Mr. Tony Trella joined our class to share his experience in
residential development. Mr. Trella is the founder of the Meranth Company, an
advisor and consultant to the real estate development and investment industry.
Mr. Trella shared the same advice about learning from history as the previous
speaker, and went on to share a bit of history that would give us perspective
on the industry.
Mr. Trella began his lecture in the years surrounding and
following World War II. Prior to the war, it was more common for Americans to
rent homes rather than to own. However, in the post-war era, the large return
of soldiers from the front created a large demand for housing. The government
passed the GI Bill, which gave access to college educations for returning
soldiers, and then approached the need for homes. This gave rise to the popularity
of planned communities, which we now consider a staple, especially here in
South Florida.
Along with these innovations in housing planning, the
country saw a massive increase in infrastructure. With the sudden increase in
population, there was a larger market for cars, which needed roads to travel
on. Eisenhower proposed the interstate highway system, building more roads to
allow mobility throughout the country. This progress gave the country the
opportunity for growth, leading to the world we know today. I cannot help but
be fascinated how an act to benefit veterans of our country’s biggest war would
have such long-reaching effects. This increase in the quality of life yielded
our highways, our industries, and the mentors and educators that we benefit
from today.
Mr. Trella attributes the perfecting of the idea of planned
communities to a developer named William Levitt, the first of which was called
Levittown. The 13 million soldiers who came home from the war begat the Baby
Boom generation, and this massive increase of population, combined with a
decline in construction, left many families without suitable shelter. Along
came William Levitt, who, with his father and brother, designed a suburban
community that would revolutionize the industry. The American dream had become
one of home ownership, and the Levitts’ offering satisfied that desire. The
success of their first endeavor, Levittown, would lead to the duplication of
the idea all over the country. This endeavor forever changed the housing
industry; however, as one passes the numerous planned communities that one
encounters in South Florida, it is noticeable how many are located near retail
centers, a large source of income and employment for all Floridians. Levittown
itself was set far away from conveniences and jobs, which limited the mobility
of residents. This was a problem that would be solved by the coming generation
of developers.
Levittown yielded more than just a massive change to our
quality of life expectations; it quite literally helped create the future of
the industry in its entirety. It was interesting to see how one company could
become an innovator for the development of the country. These “descendants”
would give rise to gigantic communities, such as Reston, Mission Viejo, and
Irvine. Like their originator, these communities still maintained segregated
zoning practices. With these new communities sharing the same inconvenience of
distance to necessities and amenities, the industry took its next big step to
bringing real estate to the format we take for granted today.
These previous developments led to the creation of communities
like Weston in Florida or Hilton Head, a new type of planned community that
would combine the offering of homes with the convenience of nearby amenities.
As new developments evolved, they included second homes, recreational
facilities and schools. With the previous model of communities outdated, these
new suburb areas provided all the access and convenience that Americans were
demanding. Commercial and retail outlets were built out front of communities,
usually near highways, in line with the country’s growth, and indeed, this is
how real estate continues to function to this day. While such a format seems
like common sense, they say, “Rome wasn’t built in a day,” and I found it
interesting to see how we reached this point.
To go a little off-topic, movies are often strong
reflections of a society’s attitude, and anyone who has seen movies from this
era would recognize the trope of the “mean-hearted, greedy developer” who
wishes to demolish an orphanage to build a golf course, or similar situation.
This attitude seemed a little unfair, considering how many persons were taking
the developers who had designed their own homes and communities for granted. It
often seems that every area has its own “preservation society,” and the irony
cannot be missed that people want these conveniences as long as it doesn’t
inconvenience them. Still, an industry must adapt to conform with the demands
of society, so once again, developers had to go back to the drawing board and
find a more pleasing community.
In today’s world, segregated planning is on its way out, in
favor of sustainability and green development. In places where there is no
longer space to develop, such as Broward, redevelopment is becoming key. A blending of urban and suburban is the new
trend, the idea of Suburbia with the amenities of an urban area to attract new
generations. As many baby boomers begin to retire, health-related real estate
is also coming to rise. However, with the expected growths to population in the
coming decades, one must wonder what new demands may arise, and what new formula
will succeed in this rapidly-changing world.
I selected an article
about a new development in the North Loop area of Minneapolis to illustrate the
appeal of green development in the modern world. Developed close to the river,
this new development will feature a lot of green space, including a park,
parking for nearby amenities, and a 10-story rental building. Currently, the
North Loop area is so in demand that it is said that a listing is likely to be
sold the very day it becomes available. This blending of suburban-style
environment in an urban setting has a strong appeal for modern-day homebuyers.
This redevelopment of urban areas is likely to become the new face of real
estate development for the near future, and I expect it will be replicated in
more areas to come.
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