Conversations about the future of real estate tend to cover topics like autonomous vehicles’ impact on place-making, coliving, modular and tech-enabled construction, and robotics. These fun topics allow us to put on our Muskian caps and wax about the possibility of how wonderful things could be in the future.
What’s less often discussed is the bad, highly-probably stuff. And the baddest and most probable stuff is global warming, which will likely make many major markets virtually development-proof in the not-so-distant future.
As of 2010, 39% of America’s population lived directly in coastal areas that include virtually every major city (the number was projected to jump to 47% by 2020); most of these areas will be subject to the impact of sea level rises and their attendant storms. A recent report underscored this, suggesting that 41M Americans live in areas, both coastal and inland, that are susceptible to 100-year flood (read: big-ass flood). This is a major revision from FEMA’s previous 13M estimate.
While wealthier areas in semi-precarious areas might figure out ways of buffering themselves from rising seas and other events, some places are straight up screwed (rich or not). Frankly, the number and names of at risk areas is too grim to fully list, but here are some superstars:
- New Orleans. Ask not if the levee is going to break, but when.
- No water, extreme heat that grounds flight, and neverending sprawl. Phoenix has it all.
- Miami/S. Florida. Because of its non-stop development in the last decade, the World Bank has put Miami as the #2 city in the world for asset losses resulting from floods.
What will this mean?
- As global warming-related events increase in frequency—and they already have—underwriters, who currently have no idea how to handle the maelstrom of major climatic events, will get wise and stop signing off on projects that are clearly in harm’s way.
- Expect to see speculative markets designed around global warming catastrophes and climate-related migrations.
- Expect to see a growing use of resilient architecture and ultra-efficient building standards like Passive House, which will withstand climatic events and the vicissitudes of extreme temperature fluctuations.
- Watch out for devaluations in very low-lying areas (so long DUMBO, Greenpoint, and FiDi) and seeing high ground as the next luxury amenity.