SAN DIEGO-With Baby Boomers and Generation Y-ers the “dominant drivers of real estate demand over the coming decade,” according to Urban Land Institute, their location preferences for working, living and playing are extremely influential in commercial real estate decision-making. Alan Mark, CEO of the Mark Co., spoke on the panel “Boomers and Gen Y: The Barbells of the Market” yesterday during ULI's Spring Meeting here, and he tells GlobeSt.com that the demographic groups needs and desires for multifamily housing vary widely.

“Most multifamily developers have been out of the marketplace for a couple of years, and they need to be aware that these are two distinct groups they need to design for,” says Mark. “Gen Y want smaller units, while Baby Boomers want larger units with better views. They like similar amenities for different reasons.”

Mark says that both groups want homeowners' necessities, but Gen Y is more brand conscious than the Baby Boomers. Also, Gen Y-ers like certain amenities because they have little time to take care of them on their own, while Baby-Boomers have reached a point in their lives when they don't have the desire to take care of these things themselves. “They both want to be in urban cores, and finishes in apartments are important to them. Everyone is focusing on designs.”

Developers need to focus on both Gen Y and Baby Boomers because often Baby Boomer parents make the decisions—or are influential in the decision-making process—for the Gen Y-ers. “One out of two Gen Y apartment seekers has parents joining them on the tour,” says Mark. “One out of three has parents help them with the down payment, and one out of five has parents co-sign on the application.”

While space needs are reduced for Gen Y-ers, common-area amenities such as the surrounding neighborhood are important to them. More and more city dwellers are doing without cars, and as walkable neighborhoods are created, cars are becoming less crucial for them.

For Baby Boomers, many who had moved to the suburbs for the good schools are now moving back to cities since their children are grown and schools are no longer a concern for them, says Mark. And while multigenerational homes are growing in appeal, “They want a place that's big enough for the kids to visit them for a week or so, but they don't want them moving in. They don't want more bedrooms, just bigger rooms—especially the Baby Boomers in their 50s. The older ones want a home where their kids and grandkids can stay with them while on vacation—even though the kids don't want to stay with them for their whole vacation.”

One thing the two groups have in common is their desire to live in a demographically diverse environment. “People want to be with a mix of people,” says Mark. “Young people don't want to be in a building just with younger people, and the same goes for Baby Boomers. “They also like the ethnic diversity a city offers. We've been finding this for years.”

In fact, people of all demographic groups are showing a desire to return to living in cities. “What we may see is that more and more people want to stay in the city, and it's going to force the school systems to get better,” says Mark. “People will want more space, but if good schools are nearby, they may want to stay in place.”