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
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 2017 3
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
DEMOGRAPHICS MARKET FORCES FOUR MAJOR CHANGE DRIVERS TECHNOLOGY RESILIENT INFRASTRUCTURE 5
DEMOGRAPHICS GENERATIONAL SHIFTS AGING POPULATION CULTURAL DIVERSITY 6
30% 25% 23% 23% 23% 23% 23% 25% MILLENNIALS 20% 20% 19% AND BOOMERS 15% COMPRISE 150 10% 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 2015 7
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 1,100,000 900,000 700,000 500,000 65 PLUS 5 TO 17 U.S. Census Bureau, Decennial Census and Population Estimates. Forecasts: Minnesota State Demographic Center. 8
MOST NEW HOUSEHOLD GROWTH WILL BE AGES 65+ NET HOUSEHOLD GROWTH: 1990 2010 NET HOUSEHOLD GROWTH: 2010 2040 21% 6% 9% 80% 85% Under 35 35 64 Over 65 Under 35 35 64 Over 65 Arthur C. Nelson, TWIN CITIES Metropolitan Council Area Trends, Preferences, and Opportunities: 2010 to 2020, 2030 and 2040, 2014. 9
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% 2005 2020 2035 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
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
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
MARKET FORCES MSP REGION COMPARATIVE ADVANTAGES COST-BURDENED HOUSEHOLDS HOUSING AND JOBS MISMATCH WORKFORCE SHORTAGES COMMERCIAL INDUSTRY TRENDS 13
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
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
100% COMPARED TO 20 30 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
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 $0 1975 1985 1995 2005 2015 Bottom 90% Top 5% Economic Policy Institute s State of Working America Data Library 17
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% 1980 1990 2000 2010 2013 Severely burdened (50% or more of income) Overall cost-burdened (30% or more of income) U.S. Census Bureau 18
WORKFORCE HOUSING PER LOW-WAGE JOB MISMATCH BETWEEN AFFORDABLE HOUSING AND JOBS 19 Sources: Comprehensive Housing Affordability Strategy data and Longitudinal Household Employment Data
PROJECTED SHORTFALL OF 100,000+ SKILLED WORKERS BY 2020 BABY BOOMER RETIREMENTS STAGNANT LABOR FORCE GROWTH CHALLENGES RECRUITING TO THE REGION 20
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 $20 120 100 80 60 40 20 NEW RETAIL SQUARE FEET (MILLIONS) $0 2008 2009 2010 2011 2012 2013 2014 2015 2016 EST E-Commerce Sales in $B New Retail Space in Millions of Square Feet 0 Sources: New retail space data from JLL Q2 2016 Retail Outlook. E-Commerce sales data from US Economic Census 21
TECHNOLOGY AUTOMATION AND JOBS NEW TECHNOLOGY, REGULATION AND CITIES DATA, TRACKING AND CONNECTIVITY 22
AUTOMATION IS AFFECTING JOBS AND CREATING CHALLENGES AND OPPORTUNITIES 23
THE COLLABORATIVE ECONOMY IS CHANGING RETAIL AND SERVICES REGULATION IS PLAYING CONSTANT CATCH-UP 24
ADVANCING TECHNOLOGIES WILL AFFECT CITIES IN NEW WAYS DRIVERLESS CARS 3D PRINTING & CONSTRUCTION DRONE DELIVERY 25
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
RESILIENT INFRASTRUCTURE CYBER SECURITY REUSE OF INDUSTRIAL BUILDINGS DEFERRED MAINTENANCE HUMAN-SCALE INFRASTRUCTURE 27
COMMUNITIES NEED A CYBERSECURITY STRATEGY 28
WAREHOUSE/DISTRIBUTION FACILITIES ARE MUCH LARGER AND REQUIRE GREATER CLEAR HEIGHTS 29
INDUSTRIAL SITES AND WAREHOUSES CAN BE ADAPTED AND REUSED AS MAKER SPACES AND INCUBATORS 30
AGING INFRASTRUCTURE AND DEFERRED MAINTENANCE 31
INCREASING EXTREME RAINFALL EVENTS MORE CROP RUNOFF STORMWATER OVERLOADS SEWER SYSTEM FAILURES 32
HUMAN-SCALE PLACES ARE ECONOMICALLY RESILIENT AND ADAPTABLE 33