How might driverless cars impact commercial real estate?

By Greg Bell

With each day of technology news, it seems ever more likely that self-driving cars are coming to our streets much sooner than was anticipated. Within the next 10 to 20 years, cities could see the transportation landscape change in way it hasn't since the invention of the car. The big question for those looking to buy commercial property on the Gold Coast, however, is how might these changes impact the price and usage of their property?

The promise of a self-driving future

The benefits that self-driving cars are hypothesised to bring are many – increased safety and reliability, a lower road toll, better fuel economy and reduced congestion are just some of the things experts suspect the widespread adoption of self-driving cars will bring. An article by Jason Henderson and Jason Spencer in the Cornell Real Estate Review outlines a number of changes the technology is expected to bring about for individual transportation decisions:

  • People choosing to travel more thanks to lower cost per kilometre and the ability to do tasks other than driving whilst doing so.
  • Non-drivers will be able to travel more, like children and the elderly.
  • Ownership rates of personal vehicles are set to lower, as vehicles can 'self-taxi' making it easier to share vehicles between multiple people.

These changes are the base from which the other potential effects to society and real estate can flow.

Does distance no longer become a problem?

One of these wider effects of self-driving cars may be that distance or location of a property may lose some of its importance. Office blocks or commercial real estate that was once considered unattractive because it was too far away (or conversely, properties that were valuable because of their prime location) may see changes to their value that would otherwise be unexpected.

This is because travel will have become a great deal less burdensome. There is no reason why a car needs to have the traditional configuration – why not have a space with a bed, or perhaps even a desk? Suddenly, working several hours away from where one lives isn't as much a pain as it once was – sitting in a traffic jam for hours wouldn't be so bad if you were asleep, or could be doing your work at the same time.

A better use for parking space?

Another of the changes self-driving cars could bring is the more efficient use of parking space for other purposes. A lot of space in cities is dedicated to parking cars when they're not in use – think what could be done with it if the parking wasn't needed. Self-driving cars don't need to park, or if they do, not close by. A future where you step out of your car at your work's door, only for it to drive off many kilometres to find itself a park is one where inner-city real estate dedicated to parking could be better used for commercial purposes.

While the last decade has seen online shopping become far more popular, self-driving cars could give physical retail locations a boost too. Would people be willing to travel to a retail store if they new they didn't have to find a park and they could be doing things other than driving on their journey there? It's not outside the bounds of possibility.

Just how far in the future these kinds of changes to the value and use of commercial real estate in this country are, is anybody's guess. You can be sure, however, that the experts at Ray White will be here to keep you in the know.

Looking for commercial property for sale on the Gold Coast? Get in touch with the team at Ray White today.

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