The "live, work, play" lifestyle and good jobs motivated millennials to move to downtowns, but as they grow their families and long for cheaper living, many millennial "hipsters" are finding suburbs that fit their lifestyle motivations. Thus, "hipsturbias."
The term hipsturbias was first coined in 2013 by the New York Times, but has continued to be used as more suburbs are meeting the needs of and attracting millennials. Essentially, the attraction starts with the "live, work, play" lifestyle, which used to be catered by inner-city areas and downtowns through multi-use areas. But as time progressed, suburbs have been able to duplicate what downtowns have long provided—restaurants, entertainment and recreation near housing and jobs.
"Success has a way of spreading, and 24-hour downtowns have provided replicable models that many suburban communities are seeking to emulate," an Urban Land Institute 2020 real estate trends report said. "From dense northeastern cities like Philadelphia, to Sun Belt giants like Atlanta, to boutique markets like Charleston, our interviewees and focus groups have uncovered the desire of suburbs to create their own versions of the live/work/play district. There is a term of art being heard to capture this concept: hipsturbia."
Suburbs with good jobs that are relatively close to nearby city centers are growing twice as fast as their closest cities. Due to their growth, suburbs can invest more in amenities and attract businesses and entertainment centers, which cater to millennials' desired lifestyle. With today's positive economy and employment, millennials aren't tied to downtowns for good jobs, and, instead, have the flexibility to find them where the cost of living is cheaper, especially when millennials are likely to pay 39% more than baby boomers for their first homes.
"We are already seeing such qualitative shifts as the rise of 'hipsturbias' in our metro areas," the Urban Land Institute report said. "A change in ethos also is observable. The environmental, social, and governance movement has taken root in the corporate and institutional investment world. Real estate operations, meanwhile, are more and more attuned to a preference for 'community' in the places where we live, work, and play."
By some estimates, by 2025, the population in suburbs will exceed those in urban centers for the first time, so developers will have to reimagine suburbs as self-contained communities not reliant on nearby cities.
"I don't think it's a shift of demographics," said Diana Olick, a CNBC business news journalist. "Millennials, just like generations before them, are moving out to the suburbs and it's the same percentage that were moving out there back in 2000. I think what millennials want from the suburbs is different. I think they want closer-in. They want it walkable. And they want it around smaller cities."
To keep up with the trends, there will be a few implications with the draw of millennials to suburbs, according to Karen Harris, managing director at Bain Macro Trends. She told Axios that while distance has changed with the help of technology moving information more cheaply and efficiently, businesses will potentially need to adjust with more locations or smaller offices to lessen commuting times for millennials, who reported higher displeasure in driving than other generations. Additionally, Harris says brick-and-mortar shops will have to "refocus their mission on providing amazing customer experiences" to combat the rise of online shopping.