David O'Sullivan, O'Sullivan Architects

Spring forward!

What do you think about spring? It has been a mild winter and the construction activity never seemed to slow down so the transition to spring is not a huge change this year. The main focus in the news is the presidential primaries and the strange happens on that front but in the real estate industry the news is all about rising prices. The prices recorded for some recent sales, both the larger commercial transactions as well as home prices, show a strong demand in our area. The value is there today but some speculate we cannot sustain these levels.

You can look at a variety of factors that contribute to the strong real estate market. According to the Fed, family finances which peaked in the third quarter of 2008, have almost returned to that level. They report that household net worth is now at a record $86.8 trillion and that shows household balance sheets are looking good and is money out there to acquire and invest in real estate.

When you look are several factors related to the building industry, similar to what the Federal Reserve Bank of Atlanta did with their Housing Market Recovery Spider Graph, it looked at factors such as job growth, consumer confidence index, housing permits and starts, existing home sales median household income and unemployment and compares years 2007-2015. Most of those factors point to improvement in areas of demand and absorption. It also exposes some issues on constraints such as limited supply. This is just what we see in our local area. There are signs of some segments of economy not increasing the way it was hoped and that is reflected in the Fed decision to not raise short term interest rates.

We all know every market is local but today the world economy also plays a role everywhere. In Boston, with its diverse economic base, its large percentage of foreign investment and buyers, we have to look beyond the local factors when analyzing a development for success. The city of Boston as well as adjacent Somerville, Quincy and Cambridge are all adding population as well as office/retail space which is fueling demand for developments. We are also seeing household formation, which has been lagging during this recovery, start to pick up. All this is good news for us in the real estate industry.

As an architect we are challenged to look at existing parcels that most likely serve another use and we need to reimagine their potential to provide places to live, work, and play. We are charged with making neighborhoods and places that are attractive for these uses. Often this involves adaptive reuse combined with new construction. The ideas of sustainable design melds well with this approach as does transit oriented developments utilizing existing or proposed infrastructure.  It is this mixing of old and new that has made Boston attractive to residents and newcomers. We have approached many smaller infill projects by first looking at the surrounding areas. Often this provides insight to what is needed in the area and what we design will provide a development to better serve the community and client. We stress to our clients to open a dialogue early with abutters, neighborhood groups and local officials and make them a part of the process. The combination of research, listening and creativity has resulted in buildings and developments that enhance the lives of the users as well as the existing residents. The idea that a building which may appear to neighbors as blighted can be transformed and possibly combined with a new structure and create something that is familiar but new at the same time has a widespread appeal.

New developments can have the potential to change the neighborhood and you need to walk a fine line between good changes and too much change with residents. By having a new retail component combined with housing we can enliven the street and provide a destination with broad appeal. This is why including restaurants are so attractive but you do need to design for them from the start with proper loading, trash and venting or they will soon become a negative to the neighborhood. 

As we see demand for new development continue, we need to be sensitive to how we are transforming the areas where we planned them and provide buildings that serve the neighborhoods in constructive ways yet provide budget friendly projects that developers can still build profitably.

David O’Sullivan, AIA, is the president of O’Sullivan Architects, Inc., Reading, Mass.