Fighting McMansions with higher densities in Sydney

Australia has a reputation for McMansions but some Sydney neighborhoods and suburbs have seen a shift in recent years toward higher densities:

But while Sydney’s Hills District has been synonymous with the Great Australian Dream – life in the suburbs with a large backyard and Hills Hoist – it is quietly carving out a new identity.

Five years ago, in nearby Rouse Hill, 90 per cent of homes were houses. Today, it’s 60 per cent, census data shows. Houses in these suburbs regularly sell for Sydney’s median $1.15 million, while five years ago the prices were below $700,000.

Signs of change came as early as the opening of Rouse Hill Town Centre in 2008. At the time, there were plans for mixed-use apartments, but not all the locals were sold on the idea…

“Developers prefer the small lot subdivision, townhouse and apartment-style dwellings over the mansion style lots because there are more buyers than can afford them,” he said.

It sounds like the shift toward more housing units is not a backlash against McMansions per se but rather a high demand for more housing. Why build one McMansion when several townhomes could fit on the same lot?

In the long run, creating more housing units has multiple advantages: more people can access these communities, the townhomes are a better use of land opposed to detached houses and large lots, and higher population densities could support more vibrant street life. But, there could be one downside: how much will the new units help make housing more affordable? On the whole, more units in the metropolitan region should help reduce housing prices. However, if these new units are primarily concentrated in hot and/or desirable neighborhoods and the townhomes are more of luxury units rather than starter units, swapping McMansions for townhomes might not help many of the regions average residents.

Final thought: numerous people have suggested replacing McMansions with higher densities through a variety of means (teardowns, subdividing existing homes, building fewer McMansions in the first place) but Australia seems to be ahead of the United States in this regard.

Reviving the dead shopping mall with residences, hotels

Efforts to resuscitate dead shopping malls include adding living space:

Four years later, after failing to make that work, owner The Krausz Companies is pitching a new plan that would keep existing anchor stores but demolish vacant Kohl’s and Sears stores and significantly shrink the size of the mall. The concept plan, proposed in April, also calls for building 155 town homes and 256 apartments north and east of the existing mall…

Melaniphy said he thinks there also will be more redevelopments that shrink the amount of space devoted to retail and mix it with residential or hotel development.

That’s already happened at the former Randhurst Shopping Center in Mount Prospect. It billed itself as the largest mall in the world when built in 1962 but struggled to keep up as more upscale shopping centers opened nearby. It relaunched as Randhurst Village in 2011, an open-air shopping center with shops, restaurants, a movie theater and hotel.

This sounds a lot like the retrofitting of suburbia suggested by Ellen Dunham-Jones. The key is to have a steady flow of people on the site – people who live there or who are staying at a hotel – rather than relying on people driving to the mall. If all goes well, it might be hard to tell decades from now that these sites were once large shopping malls. (At the same time: (1) these mixed-use developments might stick out in the suburban landscape and (2) the trickiest part of improving these malls might be linking the edges to the surrounding areas. Suburban developments often have fairly impermeable edges.)

A reminder: this does not mean that the traditional shopping mall is dead. There may just be a lot fewer and they will be concentrated in wealthier areas:

“The fancier malls are going to be healthy because there are always folks that want that aspirational lifestyle, but there’s still a lot of money to be made with people who might have more value-oriented customers as their focus,” Trombley said.

While food deserts were all the rage several years ago, we might talk of retail deserts in the future.

 

Why are 62 acres so close to Chicago’s Loop even available?

There has been a lot of talk about a new project on 62 acres on the Chicago River just south of the Loop. Before we get to what will go there, why was such a big piece of property empty near one of the major centers of the world?

The South Loop property was used as a rail yard, but has sat unused for decades.

The scraggly land was later owned by Antoin “Tony” Rezko, a former fundraiser for imprisoned Gov. Rod Blagojevich who himself served a prison sentence after a fraud and money laundering conviction. The site was sold 10 years ago to Luxembourg-based General Mediterranean Holding, a firm led by Iraqi-born and British-based businessman Nadhmi Auchi. He was convicted in a French corruption scandal in 2003.

Last May, Related completed a city-approved deal to take over as lead developer, with Auchi’s firm remaining a joint venture partner.

From the city’s perspective, Related’s involvement brought credibility to the long-idle site. Related Midwest is an affiliate of New York-based Related Cos., which is building 18 million square feet in the Hudson Yards mixed-used development in Manhattan.

One thing that is striking about Chicago and some other Rust Belt cities is the amount of available or empty property. In particular, Chicago’s South Side has a number of large parcels including this site along the Chicago River, land southwest of McCormick Place with some small developments here and there, land on the Robert Taylor Homes site with a few buildings here and there, and the former US Steel site (and subject to a number of proposals in recent years – see the latest here) plus numerous empty or vacant properties scattered throughout neighborhoods. Even while development booms in certain neighborhoods (and the city trumpets the work taking place in the Loop), others have significant chunks of empty land.

The why: these properties are often available in poorer or more industrial neighborhoods and the properties are often located in or close to areas with higher concentrations of black residents. In other words, these properties are not desirable, even at cheap prices (such as $1 properties in Chicago), and the desirability is connected to the status of the location and the status of places in the United States is closely related to race and class. This particular 62 acres is a great example of how uneven development works; those who want to build (leaders and developers/those in the real estate industry) usually do so in order to profit as much as possible. Now, this 62 acre site is more desirable (meaning profitable) because the South Loop has done well in recent years and there are other new developments nearby.

On the failure of the High Line

Even as cities around the world attempt to emulate New York City’s High Line (earlier posts here and here), the creator discusses why he thinks the original failed:

But by one critical metric, it is not. Locals aren’t the ones overloading the park, nor are locals all benefiting from its economic windfall. The High Line is bookended by two large public housing projects; nearly one third of residents in its neighborhood, Chelsea, are people of color. Yet anyone who’s ever strolled among the High Line’s native plants and cold-brew vendors knows its foot traffic is, as a recent City University of New York study found, “overwhelmingly white.” And most visitors are tourists, not locals.

“We were from the community. We wanted to do it for the neighborhood,” says Hammond, who is now the executive director of Friends of the High Line, the nonprofit that funds, maintains, programs, and built the space (New York City owns it, and the parks department helps manage it). “Ultimately, we failed.”…

“Instead of asking what the design should look like, I wish we’d asked, ‘What can we do for you?’” says Hammond. “Because people have bigger problems than design.”

His organization finally did launch a series of “listening sessions” with public housing tenants in 2011. What people really needed were jobs, Hammond says, and a more affordable cost of living. Residents also said they staying away from the High Line for three main reasons: They didn’t feel it was built for them; they didn’t see people who looked like them using it; and they didn’t like the park’s mulch-heavy programming.

While it is easy to link such conversations to gentrification, I think this gets at a deeper issue regarding development in urban areas: who ultimately benefits? The short answer is that it is not typically the lower-income resident. Urban sociologists have made this point for decades; for example, the concept of growth machines suggests development decisions are typically made by political and business leaders who are looking to profit. In other words, developments are judged by how much money can be made (whether through the sale of property or buildings as well as through increased tax revenues) rather than by how many members of the local population experience a better quality of life. Or, see the the sociological study Crisis Cities that shows how money to redevelop lower Manhattan after 9/11 or New Orleans after Hurricane Katrina generally went to wealthier actors and made life difficult for the average resident.

Buying vacant Chicago lots for $1

Many Rust Belt cities have plenty of empty land and the city of Chicago is selling some of these lots for $1 a piece:

In an effort to combat urban blight and the illegal activity that often follows, the City of Chicago has announced a major expansion of its Large Lots program that offers empty city-owned parcels to nearby homeowners for just $1.

After debuting in Englewood and East Garfield Park in 2014, more than 550 homeowners have so far taken advantage of the program. Now, thanks to its recently expanded scope, Large Lots will extend to 33 Chicago communities on the West and South sides, offering 4,000 empty properties at the extremely discounted rate…

Not just anyone can swoop in and grab real estate for a buck, however. To purchase a lot, buyers must reside on the same block, be current on their property taxes, and be in good financial standing with the city in order to be eligible. Large Lots will be accepting applications on its website through the end of January.

The city tells the Chicago Tribune that all lots in the program are reserved for residential uses such as extended side or back yards, gardens, parking pads, or landscaped green space. In addition to improved neighborhood aesthetics, the Trib also cites a study that found the program yielded a notable drop in nearby littering, drug activity, and prostitution.

Eliminating empty properties is probably a good first step. But, what is the next step? What is the long-term solution to reviving both these properties and neighborhoods?

I will occasionally get questions from students as to why people or businesses don’t see vacant land like this as opportunities. On one hand, the Chicago metropolitan region is in desperate need of affordable housing. On the other hand, these properties are often located in poorer neighborhoods. But, a collection of residents or organizations could really make something interesting out of cheaper properties and the city would benefit from better uses.

Updating the last few years of (private sector) history of Chicago’s public housing

By now, a number of scholars have effectively explained the problematic history of Chicago’s public housing. But, as this new piece from Curbed Chicago suggests, the most recent years have involved a lot of change. Here are some interesting tidbits from this recent history-in-the-making:

Holsten’s answer is emphatically yes. He specializes in mixed-income and affordable housing, and has developed $500 million worth of it since 1975. But building a mixed-income building is one thing. Forming an actual community across racial and class lines is another. “Our job as developers is much more than financing buildings and property management,” he says. “It’s trying to build community. That’s the hardest part.”…

One sticking point is the issue of density. Chicagoans feel burned by their past experience with high-rises. And the city has a tradition of homeownership that’s different from other very large American cities. Chicago’s famed “bungalow belt” of brickworker cottages built in the early 20th century offered waves of immigrants affordable single-family homes, and preservationists have formed a nonprofit to protect them.So the CHA’s residents would prefer a house and a porch of their own, but that desire often runs counter to the need to accommodate the thousands who have been displaced…

Between 2008 and 2012, the CHA issued about 14,000 fewer vouchers than HUD funded, building up a surplus of $432 million and earning a rebuke from HUD Secretary Julian Castro. (The CHA says its reserves have since been cut and will be spent down by the end of 2017.) A Chicago Sun-Times and Better Government Association investigation found that four out of 10 voucher units have been cited for building code violations in the last five years.

I am skeptical that the private sector alone can solve these housing issues. The free market tends to lead to exclusion and profit-seeking. It doesn’t provide many solutions to correcting existing inequalities, which in the United States tend to connect race, social class, and housing. See an earlier post for a number of the bad outcomes that can result from a free market approach to housing.

On the other hand, the Chicago Housing Authority has done little good. And Americans from the beginning have been ambivalent about involving government in housing. There is little chance that the government will do much more to provide housing – even as the need for affordable housing is great in many cities – because it is a difficult issue in which to find much support.

Perhaps there is a third approach: the US government props up the mortgage industry! Probably not a good long-term solution but this is what we have and it is a system that privileges homeownership.

How many suburban entertainment centers can one region have?

Schaumburg is looking into creating a new entertainment district out of underused properties:

Schaumburg trustees Tuesday approved a $6.58 million offer to buy the two single-story office buildings just north of the village’s convention center and Renaissance Hotel to help develop a new entertainment district and reconfigure Thoreau Drive.

The 110,000-square-foot Woodfield Green Executive Centre lies on the north side of Thoreau Drive and just across Meacham Road from Zurich North America’s new headquarters…

The long-term plan is to hold the property to sell to one or more developers interested in building more restaurant and other entertainment venues near the southeast corner of Meacham and Algonquin roads.

This sounds like a typical suburban strategy today: take properties that are not doing well or even abandoned (see efforts to utilize closed grocery stores) and start generating revenues through new entertainment use. Stores come and go but theaters and restaurants can come together to create a vibrant distract that will generate property and sales tax revenues for years to come.

This did lead me to a question: within the Chicago metropolitan region, how many entertainment districts can the region support? If many suburbs are trying to pursue these goals, can most of them sustain successful districts? There are already a number of successful or established districts: Evanston, Arlington Heights, Schaumburg and Woodfield, Rosemont, Gurnee Mills, the Oak Brook-Yorktown corridor, Naperville, plenty of other downtowns with lively scenes and regular festivals and events (Geneva, Aurora, Elmhurst, etc.) and countless shopping centers that are transitioning to lifestyle centers. I assume there is a saturation point where these districts start losing people to each other. Of course, this might be mitigated by two factors: (1) continued population growth so that everyone can share from a growing spending pie and (2) specialization among entertainment districts that could help each remain competitive.

Another thought: how often do entertainment districts simply reproduce existing patterns of wealth and the distribution of higher-end commercial properties?