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Yesterday when I was researching for this post on Lean Urbanism, I came across a really interesting way of describing and classifying the groups typically involved in the emergence of a new neighborhood.
It came from New Urbanist Andres Duany, who explained the process, here, using 3 groups of people: those that are risk-oblivious; those that are risk-aware; and those that are risk-adverse.
Risk-oblivious are people like the artist, who go into a crappy neighborhood and magically make it hip. They’re the ones that give the neighborhood its character. They’re the first catalyst.
Risk-aware are people like real estate developers. They know risks exist, but they believe they can manage it, as well as profit from taking it on. They take the neighborhood to the next level.
And finally, risk-adverse are the boring people who only come to a neighborhood once it’s absolutely clear that it’s a safe investment. Duany typecasts this group as the “dentist from New Jersey.” There’s much less value creation at this stage.
Most of you have probably heard of this cycle of urban renewal, but I thought it was really interesting to frame it in terms of risk tolerance.