Tracking the great urban migration
FT’s Tom Kaiser, center, strides a Minneapolis skyway, looking for urban tales.
Photo by Nicholas Upton
You can learn a lot by turning off HGTV and experiencing life. In this instance, I was searching for what boomers and millennials are getting for their money when ditching the country or suburbs and moving their lives into the city. Also, as somebody who’s lived everywhere from isolated woods to the heart of downtown, I wanted to explore what people leave on the table as waves of Americans head into city centers.
It was the perfect excuse to call my delightful real estate agent, Amanda Winterer of Keller Williams, who recently helped me decamp to a first-ring suburb just outside the city—we millennials like to buck the trends. We planned a day to scope out the finest downtown residences, no cul-de-sacs, gated communities or single-family homes allowed.
Wasteland no more
Our GPS-packed day began in the trendy Mill District, home to the Guthrie Theater and stacks of high-end condos. I remember this neighborhood from my college days (12+ years ago) as a wasteland of crumbling parking lots, abandoned shopping carts and a rundown Liquor Depot, the birthplace of those carts. This neighborhood has been fully transformed in recent years.
Nine floors up, our first listing was a 4,000-square-foot pad overlooking a stunning panorama including the Mississippi River’s St. Anthony Falls and gorgeous Stone Arch Bridge that once hauled Pillsbury flour, but now is a cross-river bike/ped path. Standing on sleek mahogany floors, we considered the pros and cons for a hypothetical new urbanite shopping for luxury with a view.
“Somebody like that has probably been out in the suburbs for years, and they’re looking for walkability and a new lifestyle,” Winterer said. “The kids are gone now, so they can finally live someplace where they can walk everywhere, enjoy the city and don’t have to get in the car to drive everywhere—plus, you can see the fireworks from here.”
She added that guest spaces are key for boomers looking to entertain, be it visiting kids, family or friends. This fabulous abode had two guest bedrooms separated by a Jack-and-Jill bathroom, which we agreed would have to go for privacy’s sake. At $2.1 million for this place, mere nickels and dimes.
Compared to the panic-soaked first-timers, seasoned buyers know the process, Winterer said, but are often shocked at the current market conditions where open houses create a feeding frenzy that can result in double-digit offers within the first day.
ERA Real Estate CEO Charlie Young expects these hot-and-heavy conditions to persist due to the ongoing, pent-up demand still lingering from the Great Recession.
“My wife and I are soon to be empty nesters and are going through all these questions in our personal lives,” Young said. “I don’t plan on retiring any time soon, so we’re not looking at a major relocation, but we are certainly looking at downsizing so I’m not commuting as far. We have three dogs, which will make that a little problematic, but I have a lot of land to take care of today and I’m done with that.”
Targeting young professionals and downsizing boomers, ERA, he added, is focusing on Charlotte, Nashville, Louisville and other so-called 18-hour cities, which means they don’t keep pumping around-the-clock but don’t roll up the sidewalks at 5 p.m., either.
Amanda and I motored onward to a 1,200 square-foot condo in one of the tallest towers in the city. A third of the price and square footage as our last stop, this two-bedroom had a closed-off layout, smaller rooms but another stunning view of downtown.
With smaller bedrooms and a miniature living room—saying nothing of the yellow paint throughout—it was easier to look past the view to what city dwellers give up over the country or burbs: outdoor space, privacy and the ability to knock down walls or build outward. We agreed being near parks, bike trails and amazing restaurants would be worth the trade off, but those yellow walls. Oof.
Further up the river lies the North Loop, an industrial hardscape remade into the trendiest part of town. We toured a three-level, three-bed, 3,000 square-foot townhouse with “urban boomer” written all over it—lush river views, multiple levels, separation between bedrooms and a big, unfinished basement with space for a gym, studio or grandkid racetrack.
“The open floor plan is an interesting phenomenon, because so many young people want it to watch the children while they cook,” she said, adding her wish to preserve some homes in the condition they were originally built. “My kitchen is closed off so I have the gift of gossip—I can pull somebody in my kitchen, get help and no one will see me frantically trying to make enough drinks for everyone. It’s very 1950s.”
The full Patrick Bateman, this condo has sharp lines, light colors and great city views.
Something has to give
Back to the present, something has to give in this era of high-stakes open houses, quickly rising prices and limited housing stock. Just look at the insane prices for even substandard housing in San Francisco and surrounding Bay Area.
Demographic evidence shows the great migration back to cities will only continue, and physics suggests exurban, single-family housing tracts cannot be built out in perpetuity.
Keller Williams President John Davis gets fired up talking about the current market—he might always be fired up—and believes the current residential market is in the middle of the eighth inning and heading into the next downturn. Rather than being worried, he says “fortunes are made in the downturns,” and said his company is preparing accordingly.
“I’m right in between an empty nester and a millennial—more toward an empty nester—but I personally live in downtown Austin and love it,” Davis said. “Every market’s different, but this movement to urban centers and redevelopment of historical buildings is a trend that has staying power.”
Winterer and I pushed the button for the 12th floor of a mixed-use building including condos, a high-end restaurant, luxury hotel and spa—our final stop. Herringbone floors, a temperature-controlled wine cellar, marble backsplash, brick accent walls and the best, most skyscraper-packed view of the day—its modernity, amenities, finishes and location spoke to us both.
There’s no garage or yard space for tinkering—here or in any of the others—but downsizers are likely tinkered out, and anecdotal evidence suggests younger folks are less about gardening or engine rebuilds than previous generations. And, the plus sides of such a lifestyle seem to outweigh the downsides: a two-minute walk to the orchestra and the best restaurants in the city, a 5- to 10-minute Uber ride to the rest of the city and a great view to watch summertime thunderstorms roll through town.
If you’ve got a yard now, enjoy it while you can. High-rise, multi-unit housing is the future for a lot more than trendy millennials and well-to-do boomers. If you’re in the business of predicting future market conditions, don’t forget that business follows rooftops—however many of us are crammed under a single one.
Tom Kaiser is associate editor of Franchise Times, and writes The Urbane Franchisor column in each issue. Reach him at firstname.lastname@example.org.