Are We There Yet? A Sputnik Moment
Editor's Note: What do the housing bust, major demographic changes (more families without children and more older Americans), and employment centers all have in common? The answer found in this excerpt from Are We There Yet? is that together, they point to an enormous opportunity for the US to rethink where our homes go and what they look like. We quote Urban Land Institute CEO Patrick Phillips in calling this a “Sputnik moment,” giving US towns and cities the chance to link downtowns and those closer-in suburbs with housing in walkable, compact neighborhoods. The challenge is capturing this moment and turning it into opportunity for families of all incomes. As the interest in walkable, “gritty,” urban places grows, the lower-income families that have lived in many of those close-in neighborhoods can be vulnerable to being priced out. Capturing the next round of housing growth in opportunity areas equitably will be the indicator of our success in the future.
The U.S. population will grow — the U.S. Census Bureau expects it to climb from 308 million in 2010 to 341 million in 2020 — and so will the housing market. But an estimated 90 percent of the population increase will be households without children, and 47 percent of those households will be aging Baby Boomers who are quickly becoming senior citizens. According to the Census Bureau, 20 percent of Americans will be 65 or older by 2030.
Rental housing, townhomes, condos, live-work spaces and lofts are all housing types that will appeal to these renters and homebuyers, especially if the housing is located in neighborhoods that are “friendly” to older Americans and to families with children. An Internet search for “child-friendly neighborhoods,” for example, makes it clear that a large number of people are searching for them.
Directing that development into complete communities and opportunity areas near transit could be one “sweet spot” for development. See list on page 21: Top 5 regions that are growing in opportunity areas.
How often does Laredo make a Top 5 list? When it comes to the share of households living in opportunity areas, Laredo, Texas, ranks fifth in the nation after New York, Los Angeles, San Francisco and Chicago. This is because Laredo has long adhered to the historic “Law of the Indies” — a body of laws used in Spanish colonies and thus throughout the Southwestern U.S. to guide the development of communities and favoring a development pattern with small blocks surrounding a central square.
Even in regions where the population is decreasing it makes the most sense to focus resources in these places. In Detroit, for example, five companies have pledged $4 million over five years to convince their 16,000 employees to live downtown in the hopes of creating a 24-hour community that will liven things up — including the real estate market.
These employees are eligible for a forgivable $20,000 loan toward purchase of a primary residence, and new renters receive a $2,500 allowance for an apartment, followed by another $1,000 the second year. Current renters get $1,000 to renew their leases, and homeowners receive matching funds of up to $5,000 to improve their homes’ exteriors.
Urban Land Institute CEO Patrick Phillips told the San Diego Union-Tribune in 2011 that he believes the city’s close-in suburbs are going to be the sweet spot for redevelopment because they are close to transit, culture, entertainment, parks and other infrastructure. “They have a distinct urban feel but don’t have the urban grit,” he said. “They are walkable, architecturally interesting — and they are employment centers.”
Phillips believes the housing market bust could be the development industry’s “Sputnik moment” — a time when re-thinking how and where we build could spark a wave of innovation and investment that could in turn fix both the housing market and the American economy.
BETTER NEIGHBORHOODS, SAME NEIGHBORS
The biggest question, however, remains unanswered: How do we get the right mix of affordable and market-rate housing, and how do we build more housing and transit and other neighborhood improvements but still leave in place the unique character and attributes of the neighborhood, and ensure that the people who already live there don’t get pushed out?
Sci-Fi Outpost: Building An Opportunity Area
In A Hostile EnvironmentAn astonishing development has arisen in the sea of big box retail and empty parking lots eight miles north of downtown Seattle, described thusly by blogger Dan Bertolet: “Cruising by Northgate Mall on I-5, the nearly completed Thornton Place evokes images of sci-fi outposts rising from the barren landscape of distant planets. In reality, Thornton Place is a daring pioneer in a built environment that is likewise hostile to human life. The conversion of nine acres of asphalt into the development is a phenomenal accomplishment.”
The development includes 200 condos and 300 apartments, 20 percent of which are priced below the market and 143 of which provide assisted living for seniors, as well as 50,000 square feet of retail, a 14-screen cinema and great urban public space that serves as an ambitious counterpoint to an alluring stream restoration and stormwater treatment project. This effort brought the long-buried Thornton Creek back to life to treat urban stormwater runoff using a necklace of channels, pools and terraces that mimics the landscape of a natural creek, with lush native plantings, overlooks and paths.
Thornton Place is full of sustainability bells and whistles: It has its own district heating system, energy efficient and resource-conserving LEED-certified buildings, preferred parking for alternative-fueled vehicles, and it is near a major bus transfer station and a planned light rail line. Meantime, the development also:
- Increases open space by 50 percent.
- Provides pedestrian links to adjacent. neighborhoods that shorten walking distances by 50 percent.
- Reduces impervious surfaces by 78 percen.
- Stormwater treatment project removes 40-80 percent of suspended solids from 91 percent of the average annual volume of stormwater.
- 85 percent of the project’s plant palette is native species.
- Created a new habitat that was quickly colonized by native plants and birds that migrated to the site.
A Reconnecting America study for the Los Angeles Housing Department found that 75 percent of Los Angeles residents who commute to work on public transportation make less than $25,000 a year. But Los Angeles has begun an ambitious transit expansion that will put the neighborhoods where these lower-income residents live within an easy 15-minute transit ride of hundreds of thousands of jobs, and even before transit construction began there has been an uptick in property values in these neighborhoods.
The redevelopment effort around three subway stations in Hollywood provides a complicated picture: Hollywood had been on the skids for decades before the stations opened, but in the dozen years following the incomes of households near stations and the number of cars owned by these households increased — and property tax revenues for the city increased six-fold.
Hollywood has staged a major comeback and business is booming, even in the recession, but are the new residents driving their cars, walking or biking, or taking transit? What happened to the lower-income people with fewer cars who were living there before? And what are the policies that work best to manage this change in a way that benefits everyone and ensures high transit ridership?
For example, what is the right mix of incentives and exactions that can convince developers and investors to build near transit, but that also captures some of the land and property value that will be created, and uses that value to help subsidize affordable housing and other investments that improve neighborhoods?
A nonprofit organization in Los Angeles named SAJE (Strategic Actions for a Just Economy), which has positioned itself to address “the collision course that redevelopment and gentrification have set in motion in downtown Los Angeles” — where many of those transit riders who make less than $25,000 live — captured the essence of this balancing act in the title of a publication: “Better Neighborhoods, Same Neighbors.”
As the demand for housing near transit increases, it’s important that lower-income people who are the most frequent users of transit can continue living where they will get the benefit of lower cost housing and transportation costs. Nationally, a larger percentage of lower-income households live near stations and in opportunity areas: 50 percent of all households in station areas are low-income, and 53 percent of all households in opportunity areas are low-income. As a point of comparison, nationally only 40 percent of households are lower-income.
In the online magazine Grist, Claire Thompson speculates on one solution to the threat of gentrification in her own suburban Seattle neighborhood: “One of the best ways would be for the neighborhood’s newcomers to invest their resources and energy in its existing infrastructures instead of totally taking and making them over — newcomers could send their kids to local public schools, which are starved for parental involvement. They could patronize the Ethiopian restaurant and Vietnamese nail salon, and the Mexican taco trucks — as well as the new foodie cafes. They could ride public transportation alongside their neighbors, to send the message that they want to be a part of the community that’s already there.”
In fact, communities are always in flux. The key to smart planning is how we manage the changes so that “the community’s that’s already there” continues to be a vital part of the ever-evolving neighborhood. The Top 10 lists on the following pages highlight some regions that are doing well by our Living metrics, and are getting closer to becoming complete communities. The full list of metrics for 366 regions can be found on our website: reconnectingamerica.org/arewethereyet
Downtown Revitalizations And Smart Growth Incentives
- Six major land owners in suburban White Flint, Maryland, have agreed to finance a “21st century boulevard” with wide sidewalks, bike lanes, six rows of trees and lanes dedicated for transit in return for being allowed to build at higher densities near the Metro Red Line station.
- The planned Atlanta Beltline, a 33-mile circular light rail line on an abandoned rail corridor connecting 45 downtown and Midtown neighborhoods, could become this country’s most ambitious TOD project. The rail line and greenway with bike and pedestrian paths is expected to activate the real estate market around an estimated 3,000 acres of underutilized properties, and connect to the MARTA heavy rail line.
- Development in downtown Las Vegas, especially rental housing, is moving forward in spite of the recession, with businesses such as Zappos — which just moved its corporate headquarters downtown — providing money to repave streets, widen sidewalks and other improvements. Local government is doing a lot to incentivize this growth with public investment, and is working closely with developers.
- Downtown LaCrosse, Wisconsin emptied out when a new mall was built on the outskirts in the late 1970s. But the city has been offering low-interest loans to developers to build new buildings and renovate historic ones, with the results that people and businesses are moving back downtown — all during the Great Recession.
- Santa Fe, New Mexico, declined offers to build a large-scale mixed-use project that would have taken down historic buildings on a 50-acre site adjacent to a station built in the late 1800s and now served by commuter rail. The city opted instead to lease anchor sites at below-market rents to an arts-based teen center, contemporary arts organization, Latino cultural center and a farmers market, and adapting the historic structures for housing, retail and office. The project has become a catalyst for surrounding economic development.
- Washington, D.C., already well-served by its rail system, plans to build a 37-mile-long streetcar system that would put 50 percent of the city’s residences within walking distance of rail transit — up from 16 percent in 2011.
- Tulsa, Oklahoma, is offering $3 million in incentives for developers to build downtown housing with the goal of bringing back Tulsa’s glory days when the streets were bustling with people and excitement.
- In Phoenix local and national funders have created a $10 million Sustainable Communities Development Fund (the goal is to increase it to $50 million) to finance TOD, with an emphasis on affordable housing. Money can also be used to build grocery stores, childcare and other amenities.