ABOUT ULI MN. VISION Thriving communities.

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2 ABOUT ULI MN MISSION Urban Land Institute Minnesota engages public and private sector leaders to foster collaboration, share knowledge, and join in meaningful strategic action. VISION Thriving communities. 2

3 REGIONAL COUNCIL OF MAYORS Minneapolis, Saint Paul and 53 other municipalities, in the developed and developing suburbs, are represented in the RCM. FROM 8 MAYORS IN 2004 The RCM provides a nonpartisan platform focused on building civic trust through networking, learning, collaboration and action. TO 55 MAYORS IN

4 ADVISORY SERVICES: IT S ABOUT TRUST More than 50 cities have completed ULI Minnesota workshops. Trust is developed across public and private sectors. "The workshops are opportunities for City officials to ask questions of real estate professionals in an environment where neither party has anything at risk. This is a new kind of civic space. The developers are neither seeking anything nor defending anything and City officials are not under any pressure. It allows for a spirit of inquiry and exploration that is too often not possible when both parties are advocating specific positions." ULI MN Governance Chair John Breitinger Cushman & Wakefield/Northmarq 4

5 DEMOGRAPHICS MARKET FORCES FOUR MAJOR CHANGE DRIVERS TECHNOLOGY RESILIENT INFRASTRUCTURE 5

6 DEMOGRAPHICS GENERATIONAL SHIFTS AGING POPULATION CULTURAL DIVERSITY 6

7 30% 25% 23% 23% 23% 23% 23% 25% MILLENNIALS 20% 20% 19% AND BOOMERS 15% COMPRISE % 10% 10% MILLION AMERICANS 5% 0% United States Minnesota Gen Z Under 18 Millennials 18 to 34 Gen X 35 to 50 Baby Boomers 51 to 69 Silent Generation 70 years and older US Census estimates & Minnesota State Demographic Center, August

8 MN S OVER 65 POPULATION TO EXCEED SCHOOL-AGE BY 2020 Under 18 population will decline from 23% to 20% of population Over 65 will grow from 17% to 22% 1,700,000 1,500,000 PROJECTED MN POPULATION: AGES 5 17 AND 65+ "These things usually creep along at the speed of a glacier. Not so with aging. In demographic terms, this is a tsunami. It doesn't get much bigger than this. Thomas Gillaspy Former MN State Demographer 1,300,000 1,100, , , , PLUS 5 TO 17 U.S. Census Bureau, Decennial Census and Population Estimates. Forecasts: Minnesota State Demographic Center. 8

9 MOST NEW HOUSEHOLD GROWTH WILL BE AGES 65+ NET HOUSEHOLD GROWTH: NET HOUSEHOLD GROWTH: % 6% 9% 80% 85% Under Over 65 Under Over 65 Arthur C. Nelson, TWIN CITIES Metropolitan Council Area Trends, Preferences, and Opportunities: 2010 to 2020, 2030 and 2040,

10 100% CHANGE IN RACE/ETHNIC COMPOSITION OF TWIN CITIES 80% MINNESOTA IS BECOMING MORE CULTURALLY DIVERSE 60% 40% 20% 0% 80% 71% 8% 65% 11% 5% 10% 8% 6% 7% 10% 11% Black American Indian or Alaska Native alone Hispanic or Latino All Communities of Color Asian and Hawaiian or other Pacific Islander Two or More Races White Integrated Public Use Microdata Series from the U.S. Census Bureau, American Community Survey 10

11 35% US & MINNESOTA PERCENT FOREIGN BORN OVER TIME 30% IMMIGRATION 25% MAKES UP AN 20% Minnesota INCREASING PORTION OF POPULATION 15% 10% US 14% 8% GROWTH 5% 0% Minnesota Percent Foreign Born US Percent Foreign Born U.S. Census Bureau 11

12 MINNESOTA S COMMUNITIES OF COLOR EXPERIENCE SIGNIFICANT DISPARITIES 100% 87% 80% 60% 76% 68% 40% 44% 39% 20% 23% 7% 11% 4% 25% 0% Live in poverty No health insurance Cost-burdened households Homeownership rate Complete high school on time People of Color White U.S. Census Bureau, American Community Survey. All data 2015 except Health Insurance (2014) 12

13 MARKET FORCES MSP REGION COMPARATIVE ADVANTAGES COST-BURDENED HOUSEHOLDS HOUSING AND JOBS MISMATCH WORKFORCE SHORTAGES COMMERCIAL INDUSTRY TRENDS 13

14 TOP COMPARATIVE ATTRIBUTES OF THE MSP REGION 1. HOUSING: Availability and affordability of housing 2. PROXIMITY: How close to my opportunity is it? 3. MOBILITY: Do I have options to get around? 4. CONNECTIVITY: Can I meet people or be near friends and family? 5. PARKS AND GREEN SPACE: Can I enjoy the outdoors? ALSO RATED HIGHLY: Access to restaurants/bars, arts/culture, safety SITUATIONALLY IMPORTANT: Walkability, school district, bike paths Source: GREATER MSP (Make It. MSP. MSP Welcome Survey, 2016) 14

15 MILLENNIALS LIVE IN COMMUNITIES OF ALL TYPES AND WANT URBAN-LIKE AMENITIES WHERE THEY LIVE HOW THEY SEE THEMSELVES Small towns 17% Rural 7% Downtown/near downtown 13% City People 37% Small-Town Folk 26% Newer suburbs 15% Other city neighborhoods 35% Dense, older suburbs 13% Suburbanites 36% 15

16 100% COMPARED TO YEARS AGO, SURVEY RESPONDENTS THINK IT IS HARDER FOR MILLENNIALS TO A MIDDLE CLASS LIFESTYLE IS INCREASINGLY OUT OF REACH FOR MILLENNIALS 80% 60% 40% 20% Save for retirement 81% Own a home 76% Have a stable, decentpaying job 71% Have stable, affordable housing 71% Have health insurance 50% Obtain education beyond high school 45% 0% MacArthur Foundation, June 2015 Survey 16

17 U.S. ANNUAL WAGES BY GROUP IN 2015 DOLLARS $350,000 $300,000 $287,983 $250,000 $200,000 $150,000 $100,000 $131,546 WIDENING INCOME AND WEALTH GAP $50,000 $26,252 $34,481 $ Bottom 90% Top 5% Economic Policy Institute s State of Working America Data Library 17

18 60% CHANGE IN COST-BURDENED RENTAL HOUSEHOLDS 51% 48% 40% 37% 41% 38% THE NUMBER OF METRO AREA 20% 16% 19% 17% 26% 24% COST-BURDENED HOUSEHOLDS HAS GROWN 0% Severely burdened (50% or more of income) Overall cost-burdened (30% or more of income) U.S. Census Bureau 18

19 WORKFORCE HOUSING PER LOW-WAGE JOB MISMATCH BETWEEN AFFORDABLE HOUSING AND JOBS 19 Sources: Comprehensive Housing Affordability Strategy data and Longitudinal Household Employment Data

20 PROJECTED SHORTFALL OF 100,000+ SKILLED WORKERS BY 2020 BABY BOOMER RETIREMENTS STAGNANT LABOR FORCE GROWTH CHALLENGES RECRUITING TO THE REGION 20

21 COMMERCIAL INDUSTRY TRENDS $120 E-COMMERCE CONTINUES TO GROW RAPIDLY AS WE BUILD FEWER NEW BRICK AND MORTAR SPACES 140 E-COMMERCE SALES $B $100 $80 $60 $40 $ NEW RETAIL SQUARE FEET (MILLIONS) $ EST E-Commerce Sales in $B New Retail Space in Millions of Square Feet 0 Sources: New retail space data from JLL Q Retail Outlook. E-Commerce sales data from US Economic Census 21

22 TECHNOLOGY AUTOMATION AND JOBS NEW TECHNOLOGY, REGULATION AND CITIES DATA, TRACKING AND CONNECTIVITY 22

23 AUTOMATION IS AFFECTING JOBS AND CREATING CHALLENGES AND OPPORTUNITIES 23

24 THE COLLABORATIVE ECONOMY IS CHANGING RETAIL AND SERVICES REGULATION IS PLAYING CONSTANT CATCH-UP 24

25 ADVANCING TECHNOLOGIES WILL AFFECT CITIES IN NEW WAYS DRIVERLESS CARS 3D PRINTING & CONSTRUCTION DRONE DELIVERY 25

26 DATA, TRACKING, AND CONNECTIVITY Think about what it would mean for a city where every building is connected and able to exchange information freely. Jason Kelly Johnson, Cofounder, Future Cities Lab 26

27 RESILIENT INFRASTRUCTURE CYBER SECURITY REUSE OF INDUSTRIAL BUILDINGS DEFERRED MAINTENANCE HUMAN-SCALE INFRASTRUCTURE 27

28 COMMUNITIES NEED A CYBERSECURITY STRATEGY 28

29 WAREHOUSE/DISTRIBUTION FACILITIES ARE MUCH LARGER AND REQUIRE GREATER CLEAR HEIGHTS 29

30 INDUSTRIAL SITES AND WAREHOUSES CAN BE ADAPTED AND REUSED AS MAKER SPACES AND INCUBATORS 30

31 AGING INFRASTRUCTURE AND DEFERRED MAINTENANCE 31

32 INCREASING EXTREME RAINFALL EVENTS MORE CROP RUNOFF STORMWATER OVERLOADS SEWER SYSTEM FAILURES 32

33 HUMAN-SCALE PLACES ARE ECONOMICALLY RESILIENT AND ADAPTABLE 33