Auto Destruct: Is The Property Industry Suffering Groupthink About Cars?

For almost a century, our cities have been built around cars. But the dominance of the automobile is now being challenged, and that raises some big questions for real estate about what and where the sector builds and buys. 

The climate and social impact of the car as a pre-eminent mode of transport is being questioned by protestors and governments from London to Los Angeles.  Property developers and investors, with activist shareholders on their tail, governments pressing for action, and demanding sustainability targets to meet, are also concerned. The idea of the car-free city is increasingly something many people are pushing as a goal to be strived for. 

But the property industry does not operate in a vacuum. A much bigger political and cultural conversation sets the scene. Some of that conversation embodies assumptions that go largely unexamined, but are now widely repeated. As developers and investors race to meet sustainability targets, the risk of group-think is growing.

A less car-centric world would change what we build and where, so it is important that property understands where the future of transport is heading. And the sector may be in danger of writing off the car too quickly. 

For instance, the original justification for limiting private car use — pollution and contribution of petrol and diesel to carbon outputs — will soon be history.  The UK will no longer allow the sale of new petrol and diesel vehicles after 2030. By 2035 all cars and vans must score zero carbon emissions. Within a few years the long tail of carbon-based secondhand vehicles will also be gone.

Yet the idea that private cars are bad (in ways divorced from the pollution or carbon emissions associated with fossil fuels) seems to have taken root. It is firmly entrenched in the property business. All cars are bad, not just petrol or diesel cars.

“Cars are not OK just because they’re electric," Savills’ Sustainable Design Director Dan Jestico told Bisnow. "They still lead to particulate matter emissions from brakes and tyres, which affects air quality. They’re still dangerous, and they still take up loads of space that would be better allocated for more social uses.” 

Jestico is far from alone.

“The car 'good or bad' debate goes beyond the fuel source,” Gerald Eve partner Julia Chowings said. “We know that the shift from petrol and diesel vehicles to electric vehicles is a much-needed environmental change. However, there are other reasons why a model shift away from private cars is a positive, such as reducing congestion on roads, encouraging health and wellbeing through walking and cycling to destinations and a better connection with the local environment. Even if cars go green there are still valid reasons to reduce car use.”

Whilst few go as far as some ardent campaigners — last weekend saw the serious suggestion that cars were a bad idea because they inspired road rage — it is clear that private vehicles, even if electric and thus less compromised on pollution or carbon, are not much welcomed by many in the property business.

High Anxiety

In its anxiety to please planners and policymakers, has the property business embraced a position hostile to 32 million UK private cars? It would be a serious matter if it had because an awful lot of real estate depends on car use for its value.

Barton Willmore Urban Design Director Vaughan Anderson articulates a pragmatic, thoughtful approach to private cars that will be widely recognised in the property business. He has a car himself, although rarely uses it because he lives in London where public transport is lavishly provided, but he recognises that the 32 million UK private cars are not going anywhere soon. 

“We’re in the business of designing places for people, and the premise that all cars are bad is certainly not how we look at the public domain, but we do want to respect a hierarchy of users, and see how we can give priority to pedestrians and cyclists,” Anderson said. He is currently working on a 5,000-house urban extension in Bedfordshire, where these principles are in play. Private cars are at the bottom of the hierarchy, although “there’s an element to be played into about how cars will be accommodated in the future.”

Developers have to be educated, Anderson said. The sales team often wants more cars, the planning team rather less. His job is to help achieve a balance. “Private cars will be a part of the places we create for some time, but how exactly, we don’t yet know. We should be addressing environments that can accommodate the car, but not to the detriment of creating great places. In the meantime we have to future-proof up to the point when cars are used and perceived differently.

“What we need is choice — a choice between a range of sustainable transport options which all have a role — walking, cycling, public transport, autonomous vehicles, ride-sharing ...,” he said. But no mention of private cars, even though Anderson admits “we can’t go from lots of parking spaces to zero tomorrow, there needs to be a transition”.

“And yes, it’s a kind of utopian ideal to walk and cycle everyone and have things on your doorstep,” he said. 

Utopian Ideals

The last time property fell into the group-think trap with transport was in the 1950s and '60s, and that was utopian too. In those days the idea was that the car was king, and cities were lavishly remade to suit car users' needs. Over the last 20 years enormous efforts have been made to remove or remodel those car-oriented cities. At the time — 50 or more years ago — nobody doubted what they were doing was right. To ask the question was to invite incomprehension, and the accusation of standing in the path of manifest destiny.

It’s not a new problem, because there has often been a tendency to utopian thinking in the transport sector.

Remember the hyperloop, the high-cost but low-capacity rapid transport solution that everyone was talking about? They aren’t talking about it so much any more. Google Trends data shows search engine interest falling of a cliff since late 2020, down to 5%-10% of peak levels, except in Colorado, West Virginia and Missouri where Swissloop and Virgin are experimenting.

The same trajectory is apparent in the world of automated vehicles. As reality has bitten, and utopian ideas have crashed into reality, so chatter about the technology has tended to diminish. Enormous upfront capital costs and a lot of unanswered questions on maintenance and servicing have left some observers doubting the idea will ever pay.

Google Trends data shows this scepticism in action. Autonomous vehicle searches rose steadily from 2014 to 2019, then peaking and falling gently ever since. Tellingly, most of the searches come from Michigan, where Ford are investigating the subject, and Washington D.C., where policymakers can’t get the idea out of their heads, viable or not.

Meanwhile some car-replacement thinking feels seriously utopian. PLP Labs, the research arm of PLP Architecture, has developed IUMO/h, which proposes replacing the Crossrail 2 underground train line with platoons of shared on-demand automated electric vehicles.

The Integrated Urban Mobility system is faster, cheaper and more convenient than conventional commuting and would save Transport for London billions of pounds, it said, not least because you need one tunnel rather than two, and stations don’t need to be so ritzy and big. “It allows us to begin reshaping our cities’ streets to create safer, cleaner and more accessible places for all,” the firm said in a statement to Bisnow.

This is bold blue-skies stuff. Yet in the often grey streets of east London some worry that too little reality enters the debate about cars and property, and it leaves them unsettled. 

Luxury Ideas?

Olaide Oboh is a director at Socius, one half of what was First Base, with a development portfolio including town and city centres in Bristol, Milton Keynes, Brighton and Cambridge. All locations which, as Oboh confesses, are “car-dominant places”.

Oboh said its approach is not anti-car, it is anti dirty cars. She is looking at autonomous vehicles and car-sharing, hoping this is a technology that can change the dynamic of car use, with electric vehicle charging and the usual walking and cycling options. Socius is also installing infrastructure which — the firm hopes — will allow its buildings to be adapted as technology changes and varieties of autonomous vehicle become viable. Milton Keynes is already a test area.

“Our starting point is car-free, but we can move now to car-lite schemes, if we can make them sustainable. And we can implement technology in schemes now that will make them useable in the future,” Oboh said. Socius is committed to urban locations, places that on the whole are well-served by alternatives to the car, and that is the way it likes it.

Yet watching (and participating in) the debate about a future without private cars, Oboh has some qualms. 

“In Walthamstow, where I live, the debate about private cars has become toxic,” she said. “I understand both sides of the argument on low traffic neighbourhoods [streets in which vehicle access is made all but impossible]. But I also know there’s lot of deprivation in these areas, people need their cars to get to work, carers need cars to get to all of their elderly clients around the area, clients who need them, and we can’t just say private cars are bad. I’ve really struggled with this. What you have to do is to change the vehicles from dirty to clean.”

In other words, those leading the righteous charge against private cars in some neighbourhoods seem not to notice how much other rather poorer people depend on cars. 

If that’s what is going on we’ve landed in the territory of 'luxury belief' — beliefs that confer prestige on those who profess them, in the same way a Rolex watch does a successful wrist. The difficulty is that the costs of holding the luxury belief are borne by others with a weaker economic position and not much prestige, as Oboh feared may be happening in Walthamstow.

Slowly Does It

A few thousand miles away in Dallas, real estate and tech guru Elie Finegold shares some of the same concerns. 

“Just because you don’t use a car yourself doesn’t mean your lifestyle isn’t enabled by cars,” Finegold cautioned.

But Finegold also argued that a dose of utopianism — mixed with some hard-headed realism — may be the way out of the group-think problem.

“Yes there is a human tendency to utopian group-think, but when you look at the actual built environment, there’s been far more talk than action,” said Finegold, managing director for venture investments at Crow Holdings and venture adviser at metapropNYC.

“The pace of change in real estate is very slow," he said. "The things we need cars for have not gone away but they have changed substantially.  When I think about mobility and location, in dense city cores or sprawling urban cities, there’s a lot more deliveries coming to us from stores, and we’re not always in our offices but we’re at home. So things have evolved.

“Even so, regardless of group-think, the way real estate changes is very, very slow. Most of us are living in buildings that date from before the iPhone, only a small amount of property is redeveloped at any given time, the rate of change of customer demand is slow, so it’s going to take 20 years for a changed attitude to private cars to have any meaningful impact.”

Finegold is an enthusiast for ride- and car-sharing, but the big impact of autonomous vehicles may not be quite what many expect. Finegold predicted autonomous freight vehicles could support a winning business model both for short-haul and long-haul freight, and other kinds of robotic autonomous vehicles — drones, perhaps — will make an enormous and growing impact. But we are so wedded to our private cars that rapid change there is unlikely.

Electric vehicles aren’t a silver bullet, either. “It is highly debatable whether EVs will be cleaner on emissions or less resource-intensive on construction, and in some places they may not even be emissions neutral with our current grid," Finegold said. "But you can use them in different ways, notably their long depreciation cycle and ability to fuel in place opens up new use cases for more resource and capital-efficient sharing. But we have a long way to go before people give up their cars — and first, maybe we’ll see households go down from two cars to one."

So progress will be slow. Private cars aren’t going anywhere fast. Autonomous vehicles will have impacts you did not expect. Electric vehicles are problematic. And yet Finegold says we need to keep on dreaming.

“You need to be able to dream to make progress. We need to dream about life without cars because cars are incredibly resource-intensive to make and run, expensive, and if you don’t have them life can be extremely difficult, so there are all sorts of reasons to dream,” he said.

“But you also need to be pragmatic, and incremental, and remember that the second somebody living a ‘carless lifestyle’ doesn’t get their fresh juice at Pret a Manger because there wasn’t a vehicle to deliver it, there’s going to be trouble.”