New Urbanism: Smart, Sustainable Growth — Fantasy Vs. Reality
Guest Post By Don Southerton
As mentioned in a previous Forbes guest article, I live in Belmar, a new urbanism community in Colorado. With today’s global and often virtual workplace, about half my day centers on Korea. Between trips to Seoul and being highly involved in Korea-facing business I’ve long observed Korean trends toward quality of living, green and sustainability. For example, trendy Korean Starbucks asks patrons to separate their trash from hot liquids—not trashing unused coffee with the paper waste—soggy paper is hard to re-cycle.
I also support Korean manufacturers like Hyundai and Kia Motors. I see them striving to produce the next generation of green and sustainable cars: Outside the hybrids, eCars, and Fuel Cell Electric Vehicles (FCEV), the materials now used in the assembly of the vehicles are increasingly eco-friendly along with a bold program for the recycling of obsolete cars and trucks.
On a broader scale, I’ve been involved in new urban communities like South Korea’s Songdo International Business District—envisioned as a “city of the future” and intended to meet strict environmental building standards amid providing world-class amenities.
My days are also impacted by life in Belmar. The vision of Continuum Partners LLC., a Denver-based real estate development company, for Belmar was born from the belief that there is a connection between long-term, sustained property value, high-quality urban design, and the principles of smart-growth. At its core Belmar strives to offer a balance between a Live, Work, and Play lifestyle.
Between my Korea experiences with projects like Songdo IBD and those in America like Belmar, I see new urban communities—looking to link quality of living and sustainability—facing a number of challenges. Beyond huge development costs, the vision for these communities not only centers on providing a high quality of living amid green tech rooftop solar arrays and LEED-certified buildings that pass US energy-efficiency standards, but for the developers and businesses financial considerations matter, too.
With groundbreaking in October 2002 and most of the construction completed by 2008, Belmar developer Continuum CEO Mark Falcone has sought to maintain a balance between promised deliverables to the public and local governing bodies, and fiscal realities. As Falcone notes, “The key factor which allowed us to manage through all the changing dynamics of the market was the zoning and a highly responsive City [Lakewood, Colorado]. Those factors gave us the flexibility to respond to evolving market realities as they emerged without altering the essential character of the place.”
When questioned on how Belmar adapted, the Denver developer further explained: “As the economy eroded we had to shift to less ambitious development phases. We focused on heavily pre-leased developments and sacrificed density to keep things moving. We also sold land directly to users or other builders. A land sale to Target in early 2010 and KB Home in early 2011, for example.”
That said, I’m drawn to a question—Have high profile new urbanism communities like Belmar met their early vision and expectations? Several key areas deserve reviewing. They include:
Green—Plan to reality. Beyond core values of ecological sustainability, Belmar relied partially on a $200 million green bond for funding the development. (Belmar only ended up using only $8 million of the bond allocation.) Still, Belmar had an incentive to ensure its renewable energy program was implemented and green building practices were followed. Two key programs stand out in Belmar—Solar and LEEDs. According to Belmar officials, the roof top solar farm and sustainability gets the most attention—renewable energy being a popular topic.
That said, the developers are perhaps prouder of their LEED’s initiative. In 2002-2003, with construction underway for one of America’s first LEED Silver Certification buildings, Belmar gained national attention. In particular, Belmar was unique since it was a mixed-use structure. Sitting in a conference room on the second floor of the three-story LEED building, I found the heat/AC vents of interest—their floor location similar to a water drain, but pushing out warm air on a chilly Denver morning.
Over the next few years of new construction, retailer Target exceeded expectations and met Silver LEEDs standards. Along with the Whole Foods building and interior, in all, four of Belmar’s structures are LEEDs certified.
Housing—Plan to reality. Belmar apartments are currently divided into two groups. The first grouping are those more near the core of the project and spread out into about seven buildings. Currently, these units are over 95% occupied. A 300 unit building to the south of the project is approximately 97% occupied. Belmar upscale condominium units are 100% sold.
Commercial Leasing—Plan to reality. As of the end of October 2011, Belmar office space is 96.4 % occupied and 100% leased. The key tenant is The Integer Group, one of the world’s largest promotional, retail, and shopper marketing agencies, and a member of Omnicom Group Inc. Their Belmar offices alone employ over 500 people.
Retail—Plan to reality. As of the end of October 2011, Belmar retail space was 91% occupied and 92.3% leased. Key tenants include: Target, Whole Foods, Best Buy, Dick’s Sporting Goods, and Nordstrom Rack, along with a mix of national and local stores, shops, and services. In particular, the Ohio Center for Broadcasting, Denver and Paul Mitchell, the School adds to the community’s diverse appeal.
Services, Amenities and Community events—Plan to reality. Many in the Denver area find Belmar’s restaurants (PF Chang’s, Ted’s, The Rock, Baker Street) trendy, with shopping and parking convenient. The ice skating rink is a seasonal highlight. (I’m fond of the “skating with Santa” holiday promotion on Saturdays leading up to Christmas.) Furthermore, Summer Sundays also see a thriving Farmer’s Market, and a flourishing local art scene. I have also heard there is interest among locals for a community garden. Count me in on the latter.
Overall, Belmar has made good on its promises and pledges. Still, sustaining the vision over time, like building a sustainable community, will require the embrace and support of local residents, merchants, commercial tenants, and consumers. I see the local art scene and plans for the community garden as very encouraging. Moreover, it seems that visitors to Belmar appreciate the community’s new urbanism focus and in some cases envy a life style where one can live and walk to work.
Meanwhile, I’ll continue to share my impressions of Korea, Songdo, and Belmar—and wait for the day when in America I will not have to dump my excess coffee in with the recyclables or maybe take a spin around the local community in a EV.
Don Southerton is a consultant, marketing strategist, and researcher for top Korean-based corporations with global business, along with major western firms that have ventures in Korea and Asia Pacific.
Southerton frequently comments in the media on topics including the Korean car market, Green technology, and global business.
Belmar Solar Array Fact Sheet
The Belmar Solar Array began operating in late summer 2008
The Belmar Solar Array consists of approximately 8,370 panels and is 125,000 square feet in area.
The Belmar Solar Array is a 1.75 mega watt system generating approximately 2.3 million kilowatt hours of electrical energy per year.
The Solar Array power lights in the three structured parking garages on which the panels are mounted. (Technically, the power generated by the solar arrays is routed back to the local XCEL Energy grid, and XCEL sells power back to the Belmar project at a reduced rate.)
Source: Belmar
2012 Trends and Expectations—A Korea-facing Commentary
January 1st, 2012By Don Southerton
Each new year, I share thoughts for the upcoming months in an executive-level commentary. Looking back at 2011, South Korea’s export economy saw a robust year—familiar names like Samsung, Hyundai, and Kia continuing to grow global market shares—demand driven by a mix of product quality, value, and design appeal, along with Japanese brands suffering set-backs from the devastation of the tsunami and threat of catastrophic nuclear meltdown.
Tempering the demand for top Korean cars, electronics, and consumer goods were deep concerns over the EU fiscal crisis—worries that still linger.
On a positive note following an amended agreement for the Korea-U.S. Free Trade Agreement (KORUS FTA) and ratification both by the U.S. Congress and Korean Assembly expectations are that the treaty will be implemented in the first quarter of 2012. Advocates and critics alike see the FTA boosting annual commerce between the two nations into the billions of Dollars.
Looking forward to 2012, first, the succession in North Korea will continue to be a concern. Issues include the stability of the Kim regime, threats of more border clashes, and an unchecked nuclear arms program. I’ll continue to monitor and share news as it unfolds.
Next, building on the momentum of the past 3 years, expect Korea’s export-driven firms to push their organizations to carve out greater global market shares. Look for even bolder announcements and sales targets than in the past. For example, Hyundai Motor Company, along with their sister firm Kia Motors, announced their global goals for 2012—targeting sales of seven million units. This is a significant increase from estimated sales of between 6.5 and 6.6 million the group expects for 2011.
Not to be outdone, Samsung Electronics, with record 2011 cell phone sales, intends to increase their total by as much as 15%. This translates to approximately 374 million phones, including 150 million smartphones for 2012.
One change from the past 2 years…., I expect few new foreign brands to enter the Korean market in 2012—part saturation, part concerns by the major Groups over the euro-zone fiscal crisis and a stalling U.S. economy undercutting global demand that in turn has an impact on the domestic economy. Two exceptions. One will be services benefitting from KORUS FTA such as U.S-based international law firms wishing to expand into Korea. The second are highly successful brands and products that bring with them strong appeal and a ready market—for example, Chipotle.
For those foreign businesses and brands that do plan to enter the Korean market or partner with Korean firms, I suggest they take efforts to understand not only the culture, but also business norms and expectations. For example, your key management needs access to coaching and someone to answer their questions on topics ranging from strategy to the impact of routine management changes within their Korean partner’s organization. It’s a small upfront investment and less costly than the consequences, which can include lawsuits, local and expat employee turnover, and months of missed goals and low productivity—not to mention tensions between you and the client over expectations. I know this area well—most recently handling the negotiations for a major brand launch in Korea.
Finally, expect further growth in Korean Green technology (wind power, solar, eCars, batteries), along with Korean overseas acquisition of energy related firms. With regard to Green, most of Korea’s major Groups have boldly entered the renewable and sustainable side of the market with plans to expand sales and distribution globally. This includes state of the art manufacturing facilities for wind turbines, solar cells, next generation batteries, and electric power trains. In particular, Hyundai and Kia introduced hybrid models in 2011, with the group aiming to launch a variety of eco-friendly models in 2012.
To conclude, understanding the dynamics of Korea’s economy, markets, and major business groups is vital. It is critical to take into consideration Korea’s past and current trends. Culture, global influences, and a 24-hour virtual workday add to this complexity. I’m dedicated to providing much needed research, analysis, and critical thinking to provide you with answers and insights 24-7-365.
Please feel free to share this commentary across your organization and teams.
If needed, I can also provide more details on specific market sectors, etc.
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Tags: Chipotle, Don Southerton, Don Southerton Korea consultant, Hyundai Kia Automotive Group, Korea consuting, KoreaPros, KORUS FTA, Samsung Electronics
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