Tag Archives: regulation

Parking requirements and unintended consequences

Surface parking in Minneapolis. CC image from Zach K.

Writing in MinnPost, Marlys Harris asks why (seemingly) nothing is getting done in Minneapolis. She comes up with three broad reasons: a negative attitude towards new development, economic justifications that don’t pencil out for new projects, and the impact of zoning and land use regulations – often unintended impacts or perverse outcomes. While all three are certainly factors, the real interesting implication is the interplay between them: as an example, regulations that dictate long and uncertain processes, enabling those opposed to new development to organize in opposition, thereby adding time and cost to a building project to the point where it’s no longer feasible.

In the comments, Max Musicant offers an example of these chain reactions on the regulatory side:

[T]he zoning code is very often in conflict with how multi-story buildings are actually built – which also drives the almost constant demand for variances. If one wants to build a multi-story building, you are required to provide an elevator. If you need an elevator, you need to build 4-6 stories to spread out the cost. If you are building that high, you will likely be required to build parking on-site. If you have to build parking on-site in an urban location, it will have to be underground – which is very expensive. All of this can be avoided only if 1) you build one story suburban style or 2) your price points are affordable only to the wealthy.

The parking requirements are particularly onerous. Oregon Public Broadcasting took note of parking-less apartment building projects in Portland back in August. New buildings are going up without off-street parking, taking advantage of a change in the zoning code that allows exemptions from parking requirements under certain conditions. While the article’s narrative focuses on the kinds of people who would live without a car or without a designated parking space, this cultural focus is misplaced – as Max Musicant noted later in his comment, these kind of walk-up apartment buildings without off-street parking were commonly constructed in American cities in the not-so-distant past.

The real takeaway from the OPB piece isn’t about the behavior of the tenants, but of the impact on the bottom line of the builders:

One of those developers is Dave Mullens with the Urban Development Group. He opened the Irvington Garden in a close-in Northeast Portland neighborhood last year. It’s 50 units with no parking places.

“The cost of parking would make building this type of project on this location unaffordable,” Mullens says.

Mullens calls the difference “tremendous.”

“Parking a site is the difference between a $750 apartment and a $1,200 apartment. Or, the difference between apartments and condos,” he says.

In other words, these kinds of regulations have severe costs. Taking Mullens’s price figure at face value, it’s not hard to see how removing a requirement like this would help market rate development target demand at lower price points. Likewise, it’s not hard to see how seemingly narrowly-focused and well-intentioned regulations can have much broader consequences when layered with other constraints.

Of course, these points are all on the micro scale of an individual project, but the macro scale also matters. The regulations have to allow the market to increase supply in order to meet demand – otherwise bad things happen. In the Washington Business Journal, Montgomery and Fairfax counties in metropolitan DC are concerned about housing becoming unaffordable even for those with six figure incomes.

It’s not until the end that simply relaxing zoning requirements to a) increase supply, or b) lower the cost of development (see the parking requirement discussion) is mentioned. The article does not mention option c), all of the above.  Since there would still be a need for deeply affordable dwelling units, relaxing or eliminating parking requirements would be a good place to start in striking the balance between good, well-intentioned, and effective regulations and an efficient marketplace for new development.

Density links – process and constraints

Zoning notice from Burlington, VT - CC image from Don Shall

The ‘right’ density: In the process of putting this post together, I missed Ryan Avent’s piece in The Economist, mentioning some of the broader consequences of land use regulation constraints.  It’s a great summary of some of the key issues regarding density, constraints to growth, levels of governance, and our regulatory processes.    The genesis for the discussion is Facebook’s ability to spark a boom in Silicon Valley following their IPO.  Avent documents the constraints to this (and any other development) and the macroeconomic implications.

Avent leaves a footnote about what the ‘right’ level of density is, offering another criticism of Richard Florida’s recent piece on the subject. Avent writes:

Some urbanists claim that it’s important to cultivate the “right” density to boost innovative activity, and that tall buildings aren’t compatible with this. See this recent Richard Florida piece as an example. This strikes me as mistaken on multiple levels. I have very little confidence in the ability of planners to understand what a particular density is accomplishing and whether the “interactions facilitated” by shorter buildings either exist or are large enough to offset the higher real-estate and labour costs to which they contribute. It does not appear that technology companies have had trouble colonising central San Francisco or New York, despite the significantly greater verticality of those places relative to, say, Mountain View. And space is mostly fungible. Even if we assume that tech companies prefer short buildings while professional firms and households are happy in tall ones, the failure to provide ample supply for the latter uses will crowd out some of the former. That is, maybe the construction of lots of new residential and office highrises in San Francisco doesn’t attract a single tech firm to the new towers. The new construction will nonetheless place substantial downward pressure on rents, attracting lots of new people to the region and making it easier to start a business.

The focus on the ‘right’ density for innovation seems quite far-fetched and unsupported by evidence.  Some planners will indeed offer all sorts of reasons to limit heights of buildings, but facilitating greater innovation is not usually the stated reason.

Michael Lewyn offers a line-by-line takedown of a similar line of thinking from Ed McMahon (linked previously here). Well worth a read, despite the use of all caps.

Planning and process:  There are two competing issues that Avent touches on, however.  One is the content of the land use regulations, their substance and their scope.  That is, the kind of stuff they allow and disallow.   The other is the process of making these land use decisions.

Over the weekend, the New York Times featured a profile of New York’s planning chief, Amanda Burden.  A few things jump out: under Burden’s leadership, the planning department has substantially upzoned many areas of the city:

Since 2002, when she was appointed to head City Planning, she has overseen the wholesale rezoning of the city, with 115 rezoning plans covering more than 10,300 blocks; by the end of her administration, the department is expected to have rezoned about 40 percent of New York, an unprecedented number.

However, while the content of the regulations has increased, the process has not gotten simpler:

But that attention to detail has also received criticism. Ms. Burden’s belief in contextual zoning, for example, under which new developments in a neighborhood are required to be in the height and style of surrounding structures, leads to “profoundly conservative building,” said Julia Vitullo-Martin, a senior fellow at the Regional Plan Associationand director of its Center for Urban Innovation. “New York’s greatness as the dominant skyscraper city of the 20th century was the result of bold building, but the local zeitgeist has switched from big and bold to keeping everything small, nondescript and similar to everything else in the neighborhood.”

It has also become common under Ms. Burden’s leadership for developers and their architects to have to negotiate their designs with City Planning. “Development has become a game of second-guessing,” Ms. Vitullo-Martin said. “What will Amanda think of my project? What will I need to compromise on?

“There really doesn’t seem to be any true as-of-right development anymore,” she added, referring to the ability to build without obtaining permits or other approvals.

This strikes me as one of the fundamental tensions of urban development.  Much of it will follow the path of least resistance, building what is allowed by right due to the easier process. Chris Leinberger always made a point to emphasize how reform must make doing the right thing also the easy thing.  This is more about making the bad approach just as hard as the right approach.

In an ideal world, it would be best to make doing the right thing the easy thing; the by-right thing for developers.  You could reduce the constraint of the code’s substance while also reducing the procedural barriers to building – the timeline for approval in New York is significant:

FOR developers, the clock is ticking. Though the Bloomberg administration won’t leave office for 19 months, most projects that require rezoning or other Planning Department approval can take at least 18 months to get through the process. And the administration’s overall friendliness to development means that most builders with projects on the drawing board are scurrying to get them passed before the term’s end, rather than face the uncertainty of the next administration.

However, I’m curious if there is an absolute tradeoff between content and process.  Richard Layman advocates for precisely that – the reduction of by-right allowances with the goal of improving development outcomes.  I’m not sold that the tradeoff is absolute, however – that the only way to improve outcomes is to increase the control of the process over development.  Instead, the bar for by-right development should be higher, but without extra procedural hurdles.

Nonetheless, I am interested in seeing where exactly the borders between those tradeoffs are.  There’s also the question of personality and uncertainty – what does the rush to get approvals before Burden leaves office say about the longevity and sustainability of that regulatory mechanism? Does it become completely reliant on the people in a given office?

Open questions, all – I’m uncertain about the nature of those tradeoffs.

The wrong relationships: Echoing Richard Florida’s points about density and skyscrapers being nothing but ‘vertical cul-de-sacs’, the blog Walkable DFW unloads a lot of reasons to hate skyscrapers, none of which stand up to a closer reading.

An example.  Increased density has diminishing returns for efficient transportation:  this is true for transit ridership, but that’s because once you get to high levels of density, you don’t need transit at all – you just walk. Accessibility wins over mobility.

There are lots of other problematic statements, including some cherrypicked density datapoints from Barcelona and New York, but one in particular caught my eye: “stretching buildings upwards has the same effect as stretching them outwards.” That is, he claims building up is just as inefficient as sprawl:

I often lament living on the 19th floor.  I often walk to work.  But I still experience rush hour:  waiting for the elevators before and after typical work hours (often as much as 10 minutes if a few of the elevators are down, which invariably some always are).

I only bring this up for a chance to link to this excellent 2008 New Yorker piece on the secret lives of elevators. It would seem that this blogger’s building is under-elevated – though I would posit that’s not a particularly good reason to throw the baby out with the bathwater.

 

Rail transport links – carry that weight

CC image from Rob Swatski

Some illustrative links from the world of rail transportation:

From Reason and Rail: Why the freight railroads will never electrify.

This is the problem which freight electrification faces. While electrification would represent a lessening in fuel expenses, especially as the price of oil is expected to rise another 20-30% over the long-term, this is a fairly minor savings for the railroads.

Some discussion in the comments asking if government subsidies would change the calculus.  It might, but perhaps the better question is about ensuring common usage of key track segments between commuter and freight traffic, between double-stacked containers and electric multiple unit passenger trains.

Why commuter railroads will electrify:

Firstly, operational costs have a far greater prominence than do capital costs owing to the nature of government agencies as opposed to private agencies. An investment that is hard to justify for a freight operator becomes much easier for a public agency that is receiving “free” funding from another agency and in the process is able to reduce its operational costs to those to whom it is immediately responsible. In such a way does spending hundreds of millions of dollars to save a few million per year become an attractive financial option.

More importantly, however, is the fact that electric trains accelerate much faster, and electric multiple units, compared to a diesel locomotive hauling several rail cars, accelerate like a bat out of hell.

The upshot of this is that more time is spent at higher speeds, reducing the time penalty for any individual train stop and greatly increasing the average speed, making it more attractive to travelers and increasing its patronage, and political support, as a result.

Alon Levy notes in the comments that commuter lines are talking about electrifying only a fraction of the track that would be required for a transcontinental freight route.  Greater payoff and a smaller up-front investment makes sense.

Some confounding factors: speed and weight.  Alon Levy takes note of three challenges in meshing fast passenger trains with heavy but slow freight – a conflict inherent in mixing passenger and freight traffic.  They are 1) schedule conflicts, including the challenges of meshing disparate speeds together; 2) different track geometries required, particularly superelevation (e.g banking) of the tracks; 3) damage to tracks inflicted by heavy trains.

Another confounding factor: US regulations.  Systemic Failure takes note of a recent US railcar procurement.

The FRA is soliciting bids for a $551 million contract for 130 bi-level railcars. As a condition for the contract, the railcars must be manufactured entirely with American steel and components. If you do the math, that comes to 4.2 million dollars each – double the global market price for a bi-level car.

In other words, the FRA is pissing away a quarter billion dollars. Imagine all the projects that might have been done with $250 million. Imagine all the jobs that might have been created with that money. I’m talking real jobs — not bureaucrats enforcing Made-in-America rules. Jobs like installing new PTC signaling, repairing bridges, or expanding the transit network. You know, things that have tangible benefit to riders.

The really crazy thing is that there is a glut in the passenger railcar market. The last thing needed is yet another product (a hopelessly primitive one at that). And since few operators besides Amtrak will be interested in this railcar, a lot of design and development will just go to waste.

Our regulations prohibit purchasing rolling stock off the shelf from other nations, while our history of divestment in passenger rail has largely dried up rail car manufacturing in this country.  These regulations also make the adoption of the faster electric traction commuter trains mentioned above more expensive and more difficult.   They also mandate inferior performance:

Now compare that to the example of the FRA compliant Colorado Railcar as given in theFairmount DMU study. With two single level multiple units and two trailers, Colorado takes 123 seconds to accelerate to a speed of 60 miles per hour. The Talent, however, has blazed past Colorado, reaching 95 km/h (~60mph) in 40 seconds. Indeed, by the time that Colorado has reached 60 miles per hour, the Bombardier Talent has reached the FRA’s normal speed limit of 130 km/h and been cruising at top speed for 50 seconds.

The implication here isn’t just about speed for speed’s sake – the better acceleration makes it easier for the trains to keep on schedule, improving reliability and cutting travel time.

Links: The new American Dream

House for rent. CC image from Sean Dreilinger

Foreclosed sprawl – the next frontier of renting?  The New York Times looks at the practice of firms buying up foreclosed, cookie cutter sprawl housing at relatively low prices with the idea of renting these houses out to tenants.

As an inspector for the Waypoint Real Estate Group, Mr. Hladik takes about 20 minutes to walk through each home, noting worn kitchen cabinets or missing roof tiles. The blistering pace is necessary to keep up with Waypoint’s appetite: the company, which has bought about 1,200 homes since 2008 — and is now buying five to seven a day — is an early entrant in a business that some deep-pocketed investors are betting is poised to explode.

With home prices down more than a third from their peak and the market swamped with foreclosures, large investors are salivating at the opportunity to buy perhaps thousands of homes at deep discounts and fill them with tenants. Nobody has ever tried this on such a large scale, and critics worry these new investors could face big challenges managing large portfolios of dispersed rental houses. Typically, landlords tend to be individuals or small firms that own just a handful of homes.

Cities usually have more rentals, and for good reason.  Apartments have common structural elements and provide for economies of scale in managing multiple units.  Applying this to large-scale single family detached homes is a different and challenging model, but a seemingly inevitable result of the decline in home prices in these areas once built on speculation.

It’s also an example of housing market filtering in action.

This isn’t quite what the concept of filtering is about… Cap’n Transit disputes the concept of filtering, noting that such shifts are not permanent.  However, I don’t think anyone was asserting they were.  Filtering is a process, a description of the market responding to shifting demand.  It is not a description of an end state.

It’s true that most of those buildings were not well-maintained, but the causation is more likely the other way around: the landlords didn’t put a lot of money into them because they didn’t bring in much rent. So why were the rents so cheap? I’m guessing that there were several related factors: racism, city services, crime, noise, fads and the suburban ponzi scheme.

I don’t think any of those really disproves the filtering concept.  Filtering doesn’t really describe causation, just the correlation – as demand drops (and therefore the potential rent income), so to does maintenance, and the units on the margins will filter down to more “affordable” prices. Each of those factors listed at the end could be construed, one way or another, as an influence on demand.

The rest of the Cap’ns post on the politics and emotions of gentrification and filtering up are spot on, however.

The fiscal benefits of density: While renting out old McMansions might be a challenge due to diseconomies of scale, Emily Badger looks at Asheville, NC and makes the fiscal case for density and urban infill development.

The whole idea is pretty simple. But it’s sort of baffling that we haven’t been looking at our land this way for years. Cities, Minicozzi laments, are woefully ignorant about exactly which types of neighborhoods and development put the most financial strain on public coffers and which kick in the most money. This is why Minicozzi has been deploying every metaphor he can think of – cash crops, gas tanks, french fries! – to beat home the math.

Fundamentally, this is the same concept as the Geoffrey West observation of urban agglomeration and the inherent efficiency it offers.

How to make use of the reverse commute: Perhaps someone should inform various secondary job centers along transit lines of their fiscal potential.  Alon Levy looks at what’s required to make for successful secondary CBDs along rail transit lines, and what’s wrong with our current land use around suburban stations:

But really, the kind of development that’s missing around suburban train stations in the US is twofold. First, the local development near the stations is not transit-oriented, in the sense that big job and retail centers may be inconvenient to walk to for the pedestrian. And second, the regional development does not follow the train lines, but rather arterial roads, or, in cities with rapid transit, rapid transit lines…

In both cases, what’s missing is transportation-development symbiosis. Whoever runs the trains has the most to gain from locating major office and retail development, without excessive parking, near the train stations. And whoever owns the buildings has the most to gain from running trains to them, to prop up property values. This leads to the private railroad conglomerates in Tokyo, and to the Hong Kong MTR.

Commenter Jim notes how the DC region has a decent track record in this regard with Metro, but not with commuter rail:

The experience in Washington has been that when a Metrorail station (either an extension or infill) is proposed, the planners tear up their existing plans and write new ones for the area immediately surrounding the new station. Metrorail-catalysed TOD is a well understood and appreciated phenomenon. But no-one cares about commuter rail. Planners don’t assume that commuter rail stations will change anything, so don’t change their existing plans to accommodate them.

That’s the disconnect you have to fix.

Indeed – creating that symbiosis requires solving a bit of a chicken-egg problem.  Still, some opportunities exist in the DC region.  New Carrollton jumps to mind, both for Metro access for DC reverse commutes, as well as its mid-line location on the MARC Penn line.  However, the challenge there is on the development side, not the transit service side.

Parking requirements matter: Downtown LA’s revival based on adaptive re-use might not have been possible without changes to LA’s minimum parking requirements.  Making a place built pre-requirement conform is unnecessary, and shows how influential and destructive the requirements can be.  It also speaks to the ability of changing regulations to make doing the right thing the path of least resistance:

Passed by the L.A. City Council in — yes — 1999 and at first applied only to Downtown, ARO gave the go-ahead for the conversion of historic and other older — and often under-used, under-appreciated or even abandoned — office buildings into residences. ARO was expanded in 2003 into various other parts of the city.

“[The Ordinance] provides for an expedited approval process and ensures that older and historic building are not subjected to the same zoning and code requirements that apply to new construction,” reads text on the city’s Office of Historic Resources site.

Fitting in with the econourbanist theory about reduced land use regulation allowing for the market to better address issues of supply, the response was impressive:

During an almost thirty-year period beginning in 1970, Downtown Los Angeles gained a grand total of 4,300 units in housing stock.

Then, between 1999 and 2008, Downtown gained at least 7,300 housing units just from long-term vacant buildings.

That said, it’s not like LA completely abandoned these regulations:

Shoup’s article notes that pre-ARO, developers were required per each housing unit to provide two or more parking spaces. Those spaces, Shoup emphasizes in his piece, were required to be on-site.

Post-ARO, Shoup’s piece says that the average number of on-site parking spaces fell to 0.9 in those converted, previously vacant buildings. Including off-site parking, the number was still 1.3 spaces per unit. That’s a 65% drop in required parking spaces in an area where many residents already self-select to reside in for reasons unrelated to having a multi-car garage.

Nearly one space per unit is still a lot of parking.  Granted, this is LA that we’re talking about.  The flexibility to meet that requirement off-site (flexibility likely required to make the adaptive reuse of historic buildings possible) speaks to the benefits of allowing such changes as a matter of right.

The point about residents self-selecting to live in such conditions is key, contrary to common NIMBY complaints – no one is forcing Angelenos to move in at gunpoint.

Different thoughts on transit service metrics: Jarrett Walker looks at San Francisco’s transit speed (same as it was 100 years ago, or slower) and offers thoughts on various metrics and the need to think about the reliability of the network as a whole.

My own work in this area has always advocated a stronger, more transit-specific approach that begins not with the single delayed line, but rather with the functioning of an entire network.  Don’t just ask “how fast should this line be?” which tends to degenerate into “What can we do to make those forlorn buses move a little faster without upsetting anyone?”  Instead, ask “What travel time outcomes do we need across this network?”  Or turn it around: How much of the city needs to be within 30 minutes of most people?  — a question that leads to those compelling Walkscore travel time maps, which are literally maps of individual freedom.

The rent is still too damn high

CC image from Jaybird

A few more thoughts (and links) to discussion from The Rent is Too Damn High.

On rent control:  Mike Konzcal (linking to JW Mason) notes how Yglesias’ book is more or less an endorsement of renting, yet rent control and similar sorts of tenant protections are part of what helps give renters similar levels of stability to owners.  While rent control often gets a bad name because of distortions it can cause in the rental market, the purpose was not explicitly to distort the market, but to provide stability. Mason:

I would just add that a diversity of income levels in a neighborhood is also a goal of rent regulation, as is recognizing the legitimate interest of long-time tenants in staying in their homes. (Not all rights are property rights!) So by framing the question purely in terms of the housing supply, the Booth people have already disconnected it from actual policy debates in a way favorable to orthodoxy. Anyway, no surprise, orthodoxy wins, with only a single respondent favoring rent regulation. (And I think that one might be a typo.) My favorite answer is the person who said, ” Rent control will have similar effects to any price control.” That’s the beauty of economics, isn’t it? — all markets are exactly the same.

Indeed, despite the virtues of renting, many aspire to own just because of that extra measure of stability and control – see Emily Badger in The Atlantic.

Defenses of rent control aside, I think this critique misses Matt’s broader point, which is that the kinds of entities focused on maintaining affordability via non-profit affordable housing development and via rent subsidies and so on should be on the forefront of wanting to grow the overall housing supply – but they seldom are.  There’s a blind spot and a disconnect here. Peter Frase takes Matt’s argument to the extreme:

The problem, here as elsewhere, is that in the tradeoff between social stability and aggregate material prosperity, Yglesias appears to assign stability a value of zero. If people “tend to resist change”, then this is simply an obstacle to be overcome by “state and federal officials”. The ideal type of society that’s evoked here is a perfectly frictionless world of market transactions, one that fully realizes Marx’s comment that under capitalism, “all that is solid melts into air”.

Glaeser’s Triumph of the City suffers a bit from this same problem in its policy descriptions (the ones regarding historic preservation are particularly illustrative), but just because their policy ideas might be a bit extreme doesn’t negate the substance of the analysis. Glaeser’s broad point is that cities are important, density is good, and we’ve severely restricted some of our most innovative and creative places.

On incremental change: Given the huge value current regulations place on maintaining the status quo (providing too much stability in many cases), any changes will necessarily happen at the margins.  They’ll be incremental, not transformative. Even a large change to the procedural environment around these markets will take years to adjust given the current levels of pent-up demand. Frase hints at this:

It’s not that Yglesias’s line of critique is totally wrong—I agree that NIMBYism and fear of change is often an impediment to desirable policies, and I agree that people with generally Left politics often betray a confusion about these issues. But while it’s not desirable to just freeze our current cities and neighborhoods as they are, it’s unreasonable to simply dismiss the desire for stability out of hand. To take this to itsreductio ad absurdam, I don’t think most people—or probably even Matt Yglesias—would want to live in a world where we all had to change jobs and move to new apartments every few weeks, even if such an arrangement would make us materially richer.

On confounding factors in housing markets: Mike Konzcal notes (#2) the major differences in housing price due to other variables beyond just supply and demand – namely, school districts, infrastructure, and all of the other elements of ‘location, location, location.’  The economic comparison requires an assumption of all else being equal, yet it seldom is.

 The quality of your schools, the relationship you have with the police, your ability to move freely and transport yourself, how you’ll be represented democratically, the primary means through which you’ll transfer wealth across generations (if you are a homeowner) and more are all in play even before you get to the economic efficiency, public sphere and social/health arguments about what housing brings.  Perhaps we can reform housing regulations without having to reexamine these issues, but it will be difficult.

Indeed, these kinds of intermingling of various issues is part of what makes zoning decisions so emotional and contentious.

On upzoning: Matt notes two cases where upzoning could be useful (or even just relaxation of existing rules around, say, accessory dwelling units), one about the broader need to increase the overall housing stock:

The question is not whether some fixed pool of people should give up stability in exchange for more money. The question is whether the incumbents should be asked to give up some stability for the sake of other people who are currently excluded from the opportunities the incumbents enjoy. My answer is that yes they should.

Consider the reactions against such increases in the housing stock, often exemplified by those incumbents.  Again, these decisions are incredibly emotional and contentious.  However, Chris Bradford notes how this ability to add supply is working in Houston:

The difference between Houston and a lot of other cities is that it is still easy to add housing in Houston’s nice, central city neighborhoods (unless your project has “Ashby” in the title). There are currently 15 apartment projects with 4,300 units under construction in the Montrose/River Oaks area. That’s not “announced” units; that’s 4,300 units under construction. For point of reference, only 3,089 building permits were issued for housing units of any type in the entire San Jose-Sunnyvale-Santa Clara metropolitan area in 2011.

Houston has a lot of needless land-use controls, including excessive minimum-space requirements and parking minimums,  but there really aren’t many other places in the country where there is both strong demand for infill development and a regulatory environment that freely allows it.

On the direct link to affordability: Matt’s second post takes aim at Arlington, VA:

What you see is a narrow thread of urbanism between Wilson Boulevard and Clarendon Boulevard, with a bit of a thicker blob of urbanism around the Metro station itself. I don’t really want to condemn this development paradigm because if you compare it to other suburban jurisdictions around the United States, what Arlington has done really stands out as practically best in class. But still the fact of the matter is that these single-family homes adjacent to the corridor of urbanism are sitting on some extremely expensive land. If you opened it up to redevelopment, you’d see denser building. Perhaps tall apartments in some cases, perhaps attached rowhouses in others. Opening this up would both bring the luxury market closer to saturation, and also just create some housing that’s a bit less convenient to the Metro and thus perhaps a bit more affordable.

One commenter expresses skepticism about the the ability of new luxury units to actually filter down as more affordable units.  As a counter, I always like to link to Chris Bradford’s posts on the subject of filtering: one here, another one, and a third.

On sprawl and governance: Charlie Gardner notes that growth on any given space has its limits.  Sooner or later, growth can’t just go up, it must go out.

A basic point I’d raise is that in almost all times and places, the solution for urban population growth has not been vertical densification, but outwards expansion into greenfield areas.  Historically, dramatic vertical growth was the product of exceptional circumstances, generally related to the presence of city walls paired with external military threats discouraging sub-urban construction, or the occasional imperial mega-city.  The development of skyscrapers in the late 19th century looked to have the potential alter this longstanding pattern, but for several reasons, greenfield development still remains today the overwhelming source of accommodation for urban population growth.

While I think Charlie is a little too attached to shorter cities (just as perhaps Glaeser and Yglesias are too attached to high rises), the point stands. I don’t recall the source, but I remember seeing a chart estimating the number of New Yorkers who live on the 5th floor or below.  Some very small portion (say 5-10%) lived above the 5th floor (i.e. in mandatory elevator territory).

Indeed, growing outward is natural. It need not be sprawl, since outward growth is only one key part of sprawl. Part of the problem (particularly when discussing regulatory and policy issues) is that of governance – and how our governance structures no longer match the actual economic geographies of our cities.

Some of this is inherently confusing our own terminology in discussing the issue. Mike Konzcal (#3):

There’s a good Foreign Affairs review of Glaeser’s Triumph of the City, which points out the trouble the economics-driven, supply-side housing costs arguments have with dealing with the suburbs.  As someone who read Suburban Nation early when he began to think critically about these issues, I find that a lot of these arguments just focus on city regulations while ignoring the whole existence of suburbs.  Foreign Affairs review:

Glaeser overlooks one of the central issues confronting cities for most of the last century: their competition with suburbs. Glaeser sees the competition as primarily between cities that restrict growth and those that accommodate it…

Getting any traction on this issue depends on defining suburbs.  The Joel Kotkin-esque definitions aren’t really useful, nor do they illuminate the differences between the real economic geographies of cities (that is, their regions) and instead focus on arcane and often anachronistic political boundaries.

None of this even gets at the key points about the regulations and governance structures that lead to sprawl – from Payton Chung:

Here’s the main problem I have with anti-government status-quo boosters: they’re somehow completely blind to how government created the existing situation, but then loudly whine about how government shouldn’t change anything! Not even removing its distortionary supports for the status quo!

On prospects for reform: Ryan Avent circles back to the same issues, albeit by approaching them from a different direction:

At some point, however, we need to stop and ask why the most sensible of ideas aren’t adopted by the American government. It’s not that congressmen are corrupt dolts—they may be, but that’s beside the point. It’s that America’s legislative institutions are not set up to encourage the adoption of the policies opinion editors want to see. Every once in a while an op-ed writer stumbles toward the truth with a “Washington is broken” sort of piece. It is incredibly rare to see a systematic analysis of the incentives facing legislators, which follows its logic through to the end: if Americans want Congress to behave differently, then it may make sense to devote more energy (or, really, energy) to assessing areas of institutional weakness and figuring out whether reform is needed.

 

The rent is too damn high

I just finished a nice, quick read of Matt Yglesias’ new e-book The Rent is too Damn High.  Following in the same vein as Ryan Avent’s The Gated City, Yglesias documents the perverse economic impacts of development regulations and restrictions on urban areas. Though not as well sourced and without the in-depth discussion of Avent’s e-book, Yglesias nonetheless offers an accessible and understandable narrative to understanding the same array of urban economic issues.

Yglesias’ self summary is available at his blog:

 It’s about the high cost of housing in America’s coastal metropolises and downtowns everywhere, but more broadly it’s about the crucial role that dense urban development and barriers to its creation matter in a service economy. If you’ve ever read me on housing and wondered “why does this guy think this is so important” or read me on manufacturing and thought “yeah, but what’s his answer” then you will find the answers herein. Andrew Chesley has been reading his copy and liked this line:

Lots of people buy RVs, but nobody “invests” in them. And what’s a house but a giant RV with no wheels?

As I said before, one of my key goals with this book was to write something that would not only be cheap to buy (just $3.99!) but also short. That means I didn’t pad it out with a lot of to-be-sures and efforts to guess what objections people will have. Better, I thought, to release a detailed-but-not-tedious version of my ideas into the world and then see what people see. So if anyone reads it and has questions, objections, thoughts, ideas, etc. please do email me about them or send links to your own blog where you’ve written about it. I’d love to continue the discussion and follow whatever points people think are interesting or flat-out wrong or in need of elaboration.

In the spirit of that discussion, I have a few thoughts.

First, a video interlude for the book’s namesake.

Perhaps the most interesting part to me is Matt’s claim in the book that the final chapter of any public policy book (the chapter that actually gets at potential solutions) is often the most disappointing.  I won’t hold that against this e-book, since the educational component about the issue (as opposed to, say, healthcare or climate change) often isn’t even regarded as a problem.

That said, who is the audience for this kind of material? Convincing the general public, one development project and one upzoning at a time isn’t a sustainable solution. Likewise, too much of the NIMBY opposition discourse is of the shotgun, everything including the kitchen sink approach: throw out all possible objections and see what works.  That kind of approach isn’t likely to buy into a reasoned argument.

Tyler Cowen assumes most of America won’t pay attention to Matt’s point – but maybe they don’t have to. Perhaps with some procedural modifications (see thoughts here and here) you could make progress, and in that case the audience in need of convincing would be elected officials – either by convincing current officials or by electing new ones who understand the issue.  Good news: as Matt points out, Mitt Romney was all over this back in 2006.

Josh Barro at Forbes looks at Chicago and wonders how that city manages to keep prices in line with construction costs:

Yet Chicago has a planning process that looks, at first, like it ought to be a nightmare. The city is divided into 50 wards, each of which elects an Alderman to the City Council. In practice, the Alderman has enormous control over what developments get approved within his ward. Yet, despite these fiefdoms, projects tend to get approved.

This is partly because Chicago also liberally uses Tax Increment Financing districts, which now cover huge swathes of the city. When a TIF district is created, the amount of property tax revenue that the district sends to the city is frozen for 23 years. Increases in property tax receipts are instead directed into a special fund that can only be used for projects within the TIF district boundaries—and new developments tend to mean significant increases in property tax collections. When you create a TIF, you create an incentive for residents and their Aldermen to approve new development, as that means more money for local goodies.

I’d expect nothing less from the City that Works. However, it’s not as if Chicago’s system (or that of Houston) produces quality results all the time. Chicago still has plenty of those subtle barriers to development that often produce unintended consequences, even if the overall price levels are reasonable. Also, Chicago isn’t seeing the same kind of intense demand as other coastal cities are, perhaps confounding the city’s apparent success in keeping costs reasonable.

David Schleicher, in an interview with Mark Bergen at Forbes (Part 1, Part 2) discusses some potential legislative solutions.

It’s great to see these issues front and center in the discourse, even if only in this small corner of the internet. I’d highly recommend Matt’s e-book for a quick, concise summary of the basic issues of over-regulation and the benefits of density and cities with a little more freedom to operate.

[EDIT: 3/9, 7:52 am – Yglesias responds here]

Institutional hurdles to dense infill development

dc cranescape - CC image from yawper

A common theme is emerging among those thinking and writing about cities, from Ryan Avent to Ed Glaeser to Paul Krugman – our land use controls have stunted growth in our developed and productive areas – our cities. So, a simple fix would be to just allow more development, right? Glaeser makes the case that one American city, Chicago, has done a pretty good job of that, and as a result housing prices there are low relative to other large cities.

But for anyone who’s watched the intense battles over seemingly innocuous projects in our cities, it’s obvious that simply allowing more development isn’t that simple. No matter the reasonable arguments in favor of such development, opposition is often intense and emotional, and the institutional decision making processes favor delay and often unfavorable decisions in terms of increasing urban densities.

A few weeks ago, Austin Contrarian posted about a new draft paper from David Schleicher at George Mason.  Over the past few weeks I’ve been reading and sharing some reactions to the paper in my del.icio.us sidebar feed (a workaround for my use of the sharing features of the new Google Reader).  I’d like to compile some of those thoughts (and somewhat related posts) here.  First, the abstract of Schleicher’s draft paper:

Generations of scholarship on the political economy of zoning have tried to explain a world in which tony suburbs run by effective homeowner lobbies use zoning to keep out development, but big cities allow relatively untrammeled growth because of the political influence of developers. Further, this literature has assumed that, while zoning restrictions can cause “micro-misallocations” inside a metropolitan region, they cannot increase housing prices throughout a region because some of the many local governments in a region will allow development. But these theories have been overtaken by events. Over the past few decades, land use restrictions have driven up housing prices in the nation’s richest and most productive regions, resulting in massive changes in where in America people live and reducing the growth rate of the economy. Further, as demand to live in them has increased, many of the nation’s biggest cities have become responsible for substantial limits on development. Although developers are, in fact, among the most important players in city politics, we have not seen enough growth in the housing supply in many cities to keep prices from skyrocketing.

This paper seeks explain these changes with a story about big city land use that places the legal regime governing land use decisions at its center. Using the tools of positive political theory, I argue that, in the absence of strong local political parties, land use law sets the voting order in local legislatures, determining policy from potentially cycling preferences. Specifically, these laws create a peculiar procedure, a form of seriatim decision-making in which the intense preferences of local residents opposed to re-zonings are privileged against more weakly-held citywide preferences for an increased housing supply. Without a party leadership to organize deals and whip votes, legislatures cannot easily make deals for generally-beneficial legislation stick. Legislators, who may have preferences for building everywhere to not building anywhere, but stronger preferences for stopping construction in their districts, “defect” as a matter of course and building is restricted everywhere. Further, the seriatim nature of local land use procedure results in a large number of “downzonings,” or reductions in the ability of landowners to build “as of right”, as big developers do not have an incentive to fight these changes. The cost of moving amendments through the land use process means that small developers cannot overcome the burdens imposed by downzonings, thus limiting incremental growth in the housing stock.

Finally, the paper argues that, as land use procedure is the problem, procedural reform may provide a solution. Land use and international trade have similarly situated interest groups. Trade policy was radically changed, from a highly protectionist regime to a largely free trade one, by the introduction of procedural reforms like the Reciprocal Trade Agreements Act, adjustment assistance, and “safeguards” measures. The paper proposes changes to land use procedures that mimic these reforms. These changes would structure voting order and deal-making in local legislatures in a way that would create support for increases in the urban housing supply.

Bold is mine.

In other words, the procedural causes of slow zoning approvals are systemic.  It’s a similar argument to that in favor of the “zoning budget,” some procedural change to give the broad yet shallow interests in favor of development an equal say to the narrow and intense sentiments often in opposition.

Matt Yglesias takes Schleicher’s lead and looks at this in the political context of urban governance:

In other words, if U.S. cities had regularized party systems each city would probably have something like a “growth and development party” that pushed systematically for greater density. Its members and elected officials would, of course, have idiosyncratic interests and concerns that would sometimes cut across the main ideology. But the party leaders would be able to exercise discipline, the party activists and donors would push for consistency and ideological rigor, and it’d be off to the races. Instead, most big cities feature what really amounts to no-party government in which each elected official stands on his or her own and overwhelmingly caters to idiosyncratic local concerns rather than any kind of over-arching agenda. But different institutional processes could change this, and create a dynamic where growth, development, and density are more viable.

Richard Layman often speaks about the “growth machine” thesis of cities, but I don’t know that it accounts for the more procedural hurdles ‘regular’ infill development encounters, as opposed to big ticket projects.

At the Atlantic Cities, Emily Badger asks: should building taller should be easier?

But how do you grow denser if you can’t grow up? At a certain point – whether it’s in downtown Austin or near a suburban Boston transit station – communities will exhaust the real estate that exists below building height limits imposed years ago for safety, continuity or aesthetics. And then what? Will people let go of these rules?

Given DC’s height limit, Badger focuses on some examples of DC’s stunted growth and the practical implications of such a policy.

Ryan Avent chimes in at The Economist:

Part of the problem, I think, is that people view the built environment as primarily aesthetic in nature. Most of us live in one building and work in another, and almost every other structure in the city is essentially decoration for our lives; I’ve been in a lot of Washington buildings, but my primary interaction with the vast majority of Washington structures is a street-level view of their exterior. The nature of this interaction is such that we underappreciate the built environment as an input to production. It is clear, for instance, that people and machines are critical to the functioning of the economy. There would be huge concern if the government of a city declared that firms located within its boundaries could employ at most 30 workers using 15 computers. But the built environment is just as important a part of the production process; firms pay eye-popping rents for Midtown offices and Silicon Valley real estate because they anticipate getting a good return on their investment. In the same way that a firm which pays out millions in salary or to use a piece of capital equipment also anticipates getting a good return on that investment.

Indeed, the costs of limiting density (or of delay via uncertain procedural approvals) all impose costs that are often hidden, but nevertheless real.  And, sometimes counter-intuitively, the feared externalities of dense development such as traffic never materialize:

“What I’ve found is that what people envision has nothing to do with the reality,” [Roger] Lewis says. “What they envision is ugly buildings, more traffic.”

This sounds counter-intuitive, but taller buildings that are part of a walkable, transit-oriented community can actually help ease congestion. And there’s no reason for these places to be ugly. Tall buildings that make the best neighbors don’t feel like tall buildings at street level. They’re wrapped there in lively retail, townhouse fronts or inviting public space.

The aesthetic concerns over height and density are indeed overblown – good street-level urban design and architecture at the human scales are far more important to building a quality environment than the overall height of buildings.  Obviously, taste in styles is a matter of personal preference, but we have a strong enough catalog of what works in urban design to get the broad principles of those designs into new development projects.

Unfortunately, the structure of the regulations and ordinances seldom make quality development the path of least resistance for a developer – again highlighting a procedural, systemic argument.

 

Innovative re-use along the low road

Screencap from Bundled, Buried, and Behind Closed Doors

Assorted (and tangentially related) links:

1. Stephen Smith also digs into Eric Colbert (see my previous post here):

I’m not sure I agree with her parenthetical about DC’s “historic fabric” being “so strong already” – in fact, I’m hard-pressed to think of a newer city on the Northeast Corridor than Washington – but she’s definitely right that that’s what Washingtonians, even the not-so-native ones, think of their city. Of-right development – that is, building within the zoning code in a way that does not trigger a subjective review – is on the wane everywhere in America, but in DC it’s even rarer, and therefore personal relationships like the ones Eric Colbert has (“an ANC 2B commissioner, who had worked with Colbert on previous projects, introduced him with affection”) are even more important than usual when compared to good design.

A few points. A) I’m not sure why Stephen associates the strength of a city’s fabric with age – DC’s fabric has the advantage of being largely intact.  B) Stephen more explicitly states the same thesis – that Colbert’s architecture is ‘boring,’ and boring is, by association, bad design.  I would disagree that fabric is boring – on the contrary, fabric is essential. C) It’s a mistake to conflate the countable and objective measures of development (square footage, height, density, etc) with more subjective measures like ‘good design.’  Stephen conflates two key elements here – development by right, and design by right. The regulatory structures and processes that govern both are quite different.

2. Cities are all about context. Atlantic Cities discusses a review of San Francisco by John King, from iconic buildings to more mundane (boring?) elements of the urban fabric.

3. Mammoth links to another Atlantic piece, discussing “Low Road” buildings and their importance in urban economics, innovation, and entrepreneurship.

The startup lore says that many companies were founded in garages, attics, and warehouses. Once word got around, companies started copying the formula. They stuck stylized cube farms into faux warehouses and figured that would work. The coolness of these operations would help them look cool and retain employees. Keep scaling that idea up and you get Apple’s ultrahip mega headquarters, which is part spaceship and part Apple Store.

But as Stewart Brand argued in his pathbreaking essay, “‘Nobody Cares What You Do in There’: The Low Road,” it’s not hip buildings that foster creativity but crappy ones.

“Low Road buildings are low-visibility, low-rent, no-style, high-turnover,” Brand wrote. “Most of the world’s work is done in Low Road buildings, and even in rich societies the most inventive creativity, especially youthful creativity, will be found in Low Road buildings taking full advantage of the license to try things.”

Being on the low road isn’t exactly the same as being a part of the fabric – the price point and the prominence don’t always correlate – but the concept is somewhat similar.  These spaces are easy to adapt and reuse. Not just easy, but cheap.

4. Where Stewart Brand discusses the space of innovation, Ryan Avent has another (follow-up) piece on the geography of innovation:

I think that the authors have basically gotten the state of innovation right: we are approaching a critical point at which impressive progress in information technology becomes explosive progress. And I think that the authors are right that the extent to which we are able to take advantage of these technological developments will hinge on how successful America’s tinkerers are at experimenting with new business models and turning them into new businesses. But I also think that there is a critical geographic component to that process of experimentation and entrepreneurship and, as I wrote in my book, I think we are systematically constraining the operation of that component.

High housing costs constitute a substantial regulatory tax burden on residence in many high productivity areas. These are the places where the tinkerers are having their ongoing innovative conversation. But if the tinkerers are driven away, the conversation loses depth and breadth, and we lose many of the combinations that might go on to be the next big company — the next big employer. That, to me, is a very worrying idea.

5. When considering both the versatility of space as well as the institutional and infrastructural momentum (as well as touching on the importance of information technology), Mammoth also links to a short documentary of the infrastructure of the internet: Bundled, Buried, and Behind Closed Doors:

 

Generational regulation and institutions

Two somewhat linked thoughts from the feed reader in the last week.

Neil Flanagan, on the generational shifts amongst environmentalists from the literal to the abstract:

My (undeveloped) conjecture is: the older generation sees environmental problems from an intuitive (fishkills & pesticide) perspective, whereas the later generations see the issue in terms of abstractions (%CO2 over 10,000 years). I think I can say that ecology is based on systems thinking. “Ecosystem,” after all, precisely refers to an interrelated organization. That complex activity can only be understood through abstractions that make consequences more intuitively threatening.

But the older generation seems to approach an environmental issue as perceptible, in that anyone can readily see the links and the loops and understand their consequences. You cut down a tree, and this directly harms the environment and limits one’s access to it. A particular, standing in for the general, is irrevocably lost. Building where there once was a grassy patch is paving over paradise, and a building that brings any cars to the neighborhood is causing pollution.

The primary enemies of the 1960s were intensely graphic horrors such as the burning Cuyahoga, broken bird eggs, and the disfiguration wrought by thalidomide. The problems were so obvious, you could see them with your eyes, and that his how we noticed in the first place. For the generation brought up during an era of global warming, the agents are more nefarious. How does one picture a rise of water over decades? How do you draw the cancer cluster caused by dioxins in an aquifer? You have to rely on the numbers.

This kind of paradigm shift obviously impacts the way we regulate our environments.  We, as a society, structure our response (often via regulation) to how we’ve defined the problem.

Alon Levy on highways and cost control, and the role of a particular moment of time in shaping our regulations and institutions:

Second, it reminds us that many of the rules that are currently associated with government dysfunction were passed with opposite intent and effect back in the Progressive Era. Lowest-bid contracts were an effort to stamp out corruption; civil service exams were an effort to reduce patronage; teacher tenure was meant to make teachers politically independent; the initiative process was intended to give people more control over government. All of those efforts succeeded at the time, and took decades of social learning among the corrupt and incompetent to get around. Although programs built under these rules often turned out badly, such as the Interstate network, with its severe cost and schedule overruns, this was not due to the contractor collusion seen in the 1910s or today.

Combine the effects of unintended consequences, changing paradigms and a shifting understanding of the issues at hand, institutional momentum, and you can end up with the kind of slog we have.

There are questions of rigidity and enforceability to ensure that regulations have ‘teeth,’ but adaptability is also key.  Defining the scope of the regulation is also a critical element.  Frankly, aside from constant review and reevaluation, I’m not sure there’s any way to future proof these kinds of institutions.

Nightlife agglomerations & the corner bar

The Corner Bar, Divernon IL - CC image from Randy von Liski

The Corner Bar, Divernon IL - CC image from Randy von Liski

A few booze-related items I thought I’d comment on:

The Hill is Home takes note of ANC 6B‘s seemingly preferred method to avoid “Adams Morganization” – a moratorium on all new liquor licenses.  Nevermind that the trigger for this fear of Adams Morgan is Moby Dick House of Kebob – which makes me think those leveling this barb have neither visited Adams Morgan recently nor dined at Moby Dick.

Matt Yglesias notes that such efforts to control liquor licenses is fighting the natural tendencies urban economics, where things like to cluster.  That’s what cities are, after all – clusters and agglomerations of people, firms, skills, capital, etc.  Yglesias makes a great point about the appropriate scale of governance of these issues.  While small, local groups (such as an ANC) might be affected by a new bar or restaurant, the practice of giving them veto power over things like liquor licenses has some severe implications:

The bigger question here is about levels of governance. Insofar as you empower residents of my building in DC to make the decision, we will attempt to regulate the food service establishments on our block so as to minimize late-night noise. After all, the service sector jobs lost in the process aren’t the jobs that we do while as homeowners we bear the losses of reduced property values on the block. And to simply disempower us, as a block, would be arbitrary and unfair. But empowering each and every block leads to highly inefficient outcomes with the bulk of the pain felt by low-income people and there’s no obvious reason of justice to think this kind of hyper-local empowerment is more legitimate than taking a broader view would be.

Ryan Avent adds on, noting that these kinds of restrictions and inefficiencies lead to poor outcomes for consumers:

That’s largely because it’s very difficult to open new bars. And the result is a pernicious feedback loop. With too few bars around, most good bars are typically crowded. This crowdedness alienates neighbors, and it also has a selecting effect on the types of people who choose to go to bars — those interested in a loud, rowdy environment, who will often tend to be loud and rowdy. This alienates neighbors even more, leading to tighter restrictions still and exacerbating the problem.

Sadly, this is the kind of dynamic that’s very difficult to change. No city council will pass the let-one-thousand-bars-bloom act, and neighbors can legitimately complain of any individual liquor license approval that it may lead to some crowded, noisy nights. It’s interesting how often these multiple equilibrium situations turn up in urban economics. In general, they seem to cry out for institutional innovation.

Avent specifically laments DC’s lack of the ol’ neighborhood corner bar.  Having been born and raised in the boozy midwest, where the small, corner bar is an institution and people drink alcohol the way others drink water, I miss the corner bars, which aren’t as common as they could be in the District.

One of the problems is in the tools used to limit these licenses.  As Avent and Yglesias note, the kinds of tools bandied about by ANCs lead to an inefficient marketplace.  Instead of preventing Adams Morgan, something like a moratorium ends up ensuring a slippery slope towards “Adams Morganization” rather than preventing one.

On the broader issue of retail mix (ANC 6B’s stated reason to oppose new liquor licenses), the December issue of the Hill Rag had two contrasting pieces on the issue of retail on Barrack’s Row.  The first discusses potential options – none of which seem palatable for actually encouraging retail.  Regarding a moratorium, the impact is exactly what Avent describes:

One problem he cites is that it seems to be “too easy to become a bar or pub once you have the license.” So, even if there is a moratorium on new licenses, there is always the chance that existing licenses can morph from restaurants, which most neighborhoods don’t mind, to bars that operate later and attract different customers.

Another suggested tool is a zoning overlay district, but such a tool is a mismatch between the stated problem and solution.  Zoning is best used to regulate the physical form and the use of buildings, broadly defined.  Zoning can separate a retail use from a residential one, or an office use from light industry – but it is not an adept tool to parse out specific kinds of retail, or in differentiating between Moby Dick and Chateau Animeaux. The issue of bars and liquor licenses is more an issue of how those physical spaces are programmed.  Zoning is not a good tool to control these kinds of issues, and these types of regulations often backfire.

Refreshingly, another article in the issue (about parking, no less) from Sharon Bosworth of Barracks Row Main Street gets at the real reason 8th St SE is more favorable to bars and restaurants instead of retail:

By mid 2009, The Wander Group, consultants who make saving America’s historic corridors their specialty, reported back to BRMS: our commercial corridor, specified by none other than Pierre L’Enfant in 1791, is today uniquely suited to businesses requiring small square footage because of the antique proportions of our buildings which are well protected in the Capitol Hill Historic District. Restaurants require small square footage and restaurant owners would always be on the hunt for charming, historic sites. Wander Group predicted more restaurateurs would find us, and so they did. Our tiny buildings are difficult (but not impossible) for most retail footprints, yet they work perfectly for restaurants.

In addition to those challenges, there’s the broader issues facing retail – online competition, fighting against the economies of scale for big box and chain retailers, etc.

Instead, we have an industry that works well in an urban setting and wants to cluster here.  Here’s one vote in favor of more corner bars.