Before a single site plan is drawn, before a capital stack is assembled, before a single square foot of ground is broken, I ask the same question: Will this place still make sense in 20 years?
It sounds simple. It isn’t.
Most development decisions are made within a compressed window. You’re reacting to interest rates, a seller’s timeline, and what comparable projects just traded for. The market rewards speed. But the market also has a short memory, and the graveyard of real estate development is full of projects that made perfect sense in year one and became liabilities by year ten.
That’s the trap I’ve built my entire decision-making framework to avoid.
The Numbers Don’t Lie, But They Don’t Tell the Whole Story Either
Here’s what the data tells us about the world we’re becoming: By 2040, roughly 70% of the global population will live in urban areas, according to the United Nations. In the United States alone, household formation trends are shifting dramatically. The Urban Land Institute projects that by 2030, single-person households will make up nearly 30% of all U.S. households, up from roughly 15% in 1970. Meanwhile, the U.S. faces a structural housing shortfall estimated at 3.8 million units, per a 2021 Freddie Mac analysis. Years of undersupply and rising construction costs have done little to close that gap.
These aren’t abstract projections. They’re the demand curves that will determine whether a development thrives or sits half-leased twenty years from now.
But even the best demographic data doesn’t answer my core question. Demographics tell you who will be there. My question is about how they’ll want to live.
What “Making Sense” Actually Means
When I ask whether a place will still make sense in 20 years, I’m really asking four things.
First: Is this location durable? Not just desirable today, but structurally positioned, with proximity to employment corridors, infrastructure investment, educational institutions, and healthcare. Markets shift, but the bones of a well-located asset don’t lie. A project within a mile of a major medical campus, a university, or a transit hub has a built-in demand anchor that outlasts economic cycles.
Second: Is the product type adaptable? Rigid, single-use developments are increasingly fragile. Mixed-use environments consistently outperform single-use peers. A 2023 CBRE report found that mixed-use developments in secondary markets achieved 18% higher long-term occupancy rates than single-use counterparts. Flexibility isn’t just a design value. It’s a hedge.
Third: Does the project reflect how people want to live now and where those preferences are heading? Remote and hybrid work have permanently restructured how people prioritize location. According to McKinsey, as of 2023, approximately 58% of Americans have the option to work from home at least part of the time. That’s not a blip. That’s a structural behavioral shift that changes what proximity to a CBD is worth, what amenity packages need to deliver, and what “community” looks like in a residential context.
Fourth: Is the project a net positive for the community it’s entering? This one is less quantifiable but no less real. Projects that deepen community value by adding retail, green space, walkability, and workforce housing components build political durability and neighborhood goodwill that protect long-term asset performance. Projects that extract without contributing tend to face headwinds: resistance at the entitlement stage, friction with local operators, and the slow erosion of neighborhood character that ultimately hurts everyone’s asset values.
The Discipline of the Long View
There’s a reason so few developers operate with a 20-year lens. It means turning down deals that pencil beautifully under a 5-year hold model but don’t align with where the market is headed. It means investing in quality materials, design, and community amenities, which don’t immediately show up in the pro forma. It means trusting conviction over consensus.
I’ve walked away from opportunities that looked strong on paper because the answer to my core question was unclear. And I’ve pushed forward on projects that required patient capital and creative structuring because the 20-year thesis was airtight.
The hospitality and residential sectors I operate in are particularly unforgiving of short-termism. A hotel or a mixed-use community isn’t just a financial instrument; it’s a physical place where people eat, sleep, celebrate, and build lives. The standard has to be higher than “will this produce returns in the next few years?” It has to be: will the people who live here, stay here, and gather here in 2045 be glad someone built this?
That’s the only question that keeps me honest.