Reimagining Cities-Disrupting the Urban Doom Loop

NOI PER SF GROWTH (2019-2023)

10% 15% 20%

0% 5%

-20% -15% -10% -5%

Downtown Downtown Adjacent Urban Commercial

Urban University

All WalkUPs

All WalkUPs with BIDs

All WalkUPs with BIDs (No-BID Inventory Composition)

All WalkUPs without BIDs

Source: Places Platform, LLC, Cushman & Wakefield Research

INVENTORY COMPOSITION

We’ve also mentioned how the composition of WalkUPs plays a role, especially since WalkUPs with place management organizations are more Work-centric, particularly in Downtowns. As a counterfactual, we estimated what NOI psf 81 would have been in WalkUPs with place management if their inventory composition had been more diverse, similar to that of WalkUPs without place management. The results show that, if WalkUPs with place management had been more diverse and less Work-centric, NOI psf growth would have unilaterally outperformed their non place management counterparts. This finding is significant. It suggests that place management organizations are in some of the most significant parts of cities, but the mix of assets in those WalkUPs may be limiting their performance.

20% 30% 40% 50% 60% 70% 80% 90% 100%

16.3%

17.6%

43.6%

53.0%

38.9%

30.6%

0% 10%

No BID

BID

Live

Work

Play

Source: Places Platform, LLC, Cushman & Wakefield Research

81 Why NOI psf? Again, cities do not influence the national interest rate environment, and thus including cap rates in implied valuations would be less insightful and constructive for answering the question of how cities can reimagine themselves.

Reimagining Cities: Disrupting the Urban Doom Loop 61