Thursday
September 21, 2017

Corporations Flee Suburbs, Head Downtown

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Corporations Flee Suburbs, Head Downtown

More companies are abandoning massive office parks in the suburbs and heading back to once-abandoned office space in urban centers. They’re making the move in an attempt to appeal to millennial employees. But some developers and community planners are worried about what will happen to less densely populated areas if the trend continues.

Over the last half-century, employment has shifted from city to suburb and now back to the city, according to an article at Curbed.com. A recent report by Smart Growth America found that of nearly 500 companies, 245 had relocated from a suburban location. As one high-profile example, McDonald’s has had its headquarters in Oak Brook, Ill., since 1971. The fast food giant announced last year that it would be moving to Chicago’s West Loop.

“It’s all about one thing: talent,” Tom Murphy, a senior resident fellow at the Urban Land Institute, told Curbed. “For the first time in history we’re seeing jobs move to where people are, rather than vice versa. For companies, it’s all about being where talent wants to be.” 

Other developers and city planners believe millennials will return to the suburbs to start households when they get married and are ready to start a family. John Burns Real Estate Consulting even coined a term around the concept that younger Americans will seek out “surban” living, a blend of city and suburbia. They’ll desire dense, walkable developments in the suburbs with revitalized Main Street–style commercial districts.

John Arenas, who owns coworking company Serendipity Labs, told Curbed.com that corporations are rushing too fast back to downtowns and that younger adults may prefer locations in the suburbs.

“They’ll see they’re working against the tide very soon when millennials eventually head to the suburbs,” he says. “We see a lot of what we call ‘millennials in mourning.’ They’re married with their first child, and the last place they think about is the urban environment. A lot of people are soon going to be at the point where finding a good place for their kid to go to school is going to be a lot more important than the coolest restaurant to hang out. Unfortunately for some companies, they may be moving into the cities just before the tide goes the other way.”

Source: “Corporations Are Leaving Suburbs: Can Anything Reverse the Trend?” Curbed.com (Aug. 1, 2017)