Autonomous Vehicles Changing Real Estate Design

Though autonomous vehicles are years away from popular usage, they are already changing how land-use planners and developers think about commercial real estate, said valuation and assessment firm BBG, Dallas.

“The day is coming that autonomous vehicles will be made widely available across the country, transforming society in more ways than how we transport people,” BBG CEO Chris Roach said. “Besides reducing traffic congestion and the carbon footprint, self-driven vehicles will clearly impact the design and construction in real estate development projects in cities and towns nationwide.”

Roach called it important that planners, developers and others in real estate work together to ensure that self-driving cars enable better places to work and live.

A recent University of California-Davis Institute of Transportation Studies policy brief called autonomous vehicles one of three “revolutions” along with vehicle sharing and vehicle electrification that will present both new challenges and new opportunities. “Absent policy reform, the three revolutions may contribute to more sprawl, but a sustainable planning approach that supports both higher-density development and lower single-occupant (or zero-occupant) driving can once again put people first rather than their cars,” the report said.

BBG said two major events are fueling the growing interest in self-driving vehicles. “Earlier this month, General Motors announced that it can begin manufacturing autonomous vehicles for mass production pending regulatory approvals,” the report said. “The automaker, which said it’s capable of producing 100,000 self-driving cars annually, is among other companies such as Tesla and Google working toward taking driverless vehicles from dream to reality.”

In addition, the House of Representatives recently passed the SELF DRIVE Act, which created an initial framework to regulate autonomous vehicles, BBG said. The bill is awaiting Senate action.

“The prospect of autonomous vehicles rolling off production lines has influenced those planning real estate development projects across the country,” BBG said. “For instance, the University of Wisconsin-Madison reportedly intends to reduce parking spaces based on expectations that more of its students and staff will be commuting to and from the school with autonomous vehicles or from ride-hailing companies like Uber and Lyft, both of which are also planning to get into the autonomous vehicle business.”

Other projects are also being designed with less on-site parking, BBG said. “A Nashville, Tenn., mixed-used development project is making fewer parking spaces available, and a Somerville, Mass., parking garage is reducing space by more than 60 percent, saving millions of dollars when completed.”

As expectations grow that less land will be needed to park cars, developers are rethinking how to use land that was initially set aside for parking spaces, BBG noted. “Scaling back parking spaces means that the land can be used for other commercial or residential real estate purposes, resulting in more usable and high-value space,” the report said. “For example, shrinking demand for parking facilities could prompt development of more mixed-use walkable cities, which include streets designed for door-to-door service to accommodate autonomous vehicles.”