Saturday, December 31, 2005

Dallas declares Houston "Texan of the Year"

In an absolutely amazing display of setting aside city rivalries, the Dallas Morning News has declared Houston its "Texan of the Year" for 2005 (headline, article - goes to print in tomorrow's Sunday edition).
In 2005, Houston became the heart of Texas. For resilience, resourcefulness and good old Texas neighborliness on a scale that did the whole state proud, Houston is the 2005 Dallas Morning News Texan of the Year.

To this day, an estimated 150,000 survivors of hurricanes Katrina and Rita call the Houston area home, and surveys show that most of them plan to stay. When Katrina hurled them, battered and destitute, onto Houston's doorstep, Houston met the challenge with the largest shelter operation in the nation's history. Singling out Houston is no slight to the scores of other communities that opened their arms to the storms' victims, including those right here in North Texas. They, too, performed nobly and deserve vigorous applause. But the demands on Houston, by dint of simple geography, were of a stunningly higher magnitude.

Talk to the people at the center of the relief effort, and, over and over, you'll hear words that echo those of Issa Dadoush, the city of Houston's director of building services: "These are Americans. They're our neighbors. If not Houston, who else?"

Or, as Harris County Judge Robert Eckels said, "We had no choice. It was just something that needed to be done."

To get it done, "we" became far more than government. The extraordinary effort depended on churches, companies, nonprofits and tens of thousands of ordinary people. Commandeered by fate, they responded with the very qualities that distinguish a Texan of the Year: trailblazing, independence, staring down adversity, and affecting or influencing lives.

In the office of Houston Mayor Bill White's chief of staff sits a large, glossy sign that admonishes: "Put Your Smile On – Company's Coming." It's a souvenir of the city's PR campaign before the 2004 Super Bowl. It's also exactly the mind-set Houston's leaders summoned after the call came from the governor's office to Judge Eckels at 3 a.m. on Aug. 31: A convoy of buses bearing traumatized survivors of New Orleans' Superdome would strike out that day, bound for the Astrodome.


He understands the magnitude of what's been accomplished: Starting from zero, "we have created the largest housing authority in the country." But, like the officials who hired him and did their utmost to insulate his bureaucratic restraints, he's relentlessly modest about their collective achievement.

"This became an urgent, compelling priority," he said. "When the floodlight is on, it's easy to succeed."

The mayor's aide, Mr. Moore, echoed that theme. "People kind of got it," he said. "This was bigger than us."

Bigger than Katrina. Bigger than Texas. Houston continues to perform a national service by modeling the virtues of local initiative and challenging Washington's missteps – most recently FEMA's decision to end the housing voucher program several months early, on March 1. Mr. White has joined that battle with the same energy he has shown throughout the crisis.

One of the latest Houston initiatives is a program that reflects the city's entrepreneurial pedigree: The Greater Houston Partnership is offering help to hurricane survivors who want to rebuild their businesses in their new hometown.

With the new year comes Houston's Phase III. So few empty apartments exist in Houston that Mr. White recently was forced to declare the city full. Now, attention shifts to the lives under the roofs, to helping guests become integral members of the community. Whatever challenges arise, Mr. White, Judge Eckels and others insist that they will succeed.

Says Judge Eckels simply: "We will rebuild, one life at a time."
The end of the article has an interesting set of three sidebars of ways to look at the crisis: by numbers, by personal initiatives, and by personal enounters.

A separate article describes the editorial process for the selection:

We shifted focus to who among these 12 should be Numero Uno, the celebrated top Texan of the Year. Surprisingly – and in sharp contrast to last year's experience – this was a relatively easy decision.

One board member made an impassioned argument for the city of Houston, which he called "the nation's shock absorber" for how warmly it took in tens of thousands of Katrina evacuees, only to wrestle itself weeks later with the onslaught of Hurricane Rita. Others nodded in agreement. Smiles broke out in the room for the first time in hours.

One board member cautioned that citing Houston might seem dismissive of the thousands of Dallasites who stepped up generously to aid thousands of Katrina and Rita evacuees. Others persuaded him that we should be able to recognize another community's monumental generosity without trivializing our own.

Think order of magnitude, we said. Degree of difficulty, volume, storm path.

The choice became unanimous.

Even though I have an obvious pro-Houston bias, I try to stay balanced, fair, and friendly when discussing "rival" cities like Dallas. If I ever have a bad day and start Dallas-bashing, I would appreciate my readers gently reminding me of this day. Thanks.

Also: Many thanks to Erik for the pre-publication tip.

Thursday, December 29, 2005

Home affordability and its benefit to Houston

The New York Times has an in-depth piece today on national home affordability:
Despite a widespread sense that real estate has never been more expensive, families in the vast majority of the country can still buy a house for a smaller share of their income than they could have a generation ago.

A sharp fall in mortgage rates since the early 1980's, a decline in mortgage fees and a rise in incomes have more than made up for rising house prices in almost every place outside of New York, Washington, Miami and along the coast in California. These often-overlooked changes are a major reason that most economists do not expect a broad drop in prices in 2006, even though many once-booming markets on the coasts have started weakening.

The long-term decline in housing costs also helps explain why the homeownership rate remains near a record of almost 69 percent, up from 65 percent a decade ago.

Nationwide, a family earning the median income - the exact middle of all incomes - would have to spend 22 percent of its pretax pay this year on mortgage payments to buy the median-priced house, according to an analysis by Moody's, a research company.

The share has increased since 1998, when it hit a low of 17 percent before house prices began rising sharply in many places. Although the overall level has reached its highest point since 1989, it remains well below the levels of the early 1980's, when it topped 30 percent.


In high-profile places like New York and Los Angeles, home to many of the people who study and write about real estate, families buying their first home often must spend more than half of their income on mortgage payments (ouch!), far more than they once did. But the places that have become less affordable over the last generation account for only a quarter of the country's population.

Elsewhere, families tend to spend far less on housing. In Dallas, the share of income needed to buy a typical house has fallen to 13 percent this year, from 14 percent in 1995 and 31 percent in 1980.
They have a table where you can look up specific cities, and Houston is similar to Dallas, although Dallas peaked a little higher in the early 80's. We peaked at 29.9% of income in 1983, before the oil crash and drop in interest rates, and have been relatively flat/stable since 1987. We're now at 14.1% of income, 8% below the national average and one of the most affordable cities in the nation, especially among the largest metros. As I've noted before (and here and here), this gives us a tremendous amount of discretionary income to spend on things like restaurants, retail, entertainment, arts, culture, museums, travel, charity, higher education, and small business entrepreneurship - which helps give our city its great energy and vitality.

It's worth keeping in mind this stat has two parts: housing costs and median incomes. Houston is lucky to have both affordable houses and higher-than-average incomes with well-paying industries like energy, health care, aerospace, and the port. You might think, for instance, that San Antonio is much cheaper than Austin - and it is on an absolute cost basis ($123K vs. $151K) - but San Antonio's relatively lower-income tourism and military industries and Austin's relatively higher-income tech industry end up putting both of them in about the same place at 15% of income. I have to say, it must really suck to live in a popular tourist-driven area with low incomes - like Florida or Vegas - yet have wealthier outsiders driving up house prices. As an example, Miami doesn't have a lot of high paying jobs, but Northerners (is "Yankees" PC? ;-) buying second or retirement homes have driven up prices to a painful 41% of the median income, 17% less affordable than 1985.

The article includes a fascinating map. Unfortunately, this is the largest Blogger will let me insert, but you can go here for the full size map.

Wednesday, December 28, 2005

How zoning drives away jobs

The Reason Foundation has a new commentary article reinforcing our prescient wisdom of no-zoning in Houston. It opens with a discussion of skyrocketing housing costs across the country, then addresses one of the core causes of the supply-demand imbalance:

Across the country, zoning laws consistently prevent new homes from going up in many locations and often unnecessarily block the transformation of neighborhoods that could provide affordable housing. After all, only about 6 percent of the nation is developed. Two-thirds of New Jersey, the nation's most developed state, is open space. We have plenty of land to build homes - if politicians let them be built.

Restrictive zoning hits the housing market it two ways: It increases costs by adding to delays in approvals, and it reduces the number of homes built to satisfy demand. Economists Christopher Mayer and Tsueriel Somerville found that adding just three months of delay to the approval process could reduce new housing construction by 45 percent. But zoning and conventional land-use planning has an even more destructive impact. They prevent communities from changing to naturally meet new needs and community concerns.


Today's zoning codes aren't adaptable or flexible. They are intended to be bureaucratic instruments that control the behavior of local residents and businesses. The views of neighbors aren't important, nor are economic benefits or aesthetics. The only thing that matters is the letter of the law and whether the law can be applied universally throughout the community.


A critical key to keeping housing affordable will be loosening up the bureaucratic straight jacket of zoning to allow more homes of all types be built that meet demand. Without this flexibility, the ongoing mismatch between supply and demand will keep home prices higher than they need to be and keep the stability of homeownership beyond the grasp of too many Americans.

It has been noted that much of the townhome densification of Houston's core would be banned under most of the nation's zoning codes, making us semi-unique with that development pattern. Many city planning boards and zoning codes also tend to be hostile to high-density apartment and condo complexes, which are relatively common in Houston's open market. These provide affordable options to Houstonians when they burn out on their daily commute and are ready to move into the core closer to work. Most cities' zoning codes resist this densification (and zoning changes are political landmines that are fought fiercely by homeowners), which means demand outruns supply and drives up home prices in the core way beyond the reach of the average citizen. Those frustrated employees, in turn, put pressure on their employers to move out to the cheaper suburbs so they can afford to live near work with a reasonable commute, leading to an inexorable hollowing out of the commercial tax base and economic vitality of the inner city.

Let's pause for a moment and be thankful that Houston wisely avoided this fate.

Tuesday, December 27, 2005

Rockets the third most valuable NBA franchise

Forbes most recent issue (Jan 9, 2006 - a tad early, go figure) has the newest estimated valuation rankings for all 30 NBA teams. Even though their win-loss record is not so impressive this year and injuries are multiplying, the Rockets score an impressive third place with a $422 million valuation, although quite a distance behind the #1 NY Knicks ($543m) and #2 LA Lakers ($529m). They are closely followed by the Chicago Bulls, Dallas Mavericks, Detroit Pistons, and Phoenix Suns. Impressive company. Surprisingly, the champion San Antonio Spurs are stuck down at #12.

Other stats of interest: the Rockets valuation grew 14% in one year (more than all but a handful of other franchises), had $141 million in revenue and 25.8 million in income. The average NBA team is worth $326m, increased 9% over the year, had $106m in revenue, and $7.8m in income - so the Rockets are substantially above average. I imagine the credit goes to Yao, T-Mac, and the Toyota Center.

The big losers? The Portland Trailblazers at #29, losing $31.5m last year under the generous charity of ex-Microsoft billionaire Paul Allen, and, as you might guess, the #30 New Orleans Hornets of Oklahoma City.

Interesting factoid: the #20 Toronto Raptors are owned by the Ontario Teachers' Pension Plan. "Now children, don't forget to bring $50 and your parents' permission slip for yet another field trip study of basketball physics. Extra credit for the student wearing the most Raptors' logo'd merchandise that day. And don't forget the parents' day show-and-tell oral reports on the wonderful merits of any product advertised during a Raptors' game..."

Monday, December 26, 2005

Transit safety and county growth

A couple good articles of interest today in the Chronicle.

One is on similar safety problems between Houston and LA for in-street transit, whether light rail or bus rapid transit. It really points out the extreme difficulty making transit work in today's cities: Normal surface-street buses have too many stops and get stuck in traffic, making them too slow. Give bus or light rail a dedicated right-of-way for speed, and safety becomes a problem at intersections, with a lot of pretty nasty collisions with cars. Slow them down for safety, you get back to the same speed problem. Put them in a traffic-separated right-of-way - like an old freight rail line - and all of a sudden they're generally not where anyone wants to go or live, sucking out the ridership that might be generated along a high-density retail and residential street. Put them under ground in a subway or try to elevate them, and the cost skyrockets beyond all reason - $300M up to a cool billion per mile. About the only transit solution that is pretty cost-effective and fast are express buses in HOV or HOT lanes, which are fine for long-distance commuters but don't solve the local short-to-mid-distance transit problem.

The other article regards the H-GAC population growth forecasts for the county and the resulting loss of open space.
Throughout the region, the H-GAC's experts are forecasting a population increase from 5.3 million to 8.8 million by 2035. In Harris County alone, the forecasts predict growth from 3.8 million to 5.8 million residents. All of those people will need schools, office buildings and places to shop. Houses and businesses will spring up on prairies and rice fields.
The Grand Parkway takes a hit later in the article because it can "influence the form and direction of local growth." The implication is that it encourages sprawl, but I would disagree. The sprawl will happen regardless, but there are two alternatives:
  1. Loop freeways that encourage traditional Houston sprawl in roughly concentric circles, staying tighter to the core and helping to keep jobs in the core.
  2. No loop freeways, so the sprawl moves out farther along spoke freeways, with development gaps between the spokes. Think of a starfish shape. This can be seen in metros like Atlanta and DC. People get strung out so far along the freeway spokes that employers feel pressure to move out closer to them. Whatever loop has been built (a single one in Atlanta and DC, for instance), gets completely jammed, so people feel constrained to jobs along whatever spoke they choose to live on. Suburb-to-suburb mobility is extremely limited. Some spokes become "winners" and some become "losers" depending on where people, money, and jobs choose to locate - rather than a more even development that is possible when people can move between the spokes on loop freeways.
As you might be able to tell, I'm partial to option one over option two. That said, I'm sensitive to the need for some denser development and open space/park preservation. From the article:
The hundreds of people who attended the workshops generally expressed support for a linear park system along bayous with no development in flood plains; more "town center" style development with housing close to jobs and shops; and a combination of transportation services to improve mobility and reduce commuting times, said Heidi Sweetnam, executive director of Blueprint Houston.
I think all of those are good ideas, with some caveats. I don't think we can force the denser development if the market doesn't want it - we just need to make sure we get major impediments out of the way. Maybe a few incentives around rail/BRT stops, but I'm wary of zoning or heavy-handed regulations. I think the city is working on a pretty well-balanced plan in this area.

As I've said before and agree with above, the key on transit is reducing commuter total travel times, which express buses can do (and cost effectively), and heavy commuter rail can't.

I think there is a widely acceptable solution on the open space/linear parks/flood plain problem if the right people got together and worked it out. The article mentions that large-scale developers like to include open space in their developments anyway to increase their value. I also think the market may naturally limit building in the worst flood plains just because of prohibitive insurance costs. And the Willow Waterhole project is clearly a shining role model for linear park open space that doubles as floodwater retention. Maybe we need some sort of banking system where a developer buys enough flood retention park land to offset any additional runoff from their development? They could put it within their own development in certain cases, or elsewhere downstream in other cases. More parkland, more floodwater retention, more open space - everybody seems to win at a (hopefully) small additional cost to the developer. I understand systems like this have been developed in other cities, we just need to adapt the best elements of them to Houston and Harris County - and sooner rather than later.

Thursday, December 22, 2005

MLS stadium followup (and name suggestions)

First, a few good name suggestions for the new MLS franchise: Houston Heat, Hurricanes, Drillers (oil & gas play on "drilling" one into the goal), Energy, or Tejanos (playing off the Texans).

OK, now that we got that out of the way, on to serious stuff: I posted last week questioning why Houston needs a new stadium for Major League Soccer. Today the Chronicle pretty much answered the question:

Like other pro-sports franchises, MLS teams demand soccer-specific stadiums because they can control scheduling and negotiate lucrative concessions and parking deals, Luck and Courtemanche said.

A soccer-specific stadium also provides a much better venue to watch MLS games, Luck said.

"Sports are all about atmosphere," he said. "When you put 18,000, 20,000 or 22,000 people in Reliant Stadium, there is no atmosphere. It's like putting six people in a ballroom for dinner."

The MLS regular season runs from April to October.

So they want to cut a deal with HISD or UH to build a joint-use $65-80 million stadium. I've got think there are many, many more important things both those educational institutions could spend that kind of money on. Their existing stadiums aren't extravagant, but I think they adequately meet their needs. And atmosphere? Like heat, humidity, thunderstorms and mosquitos? Has anybody explained to them about Houston summers? Or are they supposed to convince HISD or UH to build yet another domed stadium in Houston?

There was a time when Houston thought at least semi-rationally about stadium investments, like getting the Astrodome to work for both baseball and football and Reliant to work for both football and the rodeo. But now two sports with similar field requirements and complimentary seasons can't share an ultra-modern, air-conditioned, roof-opening, half-billion-dollar stadium because they might have to coordinate home and away games for a couple months? Or they can't get creative about noise, crowd energy, and hiding empty seats? (like the Spurs did with the Alamodome - or see my suggestion in the original post's comments) Or because they can't find an equitable way to share parking and concession revenue? Here's a radical off-the-wall idea: how about whichever team is playing gets the revenues for that game? Is there something I'm missing that makes that inequitable?

What's next? We get a National Hockey League franchise but the Toyota Center just isn't going to cut it? Come'on folks. Just a little practicality and common sense? Please?

New 2005 state population estimates

Some breaking news this morning: We have the Census press release, the AP story, and, of course, the actual populations for each state as of July of this year on the web or in Excel format (so no Katrina displacements in here). Here are the nuggets of interest:
  • Texas grew 1.7% over the last year to 22.86 million, a gain of 388K, which is the second largest numerical gain in the country after Florida at 404K.
  • Texas is growing at almost twice the national rate of 0.9%, which grew the USA to 296.4 million. Looks like we'll pass the 300 million mark by 2007.
  • Texas is still the second largest state behind whoppingly massive California at 36.1 million. We're putting more distance between us and number three, NY, at 19.3 million.
  • Texas was the seventh fastest growing state on a percentage basis behind Nevada, Arizona, Idaho, Florida, Utah, and Georgia.
  • "The five states with the largest numerical growth (Florida, Texas, California, Arizona and Georgia) accounted for more than one-half (52 percent) of the nation’s population growth from 2004 to 2005."
  • "The South recorded both the largest numerical population increase (1.5 million) and the fastest rate of growth (1.4 percent) among regions between 2004 and 2005."
  • "The nation’s 10 most populous states accounted for 54 percent of the nation’s population on July 1, 2005." So the other 40 states are less than half our population. This helps explain why the House and Senate rarely agree, because there is such a substantial distance between the biggest states that dominate the House and the smaller states that own the Senate.
  • "Rhode Island, New York and Massachusetts lost population, as did the District of Columbia." And this is before the NYC transit strike...
Some interesting quotes in the AP article too:
Southern and Western states are growing so much faster than the rest of the country that several are expected to grab House seats from the Northeast and Midwest when Congress is reapportioned in 2010.

Demographers and political analysts project that Texas and Florida could each gain as many as three House seats. Ohio and New York could lose as many as two seats apiece.

Several other states could gain or lose single seats.

"The states in the Midwest are going through a transition," said Ohio GOP Chairman Bob Bennett. "We're going from a heavy manufacturing economic base to a more service-oriented base, and that transition has been very painful."

"But if you ever banned air conditioning," Bennett added, "I think people would flock back."

There's a Midwest economic development strategy for you: link air conditioning to global warming and get it banned. Good luck with that plan.

Continuing on the population power shifts in Congress over the last few decades:

Texas has been a big beneficiary of the shift in political power, making a Supreme Court fight over the boundaries of its congressional districts even more important, said Bruce Buchanan, a political science professor at the University of Texas.

Republicans redrew the boundaries in 2003 after taking control of the state legislature, and then gained six House seats in the 2004 elections. Democrats and minority voting groups sued.

"You nail down Texas and you have a growth engine for your political party," Buchanan said.

Update: Just got an email with a few other stats of interest:

"Texas added 388,000 in the last year, compared to 290,000 in Calif, despite CA's much larger pop (36 v. 23m). This may be the first year since before WW2 that the actual pop growth in TX has been greater than CA (this is speculation at this point).

CA's population increase has been steadily falling. Had been 524,000 in 2000-2001. 2004-5 may be the first year since statehood (1850) that CA pop has grown slower than the national rate (0.8% v 0.9%). Since 2000, TX has added 2.1m, CA 2.3, FL 1.8, GA 0.9 and AZ 0.8."

Wednesday, December 21, 2005

State of Houston's Inner City Economy

Michael Porter, a professor at Harvard Business School famous for his theories on competitive advantage and strategy, is also the Founder and Chairman of the Initiative for a Competitive Inner City. He recently released a presentation on the State of Inner City Economies, based on data from the 100 largest inner cities. They define inner cities as the census tracts with certain high thresholds of poverty. Lots of interesting statistics on employment, incomes, and industry classifications. Here are some Houston related facts-of-interest:
  • We are not among the 25 worst inner cities, which includes such cities as Orlando, NY-Bronx, Miami, San Diego, LA, and Atlanta. The only Texas city in the worst 25 is El Paso at 21.
  • It's interesting to note that, while Houston has a single inner city, they break DFW up into four separate inner cities: Dallas, Ft. Worth, Arlington, and Irving.
  • Looking at job growth from 1995-2003, we averaged around 1% annually in the inner city and ~2.5% annually across our Metropolitan Statistical Area (MSA). This actually makes us the 19th fastest-growing inner city in the country, even with such a relatively low rate (almost half of inner cities lost jobs). Looking at the graph, I'd say we have roughly the same ranking for MSA job growth, which puts us solidly in the top 20% of cities with fastest job growth.
  • Jersey City and Long Beach were the top two barn-burners of inner city growth at around 3.7%. I'm guessing it's the growth of their very large shipping ports because of increasing globalization, which I'm sure also helped Houston's inner city job growth.
  • Only five cities had healthier inner city and MSA job growth than Houston: Seattle, Charlotte, Sacramento, San Bernadino, and Stockton, CA.
  • Austin and Las Vegas are real outliers, with extremely high 5% annual MSA job growth, but -1% annual job loss in their inner cities. Surprisingly, this gives Austin the weakest inner city in Texas after Arlington. I think that might be related to the .com crash.
  • Houston had higher than average inner city average wage and wage growth.
  • It looks like our higher average inner city wage, and, to a lesser extent, our higher inner city wage growth rate, are driven by scoring high on "Traded Cluster Share of Inner City Employment" - which means that we have a lot of jobs that export products and services outside the city, rather than just serving local residents (particularly in energy, of course). Tourism is one obvious exception to this correlation, which is a traded cluster but has relatively low wages, with their examples of Anaheim, New Orleans, Orlando, and Las Vegas.
So the net is that Houston is doing pretty well all-around, in both the inner city and the metro area. Overall, the presentation is interesting for its data, but a little light on causes-and-effects and recommendations. I'll have to keep an eye on Porter and the ICIC to see if they tie this data to policy recommendations in the future.

Tuesday, December 20, 2005

A NOLA evacuee thanks Houston

OK, this is going to be a little self-congratulatory, but, well, so be it. This Chronicle op-ed letter from Sunday really touched me, and I wanted to pass it along.

So many to thank

Thank you, Houston! We arrived here four months ago knowing virtually no one. Now we have re-established family ties, rediscovered a religious community and are blessed to forge new friendships that will last a lifetime. Houston's generosity and warmth were constantly on display — from your city government and civic institutions to businesses and individual citizens.

Thanks to the company that gave us so much help as we set up temporary offices with them. Thanks to the technology firm that stayed with us until we were up and running. Thanks to the family who adopted us on the very first day and never let us go and to the one who invited us to dinner our first weekend here and many after that.

Thanks to those who welcomed us into their homes for the holidays and treated our children as their own. Thanks to the many who lent us furniture, gave us guidance, befriended us with introductions and made us feel so welcome.

Thanks to the Jewish community here that made us feel as though we had lived here for decades. Thanks to our cousins and other new-found family members for bridging the gap. And to the total strangers who took the time to give us a kind word, including one heartwarming note left on the car's windshield just because we had a Louisiana license plate!

Thanks to an Episcopal church that housed a New Orleans school. Thanks to a Jewish school in Houston that took in New Orleans' students. You all are truly blessed.

Our experience was not unique. All over this city, New Orleanians of all walks of life have been taken in, housed, helped and guided by kind Houstonians. We've gone back home to New Orleans, and we hope we can take a little bit of Houston back with us: your big-heartedness and can-do spirit and your generosity.

ROBERT M. STEEG, New Orleans, La.

Keep up the spirit, Houston: Open City, USA.

Monday, December 19, 2005

Joel Kotkin on "The Ideological Hurricane" and Houston

Based in part on interviews conducted on a recent trip to Houston, noted urbanist Joel Kotkin has written a fascinating piece in The American Enterprise titled "Ideological Hurricane", with a sidebar column comparing Houston to New Orleans called "A Tale of Two Cities" (look for it at the bottom). It puts the New Orleans Katrina disaster in a larger historical context of urban politics and economic opportunity, including race and immigration, and makes a strong indictment of urban welfare-state policies. It includes references to and quotes from such Houston notables as former mayor Bob Lanier, current mayor Bill White, pastor Ed Young, and Metro Chairman and local developer David Wolff, as well as the inspiring story of local Nigerian entrepreneur Bobmanuel.

Excerpting this article is really difficult, because my normal standard of what is "excerpt worthy" would end up quoting far more than half the article. So here's my suggestion if you're not willing to read all nine pages, but want the Houston-related highlights: go to the page, then use the "Find in this page" option in your browser's Edit menu to search on the word "Houston". Read those sentences while using "Find Next" to move through the article. When you get to the "Tale of Two Cities" section at the bottom, read the whole thing (only a couple of pages) because it is pretty much all about Houston.

That should cover just about everything I wanted to excerpt except for these few concluding paragraphs:
The result of these unfortunate political decisions [urban welfare state and creative class policies] was to leave many urban cores with nothing but some often largely vacant office towers, Potemkin tourist districts, lousy public schools, ineffective police departments, and blocks of decrepit neighborhoods where residents are more dependent on government checks or jobs, or criminal activity, than on paid employment. The results of this decoupling of cities from the global economy has been all too evident. Wealthy elites who own or patronize restaurants, high-end hotels, loft developments, and cultural institutions have done fine. Younger, single, and gay residents of cities have enjoyed themselves. But for working- and middle-class families with children, cities have become hostile environments.
Today, most central cities feature horrific educational deficiences, crumbling infrastructure, and stultifying regulations that drive commerce ever more into the suburban periphery. Yet most city leaders—not to mention productive citizens in the rest of the nation—avert their eyes from these problems until a trauma like Katrina forces the products of our urban maladministration into view. Rather than re-examine their bankrupt social and economic premises, urban elites prefer to channel money into sports stadia and convention centers, hip lofts and restaurants, hoping somehow this will suck talent and wealth into their cities. As if today’s urban underclass will just fade away, and leave the cool hipsters unbothered to enjoy their entertainment districts.

This collapse of responsibility and discipline goes against the entire grain of urban history. From republican Rome to the golden ages of Venice, Amsterdam, London, and New York, cities have flourished most when they have served as places of aspiration and upward mobility, of hard work and individual accountability. By becoming mass dispensers of welfare for the unskilled, playpens for the well-heeled and fashionable, easy marks for special interests, and bunglers at maintaining public safety and dispensing efficient services to residents and businesses, many cities have become useless to the middle class, and toxic for the disorganized poor. Today’s liberal urban leadership across America needs to see the New Orleans storm not as just a tragedy, but also as a dispeller of illusions, a revealer of awful truths, and a potential harbinger of things to come in their own backyards.

Look beyond the tourist districts. Few contemporary cities are actually healthy in terms of job growth or middle-class amenities. Most are in the grips of moral and economic crisis.

If we are lucky, the flood waters of Katrina will wash away some of the ’60s-era illusions that fed today’s dysfunction. Honest observers will recognize that this natural disaster, which hit the nation so hard, was set up by the man-made disaster of a counterproductive welfare state.

More likely, many metro elites will continue to resist dramatic reforms like reining in civil service bloat, providing tax and regulatory relief for small businesses, or promoting family and moral revival. Even as they invoke the great mayors of the past, they will eschew a renewed focus on true progressive values of better and more accountable schools, good roads, and jobs that provide upward mobility.

Instead, our urban leaders and their enablers—from rich developers to social agitators—will insist their old strategies are working. The media will likely echo their press releases. This will work only until our cities crumble under pressure, as in New Orleans, explode from within, like Paris, or simply become irrelevant anachronisms at the margins of modern society.

Sunday, December 18, 2005

NYT: 36 hours in Houston

The New York Times focused last week's "36 hours in..." column to Houston. It's always interesting to see how outsiders perceive the city. In this case, pretty darn favorably (for a nice change of pace).
THAT'S right - you're not from Texas. It's O.K. According to Lyle Lovett, Texas wants you anyway. On the other hand, however, there's long been little love returned for Houston, the state's biggest city and the nation's fourth largest. Houston doesn't have a clear-cut positive reputation, like Austin (the laid-back slacker capital), or even a good nickname, like Dallas (Big D). As far as most of the country is concerned, it's got Enron and robber baron oilmen and heavy people, all in a climate requiring enough air-conditioning to power a rocket ship to Neptune. But Houston also has extraordinary museums, an innovative alternative arts and hip-hop scene, a rapidly growing cache of upscale hotels and haute cuisine and the neighborliness to take in tens of thousands of people displaced by Hurricane Katrina. And, of course, it has rocket ships; that is, NASA's Johnson Space Center. In the end, maybe that's what makes Houston such an unusual and wonderful place - there are so many different Houstons to see.
Wow, too bad we don't have "a clear-cut positive reputation" like "Slacker Capital", huh? I'm sure employers are flocking to Austin based on that one. "Smithers, we need to build a new office/factory. What cities have a plentiful supply of slackers?"

I found this part particularly funny:
If for no other reason, go to Space Center Houston, about 25 miles south of downtown, just so at the slightest provocation - for instance, if you get lost on the way - you can say, "Houston, we have a problem." Repeat this until spouse or traveling companion begins to hit.
Now you know why so many cars are weaving on 45 South.

You can see an overview of their trip in the map below. I'm betting that 'Space Center' icon was custom to this article and probably won't get too much reuse in other columns.
(thanks to RJ for the pointer)

Friday, December 16, 2005

MLS needs a new stadium?

First off, I think it's great that we just got a major league soccer franchise from San Jose. And I'm curious to hear new name suggestions in the comments. But can someone explain to me why they need a new stadium for a summer-season sport when we have two fully-air-conditioned, domed stadiums available - both of which are empty in the summer and one of which is empty year-round? (the Astrodome)

I seem to remember somewhere in the hype around Reliant Stadium when it was built that it was designed to handle an MLS franchise too if the time came. Well, it's come. What's up? Is this just a matter of strong-arming McNair to give some concession and parking revenue rights to the MLS team? (or heck, just become the local owner they're looking for) Whatever it is, it's got to be cheaper than building a new stadium. (or, worst case, making a few modifications to the Astrodome)

Comments are welcome, but I'd really like to see this fully explored by some in-depth investigative reporting in the Houston Chronicle. (and not just by the sports writers, who always want a new stadium)

(update: see comments below, and Metroblogging Houston has some stadium analysis)

Thursday, December 15, 2005

Thinking about Metro's HOV lane conversions

Lost in the debate about Metro's rail plans has been their plan to convert the HOV lane network to a congestion-priced High-Occupancy Toll (HOT) lane network, where any vehicle can enter the lane that's willing to pay the price. The price is adjusted - either on a fixed schedule or in real-time - to keep the lane(s) free flowing. As regular readers of my blog know, I'm a huge supporter of this concept: MaX Lanes - Managed eXpress lanes that move the maximum number of vehicles at maximum speed.

The 4-managed lanes under construction down the middle of the new Katy freeway are getting national attention for the pioneering agreement between Metro, HCTRA, and TXDoT to reserve guaranteed capacity in the lanes for buses - up to 25%. Bob Poole at Reason calls these "Virtual Exclusive Busways" (VEBs), which pretty much exactly describes what they do: guarantee free-flowing lane capacity for buses or other transit vehicles, while using the rest of the capacity for cars, so no capacity goes to waste. The description of their VEB study is here, and the full pdf is here, with an appendix dedicated to the Houston case study, including the full text of the memo of understanding between the three agencies.
The Katy reconstruction, with the four new managed lanes, is under way as of this writing. Thus, Houston will be the nation's first metro area to implement a Virtual Exclusive Busway.
As part of this conversion, Metro is looking at the possibility of converting single-lane reversible HOV lanes to two lanes of bi-directional HOT lanes (probably not barrier separated from the same-direction free lanes). This will give them a managed lane network in all directions all day long. The Katy Freeway is obviously a perfect example, with the Energy Corridor and Westchase jobs creating strong flows (and congestion) both directions all day long.

But I hope Metro thinks carefully before jumping to this model for all our spoke freeways. Many of them have strong single-direction flows: inbound in the mornings, and outbound in the evenings. Contra-flow buses are not going to have any speed problems, even in the normal free lanes. And, of course, how many people will be willing to pay to be in the managed lane(s) when the free lanes are freeflowing?

Instead, they may be more useful and bring in significantly higher revenue if they are configured as two or more single-direction reversible lanes, where capacity is maximized in the congested direction and people are willing to pay to get out of it. So, for example, 290 or 45 might have 3 or 4 free plus 2 or more managed lanes of capacity in the congested direction at rush hour, while the contra-flow direction would make do with just the 3 or 4 free lanes. It does keep some of the complexity of reversible lanes, but the reduction in wasted contra-flow capacity and the gain in in-demand capacity would be well worth it. And it would be safer, since it would keep the barrier separation from the slower congested traffic. Finally, it would help keep employers in a healthy core (downtown in particular) rather than the far suburbs, since the capacity will be focused that direction.

Wednesday, December 14, 2005

Icon for Houston?

Brian Shelly recently made this request in the comments of another post:
Not to sidetrack this thread, but could I make a request to have a discussion or brainstorming session on building some sort of Icon for Houston, a la Golden Gate Bridge, Statue of Liberty, etc...? (Preferably privately financed, of course :) )

Also, does anyone know anything new about the Houston Pavilions project?
Here's the Houston Pavilions site, and here's a discussion of it. I don't know much other than what I've seen in the Chronicle about it. They did get the tax breaks and nearby city infrastructure investments they requested.

Believe it or not, I've done some thinking on a monument/icon for Houston. One idea I haven't fleshed out much would be a giant version of the 3D Lone Star on top of the San Jacinto monument - like a building or enclosed space. It could certainly make for an iconic building if it could be built. Ideally it would look like a 5-pointed star both from on the ground and in the air, which I don't believe this one does (it only has four sides, so the top view must be only a four-pointed star).

The other idea I have would similar in concept to the Eiffel Tower, but instead a composite-material latticework structure of the four legs of a giant pyramid over downtown, with no center support. It potentially could be the tallest freestanding structure in the world (CN Tower in Toronto would be the competitor). The legs would have to be assembled on the ground along two crossing streets (looking like a gigantic plus + sign from the air), and then raised into the pyramid configuration. The legs might hold a ski-lift-type transport that could take people up or down any leg to zip around downtown with a very cool view along the way. And the top point of the pyramid would hold not only an observation deck, but also a high-dollar restaurant and events facility (weddings, corporate parties, etc.) with the perfect name: "The Top of Texas". Based on the fees CN Tower charge and the revenues they make, it's possible the venture could be self-funding and possibly even wildly profitable. I saw a PBS special on the Eiffel Tower last night: it paid for itself within just a few years of construction and everything after that made Eiffel a very wealthy man.

So those are my two ideas. Additional concepts are welcome in the comments.

Tuesday, December 13, 2005

Google Transit Trip Planner

Check it out. Pretty slick. Only available for Portland right now, but they're taking requests (Metro: see FAQ question #4). Gives directions, schedule, estimated total and walking times, and compares the cost to driving based on the IRS official rate of of 48.5 cents/mile.

Monday, December 12, 2005

LA transit lessons for Houston?

From Peter Gordon, an urban planning and economics professor at USC (a.k.a. soon-to-be-losers of the 2006 National Championship Rose Bowl).
L.A. county now has five recently-completed fixed guideway lines in operation. They include a $4.7 billion subway that carries slightly over 115,000 riders each day, three light-rail lines that cost almost $1-billion each just to build and between them serve 125,000 riders per day, and a recently opened busway that cost upwards of $350-million to build and carries approximately 10,600 riders per day.

These are all pathetically low numbers. The county's population is 10-million and the average person takes about four trips per day

My students and I recently applied a standard cost-benefit template to the five projects mentioned and found that, all things considered -- including generous assumptions about auto trips diverted and externality costs avoided, these five lines have a net cost to society of $560 million per year.

It takes a court order (and a lawsuit by the NCAAP and a group called the Bus Riders Union) to tell the MTA to add express bus service.

Tom Rubin reports that all of the MTAs routes could now be served by express buses -- had the money not been wasted on rail.

And what do local planners and politicians want to keep on doing? You guessed it.
LA has perfect pedestrian/transit weather and more than twice the population density of Houston, yet can't make rail get even close to fiscal rationality. How are we going to?

Well, we're going to try by spending a whole lot less than LA - only around $2B, half from the Feds - so I guess that helps limit the potential downside. And we are doing quite a bit of rapid bus service, which is certainly more cost effective than rail. But I hope somebody at Metro is giving these numbers from other cities a really hard look to make sure we're not making the same mistakes, especially when it comes to the heavy rail commuter lines. And if that involves getting our Congressional delegation to beat up on the Federal Transit Authority bureaucracy to approve and fund more flexible and cost-effective options, then so be it (somebody at the Urban Land Institute conference in The Woodlands today told me the FTA can't handle modeling and funding of more flexible bus-based rapid transit systems).

(thanks to Out of Control for the tip)

Sunday, December 11, 2005

Sprawl and social mobility

OK, this is going to be the fourth time I post on the "Sprawl: A Compact History" book by Robert Bruegmann. I'll try not to cover anything in the earlier posts, but there are some excerpts I wanted to pass along, and both articles mention Houston several times.

First up is a book review by Joel Kotkin in the Wall Street Journal.

No, Mr. Bruegmann says, don't go blaming the Federal Highway Administration for sprawl or the executives at General Motors and Exxon or racist developers fleeing urban environments. Don't even blame Karl Rove. You really don't need to blame anyone. Mr. Bruegmann notes that contemporary sprawl -- best defined by places like Los Angeles, Phoenix and Houston -- is nothing new. It represents "merely the latest chapter in a long and curious history."

What propels that curious history is something often overlooked by the makers of grand theories -- the particular choices of individual human beings. Mr. Bruegmann places the urge to sprawl squarely where it belongs: on people's logical desire to escape the high costs, crime, pollution, congestion and lack of privacy that accompanies life in dense cities. [and I would add bad schools to that list]

As powerful as sprawl logic may be, the traditional city is far from dead. Mr. Bruegmann, a longtime Chicago resident and a professor at the University of Illinois campus there, is particularly bullish on amenity-rich older cities -- New York, Boston, Seattle and Portland, as well as Chicago. They can lay claim to a promising demographic niche among the nomadic rich, the young and those who cater to their needs.

Yet Mr. Bruegmann understands that the future of urbanity will likely be shaped not in these adult Disneylands but in the peripheries to which families, jobs and industries are now fleeing. Such flight should not be a cause for despair among those who love cities. Suburban communities are not frozen in their current form; many are busily developing their own core districts, cultural facilities and particular identities.

Urbanists interested in the future need to pay more attention and give more respect to such places. Mr. Bruegmann has told us why they grow and will continue to do so. The next step is figuring out how to make them work better.

Next, from the Architecture section of the LA Times:
One of his most shocking assertions is that suburban spread helps cities and their urban centers: Look at the way immigrants and the poor moved out of Lower Manhattan, for instance, only to have the area later reborn as a chic living space for artists and young people. It wouldn't have happened, he argues, if the highways and houses beyond the city center hadn't siphoned off population, allowing these neighborhoods to be reborn.

Even fans of Bruegmann's book blanched at this notion.

"It's certainly true that deindustrialization of any downtown presents some opportunities," author and journalist Alan Ehrenhalt wrote in an approving review in the trade magazine Governing. "But for every inner-city district that has emptied out and retooled, many more have been emptied out and are waiting desperately for the revival to begin. Abandonment is an awfully high price for the chance to start over. I wouldn't expect the leadership of Detroit or St. Louis to find Bruegmann's long view of urban history very consoling."

But Bruegmann points at downtown L.A., where he sees this process, despite some rough years, bearing fruit.He has some emotional sympathy with anti-sprawl critics, just as he does with environmentalists. But he thinks both groups are a little shortsighted when it comes to the real costs of their programs.

"By trying to stop sprawl, you'll be doing something very beneficial to the incumbents' club," he says. "It stops change and makes it harder for people to get onto the middle-class ladder. It has a definite effect on social and economic mobility."

Sprawl may not be inevitable, but it is, he says, "completely essential" to the functioning of a free society. "It goes absolutely to the heart of people's aspirations — what it is they want to be, of how they want to live," Bruegmann says. "And tampering with that is very, very fraught."
That link between sprawl and social and economic mobility would go a long way towards explaining the population booms in sprawling cities like Phoenix, DFW, Houston, and Atlanta: people seek out opportunity, and it is generally found in more sprawling areas where housing supply meets demand and keeps things affordable.

Thursday, December 08, 2005

Last-minute invitation

I'm giving a talk to the Houston Property Rights Association during lunch this Friday titled "Taking Houston from Good to Great: Applying lessons from a business bestseller." The talk will include a discussion of what makes Houston distinctive, a key economic metric for Houston, and a proposed identity for our city. The public is welcome to attend.

Here's their announcement:
Moving from good to better...maybe best!

This Friday (12/9) Houston businessman and blogger Tory Gattis will present his conclusions on Houston as a good city with prospects of becoming a great one. Tory operates a web software firm and runs the web-log which dwells on improving Houston. He is currently working with the TSU School of Public Affairs on a study of Houston as an “engine of social mobility.”

PUBLIC INVITED: $12. Courtyard restaurant; 1885 St. James Place —Friday noon, December 9, 2005

(directions: The Courtyard is south of San Felipe, west of Yorktown, and east of Chimney Rock)
Hope to see you there.

Wednesday, December 07, 2005

Houston profile

This week a friend pointed me to a site that simply compiles information on various cities, including Houston. I'm not going to list everything they have here - browse the page if you want to see the whole array of stats.

The income and home value graphs are interesting with the expected "long tails." I think the year-round weather graphs are my favorite: temp, rain, humidity, wind speed, sunshine, cloudy days, and, my personal favorite, snowfall - where looking at the national average and range makes you very happy to live here. As you might expect, our average temps, rain, and humidity are higher than the national average, our wind speed is below average (a major factor in our air pollution, I'm sure), and our sunshine is just about average.

My least favorite part is the very scary looking EPA "Enviromap" of pollution.

Most surprising fact: we have 25 over-the-air TV stations? Can people actually pick up that many? I've had cable as long as I can remember, so I had no idea.

If you have any nice pictures of Houston, they take uploads.

Tuesday, December 06, 2005

Houston parallels to Atlanta's sprawl debate

Houston and Atlanta are very similar cities in a lot of ways: fast-growing, modern, sprawling, car-based, southern cities of roughly the same size with few geographic barriers to growth. So you could replace the word "Atlanta" with "Houston" in a set of recent Atlanta Journal Constitution (AJC) articles on sprawl and have the points pretty much hold up the same as they do in Atlanta. It starts with a sprawl-defending Q&A interview with author Robert Bruegmann of "Sprawl: A Compact History." I've covered him plenty here before, so I'll just jump straight to his Houston comment:
Downtown Atlanta is a really good case. My impression is that it has been on the verge of gentrification for a long time, but it just keeps sputtering. There's never been enough critical mass, and there've been too many attractive alternatives, particularly to the north, so downtown has not quite started its revival of a residential district. But if it follows in the path of virtually all the other cities that are comparable, it will. You'll start seeing an awful lot of people wanting to live downtown in high-density districts.

With its Midtown phenomenon Atlanta follows the model of Houston. Midtown became a second downtown and in many ways eclipsed the original downtown. Eventually these old downtowns find a niche. As in Manhattan, which I think could very easily become a high-end cultural and residential resort area, rather than a business center. That may in fact by the fate of downtown Houston and downtown Atlanta somewhere down the road.
Sound like our downtowns are in similar situations? I think when he says Midtown Houston, he means Uptown/Galleria-area Houston. Midtown Houston has in no way eclipsed the original downtown. Uptown has in some ways, although I think downtown has made quite a comback in the last decade. But Uptown seems to have more residential momentum than downtown with all the existing and under-construction condo towers.

The whole thing is worth reading if you have the time.

AJC then follows with pro and con sprawl op-eds by their own editors. Len does a good job deconstructing the con case with a Houston spin at Out of Control, so I'm not going to go into it here. I think the title of the con is not very accurate, "Free market would never pick sprawl". It's an ongoing debate whether we have a true free market going on in Houston or elsewhere. Does Houston have regs that force sprawl? (to be discussed in a future post) Do we have govt subsidies that encourage it? My personal belief is that it is the natural inclination of people: rising affluence seeks more private space. But I do agree with con op-ed that natural density would be higher without a lot of zoning and permitting regs. Relatively unregulated Houston has shown an inclination towards more density than regulated Atlanta, which has about 2/3 of Houston's density. Houston allows more apartment complexes and townhome densification.

After discussing the acrimony in the sprawl vs. smart growth debate, there's an excerpt I like from the pro op-ed:

As it [sprawl] has evolved in metro Atlanta, it is not, then, the consequence of white flight, nor is it evidence of a social malady. It is, quite simply, a lifestyle option that allows poor people to have the quality of life that once was exclusive to the well-to-do. Outward development offers people something they prize: "privacy, mobility and choice," as Bruegmann explains it.

"By privacy I mean the ability to control your own environment, and one of the ways you can do that relatively easily is if you have your own plot of land and your own house.

"By mobility, I mean physical mobility and also social and economic mobility.

"And choice — that means you can do a lot of different things."


As for metro Atlanta, discussions about how to handle the inevitable growth — inevitable unless we actively conspire to create a high-tax, anti-development regulatory environment (Portland, Ore., is the oft-cited poster community for this) — could proceed if we left some of the baggage at the door.

Skycaps at the next Envision Houston meetings, anyone?

Monday, December 05, 2005

Disposable architecture

I wanted to respond to this op-ed letter in the Sunday Chronicle:
Our disposable architecture

REGARDING the Chronicle's Nov. 30 article "ARCHITECTURE / Why the buildings of our lifetime won't last long enough for our grandkids to see them," which told about the closing of the Masterson YWCA: This facility is a high-visibility example of the emphasis on aesthetics, and demonstrates the lack of concern about trends in construction quality. Unfortunately, this is only a very small tip of a very large iceberg.

The boom taking place in new, close-in, multifamily housing that is revitalizing central Houston is almost guaranteed to show the same symptoms in the not far-distant future, but on a much more massive scale.

Current building codes are simply not adequate to prevent shoddy construction; this is going to lead to high maintenance costs and rapid decay of an enormous number of structures. To see what will be coming, visit the areas south of U.S. 59 along Chimney Rock. Twenty years ago, the parking lots of these apartment complexes were filled with the BMW's and Corvettes of the yuppies who came to Houston for the oil boom. Today, those same complexes are showing up on the nightly news as the site of many of Houston's murders. Ironically, the warehouses near downtown that were built when substantial construction was emphasized are now being converted into high-value residences. (Their underlying structures are sound.)

This is also happening in many cities around the world: brownstones in New York, older homes in Georgetown, homes north of the Boston Common and along Houston's North and South boulevards — all of these are examples of how well-built housing maintains its value to the community in more than just its tax base.

I'd like to see the trend toward disposable architecture reversed, but the public and city officials don't seem to be aware of the problems, so the problems are likely to get much worse before they get better.


I've heard this mentioned before. Basically, "we don't build 'em like we used to." Commercial developers are also looking for ever-shorter payback periods to reduce risk and increase returns, so they don't really build-to-last either. The question is: Are we sure this is a bad thing?

Obviously, if you buy a townhome that turns out to be poorly constructed with maintenance nightmares after not-too-many-years, that's certainly a bad situation. We do need some minimal building codes with good enforcement. But if we raise building standards too high, then costs get out of control, affordability drops, and then stuff doesn't get built at all. There is clearly a cost vs. quality tradeoff, and hopefully your building inspector helps you get a feel for the value of what you're buying. Are we better off in a city with a lot of expensive "built-to-last" structures that are renovated for new uses? Or with cheaper structures that just get torn down and replaced every so often? I think an argument can be made for the latter.

Demand for different types of structures shifts over time. What's in and out of style is constantly shifting. And technology is changing society at ever faster rates. Does it make sense to invest in a structure that will last 50, 100, or more years and then try to continuously re-adapt it as needed? It actually may be more efficient to build a cheaper, less lasting structure with the expectation of tearing it down in a decade or two and replacing it with whatever is in demand then. This has certainly been the trend in all sorts of consumer products, where it often makes more sense to throw-away and replace rather than repair (well, hopefully recycle and replace).

The downside is we never develop the old, historical character like European cities. But it is very, very expensive to keep re-adapting ancient buildings vs. tear-down and replace. I'm in no way advocating tear-down-and-replace for older cities - they would lose a lot of their great character. But in a newer, more modern city like Houston, does it make any sense to try to go down that road?

Certainly there is a renaissance happening in some older city cores with old structures being renovated into hip lofts (inc. parts of Houston). But I would argue for every one of those buildings, there are at least ten decrepit ones in a lot of older cities, esp. in the Rust Belt. I remember driving through Philly once seeing mile after mile of run-down brownstones. Maybe these older cities would be in better shape today if they had had cheaper building stock that was more easily replaced (I'm not talking about land value, but the cost of constructing the structure). Of course, one of the key drivers of sprawl is people looking for bigger, cheaper, newer housing. If core housing was more disposable, maybe more renewal would be happening in the core? As it currently is, land values have to get pretty high before it makes economic sense to tear-down and replace, like is happening in West U, Bellaire, and some other inside-the-loop areas.

Also keep in mind that older housing stock is our largest source of affordable housing. It's really hard to build new affordable housing. But there's plenty of 20, 30, and 40-year old affordable stuff out there. The natural cycle is that offices, apartments, and houses are built new for the high-end, then slowly decay to mid-level, and eventually become cheap space, until it finally gets torn down. Even Jane Jacobs noted this way back in the 50s in her call for diverse building ages to get vibrant neighborhoods (a lot of smaller businesses can't afford the newer stuff). Might we be better off if cheaper construction let us accelerate this cycle? Build it cheap, get your fast payback, and then replace it with something newer, more fashionable, and more in-tune with the market demands of that time (maybe even New Urbanism?).

I'm not advocating shoddy work. Just saying there is a value-point, where quality and cost are in balance, and that the optimal point might be cheaper and lower quality than you think - at least from a city perspective. As a buyer, well, be sure to question your building inspector very carefully...

Sunday, December 04, 2005

Houston's social capital

Through the generosity of the Education Foundation of Harris County, I was lucky enough to get to attend a fascintating luncheon lecture last week by Dr. Robert Putnam of Harvard University. His expertise is the decline of social capital in America. If you go beyond the physical, financial, and human capital (education and skills) of the nation, you get social capital, which is our network of relationships and connections. As a matter of fact, he pointed out an interesting study showing that our personal social capital - basically our address book - is worth more in dollar terms than our educational degrees over the course of our lifetime.

Unfortunately, he shows a whole range of statistics that indicate our stock of social capital has dropped by about half since its peak in the early 1960s. We don't join clubs, participate in civic organizations, eat dinners as a family, or entertain friends (among other measures) nearly as much as we used to. From the web site for his book, "Bowling Alone: The Collapse and Revival of American Community":
Putnam warns that our stock of social capital - the very fabric of our connections with each other, has plummeted, impoverishing our lives and communities. Putnam draws on evidence including nearly 500,000 interviews over the last quarter century to show that we sign fewer petitions, belong to fewer organizations that meet, know our neighbors less, meet with friends less frequently, and even socialize with our families less often. We're even bowling alone. More Americans are bowling than ever before, but they are not bowling in leagues. Putnam shows how changes in work, family structure, age, suburban life, television, computers, women's roles and other factors have contributed to this decline.
I also like some of the surprising facts from his site:
  • Joining one group cuts in half your odds of dying next year (in the lecture, he mentioned that joining two groups cuts it by 75%)
  • Ten minutes of commuting reduces social capital by 10%
Now, where it gets locally interesting is that he was in town to get a better understanding of how our Hurricane Katrina response is related to Houston's social capital. Are we higher than other cities? I tend to think so, but I'll admit it's a biased and subjective opinion. I have a few hypotheses why:
  1. We have a more unified metro area than many other large metros, as discussed before in this blog, due to geography, annexation, and mobility investments that keep people involved in the core (and its civic organizations) rather than fully detaching to the suburbs.
  2. With the lowest cost of living of any major metro, we eat out more (usually a social activity, and we're a great town for it) and we have less financial stress, so we volunteer more and support local charities and civic organizations. If you're struggling to make your house payment every month, you probably don't have a lot of spare time to reach out and help others.
  3. Broadening that thinking a bit further: in general, social activity costs some money (although it doesn't have to, it usually does). If you're feeling poor, then staying home alone and watching TV seems like a nice, affordable option. But, if you feel like you have a comfortable level of disposable income, you're more likely to head out to social events.
  4. More affordable homeownership means stronger communities.
  5. High investments in mobility - esp. freeways - means fewer people have to move neighborhoods to switch jobs and keep a reasonable commute.
  6. We have a culture that is welcoming to newcomers. I don't know exactly how our hospitality culture developed, but it certainly helps integrate newcomers into our social fabric.
  7. Our low population density. When you're around crowds all day long - as people are in most high-density, pedestrian and transit-oriented cities - you may not be real eager to be around more people during your free time in the evenings and weekends. Witness the infamous surliness of New Yorkers. People don't smile at each other on the sidewalk like they do here. And walking with a crowd on the sidewalk or packed in subway car may be a group activity, but it's usually not a social one. Spend a lot of time alone in a car and an office, and you're more eager for human companionship during your free time.
  8. A more stable population. Houston is definitely growing fast, but we also tend to hold onto our natives. Surveys show pretty high local loyalty and satisfaction among Houstonians. Moving breaks relationships and reduces social capital. I think some other cities tend to have a more ephemeral population that moves in and out over time: NY, LA, SF, DC, etc.
  9. A more balanced, minimialist government. I'm probably going out on a controversial limb here, but from what I've read about Europe and elsewhere, when you have a large welfare state, citizens' attitude about problems subtly shifts towards "I don't need to donate or volunteer with a civic organization, the government will take care of it." As pointed out in an earlier post, Houston is more middle-of-the-road politically vs. most other large cities, which tend to be strongly left-leaning. And of course, Texas is a pretty right-leaning state overall. When you know the government's not going to step in, I think you feel a stronger pull to support private charitable, church, or civic organizations to improve things. Houston and Texas may not have much in the way of a public safety net, but I think most people would agree we have a very robust set of private nonprofit institutions.
Well, I'd like to make it an even ten, but I'm tapped. Suggestions welcome in the comments.

Thursday, December 01, 2005

Downtown Dallas' residential revival, and how it compares to Houston

The Wall Street Journal ran a page one story on Monday on Dallas' attempts to bring more residents downtown (the link should work for nonsubscribers until Dec 4th or so). They have substories about some individual families and developers, but here are the "big picture" excerpts:
Beset with one of the nation's most forlorn downtowns, Dallas is seeking salvation in a radical cure: a plan to convert most of the glass-and-steel business district into an upscale residential neighborhood.

Lots of cities are trying to piggyback on the nation's new taste for condominiums and urban living. Atlanta, Denver, Los Angeles and others have encouraged developers to recycle old downtown buildings into chic residences while continuing to promote themselves as prime office locations. These areas mainly draw childless couples, couples with grown children, gays and wealthy, single professionals. But no city comes close to Dallas in residential zeal. Dallas, a city of 1.2 million, has given out some $160 million in grants and tax abatements with the goal of creating a residential haven for those seeking to escape the hundreds of square miles of sprawl that surround it.

The city's goal is to attract a critical mass of 10,000 downtown residences, which its consultants say will be sufficient to reel in a stable, tax-paying base of neighborhood boutiques and restaurants, ultimately launching a self-propelling economy. The plans don't call for swallowing up downtown's best office towers. But planners hope these buildings, which are still largely filled with office workers, will become islands in a sea of lofts, condominiums, apartments and shops.

Across the country, Americans are embracing urban living, particularly in places where they can live, work and shop all within a few city blocks. Many seek urban excitement in projects that promise clean streets and protection from urban crime. So-called mixed-use development is all the rage. According to real-estate research firms Property & Portfolio Research and Reed Construction Data, 21.6% of all new construction this year will be mixed use, compared with 17.5% in 2002.

One of Dallas's biggest challenges is competition. Just across a freeway from downtown, Ross Perot Jr., son of the computer entrepreneur and former presidential candidate, is building Victory, a $1 billion project of upscale condominiums, apartments and hotels. Even 40 miles up the road, developers are expanding Legacy Town Center, a successful urban project with $300,000 duplexes in the suburb of Plano. Both those rivals are also using the same strategy as Dallas -- set themselves apart by attracting unique shops selling brands and products unavailable almost anywhere else in the region.

If Dallas's gambit fails, its downtown may be consigned to long-term blight, as city residents, already saddled with debt for the current set of incentives, may be reluctant to take on more taxes to try anew. Instead, developers, retailers and homebuyers may turn even more aggressively to Dallas's outlying areas.

Today, the streets of Dallas's 1.3-square-mile downtown are largely deserted apart from homeless people toting backpacks and commuters darting between their cars and their offices. There are almost no stores, and some 20 vacant high-rises. About 160 acres of surface parking lots sit across downtown, many of them covering the ground where buildings once stood.

Signs of an apparent reawakening have buoyed downtown advocates. Cranes carrying out residential conversions dot the skyline. Hard-hatted construction crews interfere with foot and vehicle traffic on almost every street. Developers lured by grants, free rent and long tax holidays have already carved some 2,400 mostly upscale apartments, lofts and condominiums from old downtown offices and hotels, and another 2,040 or so are on the drawing board. Many of the converted buildings are almost full, and sales and rentals are brisk in many of the unfinished towers.

"It's not department stores and big office buildings so much as it is people magnets, walkability, density and diversity that will bring downtown Dallas back," says William Hudnut, an authority on municipal revitalization at the Washington-based Urban Land Institute.

Dallas faces competition from developers who have long been creating a cleaner, more convenient downtown experience throughout Dallas's suburbs. Plano's Legacy Town Center, for example, offers plums that were previously the sole preserve of big cities, such as a walking promenade, ritzy restaurants, cool boutiques and a busy nightlife. Farther north on the very fringes of the Dallas suburbs, the town of Frisco is doing the same thing, even subsidizing rent on Main Street's pizza joint to tide the owner over until a critical mass of people move in.

Against these forces, Dallas's original downtown needs to find another 5,500 or so people seeking a hard-core urban life. The city is pushing ahead, confident that it can. Recently, it agreed to its largest payout ever -- $70 million toward a more than $200 million refurbishment of nine blighted downtown structures by Cleveland-based Forest City Enterprises. The company plans to build about 840 apartments and condominiums.

Housing prices are working in Dallas's favor. While the condo boom has pushed up prices in many cities and raised concerns about a possible bust, the boom has passed Dallas by. A two-bedroom condo can go for about $260,000. Karl Zavitkovsky, director of Dallas's Office of Economic Development, says that downtown Dallas won't be much affected by a market reversal because "you haven't had anything close to a condominium bubble here."

I'm going to have to disagree with that last paragraph about low condo and housing prices working in their favor. As Steve pointed out earlier in this blog, low housing prices create compelling competition for high-rise residential, and low condo prices make it harder for a developer to make a profit on a project. High condo prices stimulate development, not low ones. Witness Miami.

In addition to yesterday's post, I've previously given my own thoughts about downtown office-to-residential conversions in Houston here, and Steve did a comprehensive guest post here on the dynamics playing out downtown. The bottom line is that most of the "easy" residential conversions have been done downtown, but office building owners are holding out for new commercial tenants, and the costs are making the economics uninteresting for new residential buildings. So the good news is that we have a healthier downtown than most cities, but the bad news downside is that that inhibits further residential development. Residential only happens when people basically give up on commercial growth (as they have in Dallas, where the jobs have fled to the northwestern suburban towns).

I personally think there's another factor, though, that I haven't read much about. A big part of high-rise residential living is having a balcony with a view (or, if no balcony, at least the view). That's what people pay for, and it's why higher-up units sell for a whole lot more. But this is hard to get downtown, because there are so many other tall buildings blocking the views. I think this is why you see our condo towers being built in the Museum District, River Oaks, and Uptown - all spaced far enough apart that all four sides of each building get nice views. For commercial tenants, a view is a relatively low priority - so downtown is fine - but for residential ones, I think it's near the top of the list - which is a big strike against downtown. Not sure how to overcome that, other than pursue that niche market that is willing to give up a view for street life, stadiums, and the theater district.

November highlights

Time again for the monthly ritual. Near the first of every month, I'll be adding a post highlighting key posts from the previous month(s), with a particular focus on significant ideas I'd like to see kept alive for discussion and action. The main page will only show about a month's worth of entries, and I know most new readers won't go back into the monthly archives linked at the bottom of the right-side column, so here are the highlights:

September: A month dominated by posts on Hurricanes Katrina and Rita, so not many long-term "keepers".
Highlights from previous months can be found here.

As always, thanks for your interest in Houston Strategies.