Donjek :: The Cents of Place Blog

Productivity and Design Merge in the Gated City

Since his publication in the New York Times' Sunday Review this past weekend, Economist magazine correspondent Ryan Avent has been showered with digital ink following release of his short book, "The Gated City." Based on his Sunday excerpt, it's clear his fundamental argument is that land use and productivity are inextricable.

Amen.

The policy arena is stocked with arguments over which strategy or which sector provides the most efficient return for job creation (for a sample, search "jobs per dollar" on Google - although, as this commentary indicates, your results will be different than mine).

This dialogue, however, does not usually consider the spatial issues involved. How many jobs, and of what type, are created across a city or region? Employers rely on a workforce that is trained and educated, able to reach the workplace reliably, and able to transport a product - by rail, by digital means, or other mode of movement. Employers and the economies of which they are part also rely on relationships that form networks around industries, innovations, or particular skill areas. Success or failure in each of these areas is all about how our cities are designed and how intensely infrastructure is used.

It's relatively simple to evaluate job creation initiatives if direct public expenditures and jobs ("full time equivalents") are the only terms examined. As I suggested a few months ago, Steven Johnson and Ed Glaeser illustrate this would miss a substantial part of the essence of why and where jobs are created. The last few days' eruption of interest in Avent's message indicates we're headed for a more nuanced, comprehensive view of how urban design and productivity are linked. That's a very good thing.

*Postscript: Thanks to Ryan Avent for including this short post in his list of commentary pieces on the Gated City. See the others here.

In Search of Inzichten

Over the last several years, readers of these periodic posts may have noticed I have had a longtime appetite for inzichten uit de Nederlandse stedebouwkunde – insights of Dutch city planning. I’m intrigued by the international nature of Dutch culture, its democratic roots, and the relationship of their planning to scarcity of land. The constant threat of flooding through their history has stimulated shifts in each of these areas.

This week, I leave for travel that will include time spent with family in Holland, and I’m looking forward to exploring another tradition’s approach to city building and public finance. A few examples I’ve touched in here at the Cents of Place include:

• Understanding the value created both by access to transportation, and by a mixing of real estate asset types, remains a driver in Donjek projects. The Dutch connection is diluted in this piece, but I cited evidence from the Lowlands suggesting the premium for commercial real estate located near rail stations exceeds 10%.
• Highlighting the historical connection of urban success stories and concerted public investment, I cited the model of Amsterdam as it emerged from the Middle Ages in reviewing Joel Kotkin’s 2006 book, “The City, a Global History.”
• As a past adjunct instructor of economics, I could not be expected to forego some consideration of the fascinating period of Dutch history that centered on the mania of the tulip bulb. Similarly, I could not be expected to forego the comparison to the housing bubble, which I did in 2008.
• Given the intensive construction underway outside the Donjek office, which will lead to easy access to nearby light rail transit, I’ve been reminded of the promising product of Dutch firm, the Ooms Avenhorn Group. Using street infrastructure for more than multimodal transportation, the geothermal systems collect and store warm and cool water beneath road surfaces for climate control in nearby buildings.

This is a small, unscientific sample of ideas. There are a great many who have both a more authoritative and more comprehensive perspective on Dutch planning and development. Call me a student. With luck, I will bring home more ideas for applying the most effective Dutch practices in American central cities.

Photo: Courtesy Flickr/Tashenka

Urban Economies: Going with the Flow

Reading Ed Glaeser's Triumph of the City (which I mentioned in this post on transfer of ideas in cities), I learned that in the year 1816, transporting goods across land in early America cost an equivalent amount to shipping it from Boston to London. The comparative relationship tilted settlement and trade distinctly toward our waterways; construction of the Erie Canal and the Illinois and Michigan Canal completed a loop that connected four corners of the developing country. Between 1850 and 1970, at least five of the ten largest U.S. cities were located on this trade circuit.

Waterways remained critical as arteries to transport commodities and other inputs for trade and commerce; they also provided the doorway through which most entered frontier towns like my place, St. Paul. Over time, comparative pricing and relationships to rivers changed - railroads, then cars and trucks, airplanes, and digital thoroughfares provided radically cheaper modes of overland movement. 

Ports facilitate accumulation of value through transfer of material from one transportation mode to another. In the past, the fact that river ports fronted riverways was only significant in that barge transportation was cost-effective. As freight rail (for long runs) and trucks (for shorter runs) compete with river navigation, many river ports have declined. Minneapolis' Upper Harbor Terminal, for example, has managed falling volumes in recent years, the region's barge traffic dominated by the St. Paul (downriver) harbor.

Today, the relationships of "prices" continue to shift. In particular, the pressure to attract and retain talent is familiar to American mayors and business operators across the country.  In addition to creating recreation amenities, urban riverfronts also create collective open space that draws the eye through the city landscape. When perceived as safe and clean, access to river frontages creates substantial property value and economic potential. In addition to moving things in and out, the role of some riverfronts has expanded to focus on use as open space magnets that  make places more distinct and attractive. 

Our river, the Mississippi, formed and shapes both Minneapolis and St. Paul in important ways. Earlier this year, a team to which I served as regional advisor won the Minneapolis Riverfront Design Competition, now evolved into the Minneapolis Riverfront Development Initiative. I've been engaged for several months managing a project focused on strengthening the connection of downtown Minneapolis to the Mississippi via the Gateway. Comparable efforts have been underway in St. Paul over the last twenty years, including the Great River Park master plan developed in the last year. This subject, conveniently, presents an opportunity for field work: I'm looking forward to August visits to Roman river towns Maastricht, Ghent, and London.

Open space and riverfronts cannot by themselves replace key economic functions such as port activities. Still, as larger forces transform cities, the prominence and role of rivers continue to be key in distinguishing prosperous regions.

Photo courtesy of pmarkham/Flickr.

Charles Landry: City Making in Minneapolis Saint Paul

Expectations were high for remarks by urban theorist Charles Landry, given late last week at Minneapolis' Guthrie Theater thanks to program partners at Metropolitan Council and the McKnight Foundation. I shared these expectations, due in part to this article, which described Landry's focus as "the complex blend of elements that most effectively draw talented people to specific cities and regions." In my view, interesting work with immediate relevance.

True to form, Landy offered a compelling and global perspective on what differentiates successful cities and metropolitan areas from those in decline. Each region's approach is key: Is the dominant strategy an "urban engineering paradigm," or "creative city making"? Presented directly to us in the Minneapolis Saint Paul region, Landry asked: Is this a city of projects, or is the project the city?

Most of the audience, I believe, share Landry's underlying confidence that urbanization can and ought to bring about a greener, more productive, healthier and happier world. In that vein, he offered five threads found in great cities. In each case, I've offered editorial comments:

• Anchorage: What is a region's gravity, which attracts people and ideas? The importance of robust networks of people and activity - industry clusters - can't be understated. It's true for people involved in chemistry, and for people involved in music (and for those involved in both at the same time!). See the Metropolitan Business Plan for more.
• Possibility: What's the potential for the place? Youth development, education, and workforce development (for the young and mature) are the critical areas of possibility for a place. No urban region can thrive without investing in the young, and their potential to generate new ideas.
• Connection and Reconnection: Beyond the need for physical connections to give community members and workers access to their most significant destinations (whether work, school, civic, religious), successful regions maintain strong bonds well beyond their borders. High rates of immigration and import/export activity, and the ability to communicate a region's message in the global arena are two examples of such ties.
• Learning: To me, Landry's citation of the importance of learning extends beyond the realm of education, which (as I suggested above) is a cornerstone for effective regions. Learning needs also to include the degree to which governance is flexible and intelligent enough to incorporate emerging trends and past experience, in planning for the future.
• Inspiration: Establishing shared values and shared identity are crucial, so that a region can articulate what is its inspiration. Why are we here? What do we have to communicate to the world? What is our contribution to the cultural, economic and political life that surrounds and includes us? 

Landry's framework of these five threads offered a provoking platform to consider how regions like Minneapolis Saint Paul move forward. Unfortunately, the speaker's efforts to speak in detail about the Central Corridor LRT line (and even specific sites along it) were neither specific nor reflective of context. He also appeared unprepared to discuss how manufacturing and other industry play a role as economic engines, job providers or as gateways for workers to earn good wages.

As Ed Glaeser argues in the Triumph of the City, places are powered by people, not buildings. Landry's presentation was worthwhile as a full (if high-altitude) depiction of how "creative city making," focused on harnessing talent, can craft durable regions in the 21st century.

Intuition, Criterion for Your Next Project

Got intuition?

I work with parties involved in urban land use and redevelopment, ranging from public agencies to private developers and foundations. In some respects, this field, like many, become more analytical and data-driven. We break down components of location: Road, rail and transit access. Visibility. The quality of pedestrian environment. Hot zones. Proximity to vendors and customers. Market values and discretionary income in surrounding neighborhoods. Mix of adjacent land uses.

Recently, I called a client involved in commercial real estate investment for forty years and asked, what's in a location? How do you evaluate places for their potential? To be sure, he cited all the factors listed above and others. It didn't take long to move through these aspects of location, presented individually, understood to influence each other.

But afterward, the list exhausted, he had more to say. After the division of location into components, there was a remainder. An important one.

Intuition. Or is it thin slicing?

I recently read Malcolm Gladwell's book, Blink. The premise of the book is that we have an ability and tendency to evaluate others and situations on an immediate, subconscious level. Once we establish these "thin slices," in the author's lexicon, they guide (or misguide) us without much consultation from the thinking side. I'm left to wonder how much of my time has been spent residing in the analytic part of my mind, pretending I am in charge while the subconscious pulls all the levers.

On loan in the Donjek office space is an energetic pair of oil paintings created by a friend, whose artistic method for the works was to project an image on the canvas, paint based on the projection, project a different image, repeat. The outcome is a finished work thickly endowed with oil, drawing the eye and teasing the brain to interpret the combinations of strokes a hundred different ways.

Welcome to the places we're redeveloping.

The Big Sort - A Small Summary

I've just finished Bill Bishop's 2008 book, "The Big Sort."  The author, Bill Bishop, started research for  the book via an examination of why Congress appears polarized in debate and in elections.  To his surprise, Bishop uncovered a much more diffuse, interesting dynamic:  Americans have been using their increased mobility to sort into geographic and political homogeneity.  Congress appears more polarized because its members represent increasingly lopsided districts, full of increasingly ideological voters.

In 1976, 26% of the nation’s voters lived in landslide counties, defined as counties where one party’s candidate for President won by twenty percentage points or more.  In 2004, that figure had exceeded 48%.  More of us live near others who vote – and engage the issues of the commonwealth generally – like us. 

The Big Sort presents a number of direct challenges to the consensus view in realms where Donjek operates – development, planning, architecture, and policy.  For this reason, I am compelled to relay a sample of them here at the Cents of Place.

• The author cites work by political scientist Michael Harrington, showing that Republicans are increasingly moving to less densely developed places, Democrats clustered in areas more dense.  Average population density for counties voting for President Bush in 2004 was 110 persons per square mile; average density for counties carried by John Kerry was 836 persons per square mile.  Such findings raise questions about the market demand for dense development that many firms implicitly assume exists outside the urban core.  But does it?

• Bishop and Cushing analyzed data sets examined by Robert Putnam in his acclaimed 2000 book, “Bowling Alone,” which documented the decline of civic engagement in many American communities.  Bishop writes:

As Bob Cushing and I looked at how the Big Sort was creating greater inequality among cities – in patents, incomes, and levels of education – we wondered whether there was a relationship between culture and economic success…in fact, there was a relationship between the health of the local civic culture and the well-being of the economy.  It was negative.  The tighter the social ties, the fewer the patents, the lower the wages, and the slower the rates of growth. (p.141).

In my view, this represents a challenge not only to orthodoxy in the planning and economic development fields, but also to the premise that improving economic and financial performance is worth nearly any price.  The author appears to have taken this particular statistical finding and run with it, suggesting that weak social ties stimulate economic growth, while stressing throughout the book that social interaction and idea exchange is the most important mode of production in the modern economy.  Even in the final pages of the book, he doesn’t offer a more nuanced interpretation of his findings, which is disappointing.

• When polarization arises in conversation, the cause is frequently identified as gerrymandering – the methodical drawing of legislative boundaries to benefit incumbents.  However, Bishop points out that parties and political caucuses have an interest not in building huge majorities in certain districts and small minorities in others, but in spreading supporters to reach a plurality in as many districts as possible.  The sorting described in the book suggests a much more pervasive – and less “coordinatable” shift underway than gerrymandering.

• In a section titled “Caffeinated Federalism and the End of Consensus,” Bishop notes the emergence of “systems of issue brokering” that cross over the traditionally rigid distinction between public- and private-sector functions.  A critical challenge in the next generation will be managing the widespread misunderstanding of the importance and cost of shared infrastructure (whether provided by public or private entities), and defying the easy notion that we may consume quality services without regard to how they are financed.  

Bishop emphasizes that in part due to the Big Sort, public and private actors on the local level will provide the fuel for innovation on a regional level, or they will not.  The difference will mean everything, because the federal government remains a detached, and now increasingly mortgaged, partner for economic development.

The author’s analysis is provoking in its consideration of everything from patent filings to car models, education levels to protocol of professional attire.  He makes a strong and broad case that Americans are using increased mobility to sort into more homogenous communities, with 100 million of us picking up and moving in the 1990s alone.  However, he fails to fulfill the promise of his subtitle, to explain “why the clustering of like-minded America is tearing us apart.”  His point is that the clustering of talent and human capital has been underway to reflect the demands of the economy of the future – but fails to reconcile these shifts with the tearing apart hypothesis.

11/07/08 Postscript

The results of the mock election in our neighborhood elementary school (which attracts most of its student body from within a two-mile radius) bear testament to the Big Sort: One of the Presidential candidates won 85% of the vote.

The Urban Engine, or Trading Places Part 1

Welcome to the first in a short series of three posts inspired by three very different places.  I’ve spent today immersed in national and global issues thanks to the Federal Policy Forum hosted by the International Economic Development Council here in Washington, D.C. The second and third posts, as you’ll see, will address local development issues in a mid-size and small community.

Between the articles I read on the airplane, the content of the sessions and accessory conversations with other participants, I have notes on papers small and large hanging from folders and pockets and briefcase.  It’s all related to a notion I sketched out in a post about regional differentiation a few months ago, but I’d like to summarize a new line of inquiry related to the conference.

Bank of America CEO Ken Lewis and Pennsylvania Governor Edward Rendell have led an effort described in the publication of Retooling for Growth: Building a 21^st Century Economy in America’s Older Industrial Areas (see a summary of the book here).  The content is unabashedly “metrocentric” in light of the following metrics outlined in a session today.  The nation’s largest one hundred metro areas:

• Use 12% of American land area;

• House and employ 65% of our population;

• Are home to 74% of college graduates;

• Generate 78% of patents; and

• Create 75% of gross domestic product.

In the words of Paul Brophy, a consultant who hatched the project, the metro areas are engines for economic, social, scientific and cultural development despite the increasingly conspicuous absence of a significant federal role or resources.  In particular, he says, to move the U.S. forward it is critical to harness and foster entrepreneurship, human capital, infrastructure and what he termed “quality of places” in our urban centers.  A few thoughts on the prospective form of such infrastructure and placemaking improvements:

• Establishment of a National Infrastructure Bank to provide coordinated, significant, long-term dollars for urban infrastructure reinvestment, with accountability measures in place for both the local and federal partners involved.

• Perhaps as part of or independent from the infrastructure bank, aggressively fund urban transportation networks, including transit.  Spendy, yes.  Essential to be competitive, definitely.  This month’s Urban Land magazine reports that the City of London’s Crossrail project will extend subterranean Underground lines at a cost of $30 billion.  The business community, in a testament to the project’s competitive potential, will fund much of the investment.

• Adoption of local, state and federal policy that recognizes the missed opportunity that vacant and polluted urban land represents, and enables its reuse as developed property or open space such as parks.

• Perhaps most germane to the Cents of Place forum, standardization of the development process and fundamental property tax reform is also in order.  In Minneapolis and St. Paul, Minnesota – contiguous and mutually dependent municipalities – zoning codes and the development process continue to remain estranged.  And, as documented by a property tax report I authored last year, the current property tax system stifles the concentration of tax base upon which the health of our urban areas (and the states that rely on them) will rise or fall.

• Adoption of at least a regional, and at best a statewide approach to subsidies that seek to attract businesses location.  This idea is hardly new:  See the Economic War Between the States report published by the Minneapolis Federal Reserve in 1994.

• Focus on retaining the talented people who arrive in your region from Bangalore or Missoula or Moscow, to pursue educational experience.  See the integrated approach Philadelphia has taken to housing, employing and engaging students before they graduate and leave.

Resolving these underlying finance and policy issues is a priority that simply can’t wait.

Still with me?  Then, dear reader, indulge yourself and browse over one other publication I encountered today:  The 2007 State New Economy Index compiled by the Kauffman Foundation.

Photo:  Musely, Flickr

Review: The City, A Global History

The “tragedy of the commons” is a metaphor employed by economists to describe the difficulty of providing and pricing public goods.  Because grazing sheep in the commons is cheaper than owning private land, theoretical shepherds overuse the common thereby eliminating the available grass and value of the common generally. 

Joel Kotkin’s book, The City: A Global History, earns its broad title in its only 160 pages – and among other things, identifies for the reader how cities have over time managed the commons.  In particular, what has characterized cities that have thrived in their times?  In my view, these characteristics suggest a highly symbiotic relationship between public and private investments.  Successful cities of history are not defined by their size or their location as much as by the strategic thinking of their leadership, investment in infrastructure, and social openness. 

Pollution, high unemployment, rising residential foreclosure and commercial vacancy rates and strained education systems, these are costs that burden the public, private and civic sectors – not one or the other.  Whether costs are borne by a business or individual, or paid via the public sector using tax revenues from the same parties, is immaterial where regional vitality is concerned.  Either way, these costs reduce regional productivity and vitality and, to follow the metaphor, erode the commons.  Conversely, public investment can serve as a lever for the private sector, and vice versa.  Two points about how this played out in European history:

• Two success stories are inseparable from their emphasis on public investment.  In the 1400s, the Venetians established urban zones devoted to key industries of shipbuilding, munitions, glassmaking and others, putting the authority of the Venetian Doge behind a physical urban organization that matched the market’s interest in locating vendors and financiers near their respective industries.  By 1500, Venice was the wealthiest city in Europe.  In Amsterdam, the investment in the canal system and city sanitation, as well as mandates to use brick to manage the risk of fire, provided a foundation for what Kotkin called “the first great modern commercial city,” and the capital of an unprecedented merchant and cultural engine.

• Two success stories trace to recognition and control of “primary avenues to a widening world.”  Kotkin describes the approach of the Phoenicians, Mediterranean powerhouse of the 8^th/9^th century B.C., as focused not on rote acquisition of territory, but on controlling coastlines and trading with larger neighbors.  Consequently, Phoenicia developed what is widely considered the first influential merchant class in an urban society.  In the late 1500s, the Dutch (yes, again) adopted a similar strategy, rapidly coming to dominate the Spanish, who had continued to emphasize military power fueled by religiosity at the expense of economic strength.

Vital cities have been with us for our 10,000 years of urban life, and we can learn from successful models used to finance thriving places through history.  If nothing else, The City speaks to how fostering strong urban economies is the responsibility of public, private and civic sectors alike.

Reviewing 2007's "Great Neighborhood Book"

As a “forum for discussing financial issues around placemaking,” the Cents of Place blog cannot fail to remark on this year’s publication of “The Great Neighborhood Book” by Minnesota author Jay Walljasper.  The book covers a range of issues with an approach that is whimsical and populist, and at times reads like a love letter to places that allow for spontaneous and informal interaction.  In the process, Walljasper ignores the economic and financial issues that are in some cases at the core of his evaluation of what makes for great urban neighborhoods.  Perhaps a sequel is in order.

In the introduction, the author mentions the eleven principles of placemaking that have been developed by the book’s publisher, the Project for Public Spaces, and which serve as a framework for the book.  Principle number ten reads:

Money is not the issue.  If you have a spirited community working with you, you’ll find creative ways around financial obstacles.

I admit a bias here:  I believe that whether and how we finance placemaking is a critical issue, not one to be casually dismissed.  Moreover, the suggestion in principle number ten is that neighborhoods stymied by financial obstacles are dispirited, weak or lacking in creativity.  Instead, I suggest rephrasing the principle to read:

Money is not the only issue.  A spirited community and/or local booster can surmount a broad range of financial obstacles through creative problem solving.  Initiatives described in this book have succeeded not only because they offer aesthetic values and are homegrown, but because they enhance community differentiation via unique spaces and hence “pay off” in terms of dollars and quality of life for residents and visitors.  It’s human nature that we like to live in and visit places that are distinct, and we respond by investing our time, money and effort in those places.  If these various forms of investment do not take place, even much-adored places can be jeopardized.

In an October lecture at the national conference of the Trust for Historic Preservation, Ed McMahon of the Urban Land Institute offered a sound point about community differentiation.  “Why,” he asked, “would anyone be interested in coming to invest themselves in a community that is failing to invest in itself?”  Just as it would be incomplete to ignore the social capital and relationships that support great neighborhoods, the financial component – unsavory as it can be – needs to be addressed.

I enjoyed this book and am hoping for a second edition with a chapter on placemaking finance!

New Manual is Not Just Shuffling Cards on Stormwater Management

Stormwater management has been an ongoing thread of discussion here, as has been the campaign to make public finance concepts and decisions more graphic and communicable.  An excellent publication emerged last Friday that promises to serve as a contribution on both fronts.

Using funding from the McKnight Foundation, the St. Paul Riverfront Corporation and SRF Consulting Group worked with a review group of private- and public-sector peers to compile a compact guide to innovative stormwater management measures.  The “Water Quality Manual,” while developed locally, offers a lengthy menu of ways to reduce public and private costs on four scales:  Site, block, neighborhood, and city.  An excerpt of topics:

Site Scale

Permeable pavers

Phosphorous reduction

Dry wells

Cisterns

Block Scale

Underground retention/filtration

Infiltration trenches

Flow-through planters

Swales

Neighborhood Scale

Shoreline stabilization

Low impact development

Oil and grit separators

Alum treatment

City Scale

Street sweeping and vacuuming

Watershed groups

Water monitoring

In addition to solid, if summary, content on each topic, the information is presented on cards bound together with a screw.  The deck can be unscrewed and separated for browsing at development meetings, city council work sessions, charettes – and reshuffled to reflect measures that best fit a particular project.

Akin to some of the decision tools produced by Donjek, this manual will be a useful tool for decision making in both private and public sectors.  Contact the St. Paul Riverfront Corporation for a copy.