
Poor land use in the world’s greatest cities carries a huge cost - brendannee
http://www.economist.com/news/leaders/21647614-poor-land-use-worlds-greatest-cities-carries-huge-cost-space-and-city
======
dankohn1
I may live in the densest neighborhood of any HN participant: North Battery
Park City [1] in Lower Manhattan. As an example, my son's 500 kid elementary
school serves _9_ buildings.

And I'm here to tell you, the future feels great. Specifically, living
vertically has all sorts of wonderful aspects in terms of community (the kids
can trick-or-treat without leaving the building), access to resources (my kids
can ride the elevator barefoot to the waterpark out the back door in the
summer) and environmentally (we live in the first LEED platinum residential
building in the US).

The only problem is that it is expensive, and it doesn't need to be as
expensive as it is. Building lots more residential skyscrapers, eliminating
parking minimums [2], and reducing the incentive to warehouse vacant lots
through land taxes or similar can all make New York City even more livable
than it already is.

[1]
[http://en.wikipedia.org/wiki/Battery_Park_City](http://en.wikipedia.org/wiki/Battery_Park_City)
[2] [http://www.streetsblog.org/2012/03/21/report-details-how-
one...](http://www.streetsblog.org/2012/03/21/report-details-how-onerous-nycs-
parking-regressive-minimums-really-are/)

~~~
deet
High density doesn't always equate to pleasantness though. It still has to be
done right to be livable.

I spent last year living near Columbus Circle (the southwest corner of Central
Park in Midtown Manhattan) which is probably equally dense as Battery Park,
and didn't care for it much primarily due to its mixed use. The population
density is quite high there, but it is mixed in with office buildings that
suck the character out of the area. In particular, returning there at night
didn't feel like "coming home" to a neighborhood. We've since moved to a
neighborhood that is almost exclusively residential (but still dense) and the
difference in character and livability is very noticeable.

High density if not done right also can have a negative psychological impact
(tall buildings means less sun), constant crowds might mean less chance to
destress, no greenery, etc.

The point is, density isn't the only requirement, it has be done right, so
practicing a bit of restraint in allowing building might make sense.

~~~
worklogin
Interesting. Mixed use is often touted as a way to reduce dependence on cars
and promote local economy.

~~~
graeme
Depends how you do it. I live in a mixed use neighborhood, with lots of shops
and stores and it's great.

Likewise, downtown montreal is pretty interesting. As a pedestrian, there are
plenty of things for you to do at street level, while people live and work
above.

Versus downtown toronto, where there's little for pedestrians to do in much of
downtown. You don't see nearly as many people walking around.

------
j_baker
> Land taxes are efficient. They are difficult to dodge; you cannot stuff land
> into a bank-vault in Luxembourg. Whereas a high tax on property can
> discourage investment, a high tax on land creates an incentive to develop
> unused sites. Land-value taxes can also help cater for newcomers. New
> infrastructure raises the value of nearby land, automatically feeding
> through into revenues—which helps to pay for the improvements.

+1000

Living in West Oakland next to a vacant lot, I think there's a lot of merit to
this idea. As it stands right now, there's no harm to the owner of that lot to
just let it lay vacant for a decade. If it cost the owner some money, people
might actually do something with these kinds of lots.

~~~
jes
I don't wish to be confrontational, but in my view, taking other people's
property without their voluntary consent is wrong.

As I understand the last paragraph of your comment, you wish to see the owner
of the vacant lot forced into a situation where he had to act in some way
other than how he currently chooses to act.

In other words, you want to substitute your judgment for his, when it comes to
the use of his property.

Again, I don't mean to be confrontational, but this is how I see the
situation.

How do you see it?

~~~
krschultz
That the value of land is substantially based on the environment around it,
one that is largely driven by societal factors. 1 acre of land in Manhattan is
extremely expensive. 1 acre of land 20 miles north of Manhattan is not
expensive. The difference is everything surrounding the land.

If the people in a community have decided to spend a lot of their money to
reduce crime, improve transit, improve schools, and improve the economy, every
land owner benefits. Yet the way that we do taxes (based on the improved value
of the land), means that those that sit on the sidelines and do nothing gain
quite a bit of value by freeloading on those around them.

If we figured out the taxes based on the underlying value of the land, then
the vacant lot owner would be paying as much as the person that just invested
in building a new business next store. That seems fairer to me considering
that the vacant lot is now worth more due to its proximity to a shiny new
building.

~~~
jes
Thank you for your comment, and for obviously being concerned with issues of
fairness.

If a person makes an investment, and that investment goes up in value, even
substantially, and even with no additional effort on the part of the investor,
does that justify others taking some or all of the resulting value?

If I bought stock in Apple years ago, because I thought it was a smart thing
to do, and I simply held the stock, should other people get a cut of my gains
when I sell?

What if the stock goes down? Am I then entitled to someone else's gains?

~~~
jschwartzi
Stock is different. Your stock certificates in Apple don't increase or reduce
the value of other stock certificates you own just by their proximity and
configuration.

To put it another way, if you own common stock, and later develop some of it
into preferred stock, does the value of your remaining common stock also go
up? If you have shares of Microsoft also, and those certificates are next to
the Apple stock in your safe, does your Microsoft stock benefit from its
proximity to Apple stock certificates rather than, say, Hewlett Packard?
Suppose someone else places some of their Facebook stock in a safe next to
your own. Do they benefit from their proximity to existing Apple stock? Do
safes full of penny stock drag the value of your Apple stock down?

The fact that something is real property means that it has a direct impact on
other peoples' property around it, especially in how it is developed(or not).
I would say that there is an argument to be made for deincentivizing sitting
on land as a "real estate investment" without using it to benefit the
neighborhood it sits in.

~~~
jes
Thank you.

You write that there is an argument to be made for discouraging sitting on
land as a real estate investment, without using it to benefit the neighborhood
that it sits in.

Let's say that you are right, that there is such an argument to be made. In
other words, the neighborhood in which the property resides would benefit from
some improvements to the property in question.

In this case, why should the affected parties not try to work together to
accomplish it?

For example, if I own a vacant lot in the middle of a neighborhood, and my
neighbors want to use the land for a park, I'd be happy to discuss selling
some or all of it to a neighborhood association.

On the other hand, if the neighbors are going to get together and petition the
local city council to confiscate my property, say through eminent domain, that
seems like an unreasonable intrusion on property rights.

I understand that people want things. However, I think we'd all be better off
it we sought to work things out through voluntary cooperation and free trade –
in an environment where individual rights are respected – rather than
empowering politicians to pass laws that grant special favors to certain
groups.

------
rayiner
> Lifting all the barriers to urban growth in America could raise the
> country’s GDP by between 6.5% and 13.5%, or by about $1 trillion-2 trillion.
> It is difficult to think of many other policies that would yield anything
> like that.

And it would also reduce the real but unaccounted-for environmental and social
externalities of our sprawling homogenous suburbs. Someone living in New York
has half the energy footprint of the average American. And while the city is
pretty segregated, the New York subway is a unique setting of rich and poor
people of all races utilizing a public service together.

~~~
sbov
I can only find stats on carbon footprints. Somewhat surprisingly, California
does very well on this statistic, despite its suburbs: it's just behind New
York.

So at least for carbon footprints, those don't necessarily seem to be linked
to density.

I couldn't find anything on energy footprint though.

~~~
guard-of-terra
Maybe it's because in California you don't need as much heat/conditioning as
in other places?

We humans use land extremelly inefficiently, we mostly live in places outside
of our temperature optimum despite no longer being busy in agriculture.

~~~
santaclaus
The NY Times suggests that inefficient boilers in old buildings could be the
culprit [1].

[1]
[http://www.nytimes.com/2007/07/15/realestate/15cov.html](http://www.nytimes.com/2007/07/15/realestate/15cov.html)

------
graeme
Something that annoys me about these articles is that they're basically saying
"the world's densest cities should make themselves denser"

Maybe we should just copy what those cities did. Imagine what america's GDP
would be like if it had ten cities like the current NYC.

I live in one of the densest neighborhoods in north America, the plateau in
Montreal. It achieves this density with low rise buildings, and it's a very
pleasant area.

People say we should build taller buildings here. But I say we should build
more plateaus elsewhere.

The problem is that our current regulatory environment makes it very difficult
to build new versions of the world's most popular neighborhoods. So instead
the call is to modify existing, successful neighborhoods.

~~~
krschultz
I think if you expand a low-rise city you end up with Washington DC or LA,
meaning debilitating traffic. The density is not high enough to support mass
transit effectively, but it's too high for effective roads.

~~~
Jacqued
As I said in response to another comment, you actually can. Paris has a
density of 50000/sqmi (to compare with Manhattan's 70000) without high rise
buildings.

What you can't have though, is large avenues and parking lots everywhere.
Every inch of space than can be build has to be built.

------
pmontra
"land-use regulations in the West End of London inflate the price of office
space by about 800%; Milan and Paris the rules push up prices by around 300%."

I live in Milan so I think I'm qualified to write about this. The office space
one wants is close to home or to metro or train stations, unless one lives
outside the city. In that case the best office space is close to the highways
on the same side of the city you're from. I used to work at 10 minutes by feet
from office, then exactly at the other side of the city. It took one hour to
get to office, by car or public transport. I preferred public transport
because of the free time for reading. I work mostly from home now with
customers within 30 minutes (walking of cycling), which is even better.

I can understand that zoning rules limit the number of offices and houses that
can be build close to the best areas but as a city dweller do I really want to
see buildings built everywhere, in every single space between existing
buildings or replacing smaller ones? Call me selfish because I don't care
about raising the country GDP but I don't think so. Maybe it's because I'm
European but my ideal of a city is not a large archaeology. It's more like
this [http://goitaly.about.com/od/moreitaliancities/tp/small-
itali...](http://goitaly.about.com/od/moreitaliancities/tp/small-italian-
cities.htm) and Milan is a reasonable compromise between access to fast
Internet, customers and quality of life. People born in those other cities
won't agree but they still come here to work :-)

~~~
swombat
> my ideal of a city is not a large archaeology

You mean arcology:
[http://en.wikipedia.org/wiki/Arcology](http://en.wikipedia.org/wiki/Arcology)

~~~
pmontra
Yes, thanks.

------
carapat_virulat
This seems like a very interesting subject but the analysis seems very one-
handed. You can't just project like that, remove current regulations and
expect the city to remain the same except for all the economical growth. Would
people with money actually stay there or would those cities turn into a
unbreathable bee-hives from which people would flee as soon as they had any
money to do it?

It would be interesting to see comparison inside the same country of cities
with harsher versus lighter regulations and how they actually evolve
economically and socially. Maybe it's not even possible to remove certain
regulations in western cities without committing political suicide and having
them removed once the next major comes to power.

------
pitt1980
"Two long-run trends have led to this fractured market. One is the revival of
the city as the central cog in the global economic machine (see article). In
the 20th century, tumbling transport costs weakened the gravitational pull of
the city; in the 21st, the digital revolution has restored it. Knowledge-
intensive industries such as technology and finance thrive on the clustering
of workers who share ideas and expertise. The economies and populations of
metropolises like London, New York and San Francisco have rebounded as a
result."

Is this really true?

seems like anyone with an internet connection can interface with someone from
SF or NYC

------
jbb555
Ah skip to the last paragraph. It's just the usual "things would be better if
only we took away more of people's money by force" article.

Ignore it. It's just pro-tax stupidiy

------
6t6t6
Tokyo is a public-transport-centered city and has an interesting structure.
The land value depends directly on the distance to the metro or train station
and the importance of the line. The train station is the center of a self-
contained community and most of the services like shops, restaurants,
supermarkets, etc use to be next to the station. Also, the buildings tend to
be taller the closer they are from the station. I find it a quite convenient
way to organize a city.

------
brendannee
"According to one study, employment in the Bay Area around San Francisco would
be about five times larger than it is but for tight limits on construction."

------
drussell
Eventually the market would eliminate wasteful land use because whatever was
occupying the land would be willing to sell to someone who could benefit from
it more.

Bureaucracy and entrenchment get in the way of that though.

------
rwmj
_Knowledge-intensive industries such as technology and finance thrive on the
clustering of workers who share ideas and expertise._

So allow people to cluster in high quality virtual environments.

~~~
guard-of-terra
Is there anyone preventing you from doing that?

~~~
logicallee
there are no high-quality virtual environments (except for killing each
other)?

you literally cannot even throw an idea up on a whiteboard and have it be
there two weeks later: there is no such thing online. (virtual second-life
collaborative spaces.)

online collaborative meetings are a joke compared to real life - as a piece of
evidence, if they weren't you wouldn't have teams having to scramble to move
to silicon valley, you would just have virtual incubators: in terms of its
"manufacturing" output anything an online startup needs can be done over the
wire. (phone and server costs are basically it.)

~~~
guard-of-terra
"there are no high-quality virtual environments"

But there are high-quality cities - tech hubs. That answers your question.

------
mikelyons
We need to rethink our cities as commerce/life supporting machines instead of
aggregate plots of land for private investment. Or are we not mega-scale
engineers yet...?

------
aurora72
The problem is not the poor land use, it's the inefficient capital use!

~~~
jchrisa
Also too much paved surface area.

~~~
ctdonath
I keep wondering when building over roads will become common. Traffic only
needs a couple stories of vertical space; everything above that should be
profitably/affordably usable (once ventilation is addressed).

~~~
philwelch
Unless the road was built in a tunnel in the first place, there are structural
issues as well. You can't just put some concrete structure over the top of a
road and have it support multiple stories of building on top of it. Plus,
streets work better as open-air outdoor spaces, especially for pedestrians.

------
michaelochurch
We need to do a few things. I agree on shutting down the NIMBYs. It's zero-sum
activity that hurts young families and contributes to the generational screw-
over that Generation X and Millennials have experienced.

We also need to block nonresident foreigners from buying real estate here.
They can stay in hotels. Until housing is cheaper than 0.35% of the median
annual income per SF (at that level, you can afford 1200-1500 SF on a median
income) it is a crime to let these nonresident foreigners (often laundering
dirty money) buy properties that will go uninhabited for 11 months each year.

Finally, there's a capital allocation problem. Look at Silicon Valley itself.
It takes in passive capital from all over the country-- teachers' pension
funds from Ohio, firefighter AD&D funds from Georgia-- and distributes the
job-creation in a tiny geographic area: Silicon Valley. Jobs disappear in Ohio
and Georgia, while NorCal booms. Now, the passive capitalists would be fine
with this if that were a working investment strategy. It's not, though: VCs
have been losing money for more than a decade. The concentration of funds into
the Bay Area (which makes that area unaffordable, because housing creation is
always slower than job creation) has more to do with feudalism than any sound
investment policy.

