The Impact of Driverless Cars on Commercial Real Estate

 

 

Driverless cars have been a hot topic in the technology, automobile and commercial real estate industries as of late. Not only a cutting-edge technology advancement that is exciting and challenging to consumers, but the rise of the autonomous is anticipated to have major impacts on the landscape of our cities. Transportation has always shaped land use and as cars became the dominant mode of transportation, cities expanded highways, roads and parking lots to accommodate. So when (if?) the driverless car becomes the norm, what will be the impact on our cities?

Experts say that driverless cars will one day move about the city picking up people and goods and transporting them with little risk of accidents, essentially cutting down on consumer’s needs for personal vehicles and large, multi-level parking lots. Fully autonomous vehicles will reshape cities in the same way that automobiles shaped nearly every aspect of the built environment.

So what impact would this have on the urban environment?

  • Driverless cars will increase the efficiency of roadways by requiring significantly less road space than cars today. By traveling closer together and in narrower lanes, autonomous vehicles could support the same traffic volume as human-driven cars on one-quarter of the road space, by some estimates.
  • Today, cars sit parked 95% of the time.  Researchers estimate that a fleet of shared autonomous vehicles in urban areas could achieve daytime use rates near 70%. The United States has more than 800 million parking spaces- nearly four spaces per vehicle. Autonomous cars would require fewer parking spots than privately owned cars, because they would be in use more frequently.
  • Developers in cities like San Francisco and Chicago are seeing neighborhoods developed that are less reliant on cars and more pedestrian friendly.
  • The traditional retail model for big-box retailers: single-story structures with ample surface parking, is less attractive. Design and development may focus on more aesthetically pleasing, walkable environments.

As Bill Gates is quoted, “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten years.” In the immediate future, the impact of driverless cars may only have a slight impact on our cities. But in the next 10-20 years, our cities may start to look very different.

Katie Craven
Katie Craven is Marketing, Communication and Brand Manager at Watchdog Real Estate Project Managers, a real-estate consulting firm that provides owner’s representation and project management services. More about Watchdog Real Estate Project Managers as well as additional blog posts can be found here.
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