Friday, July 31, 2020

Post #9: Building Mixed Use Density - Part 3

In my two previous posts in this series, I explained why I believe that midwestern cities need to raise their overall density and I discussed some key issues in the design of mixed use districts.  Although what I’m advocating isn’t really “high density” when looked at from a big city perspective, in most midwestern cities it is likely to perceived as high density because it is likely to be substantially denser than what most people are used to given the low density sprawl to which we have all become accustomed.  Consequently, these mixed use developments should be carefully placed in locations where they really make sense, not scattered willy-nilly across the community if you want to minimize community opposition and maximize the chances for a successful development.  Evaluating locational options will be the subject of this post.


Before I get into the details of what constitutes a good location for mixed use density, there are two concepts that decision makers need to understand.  One deals with the profit motivations of developers and the other deals with the default assumptions underlying many NIMBY arguments.


The easiest way to make money.  The value of land in an urban area is generally defined by the amount of development potential that the land holds.  The higher the development potential, the higher the price per square foot of land area.  There are obviously a lot of practical considerations that go into making this determination such as the market demand for the type of development being proposed, the capacity of adjacent roads and utility infrastructure, or the shape and topography of the land itself.


But there is also a regulatory component as well which is the way in which the land has been zoned by the city, and the way in which it has been designated in the city’s long-term plans.  The zoning designation generally places very specific limits on development potential through both use and density restrictions that apply to any new development.  A city’s long-term plans come into play when a zoning change is contemplated since zoning changes should (in theory at least) be in compliance with those long-term plans adopted by the city.


The simplest way to make money in the development business is to find a parcel of land that meets the practical needs of your development idea but which has restrictive zoning limitations in place.  Those zoning restrictions limit its perceived development value to “X” dollars, but that can change if the developer can convince the governing body of the city to change the zoning designation to allow more intensive development.  One vote by the governing body can change the value of that parcel from X dollars to 2X or 3X or even 4X, and make a great deal of profit for the developer without moving any dirt or building any buildings.


This is why development proposals often seem to be coming “out of left field.”  While it is certainly possible that a developer has identified unforeseen potential in property that will make the community better as well as make the developer a profit, it is equally possible that the proposal will benefit only the developer and end up being disruptive for everyone else.  City leaders should be skeptical whenever a proposal requires a zoning change that is dramatically different from the existing designation or the adopted long-range land use plans.


Why does everyone oppose everything?  The world is changing, and that change is happening at an accelerating pace.  In my opinion, we are reaching the point at which change is happening faster than the average person’s capacity to adapt to change.  The result is that many people feel that their current lifestyle is threatened and they are scared that the future will be worse rather than better.  Scared people seek refuge, and for many that refuge is their home.


Little wonder then, that development proposals often stir up neighborhood opposition because they are seen as threatening that last refuge.  The status quo may not be perfect, but it is a known quantity.  Far better than a hard-to-understand development proposal brought forward by developers assumed to be self-serving and greedy, and approved by politicians assumed to be corrupt or easily swayed by big business.


I believe the level of neighborhood animosity is as much related to the level of the perceived threat brought on by societal change as it is by the specifics of the development proposal.  A bad proposal, of course, will rightly anger the neighbors, but even relatively benign proposals can generate opposition from those who are simply tired of change.  This often takes the form of an irrational nostalgia for the “way things used to be” paired with highly exaggerated assessments of development impacts such as traffic, noise or crime.  The end result is an increasingly rabid level of opposition that is resistant to logic and reasoned discussion.


If left unanswered, this type of opposition can lead to the election of local leaders who are so anti-development that they vote against virtually all development proposals that deviate from the way things were done in the past.  While this might be popular with those citizens threatened by change, in my opinion it is disastrous for cities trying to prepare for a future that almost assuredly will be different than the past.


Where moderate density, mixed use districts make sense


 I think there are three keys to finding good locations for mixed use density.  They are not all necessarily essential, but the most successful projects tend to have some elements of all three factors.  There may, of course, be local issues that also come into play and can eliminate an otherwise promising site.  I don’t mean to ignore local issues, but I’m going to focus on more universal concerns that I think apply across virtually all midwestern cities.


Build where infrastructure already exists.  In previous posts, I have talked about the dire financial conditions that many cities find themselves in and the need to increase tax density in areas that already have municipal infrastructure and services.  Moderate density, mixed use districts have a much higher tax value per acre than traditional, suburban style development.  But to maximize the benefit, it needs to be built where infrastructure is already in place which means we are typically talking about the redevelopment of an older part of town rather than new

development on the edge of town.  As is generally the case with redevelopment, there may be a need for some selective infrastructure upgrades, but these are almost always far cheaper than extending infrastructure into areas where nothing currently exists.  In nearly every midwestern city, infrastructure was designed and built with excess capacity, which means that density increases can almost always be handled without significant problems.


One type of infrastructure deserves special attention and that is alternative transportation systems.  One of the important lifestyle benefits that can help mixed use developments be successful is the ability to substitute walking, biking or transit for what would otherwise be an auto-based trip.  Some people may not take advantage of those options while others might reduce their car usage by 10 or 20 percent.  In either case, the value of having alternative transportation options is real and the target demographics for this type of development will pay for that value.  This means that moderate density, mixed use development should be located on or near existing transit services, or at least be located where future transit service is seriously contemplated.  It also means that they should be located in areas with good sidewalks, crosswalks, and bike lanes or bike routes.


Build near other interesting stuff.  The concept of building a new town from scratch has intrigued planners ever since the inception of the profession.  It has been done, but it is hard work and it takes a long time and a lot of money.  The New Town at St Charles is a midwestern example that has been at least moderately successful.  The problem is that building a “new town” on the fringe of a metropolitan area may appear urban, but it really is just a slightly different form of suburban sprawl.  Almost all of these developments end up being expensive to live in and very auto-dependent.


A far better approach, in my opinion, is to build or redevelop in a much more “close in” location and in a more incremental way.  Finding a location that is near employment, cultural, shopping, or entertainment opportunities will make each development project more successful and will build an economically sustainable mixed use district much faster.  This is why old warehouse districts on the edge of traditional downtowns often get converted to art galleries, loft apartments and coffee houses.  The old warehouses offer cheap and flexible space, but the nearby office buildings and cultural institutions make the location marketable because there are thousands of people who are already drawn to the area. 


This approach is also likely to attract multiple developers who each want to do their own project.  Not only does this speed up the creation of a critical mass of development momentum, but it also brings a creative diversity that tends to energize the area.


Build where there are clear signs of economic distress.  This final point may be a bit counter-intuitive.  Wouldn’t it be better to build in an area that is already successful?  Adding onto an already successful district is fine, but if you really want to maximize the impact on your city, find an area where mixed use density can be an economic shot in the arm that turns a declining area into a vibrant area.


This approach has two added advantages.  First, land is likely to be cheaper and land owners more willing to sell.  In most midwestern cities, building mixed use density is riskier than doing standard suburban development so finding land at a discount makes it easier to attract investors and financing.  


Second, existing businesses and residents are likely to be more receptive to something different and more intensive if they can see that their area is in decline.  As noted above, some people may be yearning for the area to return to its former glory regardless of how unlikely that may be.  Their opposition, however, will have far less impact if more intensive redevelopment is pitched as an economic revitalization strategy.


At first glance, it may seem like I am referring only to traditional central city locations but that is not my intent.  While declining downtowns and the surrounding commercial and industrial areas can be successful locations for mixed use density, more suburban locations may have potential as well.  Many of the early suburban shopping centers, for example, are now either largely vacant or occupied by third tier retailers that pay relatively little rent.  Most of these centers are never going to be successful as retail-only developments, but they might be successful if the parking lots and some of the retail space can be converted to residential, office and entertainment uses.  To be clear, I’m not talking about adding a couple of small office buildings and an assisted living facility to a failing 500,000 square foot mall.  To be successful, it is likely that the density will need to be increased by a factor of five or more which means hundreds of residential units and 100,000 to 250,000 square feet (or more) of non-retail uses such as offices, medical facilities, or entertainment uses.


The bottom line


Over the past several decades, cities have painted themselves into a corner with low-density, auto-oriented suburban style development.  Continuing down that path will lead to a slow but inevitable spiral of declining neighborhoods, vacant storefronts, crumbling infrastructure, economic irrelevance and reduced governmental services.  Cities need to increase density -- in selected locations and with a careful design approach -- to build a more robust tax base and to offer their residents and business owners a broader range of options for places to live, work and play.



Thoughts?  As always, share your thoughts and ideas by leaving a comment below or sending me an email at doug@midwesturbanism.com.  Want to be notified whenever I add a new posting?  Send me an email with your name and email address.


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