The other day I was walking in my town and saw an older man riding his bicycle down the sidewalk. As he approached a turn, a shared Lime bike was next to the path, not obstructing his way in the slightest. The man slowed his bike, launched a karate kick, sent the scooter flying into the bushes, and continued on his way. A few minutes later, two teenagers zoomed past me on a Bird Scooter, parked it on the sidewalk outside their high school, and ran into class minutes before the morning bell rang.
The juxtaposition of these two unconnected acts perfectly summarizes people’s feelings towards the growing mobility revolution. While some see shared scooters and bikes as a menace that clogs roads and terrorizes sidewalking civilians, others see this transportation service as a godsend for increasing efficiency and reducing material ownership. Regardless of your own personal feelings, the mobility revolution is here, it is growing, and it will fundamentally change everything from how you travel to where you live.
In his illuminating article, “Our Frictionless Future,” Elie Finegold, an Entrepreneur in Residence at MetaProp and former SVP of Global Innovation and Business Intelligence for CBRE, wrote about how radical mobility and transportation-as-a-service (TaaS) will change not only real estate, but the world as we know it in the very near future.
At our recent Metatrends roundtable held in New York City, we convened a panel to discuss the mobility revolution and its impact on real estate and what we should expect in the future. The panel brought together two industry experts, Elie Finegold and Tony Hudgins, VP of Partnerships at TransitScreen, and was moderated by Propmodo’s own Franco Faraudo.
Wait, so what exactly is the Mobility Revolution?
First and foremost, you don’t need to ditch your car at the local junk yard to prep for the mobility revolution. It is already here. If you’ve ever ridden in a Lyft or Uber, used a shared bike or scooter, or had food delivered to your house with DoorDash, you’ve unwittingly become a revolutionary. But the speed at which TaaS is moving forward is staggering, and these services are just the tip of the iceberg, especially as automated cars begin hitting the roads in full force in the near future.
Despite its momentum, the mobility revolution will not be complete until these new forms of TaaS mesh with existing forms of transportation – buses, trains, subways, and good old-fashioned walking – and are incorporated into one seamless process that is efficiently useable by everyone. At the outset of the panel, Hudgins touched on the role that TransitScreen is playing in the mobility revolution. His company is an aggregator of transportation information that compiles over 3,000 sources of transit data on what he calls the “shared transportation economy.” Hudgins explained that while these new forms of transportation are exciting and innovative, there are still several friction points for users to seamlessly utilize these forms of transport. Many people will use several modes of transportation to get from Point A to Point B. For example, a person could hop on a scooter to get to the bus stop, take the bus to the train station, ride the train to their stop downtown, then walk the final few blocks of their journey. But planning this trip out requires several different apps, websites of transit schedules, and maps to understand the routes. It’s a time-consuming endeavor. To address this, companies like TransitScreen are working to aggregate transit information into one platform to make the process much more efficient.
Why is aggregating transit information important?
By aggregating this transit information in one (or a few) places, certainty can be built among the user base, increasing adoption rates. If you’ve ever used a shared bike service, there is nothing more frustrating than walking out of work following your app to a location where a bike is supposedly waiting, only to find it is gone, or has two bent tires. When this happens, you have to open another company’s app to find another shared bike, which may or may not be anywhere near. It is this lack of certainty that pushes users to buy their own bikes or simply drive to work every day. As Finegold notes, upon building a reliable and efficient network of transit information, usage rates will increase, and their entire multimodal network will improve. “Utilization actually drives availability. There’s a virtual circle and once you get past the tipping point within a certain radius, you’ll have a dense range of services and options that will get you effective transportation.”
In other words, when a user can quickly find several nearby alternative transit options, the entire system improves. In my previous example—but instead with a single app or platform—when the shared bike wasn’t available, I could open my transit app on my phone and see that a bus was arriving in two minutes a block away, find a nearby electric scooter, or reserve a Lyft to pick me up. By reliably and seamlessly being able to find available transit alternatives, the mobility revolution will continue to build momentum. As stated by Hudgins, “mobility is the freedom of knowing that you do not have to be tethered to one particular option.” With reliability comes change. People will realize that the various types of TaaS are fast and efficient, and that they no longer have to own a car anymore. But it is crucial that people understand how to use the TaaS and can easily access it, something that has not yet occurred. However, when this critical mass of understanding arrives, it will have seismic impacts on the way cities are built, impacting real estate to its core.
Everyone knows the three most important words in real estate: location, location, location. But with the arrival of the mobility revolution, this fundamental principle in real estate will change. In some cases like New York City, which has had a form of TaaS for decades (think: taxis, taxis, and more taxis),location will continue to mean living in a densely populated area. But in many other cities, the changes will be much more profound. No longer will people be fighting to live close to their jobs. With effective transportation networks and increases in tech trends like remote working, people will be able to live much further from city centers. This will have a deep impact on the way real estate developers and owners approach buying assets.
Hudgins agrees with Finegold that real estate location will fundamentally change with the mobility revolution. He argues that real estate owners can get more intelligent about what real estate they own and what they want to own by understanding their occupants’ transit actions. With this information, owners can find a property that may not have been considered a “good location” in the past, but now offers excellent access to transit services and will be attractive to tenants. For developers, seeing that tenants in the area tend to use TaaS much more than cars means that building a giant parking lot in a building will be less important than creating access for rideshare cars to have curb space to quickly pull in and pick up their customers.
Additionally, the mobility revolution will bring about a change in the composition of cities themselves, but not immediately. Finegold argues that “density will become an amenity for the next generation,” as people will want to be closer to services. But as autonomous vehicles improve and services—like gourmet food delivery, for example—are brought directly to people, populations will spread out and density will be less important. But, ultimately, people will still be social creatures. “You’ll see in the near future, amenity and lifestyle centers and clusters,” Finegold states. “Cities will still have headquarters areas for work and lifestyles, but you’ll begin to see more villages that offer these services outside of major city centers. With services coming to us, we’ll need to find places to interact socially, which is where these centers will come into play. People will choose to live close to these.”
Hudgins sees the future of real estate and TaaS as inextricably aligned. In order for developers and owners to take advantage of the mobility revolution, it will be crucial to share information with their occupiers to understand how they use transportation and access a particular property. By gaining this knowledge, owners and developers will be able to accurately size their property and make the correct real estate purchasing decisions in the future.
Whether you are like the man who kicks shared scooters into the bushes or similar to the schoolkids who use these services to get you the last mile of your journey to avoid detention, the mobility revolution is here. Be ready to join it, or be left in a shared bike’s proverbial dust.