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Exploring Mixed-Use Developments and Their Impact on Commercial Real Estate

Within a mixed-use development, different types of land uses are combined, such as residential, commercial, and sometimes even industrial or institutional uses. A mixed-use development is designed to create a vibrant, walkable community where people can live, work, and play close to one another. Mixed-use developments have a significant impact on commercial real estate. They can provide substantial benefits in several ways, including meeting some demands regarding commercial property, increased property value, and diversification.

Due to the increased foot traffic created by mixed-use developments, commercial space demand increases. Several businesses, including retail stores, restaurants, cafes, and entertainment venues, can benefit. The goal of mixed-use developments is to create walkable communities, reducing the need for people to commute long distances and promoting a more pedestrian-friendly lifestyle. Commercial space within a development that places a strong emphasis on walkability may be sought after by consumers who prefer convenience and accessibility

When different land uses are integrated into a mixed-use development, the value of properties increases due to the increase in value associated with the integration of different land uses. It is without a doubt that a property that is close to amenities such as shops, restaurants, and recreational facilities in the surrounding commercial real estate will be more desirable, which will in turn lead to higher property prices and a higher rent, as these amenities will make the property more desirable. Additionally, mixed-use developments offer a unique opportunity for marketing and advertising. A property’s value increases when it people are exposed to multiple organizations that bring in a variety of people to experience the business.

Mix-use developments offer commercial real estate investors diverse and stable investments by combining multiple types of uses. Diversification mitigates risks associated with relying on a kind of tenant. When there is a downturn in the economy and one sector is adversely affected, the presence of other uses can provide stability and support the overall viability of the development. As a result of their zoning and urban planning policies, many cities and municipalities have begun to encourage mixed-use developments. In addition, developers can receive incentives for including a mix of uses in their projects as a result mixed-use developments are more financially viable and attractive

As mixed-use developments become more functional, they are likely to increase. In Winston-Salem, we see this in the attraction for mixed-use developments within future development plans. One perfect example of a mixed-use property in Winston is Bailey South located in front of Bailey Park in innovation quarter; the building includes restaurants, office spaces, retail, and more. Seeing Bailey South succeed is certainly exciting, and hopefully, we will continue to see more development of this type. Mixed-use developments have a positive impact on commercial real estate by creating vibrant, integrated communities that support economic activity and provide diverse opportunities for businesses and investors. 

This blog post was written by one of our dedicated interns as a part of our 2023 Summer Intern Program, where they delved into the world of commercial real estate. We’re thrilled to have played a role in their education and experience.

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