Here’s what could pass for a typical sentence from a development company announcing a new project:
“We’re going to build a true live-work-play environment, a mixed-use development with activated ground floors and an urban streetscape that speaks to Charlotte’s emergence as an 18-hour city.”
Yep, commercial real estate can be a little jargon-heavy sometimes.
And if you’re wondering what’s going to be built on that corner in your neighborhood where you saw bulldozers, trying to make sense of a City Council zoning meeting or curious about whether Charlotte is building too many apartments, you’ll need to know what some of these terms mean.
Here’s a list of 10 common commercial real estate, development and urban planning terms and what they mean, so you can talk about TOD zoning, TIGs and live-work-play environments like a pro:
▪ Mixed-use: Easily one of the most common pieces of real estate jargon these days, a mixed-use development is one that includes multiple uses: For example, an apartment building with ground-floor retail, or a project that has a hotel, restaurants, apartments and an office building on the same site. The opposite would be single-use: Think of a subdivision with only houses, or an office park with no shops.
For decades, local zoning laws sought to strictly separate uses, and even now, mixed-use projects in Charlotte often require exceptions to the city’s zoning rules.
It seems like every new development calls itself “mixed-use” these days, so to stand out, some plans have started using “extreme mixed-use.” Take the North Tryon Vision Plan, which calls for buildings to house everything from below-market-rate apartments to high-tech business, light manufacturing and 3D printing.
▪ Live-work-play: This term describes the goal of a true mixed-use development, a place where people can get most of their daily tasks done in one place, often without getting into a car. Such developments usually include apartments or houses, offices and shops, restaurants and amenities such as a park. Developments like Waverly and Rea Farms on Providence Road south of I-485 fit the mold: Each includes residences, offices, shops and restaurants in the same project.
One question persists about live-work-play developments in uptown, South End and other hip neighborhoods: Will the millennials expected to fill many of these areas eventually move out to the suburbs, like generations before them?
▪ Activate the ground floor: Planners often talk of “active” ground floor uses in buildings, such as shops, sidewalk cafes, a small park, interactive art – anything passersby can engage with.
The opposite of “active”? Blank walls and parking decks.
▪ Absorption: It’s one of the most common questions I get: Is Charlotte building too many apartments? Or, in real estate lingo, can the market “absorb” all the new capacity developers are throwing at it?
People often talk about how many apartments or how much square footage of new office space has been absorbed, a term that brings to mind images of a sponge soaking something up. Absorption is simply a measure of how much of a given new property type has been leased in a market. For example, Real Data estimates 4,815 new apartments have been leased (absorbed) in Charlotte over the past six months, and JLL estimates the Charlotte office market absorbed 392,231 square feet of new space in the third quarter.
▪ TIG, TIF: These acronyms refer to tax increment grants and tax increment financing – subsidies in which developers receive some of the funds from future property tax revenue increases from their new developments. Sometimes the money reimburses a developer up front for infrastructure, such as new roads, that they’re building as part of their project. For example, Pappas Properties received a TIG as part of the Metropolitan development along Little Sugar Creek Greenway, a portion of the $34 million worth of public money pledged to the project.
▪ Low-rise, mid-rise, high-rise towers: Definitions of these terms aren’t hard and fast, and vary from place to place. The National Association of Realtors defines a low-rise as less than seven stories, mid-rise as seven to 25 stories and high-rise as more than 25 stories.
▪ TOD, MUDD: These sound like names, but they’re zoning designations in Charlotte – acronyms that stand for transit-oriented development and mixed-use development districts. Each allows more flexibility for mixed-use developments, and are often requested by developers seeking to rezone property in Charlotte. Much of the land along the Lynx Blue Line has been rezoned to TOD, for example, allowing high-density developments with apartments, shops and restaurants on the same site.
▪ Workforce housing: Although sometimes used interchangeably with “affordable housing,” workforce housing is a newer term, typically referring to rentals that people can afford if they make a set percentage less than the area’s median income. In Charlotte, workforce housing often refers to apartments for people with incomes between 60 and 80 percent of the area’s median income. Think nurses, firefighters, police officers, teachers – the demographic most commonly cited as target tenants.
▪ Spec space: Office buildings are often built “on spec,” or “on a speculative basis.” That means the developers don’t have a tenant signed when they start construction, and hope to lease the space as construction progresses. All of Ballantyne Corporate Park has been built on a speculative basis, as has the new office tower at 615 South College Street uptown.
▪ 18-hour city: This category includes Charlotte, the Raleigh-Durham area, Seattle, Denver, Nashville, Portland and more similarly sized cities. They used to be called “secondary cities,” but 18-hour cities sounds a bit nicer.
The term refers to the fact that there’s stuff to do in these cities most hours of the day, but not 100 percent of the time. (We’re not New York City, a 24-hour metropolis that famously never sleeps). Charlotte’s inclusion on lists of 18-hour cities certainly marks a change from 1993, when Observer columnist Doug Smith famously found it near-impossible to buy a Snickers bar after 5 p.m. uptown.