By Mark Smith

– Fundamental cause missing in sprawl literature –

– Fixed assets in changing markets –

– Chronic sprawl is in part market inefficiency –

– Development processes and techniques contribute to sprawl –

 – Solution is pre enabling densification –

– Many factors said to cause sprawl might be considered demand generators –

– Excessive sprawl is not responsive to the market –

– Implications of business as usual? Another generation of development that will contribute to sprawl –

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The sprawl conversation does not include a fundamental cause, which is the fixed nature of real estate assets and their relationship to evolving host markets. 

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Coevolution is Needed in Key Locations

The inception of the problem is that in the market circumstances of most first construction, which are usually low activity, low value economics, moderate and higher densities are not possible without subsidy because they are financially infeasible.

Once built, real estate assets are normally fixed for many decades. But the neighborhoods and markets in which assets are located by their nature often evolve, creating additional local demand that must be satisfied somewhere else in a region. In key locations where market activity and value grow rapidly, density often becomes feasible in only a few years.  In this context, fixed assets are a constraint on market forces, and the resulting disequilibrium can be a problem when trying to satisfy demand and supply locally, and to maximize return on private and public investment.

Development industry processes that determine project feasibilities–partially imposed by participants outside the developer’s organization and control–contribute to buildings, blocks, and neighborhoods that cannot grow with demand.  Additionally, industry standards, methods, and materials used to construct buildings and infrastructure that inhibit or prohibit additional improvements.  These process and technology constraints influence regional urban form.

Today, and historically, homebuyers and businesses generally seek a variety of urban and suburban settings, matching their economic, life cycle, and functional needs.  Just as excessive sprawl is not market responsive, nor is excessive density. Balanced communities are needed in most places.

Seeking the Market

Buildings and neighborhoods that can grow, or coevolve, with local households and businesses, as well as accommodate in migration, is a capacity that has been lost. In key locations, pre enabling densification can reinstate this capacity. Planned Densification solves for this within the context of today’s development industry processes and techniques, and prescribes four methods to pre enable additional improvements to projects to meet demand when it occurs.

“Markets change, buildings don’t” screenshot from Mark Smith lecture at University of San Diego

Sprawl Attributions

Sprawl literature is voluminous, spanning decades, disciplines, and global geographies. Discussion occurs in academia, industry, and popular culture. Therein, sprawl is attributed to a number of causes. In The Limitless City, a balanced book about suburban development, Oliver Gillham identifies

…four essential ingredients of suburbanization:

– Land ownership and use;

– Transportation patterns;

– Telecommunications and technology; and,

– Regulations and standards (Gillham, 8).

Within Gillham’s broad categories, and within the broader literature, there are dozens of more specific attributed causes. However, none of these address the interdependence of the time-specific feasibilities of density with market life cycles and their activity and value characteristics. Another observation of the sprawl discussion is that many factors said to cause sprawl might be productively viewed as demand generators, either agnostic to urban form or agnostic if slight modifications were made to programs and policies. More about attributed causes will be in a forthcoming paper.

Implications of Evolutionary Constraints

Losses are occurring at numerous levels. Importantly, investments, neighborhoods, and cities could be more efficient if densification was pre enabled. In many places, it is not enough to build today’s highest and best use–we must anticipate future growth potential in targeted buildings, blocks, and neighborhoods. If we do not, a significant amount of local square footage and acreage demand will be displaced elsewhere in the region, often to the edge. Redevelopment and retrofit are an expensive and often traumatic resetting of development to the current market. We are seeking the market with a more orderly evolution.

What is also occurring is that an entire generation of planning and development is being implemented without this fundamental realization of the need for coevolution. When research studies are conducted, and when conclusions and recommendations are made without functionality to pre enable densification–we are unfortunately investing in and building a generation of real estate assets that cannot evolve with the market [FN1] and in which planned evolution would be beneficial to many stakeholders.

Density topics in University of San Diego lecture by Mark Smith, Pario Research

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[FN1] Evolved density in high investment locations can reduce pressure for density in other places. We can more definitively plan and invest in density in order to sustain and subsidize low density.

References

Gillham, Oliver. The Limitless City. Washington: Island Press, 2002.

© Pario Research 2013-2015

Reposted from Pario.com May 20, 2013

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