Transit and convenience. Time seems to be the new commodity. Even with everything going on in Silicon Valley, everybody still wants to live in and be a part of the urban fabric of San Francisco, so areas next to a Google bus stop or adjacent to either major rail stations or BART [Bay Area Rapid Transit] stations have a high desirability. People want mobility without having to drive and endure traffic, which takes up way too much time and mental bandwidth.

Erik Wood: Creative professionals tend to be drawn to environments where there are a lot of opportunities to bump into other people, whether it’s a coffee shop, or a toy store, or a sofa store, or a church. Creative professionals love having access to different activities, particularly when they can consider themselves early adopters of those activities. During the 1950s and 1960s, nightclubs were very much the rage. In the 1970s and 1980s, it was after-hours clubs where you could go after the bars closed at 2 or 4 o’clock in the morning. Creative people always like to feel as if they are doing something unconventional or transgressive.

Janno Lieber: When we began designing the World Trade Center office buildings in 2006, we held a series of meetings with representatives from a variety of companies. We talked about how to design buildings that would be more appealing and productive for cutting-edge companies. Somebody said, “What I want most of all for our company is a neighborhood.” The creative-class economy has grown downtown principally because of the things that make this a great live/work neighborhood. It has an urbanistic streetscape, with old buildings alongside new buildings. It is a real live/work environment with a lot of residential mixed in. It has a diverse and significant retail environment and is highly walkable, with places for people to eat, shop, work out, and hang out after hours. Lower Manhattan has 11 subway lines and countless bus lines. And it has a lot of museums and art galleries, as well as access to the waterfront and open space.

Sara Queen: What I think they’re most attracted to is a sense of vitality. Urban areas have been so appealing to creative companies because they like that vitality; it stimulates the creative process. You need to be close to transportation, however your market defines good transportation. So it’s good for a building to be easy to access via mass transit or by walking. Of course, if a building is near mass transit but has an awkward walking approach, that can be a problem. Sometimes an existing building has an awkwardly configured lobby, and you have to consider whether it’s something you can change easily or not.

Alan Colyer: The creative class is attracted to urban environments that have the same characteristics desired by most people. The difference is that the creative class is typically more discerning and less compromising when making lifestyle choices. They want to live, work, and socialize with people with whom they share the same values. They aspire to minimize their carbon footprint. Diversity, convenience, and a balanced mix of workplace, residential, arts and culture, services, amenities, and entertainment are needed to foster a livable urban environment. Urban environments need to provide sufficient open space [programmed park space, pocket parks] to offset the cultural impact of dense, vertical development. Lastly, the creative class aspires to being less dependent on automobiles, so the urban environment should promote and enhance pedestrian and cycling mobility.

@Elk Studios, 2012

@Elk Studios, 2012

How can municipalities work with the private sector to help attract more creative companies?

Queen: Municipalities should be open to changes in use of spaces. One of the things that makes some cities more vibrant than others is that they are more flexible in terms of the building code and zoning, whether it’s to allow the conversion of downtown offices to apartment buildings or the redevelopment of older office buildings to suit the needs of contemporary companies.

Israel: In the Bay Area, the availability and affordability of housing are becoming [of] paramount [importance]. Many of the cities are doing a good job of trying to create urban nodes that can serve as a hub for transit and development, to centralize the energy that it takes to create a vibrant community. We’re working on some conversions of former military bases that have been lying fallow for years. We just finished a master-planning project for what used to be the Alameda Naval Air Station, now called Alameda Point. It’s right on the bay and has a view of San Francisco. It also has direct ferry service to the city, much better bus transit, better connections to BART, and a network of open spaces. San Francisco has a number of projects along the waterfront that convert old industrial areas into areas where people can live in a way that’s well connected to both the urban context and the natural environment.

Wood: Many places where “creatives” feel most comfortable tend to be on the margins of things. They are pioneers in the effort to transform spaces that were deemed useless. The private sector can provide resources to help sustain these efforts, but the people who are actually creating the transformation have to feel like they’re using their own resources to make it happen. In SoHo [the South of Houston neighborhood in Manhattan] and in [parts of] other cities, creative people moved into warehouses or industrial buildings because they were affordable. They were anointing these spaces as cool. Then private sector development started to pour money into those settings. Typically, in these circumstances, municipalities are often at the very tail end of things, as in SoHo. Once there was a critical mass of these pioneers inhabiting these spaces illegally, municipalities tried to regulate it to address life-safety concerns. That’s truly when the dampening spirit tends to pervade what was once the creative sparkle, and the thing becomes something different. It now becomes a commodity.

Lieber: Young people are acutely sensitive to the difference between authentic and inauthentic places. Even suburban cities like White Plains [in Westchester County, New York] or Jersey City have areas that feel authentically urban. They have sidewalks and older buildings. To attract companies that might otherwise locate in megacities, municipalities should focus development initiatives on the parts of the city that already have an authentic sense of place and then try to support a concentration of retail, access to places that people can go after hours, and access to mass transit and an airport.

What kinds of companies, organizations, or institutions are too often overlooked as partners in enhancing a city’s appeal to creatives?

Lieber: Smaller municipalities should cultivate educational institutions because they help attract and retain technology workers and creative-class workers. Universities support a youth culture that might otherwise be challenged by affordability issues in bigger cities. The young creatives are frequently the people who create new cutting-edge businesses like biotech companies that develop out of academic research. These new businesses help attract less-well-off and middle-class people who are native to the region by giving them the best shot at participating in the new economy.

Israel: Cities could take more advantage of some of the resources ULI offers, such as technical assistance panels. In the Bay Area, there is SPUR, the San Francisco Bay Area Planning and Urban Research Association, a nonprofit organization that gives a balanced view of development issues. The cities recognize SPUR as an important organization, but I think they could engage it even further in an advisory capacity.

Colyer: Educational institutions, both colleges and universities, can play an important role in enhancing the cultural mix of a city, particularly in an urban setting. Learning environments and colleges align well with creative-class demographics and can serve as breeding grounds for creative companies, while adding a younger vibe to the urban core. College students at downtown campuses expand the tenant pool. Performing and visual arts organizations are key elements of a vibrant, active community. The creative class embraces the arts, both formal and informal, as part of their daily life experience.

What are some of the best strategies for maintaining affordability so creative workers at a variety of levels of the economic spectrum can still afford to live in or near thriving urban cores?

Wood: The best thing cities can do is to stay on the sidelines and let people move to locations where they choose. Just because a place was hot in one era doesn’t mean that it needs to sustain that same level of intensity and popularity. In New York, when people got priced out of Manhattan, they started moving into Bushwick and Williamsburg [in Brooklyn]. Things tend to go awry when the government or some regulatory agency tries to slow down the acceleration of rent. Because of the new rules or barriers to entry, those who were not part of the initial group of pioneers won’t be able to enjoy those benefits. It would be more useful for agencies to identify, say, assembly spaces where performances can take place. Those often can become an anchor for a new community. In Long Island City [the westernmost residential and commercial neighborhood of the New York City borough of Queens], MoMA PS1, a nonprofit contemporary art institution affiliated with the Museum of Modern Art, is an example. Every summer, there’s a new installation by an architect or designer that brings people together. Because of PS1’s success and the regularity of its programs, creative people have decided to set up shop and live near there.

Queen: People don’t want to have a roommate when they’re in their late 20s and early 30s. They want their own space, so providing a mix of unit sizes in multifamily housing, including micro-units, is one way to help. Some recent apartment complexes have spent a lot more money on the common areas, trying to create places where residents feel comfortable being at home, almost as an extension of the apartment.

Colyer: Given the wide range of living needs within the creative class, city-sponsored incentives alone can’t support the downtown residential/community development that is needed. Economic realities can be only so flexible, and not everyone can live in the urban core. A city’s infrastructure—roads, mass transit systems, pedestrian/cycling corridors—plays an important role as the connective tissue between the urban core and neighborhoods just outside the urban edge. Seamless, convenient connectivity offsets the financial barriers to living in an urban environment.

Israel: In San Francisco, the major funding for affordable housing is tax credit financing available only to projects that are 100 percent affordable. While stand-alone affordable housing certainly has its place, I wish we could dial up inclusionary housing, and instead of making 12 percent of the units in a development highly affordable, make 15 or 20 percent of units affordable for middle-income households. Also, the total cost of living in a residential unit includes utilities. In the rental housing market, however, there’s not a great mechanism to encourage net-zero energy or net-positive energy, or even highly energy-efficient projects, because residents of rental housing—and for-sale housing, for that matter—pay for their own power, so there is a reduced incentive for developers to increase efficiency.

Lieber: In New York City, we have a huge variety of public and private economic support for the arts. And there has been a fair amount of subsidy of the television and movie businesses to keep those industries from moving out and to keep their creative workers. A lot of people quarrel with [the idea of] those subsidies, asking, “Is it worth it? Why subsidize one industry over another?” But keeping the arts here and creating jobs in commercial TV and film production has enabled New York City to preserve, celebrate, and promote its identity.

What other significant trends or innovations are shaping the preferences of creative professionals?

Colyer: A significant trend taking place in urban cores is the repurposing or repositioning of underutilized buildings and open spaces. As corporate tenants move out of downtown to relocate to the suburbs, a surplus of underutilized buildings is left. The economic shifts caused by large-scale departures and surplus space create opportunities for new investments catering to young professionals and entrepreneurs. Office buildings are being converted to support startups and residential needs. Warehouses are being repurposed for mixed-use, entertainment, and “maker” spaces at price points attractive to the creative-class demographic.

Queen: Everyone spends way too much time at work, and so we’re always thinking about how to make that time at work more productive, both for the employers and the employees. How can we make it easier for people to pick up groceries or the dry cleaning on their way home, or to take a walk or see some nature in the middle of the day, or have a workout in the workplace? In creative industries, people may show up at the office later, or may work much later, or are always connected and working, so as landlords we need to respect that and help facilitate that flexibility for our tenants.

 

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