Weekly Threads in New Urbanism News

The Cost of Renting or Buying  a Home-– includes consideration of not just monthly costs and deductibility of interest, but also long-term appreciation or depreciation (housing busts) and that owning a house tethers the owner to that location when downturns occur and labor markets shift.  This issue is highlighted in the Economist (“Homeownership, let’s recall, is in most cases a highly leveraged, undiversified, relatively illiquid bet, with a return that is highly correlated to local labour market conditions”) and in a piece by Richard Florida.

Speaking of Richard Florida, his book The Great Reset was published a couple of weeks ago  (see my prior summary of his comments at ULI), and he has done a number of interviews in The Atlantic and elsewhere.  A brief summary of some of his thoughts on how the current economic crisis will alter our living and working patterns:

Place – not the corporation – is the social and economic organizing unit of the knowledge economy. Homeownership = driving force of the 2nd Reset post Depression.  Homeownership increased from 27% in 1920 to 45% in 1950.

Speed and velocity of cities is what makes them productive. Every minute spent in traffic costs the US $20B in productivity and more important than the waste of physical resources (and maybe a better selling point tom non-environmentalists) is regaining the lost creativity from sprawl induced traffic.

The current economic crisis marks the end of a chapter in American economic history, and indeed, the end of a whole way of life.  The recession will accelerate the rise and fall of specific places within the U.S.—and reverse the fortunes of other cities and regions.

Economic crises tend to reinforce and accelerate the underlying, long-term trends within an economy. Our economy is in the midst of a fundamental long-term transformation—similar to that of the late 19th century, when people streamed off farms and into new and rising industrial cities. In this case, the economy is shifting away from manufacturing and toward idea-driven creative industries—and that, too, favors America’s talent-rich, fast-metabolizing places.

Positioning the economy to grow strongly in the coming decades will require not just fiscal stimulus or industrial reform; it will require a new kind of geography as well, a new spatial fix for the next chapter of American economic history.

Richard Florida points out that post-economic upheaval resets are often times of great talent resets — fueled largely by bright young immigrants like Andy Grove (Intel), Andrew Carnegie and Nicholas Tesla.  [Side Note: Arizona with its new immigration law clearly doesn’t understand the net benefit of immigration]

Regional Planning Can Suck Life Out of Cities: Stringing together cities with highway sprawl can suck the charm out of the idea of regionalism, making the sum decidedly less than its parts, says Carol Coletta, President of CEOs for Cities.  Regionalism can be relatively easy to impose in regions with big, dominant core cities, such as New York and Chicago, but those regions with cities of equal size or with a weak central city regionalism is much more difficult, and throw in a history of racial or economic segregation, and the area tends to polarize.  However, “the real problem comes when, in the name of regionalism, decision makers become place agnostic. In other words, they can’t favor any one place in the region for fear of offending every other place in the  region.  We undermine regional strength when we fail to invest in making vibrant places.”

I forgot who phrased it another way — “When cities become boring, even the rich people leave.”

State Legislation Promotes H+T Affordability: Illinois became the first place to actually pass legislation allowing state agencies to factor in the combined housing + transportation costs in making future investment decisions to create more holistically affordable communities.

Streetcars Becoming Popular: Up to 22 cities could be laying track within two years!

Why do people stay or leave particular cities/ Neighborhoods? The Martin Institute at the University of Toronto examined the relative effects of three factors: (1) satisfaction with community or place-based factors such as aesthetic appeal, outdoor space and recreational amenities, artistic and cultural amenities, the ability to meet people and make friends; (2) community economic conditions; and (3) individual-level demographic factors such as income, human capital, and age.  “Our findings indicate that place-based factors, in particular the beauty and physical appeal of the current location and the ability to meet people and make friends, explain more of the desire to stay than does community economic conditions or individual demographic characteristics.”

Why Humanity Loves and Needs Cities: The New York Times did a great piece on why we love cities. “One-third of Americans inhabit just 16 large metropolitan areas, which collectively use only a tiny fraction of the country’s land mass. …  If cities serve, as I believe, primarily, to connect people and enable them to learn from one another, than an increasingly information-intensive economy will only make urban density more valuable. … Perhaps the clearest reason why people cluster together in cities is that wages and productivity rise with density. … Humanity is a social species and our greatest gift is our ability to learn from one another. Cities thrive by enabling that learning, and they have become only more important as knowledge has become more valuable. Understanding what makes cities work is more important than ever.”

Mixed Use Projects Not Moving Forward in Texas Given Lack of Financing:  Although “high-density, mixed-use projects are an important, high-impact, sustainable growth strategy because it makes sense to stop the urban sprawl,” says Scott Ziegler, founding principal of Ziegler Cooper Architects, and “even though the idea of living in a community with easy access to jobs, public transit or freeways remains popular in Texas, not many projects are moving forward.”

New Urbanism & the Road Building Lobby:  This article reminds us that there are economically vested forces that don’t want new urbanism to succeed. “The enhanced emphasis on multiple forms of transportation and their relationship to local development — known to supporters as ‘livability’ policy — comes at a time when Congress has delayed passage of a new multiyear transportation bill that could cost as much as $500 billion. Transportation money is declining in real terms because the federal gasoline tax is not indexed to inflation. Given that, how this administration spends the money that is available is firmly under the microscope of an anxious road lobby.”

Commuting Costs Offset Lower House Prices: A study of the Boston area found that people who move to an outlying Boston suburb to find affordable housing or to get more house for their money often sacrifice the savings to higher transportation costs.

Elite “Weird” Cities: The Economist points out that quirky cities tend to be more creative and prosperous. “Keep Portland weird”, say bumper stickers on the city’s cars, which all seem to be hybrid-electric vehicles. “Keep Portland sanctimonious,” mumble a few contrarians, while others savour the irony that Portland had to steal the slogan from Austin, Texas. But on the whole, Portlanders not only love their city but believe that it is, and ought to be, a model for the rest of America.

Joel Kotkin, a Los Angeles-based demographer and author, thinks that places like Portland, San Francisco and Boston have become “elite cities”, attractive to the young and single.

Could Supermarkets in the Suburbs Become Hubs of Walkable Neighborhoods? Seattle urban design planner Mark Hinshaw sees a dramatically transformed role for supermarkets. They’ll actually become the anchors of new and walkable neighborhoods.  And what does internet retailing mean for urban stores? “Some big-box stores still do not have an urban design and won’t go beyond their familiar suburban-style look. But these days, many have wised up and now have urban design templates. Savvier cities have found ways to woo these stores downtown.”

Requiem for the Suburbs:  An incredible collection of quotes and facts on the trends toward densification, transit-orientation and new urbanism.

Recession Continues to Push Rental Housing Further “Out of Reach” for Low Income Americans:  According to Out of Reach 2010, the national two-bedroom Fair Market Rent (FMR) is a staggering $959 a month. In addition, 74% of metro renters live in an area where having two full-time jobs at the minimum wage would still not allow them to afford the two-bedroom FMR.  This study highlights the need to make affordable housing a critical component of every TOD project, as the combined housing + transportation cost is particularly problematic for lower income families.

Tax Credit for TOD Projects:  One of the best ideas to come out of Congress in years — Sen. Robert Menendez (D-NJ), the senior member of the Banking Committee’s transit panel, proposes that new construction projects that are within a half-mile of transit stations and exceeding national energy-efficiency standards would be eligible for a tax credit.

Redevelopment in Urban Centers Outpaces Suburbs according to a recent U.S. EPA study, suggesting a “fundamental shift” has begun in the real estate market. “The livability initiative is in sync with where the marketplace was going anyway,” said Ed McMahon, senior resident fellow for environmental policy at the Urban Land Institute. “There’s been a pent-up demand for urban living, and that demand is evident in housing prices.”

Visualizing New Urbanism: what would a small city downtown street look like with a more walkable, urban design?  See the virtual transformation of a lifeless street in Mount Pleasant, SC.

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About Bob Voelker

Head of the Munsch Hardt (Dallas law firm) Hospitality & Mixed Use Development Group, and former developer of affordable housing. I'm i
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