"Here, There, and Everywhere"

The following text is Gil Castle's final draft of the real estate column appearing in Business Geographics, November 1997

This issue of Business Geographics focuses on transportation. Transportation and real estate are two sides of the same coin. Modify the real estate mix in a locale and the demand for transportation facilities will change. Expand the transportation infrastructure in an area and new real estate investments will inevitably follow. (Indeed, in the first three decades after World War II most of the nation's urbanization occured within a few miles of an Interstate Highway.)

Much of my early career was devoted to joint transportation-land use planning. I'm still fascinated by those relationships. The following are a series of trends I perceive happening throughout the country, and my predictions on how those trends will play out vis-a-vis the real estate industry generally and business graphics specifically.

Trend:	An ever increasing number of office workers are telecommuting. Among the reasons are: avoiding time-consuming, frustrating commutes; balancing career and family obligations, notably staying at home with the kids; pursuing a home-based career, e.g., a free-lance programmer; and a preference for working in one's bunny slippers "far from the madding crowd."
Prediction:	The demand for office space will diminish, as will demand for space for complementary services such as parking garages and lunchtime eateries.
Trend:	More and more retail purchases are being made over telephone lines, including orders from catalogs, cable television shopping channels, and Internet sites.
Prediction:	The demand for retail space for products and services readily accommodated electronically will diminish. Indeed, some major retail chains already are reallocating resources from constructing new stores to expanding their Internet-based retailing.
Trend:	As people becoming increasingly comfortable with working and shopping electronically from their homes, correspondingly they are less willing to spend large amount of time in cars or public transportation going to and from the office, stores, etc.
Prediction:	Transportation accessibility will become an greater contributor to the commercial value of a site, and will therefore also become an ever more important component of the site selection process.
Trend:	Ever greater efficiencies are being realized in vehicle navigation, fleet management, etc., as described in this issue of Business Geographics. Simultaneously, businesses are continually striving to reduce inventory costs by relying on 'just-in-time" delivery technologies.
Prediction:	The demand for warehouse space used for inventory and distribution will diminish.
Trend:	The number of cellular telephones, pagers, and other personal communication devices is skyrocketing. As organizations and individuals become ever more aware of the advantages of digital versus analog telecommunications, and as digital coverage extends throughout the nation, the demand for these technologies will grow all the more explosively.
Prediction:	(1) Buildings that offer excellent cellular transmission sites can command ever higher rents for the use of their rooftops; for example, the Sears Tower in Chicago reported earns several million dollars in rent annually from telecommunication companies with broadcast and rely facilities on the building's roof. (2) Commercial properties in zones well served by analog and especially digital cellular signals will be in greater demand than properties outside the effective telecommunications service area. (Not surprisingly, vendors of digital business graphics databases are beginning to offer telecommunications industry products.)
Trend:	The world truly has become a global village, especially with regard to manufactured goods. Even products stamped "Made in America" can have a high percentage of their components produced in factories literally on the other side of the world.
Prediction:	Properties in the vicinities of international points of entry—notably seaports and airports—will become increasingly in demand. Such properties include not only land for highways, railroads, and other transportation-specific uses, but also warehouses, offices, hotels and conference facilities, supporting retail, residences for employees, and so on.
Trend:	The more advanced an economy, the greater the percentage of Gross Domestic Product (GDP) that derives from the services sector as opposed to manufacturing sector and primary sector (e.g., agriculture, mining, fishing forestry). Services—banking, insurance, real estate brokerage, travel agents, even governmental agencies—typically require more office space and less industrial space than manufacturing and primary industries.
Prediction:	The demand for industrial space (including factories, inventory warehouses, distribution facilities, etc.) will decline; surviving properties will have high transportation accessibility. Demand for office space would increase, except that the demand could be offset by the above telecommuting trend.
Trend:	An ever increasing number of real estate professionals are using business graphics' software and data bases in site selection, brokerage, and other buy-hold-sell property decision activities. An ever increasing number of households are turning to software packages such as Rand McNally's "StreetFinder" as well as Internet sites like www.mapquest.com and www.vicinity.com when looking for products and services, planning trips, etc.
Prediction:	This increased flow of geographic information to businesses and consumers will lead to more rational land use decisions, which will complement more rational vehicle navigation and fleet management technologies as described elsewhere in this issue of Business Geographics.

I'd like to close with a vision I frequently have while waiting impatiently in a car or bus for a red light to change. Business geographics technology has already reached the stage where: all major streets could have sensors that monitor and map the number of vehicles approaching or stopped at every traffic signal in a city; origin-destination (O-D) surveys could predict with a high degree of statistical probability the pending allocation of those vehicles throughout the city's road network; artificial intelligence software (neural net, case based reasoning, or other pattern recognition programs) could link together the vehicle monitoring with the O-D statistics to accurately predict and map traffic volumes likely to pass through any given intersection in all four directions at any given time. Ergo, a business geographics based system could optimize the traffic light signals far better than current timing systems vis-a-vis minimizing the number of vehicles waiting for the light to change when no vehicles are passing through the intersection on the perpendicular street. Think of the huge amount of travel time and money that could thereby be saved... Will someone please build such a system already?!