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Tech is driving the future of SoCal homes




The Downtown Los Angeles skyline
The Downtown Los Angeles skyline
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Think of iconic home styles in Southern California.

Craftsman-style bungalows and Beverly Hills mansions might come to mind.

But the idea of what's a "typical" SoCal home is changing because of two major developments: the region's housing crisis and the boom in the tech industry.

This was one of the topics at a recent retreat by the Lusk Center for Real Estate at USC, and here's what to take away about the future of Southern California.

Expect more density

Developers are trying to build as fast as and as much as they can to meet up with the demands for new homes.

But even through there's a pressure to buildbuildbuild, homes have sprawled pretty far horizontally in the region. That means the only other direction is up – high-rise apartment and condo buildings.

For people who come to SoCal for wide-open spaces and the outdoors, the idea of living on top of each other doesn't seem all that pleasant.

But there are residents who don't mind – maybe even appreciate – living close to their neighbors.

Millennials and tech workers

While many people are on the lookout for a new home, there are two populations who are easy-to-ID targets for developers.

There are people who are ready to move out of mom and dad's – so Millennials.

But there are also many highly-educated transplants drawn to SoCal for the tech industry.

SnapChat and Google have offices in Venice and Hyperloop has a base in downtown L.A., for example, but the region also has a growing number of medical tech companies, video game makers and more.

The way these two groups live and work affects what's being built for everyone in the area.

Homes are designed for tech living

Even if you don't work in tech or aren't a Millennial, you probably call your friends and family with a cell.

But some hot features in real estate, like concrete floors and brick walls, are terrible for cell reception.

Paul Keller from Mack Urban said they learned that the hard way when residents in one facility moved out because of that, and so now it's standard that the bones of their new construction includes the usual – pipes and electricity – but also repeaters to improve cell service inside homes.

Developer Adrian Foley from Brookfield Properties adds that he believes it's important to have a visual "wow" moment in a living space. He says his company has spent time and money developing Instagrammable areas, be it through impressive communal spaces or installing breathtaking art in a building's lobby.

Meanwhile, in a nod to people who freelance or work from home, Thomas Wulf from Lowe Enterprises says they've shifted from the luxury amenity of a community movie room. Instead at Lowe's developments, coworking spaces are in fashion so residents can work in an office-like setting while being steps from home.

These are just some of the examples of how developers are trying to keep up with the demands of how we live.

Greenspaces are still important, too

The drought has definitely dried up some people's desire for a lush green lawn in SoCal – who has the water to take of it?

The region is also park-poor: over half of L.A. County residents don't have a park within a 10 minute walk.

But developers say that, despite people's reliance on apps and tech, residents still want to know their neighbors.

So Paul Keller says Mack Urban has taken upon itself to design a street-level park at one of its upcoming downtown L.A. properties that's accessible to both future residents and the public.

Why they're building luxury places, not affordable

Critics of developers will say they're just out to get rich; regular people don't need a high-rise with a pool to get by.

They say the money should be spent building as much as possible.

But developer Adrian Foley specifically said he's love to build middle class homes because they're better investments with lower risks. The problem, he argues, are state and local regulations.

Following the building rules in California costs a lot of time, a lot of money and a lot of lawyers.

The only way to recoup those costs is to charge more for homes – meaning, make them luxury – and adding technological bells and whistles to attract that Millennial and tech crowd.

Lawmakers like Governor Brown are trying to speed up the development process, however. He proposed that developers could skip a time-consuming review of a project by local governments. In return, at least 20 percent of the units would have to be affordable.

Developers say it's a promising first step but are not completely sold until the regulation process is more streamlined.