Tag Archives: development

The Washington, D.C. exurb that attracts politicians

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American suburbs are supposed to provide a respite from the big city. One small town outside Washington, D.C. provides that for politicians:

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Set in Virginia’s rolling countryside an hour west of Washington, Middleburg has one traffic light and roughly 750 residents, a majority of whom voted for Vice President Kamala Harris in the 2024 election. The town is known for horseback riding and hunting, fences made of stacked stone and long winding driveways leading to multimillion-dollar homes…

At any given time, an array of dignitaries — senators, congressional leaders, diplomats — can be spotted window shopping on Washington Street, Middleburg’s main commercial corridor, where decorative lawn jockeys stand sentry outside a few businesses. The well-heeled can also be found at the Salamander Resort, next door to Wolver Hill, where suites go for as much as $1,100 a night.

Over the years, at least four presidents have owned homes or visited the town, including Lyndon B. Johnson, Ronald Reagan and Obama. The Kennedys built a home in Middleburg in the early 1960s, a 167-acre estate they called Wexford that Jackie Kennedy sold after the president’s death, though shestill visited after leaving the White House to ride horses with her children. Elizabeth Taylor and her husband Sen. John Warner lived in Middleburg until their divorce. Robert Duvall resided on a 360-acre farm in the area for several decades until his death earlier this year. In April, Queen Camilla visited a horse farm in town during King Charles III’s trip to the United States.h

Middleburg is a small town at the edge of Loudon County, once a sparsely populated county. In 1960, Loudon County had 24,549 residents, in 1990 it had 86,129 residents, and in 2020 it had 420,959 residents. In other words, Middleburg might have been “the country” at some point but now is part of a large and growing metropolitan region.

This puts pressure on communities like Middleburg. Can they keep a way of life or local character that has been present for a long time? When developers come with proposals, what is the response of local officials and residents? The suggestion here is that the small town might be threatened by Vice President, of a locally disliked party, rents in the community. As long as he does not bring more development and residents, the small town can probably wait him out.

Suburbanites today go online early to protest development they do not like. How different is this from 50 years ago?

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I recently read news about a developer wanting to build duplexes in a nearby suburb. I soon saw reactions on social media platforms to the proposal. One response suggested the land should be protected green space while another response said what the community really needed was affordable housing.

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These are not unusual reactions from suburbanites opposed to housing proposals in their community. What is different compared to reactions in the past is the form the reactions now take: quick responses online that can then reach other community members (and broader audiences). How different is this opposition compared to 50 years ago?

My own research on suburban development suggests suburbanites have opposed new housing and other kinds of development near them for decades. This occurred even as their community was growing rapidly and some of them had been part of that growth in recent years. Residents made arguments about the character of the community, traffic, water management, green or open space, local services, threats to property values, and who might move in.

But without online platforms to share their opinions, how did these residents go about voicing their concerns? One regular forum not used much today involved writing letters to the editor. In local newspapers, residents shared their argument in relatively few words. These discussions could go then back and forth multiple times as supporters and opponents of particular plans wrote in.

Presumably suburbanites talked to neighbors and others in the community. Social scientists have argued the social fabric of the United States looked different decades ago as more Americans were involved in local organizations. Americans may have had more close friends. These relationships would provide space to discuss local issues.

Local petitions could demonstrate the opinions of residents. People would collect signatures and present them to local officials. Decades ago, this would have involved going door to door or being in public spaces to get names on paper. The process looks a little different today through change.org or similar venues.

At the same time, the process by which these proposals move forward looks similar to fifty years ago. Developers talk with municipal leaders and staff. The plans of developers are vetted by zoning boards or plan commissions who then make a recommendation to a city council or village board. Residents and others have a chance to share their opinion in public in public hearings along the way or in some meetings when leaders and developers are discussing plans. There are often months, sometimes years, for conversation and deliberations to take place.

Do the loud voices online either for or against a proposal attract more attention than efforts of residents in the past? Either way, the majority of residents in a community do not publicly voice an opinion. They might vote a certain way based on such decisions or maybe even move to a different community based on what they think is happening. And these actions can be consequential; decisions about development helps shape a community for decades.

An American county on track to have 60% of revenue come from data centers

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As Americans debate data centers, one county in Virginia is dependent on the revenues they generate:

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There is a credible argument there. Look at northern Virginia. So much tax revenue goes to northern Virginia now from being Data Center Alley, as some folks colloquially call it. The flip side can be found in Loudoun County [Virginia], or in a state like Alaska. I mean, the corollary here is that if you rely on oil and gas revenue for your state’s budget, eventually you will kind of be reliant on that industry to a point where you’re not able to successfully regulate it effectively to what the people want. And that’s what’s happening in Loudoun County, where within the past couple of weeks, staff for the county have started warning that their budget is on track to be 60 percent data-center revenues. And they’re actually very concerned about how much data-center money is providing a foundation for their living, and recommending against relying on so much data-center money.

Data centers can provide revenue. As noted in this discussion, they are an in-demand land use. They may not provide many jobs but they will pay property taxes.

As also noted, a community or county or state relying on a single industry for a large portion of revenues is a problem. That industry might be popular for a while. But it may not be popular forever. The rush of building data centers will slow. Technology may move on.

Given the opposition Americans have to data centers near them, it is more likely that:

  1. Data centers will cluster in certain locations and not others? I would guess at least a few communities or counties will approve data centers because of the benefits they perceive them to have.
  2. Data centers end up spread out across metropolitan landscapes. This may be due to utilizing certain locations that are not near residents or numerous communities approve data centers.

If I had to guess, I would go for #1: data centers will end up in places that want them. This may not be in counties that generate 60% of their revenues from data centers but some places will want to strike while this development option is hot.

The Chicago area leading the way in warehouses

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The Chicago region has become a center for warehouses in recent decades:

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Few places in the nation have been transformed so completely so quickly. Since 2000, retail giants and developers have erected more than 146 million square feet of warehouse space in the Chicago area — equivalent in size to roughly 1,400 Home Depot stores…

But Chicago is in a different league. The warehouse boom in the Chicago suburbs took off in earnest in the early 2000s with the construction of the CenterPoint Intermodal Center, the largest inland port in North America, where trucks and trains swap goods. It sits just outside Elwood, a Will County town of roughly 2,200 residents. In 2015, Amazon opened its first Illinois warehouse, in Joliet.

For a study about warehouses and pollution, researcher Gaige Kerr examined real estate listings from the commercial data company CoStar and determined that there were roughly 6,800 warehouses in the Chicago area as of 2022. Their combined square footage eclipsed that of warehouse space in the Los Angeles metropolitan area — home to the nation’s two largest shipping ports — by 13%.

Of the nation’s 25 largest metro areas, Chicago had the most warehouse square footage per person, Kerr found.

The article goes on to describe the effects on local communities and residents. See an earlier post about some of these effects in the town of Elwood. Is it good to have all these warehouses? Some local residents do not think so. All the people who order online and expect quick deliveries may disagree.

At the same time, these figures cited above tell an important story: the Chicago area is now full of warehouses. With the changes in the retail industry, outlying areas in the Chicago region became home to facilities and vehicles that could quickly transport goods.

These changes build on advantages the Chicago area already had. It is located in the central part of the United States. It is connected via waterways to the Great Lakes and the Mississippi River. It was an early railroad center and has one of the busiest airports. It is the third largest metropolitan region in the US.

Would any city or metropolitan areas want to be known for warehouses? It is less glamorous than other industries. One figure might be interesting to add what is already reported here: how much do these facilities add to the local economy?

Where data centers will end up when some community leaders see them as providing benefits, others see them as threats

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There are already thousands of data centers in the United States and more to come. Some community leaders say they benefit their community:

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The recently approved CyrusOne data center in Sangamon County is projected to bring $500 million in capital investments to the county. Marc Ayers, a former Sangamon County Board member, said it’s estimated to generate $5 million to $6 million in property taxes annually, with around $98 million in tax revenue over the next 20 years…

DeKalb Mayor Cohen Barnes said the Meta data center that has been operational since 2023 has contributed significantly to the city with community investments and around $250,000-300,000 in utility taxes…

Barnes said the data center in DeKalb employed more than a thousand union construction workers over the five years it took to build. Now, he said there are hundreds of permanent jobs working on tech, electricity and maintaining the HVAC systems.

Other local leaders describe the downsides:

Property tax revenue from data centers can be significant, but many say the massive centers aren’t worth the millions of gallons of water they consume or the stress they put on an already struggling electric grid. The ComEd territory in northern Illinois, for example, has enough large-load energy projects in its queue to more than double the amount of energy demand in the territory by 2040…

John Laesch, the mayor of Aurora, said the five operational data centers in his community have provided generous tax payments, but those benefits don’t outweigh the downsides data centers can bring to communities…

“But during our public hearings, we heard residents ask, is that $1.6 million worth the noise pollution and the strain on our power grid and potential long-term risk to our climate?” Laesch said.

With these different perspectives, are there and will there be clear patterns in which communities have data centers and which do not? With land uses that can be controversial, will most or all communities say no or will there be certain kinds of communities that approve data centers?

Given some existing patterns, these might be some fault lines:

-Communities with residents with higher incomes and higher levels of education vs. those with lower levels

-Communities who are seeking out new economic and development opportunities vs. those who are not

-The political leanings of local officials

-Communities with pro-business/jobs/growth/construction coalitions vs those where such coalitions have a lesser presence

-Metro areas with a stronger presence of big tech companies versus places that do not

I would bet some of this could be answered already but it would also be interesting to see what happens now with companies and communities having the advantages of seeing what has already happened and what might work for getting the outcome they want.

Trying to imagine an older church building with an active congregation at the center of a new development

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Inspired by this article regarding an older church building and congregation on the site of what could soon be a big development effort on Chicago’s west side, I was thinking about when major development might include a church building in a prominent spot. Not just preserve a landmark building or provide space that might be used by religious congregations. New development centered around a religious building.

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These do not always go together in the American context. Churches and religious congregations are religious groups and community organizations. They do not generate jobs and revenues like businesses do. They do not pay property taxes. Churches may have been at the center of early European settlements in the United States but many of them moved as residents left commercial cores and the land became really valuable.

In new developments, developers might provide land for religious congregations or set aside land for such purposes. But put a religious building at the center? Imagine a new subdivision or condo building where a prominent place is given to a religious group – unlikely.

Maybe the only way this could happen is if the situation is similar to the article cited above: there is a historic congregation and building present and developers want to build something new. Construction could account for and even highlight the long-time congregation.

Another option: what if the development is led by or facilitated by a religious congregation? Imagine they have additional land and they want to stay. They could sell the rights to some of the land, stay put, and be there when the significant new development occurs. Or they undertake the development themselves, building around their own presence.

Americans united in not wanting to live near data centers

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NIMBY responses to data centers are bringing Americans together:

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Lyon Township voted for Donald J. Trump in 2024, but party loyalties hardly seemed to matter. In an era when Americans are divided on everything — even the cars they drive and the TV shows they watch — data centers seem to have bridged the partisan divide.

Early evidence suggests that Americans — once agnostic — are now souring on them. Last month, Maine became the first state to pass a moratorium on data centers — only to have the governor, a Democrat, to veto it — and similar measures have been introduced in at least 13 other states and dozens of municipalities.

In Virginia, a recent poll found the public had turned sharply against data centers. The same is true in Wisconsin, said Charles Franklin, director of the Marquette University Law School Poll, which found that around 70 percent of people now say the costs outweigh the benefits.

Even more interesting, he said, the state’s deep partisan divide seems to have vanished when it comes to data centers.

I am a little confused why this is pitched as bridging political divides when there is a longstanding pattern in local American politics of residents resisting perceived threats to their property values and quality of life. If the American Dream continues to involve homeownership, often in suburban communities, residents will express concerns or protest strongly if a proposed nearby development will be near their homes.

Perhaps this is harder to see or remember when either only national politics are important or all local politics are seen as extensions of national politics. Local politics can often be about local interests. Locals are not necessarily opposed to growth and development – after all, growth is good in the American context – but they often do not want development that significantly changes their local experience.

At the same time, fewer Americans might be opposed to data centers in the abstract. If they want to use their AI powered devices and platforms, don’t these have to be built somewhere? This is common to NIMBY responses: people might acknowledge the need for a particular land use but few want it located near them.

Taking the NIMBY approach to taxes

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As someone who studies suburbs, I am familiar with NIMBY responses to proposed development: residents do not want it near their dwellings, even if they agree it probably needs to be built somewhere. I was reminded of this common response when I read a description of how Americans feel about taxes:

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Over the past decade, the share of Americans who believe that their income-tax bill is unfair has climbed by 14percentage points. A majority of Americans, in both parties and at all income levels, say that they are kicking in too much. The National War Tax Resistance Coordinating Committee, which teaches people how to conscientiously object to income levies, reports surging interest in its training sessions. Grassroots groups around the country are fighting to “ax the tax.” Most people want rates to go up—just not on them.

Someone should pay taxes, but not me. I like the government programs I participate in (if they even know they are government programs – see later in the article) but someone else should fund them. The money should come from someone or somewhere else.

What does this lead to in the long run? On the NIMBY development side, it tends to put a buffer around wealthier communities who have the resources and voice to fight against development they do not want. Would the tax case equivalent be that certain groups are able to avoid higher taxes being placed on them or certain groups are able to obtain tax cuts while others are not?

At the local, state, and federal levels, it will be interesting to see how different taxing bodies try to close budget holes. There have to be some revenue sources – or cuts? – to make ends meet.

Which US states or communities do not rely on population growth and new development?

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An article about recent changes in Florida makes this suggestion about the state’s strategy for success:

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These side-by-side trends could spell trouble for a state whose economy relies on continued population growth and real-estate development.

Not every state and community can have the kind of growth and development run that Florida has had in recent decades. In 1950, the state had 2.7 million people and today has over 23 million people. Air conditioning plus available real estate plus warm weather and natural features plus immigrants plus retirees have contributed to the third most populous state.

But don’t most American places want something like this to happen? It may not be possible due to history, a lack of development and capital, population stagnation or decline, few features that possible residents or businesses would desire. Yet growth is good in the United States. Stuff being built, people moving in, new activity is all good. The places where things are happening are getting ahead, other places are falling behind or are way out of the picture.

If these trends discussed continue, what happens to Florida? Does it become like many other places that want growth but cannot seem to make it happen? Do the new hot states pass it by? Do leaders try to chase new or different opportunities in hoping to revive their glory days of growth? The Florida that looked unstoppable may become an afterthought, all because the focus on growth moves its lens to somewhere else.

What private equity expects from suburban residential developments and “a revenue gap”

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A new proposed residential development in suburban St. Charles sparked discussion about the possibility of including affordable housing:

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A 29-acre site in St. Charles — one of the last remaining open properties in town for residential development — is becoming a flashpoint for housing affordability in the city.

With a new proposal on the table, some city officials are requesting affordable units while the project’s developers argue it would hurt their private equity-backed bottom line…

The developers said they are trying to support retail along the Randall Road corridor by “attracting residents with disposable income.” City officials responded by saying there are people who work for the city who can’t afford to live there.

During the March 16 meeting, the developers said offering affordable units, such as a $1,070-per-month studio, would “provide a revenue gap.”

The basics of the story are not unusual for suburban residential development projects. A developer sees an opportunity. Upscale residential units can bring a good profit and upscale suburban communities tend to like residential properties that enhance their status and character. The city responds to the proposal with a few requests, including requesting some affordable housing units for several groups in the community the suburb would like to retain or attract. A period of negotiation or dialogue commences.

What is different here is that the developer has clearly stated that substituting affordable housing units will lead to a revenue problem. Why? Because there are expectations from the private equity supporting the development. The article does not discuss the details (and they may not be publicly available) but it sounds like it can be put another way: not enough money will be made on this development if affordable housing is included.

Profit-making is not unexpected. The clash between private equity money and affordable housing is less often in the public view. What amount or percentage does private equity expect to make on residential development? Can it make room for any affordable housing or is it completely about profit maximization?