The Rise of Mixed-Use Developments in Urban Commercial Real Estate 🏙️✨

EPS Team
1 day ago
5 min read

For decades, commercial real estate (CRE) was segmented into silos: office buildings downtown, shopping centers on suburban highways, residential towers in separate neighborhoods. But the way we live, work, and shop is changing—and so is the built environment.

Enter mixed-use developments: projects that combine residential, retail, office, hospitality, and entertainment spaces into integrated hubs where people can live, work, and play. Once considered a niche trend, mixed-use is now a mainstream driver of urban CRE growth.

In 2025, mixed-use developments aren’t just reshaping skylines—they’re redefining investment strategies, community planning, and consumer expectations. From revitalizing underused downtowns to creating vibrant suburban town centers, mixed-use real estate is at the forefront of the urban renaissance.

This blog dives into the rise of mixed-use developments—what’s fueling them, how they impact cities and investors, what trends are shaping the sector, and why strong leadership is essential for success.

What Are Mixed-Use Developments? 🤔

Mixed-use developments (MXDs) bring together multiple property types into one cohesive ecosystem. Common combinations include:

Residential + Retail: Apartments built above ground-floor shops and restaurants.
Residential + Office + Retail: Live-work-play hubs with office towers, residences, and entertainment districts.
Transit-Oriented Developments (TODs) 🚇: Projects built around major transportation nodes.
Lifestyle Centers 🛍️ + 🏡: Blending luxury apartments with entertainment venues, dining, and boutique retail.

Unlike traditional single-use real estate, MXDs create 24/7 activity cycles, where residents, workers, and visitors interact in shared spaces. This boosts foot traffic, strengthens local economies, and enhances the sense of community.

Why Mixed-Use Developments Are Growing 📈

Several economic, demographic, and cultural shifts are fueling the rise of MXDs.

1. Urbanization and Population Growth 🌍

By 2050, nearly 70% of the world’s population will live in urban areas (United Nations).
U.S. cities like Austin, Phoenix, and Charlotte are seeing double-digit population growth, driving demand for integrated communities.

2. Changing Work Patterns 💻

Hybrid work has reduced the need for traditional office towers but increased demand for flexible, amenity-rich environments.
Mixed-use projects provide office tenants with access to housing, dining, and recreation in one location.

3. Millennial and Gen Z Preferences 👩‍🦱👨‍🦱

Younger generations prioritize walkability, convenience, and experiences over car-dependent suburban lifestyles.
A 2024 National Multifamily Housing Council (NMHC) survey found that 71% of renters under 40 prefer living in walkable, mixed-use neighborhoods.

4. Retail Evolution 🛍️

With e-commerce reshaping shopping, brick-and-mortar retail thrives best in experience-driven environments.
Mixed-use settings offer the dining, entertainment, and lifestyle elements that drive foot traffic.

5. Public Policy and Sustainability 🌱

Cities increasingly favor MXDs in zoning and development approvals to promote density, reduce car dependency, and encourage sustainable growth.

The Numbers Behind the Growth 📊

Mixed-use developments are more than a design trend—they’re a high-performing asset class:

According to CBRE, mixed-use properties outperform single-use retail and office projects by 15–20% in rental income due to diversified revenue streams.
The ULI (Urban Land Institute) notes that MXDs can command 30% higher sales per square foot for retail tenants compared to standalone malls.
Vacancy rates are lower: JLL reports mixed-use office components averaged a 10% lower vacancy rate in 2024 compared to standalone suburban office buildings.
Investment appetite is strong: $67 billion was invested into mixed-use projects globally in 2023, up 28% from five years earlier.

Types of Mixed-Use Developments 🏗️

1. Vertical Mixed-Use 🏢

Multiple property types stacked in a single building (e.g., retail on the first floor, office on middle floors, and apartments above).
Common in high-density urban centers like New York, San Francisco, and Chicago.

2. Horizontal Mixed-Use 🏘️

Separate but integrated buildings on a shared site—think town centers or lifestyle districts.
Popular in suburban redevelopments and secondary markets.

3. Transit-Oriented Developments 🚉

Located around major transit hubs, these reduce car dependency and attract residents who prioritize accessibility.
Cities like Washington, D.C., and Denver have led the way in TOD growth.

4. Large-Scale Master-Planned Communities 🌆

Entire neighborhoods blending residential, commercial, retail, and green spaces.
Examples include Hudson Yards in New York City or The Domain in Austin.

Benefits of Mixed-Use Real Estate 🌟

Mixed-use projects deliver advantages for stakeholders across the board:

For Residents 🏡: Convenience, walkability, community, and access to amenities.
For Retailers 🛒: Built-in customer base, steady foot traffic, and brand exposure.
For Employers 💼: Ability to attract talent by offering office locations near residential and lifestyle amenities.
For Cities 🌆: Increased tax revenue, efficient land use, and vibrant public spaces.
For Investors 💰: Diversified income streams, resilience against downturns in one sector, and long-term appreciation.

Challenges in Mixed-Use Development ⚠️

While MXDs are attractive, they come with complexities:

Financing Complexity 💵
- Lenders can be hesitant since MXDs blend asset classes with different risk profiles.
Zoning and Regulatory Barriers 📜
- Mixed-use zoning often requires lengthy approvals and community negotiations.
Management Complexity 🛠️
- Coordinating residential, retail, and office tenants requires specialized property management expertise.
Upfront Costs 🏗️
- MXDs are capital-intensive, often requiring billions in investment and long development timelines.
Tenant Mix Risk 🎭
- The wrong blend of retail or office tenants can weaken the entire ecosystem.

Key Trends Shaping Mixed-Use Developments in 2025 and Beyond 🔮

1. Experience-Driven Retail & Dining 🍷🎶

Restaurants, fitness centers, and entertainment venues anchor mixed-use projects more than traditional retail.

2. Integration of Green and Public Spaces 🌳

Parks, plazas, and rooftop gardens are critical for community appeal.
Studies show green space can increase surrounding property values by up to 20%.

3. Tech-Enabled Smart Communities 📲

Smart building systems, tenant apps, and IoT-enabled security improve efficiency and resident satisfaction.

4. Affordable Housing Requirements 🏘️

Many cities mandate that a percentage of residential units in MXDs be set aside as affordable housing.

5. Health and Wellness Amenities 🧘

Wellness-focused amenities—gyms, healthy dining, bike storage—are becoming standard expectations.

Case in Point: The Suburban Shift 🏡➡️🏙️

One of the biggest changes is the rise of suburban mixed-use developments. As millennials form families but still desire walkability and lifestyle amenities, suburban town centers and redeveloped malls are being transformed into mixed-use hubs.

For example:

Vacant shopping malls across the U.S. are being repositioned into mixed-use spaces with apartments, coworking spaces, gyms, and dining.
According to ICSC, over 25% of malls are expected to undergo major redevelopment by 2030, with most leaning toward mixed-use formats.

The Investor Perspective 💡

Why are investors flocking to MXDs?

Risk Diversification: Spreading risk across multiple asset types makes properties more resilient.
Long-Term Value Creation: Mixed-use communities generate sustained demand over decades.
Appeal to Institutional Investors: Pension funds and REITs see MXDs as stable, long-term plays.
High Barriers to Entry: Complex development discourages competition, creating scarcity value.

The Role of Leadership and Staffing 👩‍💼👨‍💼

Mixed-use success hinges on specialized executive talent:

Development Executives to oversee complex financing and design.
Property Managers with expertise in coordinating residential, office, and retail operations.
Leasing Directors skilled in curating tenant mixes that enhance vibrancy.
Marketing Leaders to position developments as destinations.

Without strong leadership, even the best-located mixed-use projects can struggle.

Looking Ahead: The Future of Mixed-Use Real Estate 🚀

The next decade of urban CRE will be shaped by:

Hyper-localized communities blending culture, dining, and lifestyle.
Transit-linked hubs reducing car dependency.
Tech-enabled developments that integrate data-driven operations.
Greater public-private collaboration for affordable housing and sustainability.

Mixed-use developments aren’t just buildings—they’re miniature cities redefining how we experience urban life.

Conclusion 🏁

The rise of mixed-use developments marks one of the most significant transformations in commercial real estate. As cities grow denser, consumer preferences evolve, and e-commerce reshapes retail, MXDs offer a sustainable, profitable, and vibrant solution.

But success requires visionary leadership, specialized expertise, and careful execution. That’s where staffing plays a critical role. At Executive Property Staffing, we help developers, REITs, and property managers recruit and headhunt for top executive talent needed to lead mixed-use projects with confidence—from property management to leasing to development leadership.