The Sharing Economy is Changing Real Estate Development Investment Strategies
The sharing economy is forcing changes in investment strategies of real estate developers.
Current Sharing Economy
Most readers here are already well aware of how rents and lease terms are being affected by the sharing of office space. It is old news to almost anyone how the hotel industry is affected by sharing of homes. Car manufacturers recognize that sharing of cars will affect demand, and are already making adjustments.
This said, all of the aforementioned items are a reallocation of existing infrastructure.
Causing Permanent Decisions
Recently, in San Francisco, Uber struck a deal with a residential real estate developer so that
new residents will receive a $100 monthly transportation subsidy from [the real estate developer] to use on Uber and public transit.
Once built, the action is permanent. Both parties have locked in profits, extracted from the people they serve.
Uber will be happy to have a population locked in and incentivized to use their service in an ongoing basis.
The developer will be happy to have an immediate increase in profit from an increase in density while avoiding the need to lower profits to include parking.
What other permanent actions are already taking place due to the sharing economy?