Food & Real Estate Forum. Ed McMahon Denver, CO August 16, 2017

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1 Food & Real Estate Forum Ed McMahon Denver, CO August 16, 2017

2 Building Healthy Places An overarching Theme for all of ULI Activities Convening's Councils and Networks Research and Publications Leadership & Partnerships Website: Twitter: #ulihealth

3 ULI Report on Food and Real Estate Central Theme Incorporating opportunities to: Grow Purchase Consume Food within development projects can pay dividends in terms of health, sustainability, social equity and profitability.

4 Food and Real Estate Agrihoods Food Centric Residential Developments Urban Agriculture Farmers Markets/ Food Halls/Next Gen Markets Urban Grocery Stores Food-Centered Retail and Mixed Use Development Food Hubs and Culinary incubators Innovations and Innovators

5 Changing Nature of Agriculture 18 th & 19 th Century 21 st Century

6 Changing Nature of Food Fewer fruits, veggies & whole grains More meat & high calorie fast food

7 Food Facts Agricultural production is a major source of green house gases 13% of all global emissions. More than 1/3 of all food in the US is wasted 19 % of food in US is discarded or uneaten at home. On average, US produce travels 1500 miles before reaching the plate. More than 29M Americans live in food deserts.

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9 Why the Growing Interest in Food? Growing interest in fresh, local and healthy. Growing interest in green and sustainable. We all eat 3 times a day. You can t eat online. Young people prefer experiences more than stuff. Growing, preparing and eating food can all be social activities

10 Trends in Food & Real Estate Incorporating farms and community gardens into communities is a hot trend in Residential Development 5 fold increase in number of Farmers Markets European Style Food Halls are proliferating Proliferation of celebrity chefs and concept driven restaurants Malls & mixed use projects replacing apparel with food Craft brewing has doubled its market share in last 5 years Food Truck Revenue is Growing 12.4% a year Grocery Stores changing locations, formats and offerings 36% of American households grow vegetables at home

11 FOOD-CENTRIC DEVELOPMENT TYPES AGRIHOODS Residential Working farm FOOD- CENTERED MIXED-USE DEVELOPMENT Restaurants Food stores Mixed-use FOOD-CENTRIC RESIDENTIAL DEVELOPMENT Community gardens Restaurants Residential FOOD HUBS + CULINARY INCUBATORS Regional processing Distribution centers Workforce development NEXT- GENERATION URBAN MARKETS Food halls Workforce Development Mixed-use development INNOVATIONS + INNOVATORS Sustainability Access to healthy food Economic development

12 Case Studies - Overview

13 Agrihoods One of the hottest trends in new home development is incorporating farms into communities

14 200801

15 Conservation Development Saves land Increases value Reduces infrastructure Preserves rural character

16 Agrihoods Everywhere Agritopa - AZ Bucking Horse CO The Cannery - CA Harvest TX Kukui ula HI Prairie Commons KS Sendro CA Serenbe GA Skokomish Farms WA South Village, VT Wetrock Farm - NC Willowsford - VA

17 Agrihoods Prairie Crossing, Grays Lake, IL Serenbe, Fulton County, GA The Cannery, Davis, CA Harvest, Argyle, TX

18 Agricultural Space Can Add Value As a developer it s been humbling to see how such a simple thing and such an inexpensive thing as a small farm can be a development s most loved amenity. Brent Herrington, DMB Associates

19 Serenbe Fulton County, GA 220 Homes 25 acre organic farm 3 restaurants A country inn System of interconnecting trails and pathways Abundant green space Edible Landscaping

20 Willowsford Farm Loudoun County, VA 50 varieties of fruits and vegetables Small livestock laying chickens and hens for poultry Goats for mowing Bees for honey & pollination Weekly CSA Program Market stand Open 3 days a week Educational programing and farm events

21 Agrihoods Lessons Learned Farms are the new golf. Farms create an ethos of sustainability & community building. Novelty creates interest and energy around projects. Open space can be a source of revenue. Eases concerns about density in suburbs and rural areas. Appeals to buyers seeking something a little more authentic. Consumers will pay a premium for access to trails, open space and protected land, but want assurances that it will be protected in perpetuity. Don t count on residents to do the farming or gardening.

22 Food Centric Residential Developments Multi-family residential or mixed use communities focused around community gardens, restaurants or a strong food identity. These developments tend to be smaller than Agrihoods and are often redevelopments and/or in urban settings. Grow Community Bainbridge Island, WA Community gardens are a relatively low cost amenity. Eco- Modern Flats Fayetteville, AR

23 Arbor House New York, NY Eco-friendly, health promoting building. 124 units of affordable housing 10,000 sq.ft. hydroponic rooftop farm Food available to residents through a CSA. Extra food sold in neighborhood Indoor and outdoor fitness areas Smoke-free policy Low VOC paints/green Walls Accessible stairwell, daylighted, plays music

24 ECO Modern Flats Fayetteville, AR Before Rehab of a 1960 s apartment complex (93 units) Arkansas s first LEED certified(platinum) multi-family complex Strict non-smoking policy Clean indoor air (non-voc paints, ductless, energy efficient, minisplit HVAC Community Gardens, roof top decks, BBQ areas, other social interaction areas After

25 Eco Modern Flats - Results Fully leased since completion, with a waiting list Current rents 113% to 140% above pro-forma estimates Creating community gardens was not just about growing food. It was also about growing community. Jeremy Hudson, Specialized Real Estate Group Rent rates of $1.42 per sq. ft. exceed market average of.99 per sq. ft. Turnover rates 15% below market average

26 Mariposa - Denver 850 unit mixed income, mixed use, transit oriented, redevelopment. Replaced 270 units of public housing Designed to enhance the health of residents

27 Increase Access to Healthy Food Community Garden Osage Cafe Cooking & Nutrition Classes Culinary Institute

28 Increase Physical Activity 2 Bike Share Stations Public Spaces Outdoor Exercise Equipment Exercise classes

29 Food-Centered Retail & Mixed Use Large, mixed-use (office, residential, shopping, theater) projects designed around a range of food and dining offerings. Restaurants, markets, grocery stores, etc. to enhance amenities, value, place-making. O Street Market Washington, DC Pearl District San Antonio, TX

30 The Pearl District A Culinary Destination Pearl District San Antonio, Texas 22 acre site of former Pearl Brewery 16 restaurants, 2 breweries, a bakery Culinary Institute of America (CIA) Twice Weekly Farmers Market (attracts 5,000 to 7,000 per day) Emma Hotel (146 Rooms) 432 Multi-family housing units Office and Retail 2.5 acre park Banquet & Meeting Facilities Adjacent to River Walk

31 Pearl District San Antonio Hotel Emma Stables Wedding & Banquet Facility Neighborhood Park & Apartments CIA in Former Warehouse

32 Pearl District San Antonio Micro Brewery in Pearl District Restaurant in former Brewery Offices Food Hall in former Bottling Plant Restaurant in former Manager s House

33 City Centre - Houston Mixed use development. Former site of a failed mall. 5 office buildings, 3 apartments, 2 hotels, brownstones, retail space, conference center. 24 restaurants, health/fitness facility & cinema to drive foot traffic. Included national restaurants to spread the risk, but emphasized local restaurants to add authenticity.

34 Trinity Grove - Dallas West Dallas, restaurant incubator 12 restaurant spaces, brewery & culinary events center Entrepreneurs submit concept ideas Gourmet catering, culinary classes, corporate events Help with business plans & staffing & management

35 Outdoor Dining & Urban Vibrancy In 1990 Center City Philadelphia had no sidewalk cafes. Today Center City Philadelphia has 4,400 outdoor café tables. Center City is now the fastest growing zip code in Pennsylvania. Source: Better Cities & Towns, 2015

36 Place Making Dividend People stay longer, come back more often and spend more money in places that attract their affection.

37 Pine Hills-Plymouth, MA Master-planned community 1700 homes sold 2,200 acres (about 70% of site) preserved as farms and natural areas. Pine Hills Market certified as Massachusetts s first Healthy Market. Market offers local produce, butcher shop, cheese monger, bakery & chef prepared meals and cooking classes. Market connected to neighborhoods by a trail system

38 Urban Agriculture Urban agriculture is the practice of growing, raising or cultivating food in or around a city or town. It can involve urban horticulture, beekeeping, animal husbandry and other practices. It may also involve processing and distributing food.

39 Urban Agriculture: about more than Food Community Revitalization Jobs Environmental Justice Fostering Social Interaction Helping to solve the food desert problem

40 Urban Gardens Cropping Up: Everywhere! AT&T Baseball Park Urban Garden White House Kitchen Garden Urban Garden on Chicago City Hall Detroit has 1350 urban gardens