MIXED-USE PROJECTS WILL:

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With gas prices what they are, people are increasinglylooking to avoid unnecessarily driving between their homes and workor shopping areas. It's not surprising, then, that even in a downeconomy, 82% of poll respondents think that mixed-use projects aremore important than ever. A mere 18% think they are not aspractical in this economy. Matt Harding, president and COO of LevinManagement, definitely sees mixed-use developments as important,although he notes that certain aspects are being curtailed. Hereare his thoughts:

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"Mixed-use developments are very important because they enablepeople to work and shop, live and shop or live, work and shop inthe same location. So, they are important and will continue to beso. Also, from a developer's point of view, this type ofdevelopment offers diversity in the type of product you'rebuilding. At this point in time, though, if the project is heavilyweighted with residential, particularly for-sale residential suchas condominiums, it's very difficult to get financing. That shouldchange shortly, and developers are also converting for-saleresidential product to rental, which is easier to get financingfor.

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"Developers want to build what they can sell or lease, so we maysee some shrinking of the residential component for now. That willebb and flow with the real estate cycle. There are plenty ofmixed-use projects that don't have a residential component, theyhave retail and office or hotels. They don't necessarily have tohave a residential component, but it is an important part of amixed-use project. We'll just see a little less of it for the timebeing until the residential real estate market gets things squaredaway.

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"Transit village-related developments are important and will bemore resilient in a downturn. The costs of transportation and fueland so forth isn't going to go down; most people think, in realterms, they'll continue to go up, so people are increasinglyfocused on mass transportation. If you have a mixed-use projectthat is convenient to mass transportation, that's a very bigplus."

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