CCIM Feature

Cities of Tomorrow

Is the future already here?

In the CCIM 102 course, CCIM instructors teach that the just-in-time delivery model is a primary driver of demand for industrial space. Nothing illustrates that idea more succinctly than the theme of Aerotropolis: The Way We'll Live Next.

The idea behind this book is that successful cities of the future will be wrapped around successful airports, and cities that can't adapt may be passed by. Co-author and reporter Greg Lindsay expands and expounds on University of North Carolina theorist John D. Kasarda's original idea that airports are the highways of the future. A former Fast Company and Wired magazine reporter, Lindsay racks up the frequent flier miles talking with civic leaders, CEOs, and company logistics experts, interviewing them about the importance of air transit to the future of their communities, companies, and supply chains.

The book tracks the change from the 20th-century model — airports at the periphery of cities — to the 21st-century model — the aerotropolis, where the airport is the city, the center of business, commerce, and trade. It's already the way of life in many global cities, including Washington, D.C., and Dallas, as well as Amsterdam and Beijing.

Global shipping networks are defining the way we live, as the entire world becomes one large consumer society. In one anecdote, Lindsay follows his gift of flowers from the Aalsmeer flower auction in Amsterdam to his mother's arms in Illinois to demonstrate how these global networks affect our daily lives. Even though U.S. farmers no longer grow flowers for mass consumption, U.S. consumers now find them in every grocery store, drugstore, and garden shop. This is the result of "the cool chain," a refrigerated logistical supply chain that sources flower in Africa, trades them in Amsterdam, and ships them to the U.S., all in about 48 hours.

"The aerotropolis is a time machine," Lindsay says. "Time is the ultimately finite commodity setting the exchange rates for all the choices we make."

China looms large in the book because it is adopting the aerotropolis model wholeheartedly, Lindsay says. But the speed at which it is happening reminded me of the breathtaking feelings I experienced in my many visits to China for CCIM's education program. "China is placing the single biggest bet on aviation of any country, ever. … The central government announced … that it would build a hundred new airports by 2020, at a cost of $62 billion. The first 40 were ready last year. The vast majority lie inland, hugging provincial capitals and secondary cities bigger than any in the States."

Equally overwhelming is the enormity of China's population dominance in the world:

China has anywhere between 125 and 150 cities with populations greater than a million. The United States has nine; Europe, 36. When the first phase of China's airport-building boom is complete, the number of hubs handling 30 million passengers annually — more than Boston's Logan or Washington's Dulles — will have risen from three to 13, all of which will be the host of aerotropoli. By the time they're finished in 2020, 82 percent of the population — 1.5 billion people — will live within a 90-minute drive of an airport, nearly twice the number today.

The book dovetails nicely with some of my other favorite business reads such as Marc Levinson's The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger and Sasha Issenberg's The Sushi Economy: Globalization and the Making of a Modern Delicacy, both of which deal with just-in-time delivery and creating new markets.

What does this mean for those of us in the commercial real estate profession? It has been my experience that being able to take the CCIM concepts we all know and merge them with ideas such as those discussed in Aerotropolis, adds value to the work I do for my clients. A case in point illustrates the local relevance: I've realized that the concepts in Aerotropolis, combined with continually increasing gas prices, could possibly lead my hometown, Albuquerque, N.M., to reverse its long-term trend of growing to the north. Instead it may begin expanding to the south, around the airport and areas just south of it where two national railroads intersect, creating an ideal intermodal distribution opportunity for my clients.

Todd D. Clarke, CCIM, is chief executive officer of NM Apartment Advisors in Albuquerque, N.M. Contact him at tclarke@nmapartment.com.

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