Internet Explorer 11 is not supported

For optimal browsing, we recommend Chrome, Firefox or Safari browsers.

A Possible Future for Downtowns Out in the Suburbs

Many center-city downtowns continue to struggle, but Americans, especially younger adults, still want walkability.

culdesac construction aerial view
Construction of Culdesac Tempe: A Car-Free Neighborhood. (Photo courtesy of Opticos Design)
Editor's Note: This article appears in Governing's Spring 2024 magazine. You can subscribe here.

Where are downtowns headed? One simple answer is intriguing, if somewhat fanciful: Perhaps they are headed to the suburbs.

They may be headed to places like Tempe, Ariz. In the past four years, in this suburban town of 184,000 that’s 10 miles outside Phoenix, a development has begun to rise that is explicitly trying to re-create downtown vitality and ambience in a seemingly unlikely place. Culdesac Tempe, which has drawn a fair amount of publicity, allows no cars inside its 17-acre expanse. Its goal, when built out, is to contain more than 700 apartments, 16,000 feet of retail commerce and 1,000 residents. “The removal of the car,” writes Robert Steuteville of the Congress for the New Urbanism, “allows for a porous, fine-grain urban pattern with a network of narrow, shaded pedestrian-only paseos, intimate courtyards and a central plaza.”

If you are familiar with the Phoenix area, you may be inclined to dismiss the importance of the development because Tempe is a college town, home to Arizona State University, and towns full of students and faculty are often thought to be entities unto themselves. But that’s not the case with Hampstead, a development gradually taking shape 12 miles outside of Montgomery, Ala. It advertises itself bluntly as an attempt to bring the city to the suburbs. “Imagine living in a community where you can walk to work, where your kids can (really) walk to school,” one brochure exults. The project managers tout “an opportunity for an active lifestyle without even reaching for the car keys.” That’s basically the whole selling job.

Hampstead can’t be marked off as a roaring success even after more than a decade of promotion. But it can’t be dismissed either. Nor can similar efforts underway in Charlotte, N.C., and others on the drawing board in Atlanta and Mesa, Ariz., not far from Tempe. Aspiring downtowns are sprouting up around Sun Belt cities long identified almost exclusively with cars. Now a cadre of technology investors is working on a plan to build California Forever, an urbanist mixed-use community of 400,000 people on 29 square miles in Solano County, northeast of San Francisco.

All of the experiments seem pointed, to a large extent, at people under 35 years of age, a group that still desires the density and variety of the center-city lifestyle, even as downtown commercial spaces remain disturbingly empty. And intriguingly, all of this is brewing even though conventional suburban office parks are experiencing worrisome vacancy rates.

All of this may be largely a blip. California Forever may never happen. Clones of Culdesac Tempe aren’t going to sprout up like mushrooms around every city in America. But the phenomenon raises an urbanist question too important to dismiss: What will happen to conventional downtowns in the coming decades? For that matter, what is happening to them now? And what might replace them?

The evidence is contradictory. A few city centers, such as Salt Lake City’s and San Diego’s, seem to have recovered their pre-COVID vitality. But the more common condition in much of urban America is vacant office desks and struggling retail businesses that used to serve the commuters who worked at those desks. The statistics are wildly variable. As of last year, with more than a quarter of employees working at home on any given day, the national office vacancy rate was about 19 percent. Maybe that’s not an alarmingly high figure, but it was much worse in many large cities. In downtown Phoenix, for example, it was 31 percent. Some 10 percent of the office centers in the United States have about 80 percent of the vacancies.

Amid all the churning, it remains true that two-thirds of the downtown office spaces in this country are 90 percent leased. But this figure masks the fact that so many of the desks in those offices are being used only part time, or not at all. Many offices are not technically vacant but nonetheless empty due to lingering pre-pandemic leases. If you happen to run a lunch spot or a drugstore in the middle of a conventional downtown office district, you may still be waiting for a resurgence of customers that is not going to arrive any time soon.

But if the demand for working downtown is declining, the demand for central city living, especially among younger population cohorts, is surprisingly strong. A study of 26 downtowns, conducted a few months ago by the Center City District in Philadelphia, found that resident populations are higher than they were in 2019 in all of the largest downtowns except for San Francisco and Seattle.

Cities as a whole are leaking population; downtowns mostly aren’t. And the evidence is pretty strong that if there were more attractive living situations available in and near city centers, the downtown population resurgence would be considerably stronger than it is.

To a great extent, this would require a substantial conversion of office space to residential use. There is starting to be a fair amount of this, even though developers continue to complain that most existing downtown office buildings are not well suited to residential conversion, due in large part to inconvenient floor plans. Still, as offices go unleased in larger numbers and commercial rents drop significantly, it seems inevitable that the problem of awkward floor plans will find a residential solution.

And that leaves out the prospect of newly constructed residential towers in the center of cities, or close by. Developers in Oklahoma City, perhaps not the most obvious place for Manhattan-style apartment spires, are proposing a massive new downtown project called Legends Tower, with a 1,907-foot skyscraper, 1,776 residential units, two hotels and 110,000 square feet of commercial space. Like California Forever, perhaps Legends Tower will never be completed. But the ambitions that these projects reflect, and the demands the promoters believe they have noticed, are much more likely to grow in this country than to wither.

That growth is pretty much a certainty if the current preferences of the younger millennials and the emerging Generation Z are any indication. Gen Z, whose senior members are now 27 years old, expresses less interest in automobiles than any of its previous cohorts did at comparable ages. Its members are taking longer to obtain drivers’ licenses, if they get them at all. In 1997, 90 percent of 20 to 25-year-olds in the United States had drivers’ licenses; by 2020, the number had fallen to 80 percent. That’s not a huge change, but it’s enough to attract the attention of ambitious city planners and developers. Some of the decline is due to the ubiquity of stay-at-home social media and video gaming, not to mention the convenience of ride-sharing apps, but some of it also appears to be a function of the increased desire for face-to-face human contact that digital realms do not provide.

When researchers ask young people what they are looking for in a neighborhood, the vast majority of them say they want to spend more of their time on foot. “Young adults prioritize walkability the most,” a survey by the National Association of Realtors reported last year, “with 90 percent of Gen Z and millennial respondents indicating they’d pay more for a home in a walkable community; a third say they’d ‘pay a lot more.’”

Massive projects like Legends Tower and California Forever may be outliers. Walkability is no outlier. And if there is one thing we learned from the experience of the baby boomers, it is that when enough members of an emerging generation want something, they stand a very good chance of getting it.

This does not suggest a comeback for the retail commerce that dominated big-city downtowns for most of the 20th century. The urban centers that emerge in the next decade, whether in old downtowns or in newer suburban versions, will be entertainment and lifestyle centers, not clusters of retail businesses. They will be anchored, as many of them already are, by restaurants and bars, clubs and theaters.

But what does seem probable is the creation or re-establishment of density, in revitalized city centers or suburban experiments such as Culdesac Tempe. This will not be easy to do everywhere. An edge-city colossus cannot be converted to a pedestrian-oriented enclave in a few years, or possibly at any point in the foreseeable future. But the experiments will multiply.
Alan Ehrenhalt is a contributing editor for Governing. He served for 19 years as executive editor of Governing Magazine. He can be reached at
From Our Partners