“The donut effect” is reshaping America’s cities

The most pronounced dynamic shaping U.S. cities heading into 2024 is “the donut effect” — a hollowing of the urban core as people, jobs and retailers flee to the suburbs and exurbs.

Why it matters: For all the talk of 2023 being the year of downtown recovery, the reality looks more like a swirl of experiments in how to attract residents, commuters and visitors to cities where the pulse beats differently than it did pre-pandemic.

Large cities’ populations are trending down as people move to the suburbs to work — and avoid urban crime, homelessness, shoplifting and drug use, whether real or perceived.
“People can get much of what they used to get in the city in the suburbs, in the exurbs and on their computer,” says Joel Kotkin, professor of urban studies at Chapman University in Orange, California, and executive director of the Houston-based Urban Reform Institute.
Driving the news: Cities are using all kinds of strategies to restore their former vibrancy and encourage people to shop, work, recreate and dine.

Chicago, Boston, Pittsburgh and Washington, D.C., are dangling tax incentives for converting office buildings to residential apartments.

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