Sunday, January 27, 2013

Better alternative to planning, Larry loves Houston, and more

If you caught the Sunday Chronicle op-ed this week on comprehensive planning, I would like you to direct you to my response when essentially the same op-ed was in the Chronicle in 2007.  I fully support the city planning its infrastructure - roads, sewers, etc - as it already does.  I don't support interfering with the free market with restrictive zoning or land use controls (the ultimate implementation of any comprehensive plan).  Houston is one of the most vibrant cities in the nation and is attracting waves of both domestic and international migrants - and a big part of that has to do with our free market in development and land use.  Top-down comprehensive planning is not the answer.  You cannot plan your way to utopia (show me a city that has).  The real world involves trade-offs between goals, and markets are the best at resolving those trade-offs.  What I do support are bottom-up, continuous, incremental improvements to our existing codes:
  • What do people desire that is not being provided by the free market?  Why?
  • What are we doing that is preventing the free market from providing those things?  
  • How can we reduce regulation or enable free market tools (like voluntary deed restrictions) to allow more of those things people desire?
The Texans NFL season may have come to a disappointingly early end, but in the competition among cities, Houston is winning the super bowl year after year.  Why restructure a winning team?  Why mess with success?

Moving on to some smaller misc items this week:
Finally, a very nice excerpt from Lonesome Dove author and Texas icon Larry McMurtry in Texas Monthly this month.  Take that, Dallas! ;-)
Houston was more or less my Paris, or such Paris as I had, and I still think of Rice University as my intellectual home. ... 
If I were to anatomize the six major cities more or less in order of urban merit, I would now put Houston first by a large margin: it’s a great city. Next would come Austin and Fort Worth. The latter has those three world-class museums, plus that glorious livestock exchange building over by the Stockyards, and Austin has a music scene that has nurtured both my son, James, and my grandson, Curtis, not to mention the ebullient Kinky Friedman and many another gifted bard. Dallas I haven’t enjoyed since the sixties, when I could still scout books at the Harper’s big bookshop in Deep Ellum, where my son now often performs. Dallas is a second-rate city that wishes it were first-rate.
...
I recognize that Austin has provided a welcoming environment for artists of many skill sets, but I still love Houston more: its flavors, its smells, its foods, its variety. It always had an abundance of blacks and Latinos, but in the eighties it added Asians and Middle Easterners, these last come here mainly to learn about the oil business.

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26 Comments:

At 3:15 PM, January 28, 2013, Anonymous Anonymous said...

Seems like an uptick in the median multiple in Houston. Only a slight increase will put Houston in the "Moderately Unaffordable" category next year. I wonder if the trend will continue or if more builders will start building enough again after the lull to make up for lost time.

 
At 4:09 PM, January 28, 2013, Blogger Tory Gattis said...

I do think supply will start to catch up with demand in Houston and moderate prices somewhat, but Houston may have reach such a size (6m) combined with such job growth that we may essentially be forced a bit higher on the multiple, esp. if employers stay in the core (thus putting a premium on closer-in real estate). On the other hand, if employers flee more an more for the suburbs, that may moderate our multiple, but I don't think it would be healthy for the city or metro as a whole since it weakens the core, a la Detroit or even Dallas or Atlanta.

 
At 2:14 PM, January 29, 2013, Anonymous awp said...

As long as Productivity/Wages keep going up as the city grows we can still be better off with a hire multiple. A more accurate measure of general affordability would be disposable income after housing.



You are better off making 100,000 and paying 50,000/year for housing than you are making 50,000 and paying 1,000/year for housing.

 
At 2:14 PM, January 29, 2013, Anonymous awp said...

higher*

 
At 1:04 AM, January 30, 2013, Blogger Rail Claimore said...

I suspect completion of the segments of the Grand Parkway from E to G will taken pressure off upward prices in the Inner Loop.

 
At 11:10 AM, January 30, 2013, Blogger Michael said...

>>Top-down comprehensive planning is not the answer. You cannot plan your way to utopia (show me a city that has). The real world involves trade-offs between goals, and markets are the best at resolving those trade-offs.

Show me a city that has not had planning and is "utopia". Utopia *does not exist*. But if we want to talk about people "voting with their feet" about which cities are best, then keep in mind places like greater NYC have approximately 20 million people. So perhaps they are roughly 3-4 times *better* than Houston which only has ~6 million people. As Houston grows, we are going to become more like NYC (and its planning regimes) whether you like it or not. It is just part of a city's evolution. The only advantage Houston has is we will probably end up with forms-based zoning since other forms of zoning are now out of fashion. Or maybe we will just call it something cooler than zoning, like Chapter 42.

Fact is every city reaches a tipping point where more planning is needed, and Houston is clearly reaching that tipping point.

I would agree that free markets are best at resolving trade-offs, with the caveats that:
- We don't usually have full transparency in our markets. Individual actors don't have access to all information.
- Sometimes, when a payoff is 15+ years down the road, private markets have no solution
- Externalities like pollution are not accounted for

Those are pretty huge caveats. So big that I actually don't really agree that free markets are necessarily any better than government at solving problems in the real world - it depends on the problem, the players in the marketplace, and the politicians. Sometimes a problem might be better solved by a Bill White than by Andrew Fastow. Believing that government is always better than the market, or vice versa, is just dogmatic belief.

 
At 1:45 PM, January 30, 2013, Blogger Tory Gattis said...

Yes, NYC has more total population now, but Houston has been adding more people at least the last couple of decades, and possibly longer. And most of New York's growth happened before they had substantial planning and land use regulations - back when it was a free market - and growth has slowed since.

Not a believer in form-based zoning any more than normal zoning or land use controls, but your caveats are fair.

 
At 2:48 PM, January 30, 2013, Anonymous awp said...

"We don't usually have full transparency in our markets. Individual actors don't have access to all information."

So you are assuming that some planner has a better idea of what the highest and best use for a parcel is, as opposed to the individual who is about to invest in it? Planners are also individuals and thus cannot be expected to have any information unless they are risking something by not having that information.

"Sometimes, when a payoff is 15+ years down the road, private markets have no solution"

Same as above. Even more so given that politicians are term limited. That is also incorrect plenty of investments are made in the private market where the uncertain payoff is expected far off into the future (i.e. oil field exploration, Boeing airliners).

"Externalities like pollution are not accounted for"
This is rich given that almost all existing Urban Planning regulations are anti-density and anti-mixed use and as such are pro-pollution.


To see why we should not trust planners consider the proposed parking minimums that are under consideration today.

They are essentially arbitrary both because the planners have no idea what the optimal amount of parking is, and because even if they knew the average optimal amount it is ridiculous to apply these same rules to establishments in different urban contexts. On the other hand business owners/developers have the incentive to closely weigh the cost of additional parking against the value in terms of additional patrons/residents. They are likely to be enacted because politicians are short sighted and only see the voters who are complaining about other citizens parking on "their" streets. They are not considering the long run costs(i.e. less density, more runoff, less variety, more driving, etc.). The whole "need" for parking minimums arises because of policy failure. The govt. produces a valuable resource (on-street parking) and then refuses to charge for the use of this valuable resource. The govt. should either stop building such wide streets, or should price on-street parking when it becomes scarce.

 
At 2:56 PM, January 30, 2013, Blogger Tory Gattis said...

Great points, awp.

 
At 3:31 PM, January 30, 2013, Blogger Michael said...

>>So you are assuming that some planner has a better idea of what the highest and best use for a parcel is, as opposed to the individual who is about to invest in it?

Yes, especially if that land is, for instance, an important transportation corridor or planned to be high density, which requires a greater amount of infrastructure to support. Or you can just build things haphazard, on single-lane streets, as in Houston and have residents fight you. Watch the Uptown district build its own BRT plan because the city / Metro are doing nothing for the next 30 years.

Government already decides the best uses for land by building airports, roadways, highways, and other infrastructure. Zoning just formalizes this a bit more.

>>That is also incorrect plenty of investments are made in the private market where the uncertain payoff is expected far off into the future (i.e. oil field exploration, Boeing airliners).

I never said private markets will never solve these issues, just that there is less likelihood. Obviously if you are dealing with established businesses like oil or airplanes, then existing companies will make investments for the long term as well. But my point is private enterprise, including land developers, are fundamentally more interested in short term profits than what happens 25-50 years from now. Politicians may be term-limited as well - nothing is perfect. But in theory both CEOs and politicians should be responsible to the consumers / constituents they serve. Government simply has more resources to invest in longer term outcomes, and ultimately they are responsible to all voters, as opposed to just being responsive to money.

>>This is rich given that almost all existing Urban Planning regulations are anti-density and anti-mixed use and as such are pro-pollution.

I don't think it would be accurate to say all planning in places like Chicago / NYC is "anti-density". They have high-density designations for land. In Houston, as Crossley points out, it is actually very difficult to build for high density except in the downtown area because of things like setbacks and parking requirements.

>>The govt. should either stop building such wide streets, or should price on-street parking when it becomes scarce.

I actually think part of the solution is for better transit / streetcars / and for an option to build shared parking garages in high-density areas. But I think you'd have to have some planning / coordination to do that. I have no problem with pricing some street parking either, but if it was previously a residential neighborhood then residents should still be able to park there.

 
At 4:26 PM, January 30, 2013, Anonymous awp said...

">>"So you are assuming that some planner has a better idea of what the highest and best use for a parcel is, as opposed to the individual who is about to invest in it?" Yes, especially if that land is, for instance, an important transportation corridor or planned to be high density"

The existence of a plan does not prove that the plan is good.

"Or you can just build things haphazard, on single-lane streets, as in Houston and have residents fight you."

So because I enjoy living in my neighborhood, I should be able to say that no one new is allowed to enjoy living in my neighborhood?

"Government already decides the best uses for land by building airports, roadways, highways, and other infrastructure."

Just because the government builds something does not mean that it passes a cost benefit test, and certainly does not mean that it is the highest and best use. My whole point is that we have no reason to expect that someone using other peoples money, and who will face no/minimal consequences for failure, to make the best decisions.

"private enterprise, including land developers, are fundamentally more interested in short term profits than what happens 25-50 years from now."

Short terms profits in something as capital intensive as development are a function of the expected future stream of revenue for the next 25-50 years.

"I don't think it would be accurate to say all planning in places like Chicago / NYC is "anti-density". They have high-density designations for land."

It would be completely accurate. Almost all planning regulations are anti-density. Yes, New York and Chicago do have areas where they ALLOW(though still limit) higher levels of density (just like downtown Hosuton)than they do elsewhere, but even there almost all regulations are density limiting.


"In Houston, as Crossley points out, it is actually very difficult to build for high density except in the downtown area because of things like setbacks and parking requirements."

Thanks for proving my point. ??? These are the same regulations that every city has. Using the existence of current bad planning to argue for more planning (as Crossley often does) has always confused me.


"option to build shared parking garages in high-density areas."

You don't need to provide the option. If an area is (parking) congested enough then parking garages would be built. Remember those greedy developers you were talking about before.

 
At 5:00 PM, January 30, 2013, Blogger Michael said...

>>The existence of a plan does not prove that the plan is good.

And conversely, the lack of a plan does not prove that the lack of a plan is good.

>>Short terms profits in something as capital intensive as development are a function of the expected future stream of revenue for the next 25-50 years.

They care about their private revenue stream. They do not care about "the city". The city and its citizens are more or less irrelevant to them as long as they satisfy their private revenue stream. I would rather trust someone that is at least in theory looking out for people / place as opposed to a developer that is just looking to make a buck.

>>You don't need to provide the option. If an area is (parking) congested enough then parking garages would be built. Remember those greedy developers you were talking about before.

You do need to provide the option, because *you do already have planning*, and currently those regulations involve adding parking lots, creating parking "zones", and perhaps pricing street parking. So, yes, where appropriate existing top-down planning needs to be improved to allow better options to emerge, such as shared garages.

 
At 6:06 PM, January 30, 2013, Anonymous awp said...

"And conversely, the lack of a plan does not prove that the lack of a plan is good."

I was trying(and possibly failing) to argue why I think that we would expect that urban planning would lead to an outcome worse than a relatively free market in development(i.e. planners lack the knowledge and incentives to make good choices). You came back with "we need planning because we have planning".

"They care about their private revenue stream. They do not care about "the city"."

Developers make their "private revenue stream" by building something that other people value. Part of what other people value is living in a nice neighborhood and a nice city. So yes, the developers have an incentive to care about the neighborhoods and cities that they build in.

"I would rather trust someone that is at least in theory looking out for people"

Only in the simplest theories. Politicians and Bureaucrats are just as fallible and selfish as everyone else and actually less accountable, especially in terms of the costs they personally bear when making bad development decisions.

 
At 12:10 AM, January 31, 2013, Blogger Michael said...

>>Developers make their "private revenue stream" by building something that other people value. Part of what other people value is living in a nice neighborhood and a nice city. So yes, the developers have an incentive to care about the neighborhoods and cities that they build in.

90% of the time that may be true. But then you have stuff like this Yale development in the Heights or the Ashby high-rise, and the question is - why build it there, when the neighborhood opposes it, the infrastructure is not there for it, etc? The answer is the developer bought the land cheaply and thinks they can turn a profit, not that they care about the city or that *really* the best place for such developments would be along dense corridors like Kirby / Richmond etc, where there is plenty of land available.

>>You came back with "we need planning because we have planning".

I come back with "planning exists, and will always exist - so deal with it". Since planning exists, we may as well try to have "good planning" where possible, as opposed to things that do not make any sense like our current parking code, or lack of transportation options despite plenty of "transportation planning" and government investment in a city of 6 million people.

If you think somehow we don't already have plenty of top-down planning, or we can get rid of all planning, I would say you are living in a libertarian fantasyland. Start with "get rid of all public infrastructure" and see how far you get... I may agree that could work... in an alternate universe.

Like it or not human beings have determined that the public sector has a role to play in planning our cities, the question for Houston is whether we want planning that makes sense and leads us to be a vibrant city like NYC, Boston, or Chicago, with a vibrant walkable downtown, Midtown, etc with varied mass transit options, or whether we want to be a sprawling mess.

Sure Houston can be economically successful as a sprawling mess as well. But I don't know that it will be a great place to live if we have somehow reached 20 million people without any more government involvement in directing our growth.

But - I think more planning will happen one way or another - I think it is part of the evolutionary growth of an American mega-city. "Anything goes" only gets you so far.

 
At 7:41 AM, January 31, 2013, Blogger Tory Gattis said...

I'd say Houston has developed a very vibrant core with its historical minimal planning regime and tremendous growth. I'm not sure what's suddenly changed that we need to change.

You allude to my biggest problem with comprehensive planning: in theory, it's a balanced and enlightened approach that works out appropriate density by neighborhood and infrastructure, but what seems to happen in reality is that it becomes a cudgel for NIMBYS to oppose any and all development. Ultimately, it changes land use from a market process to a political process (the bosses of the planners), and politicians will always respond to vocal neighborhoods (and they get more vocal the more they realize they can kill anything they don't like, esp. any density). Far from leading to vibrancy, it leads to stagnation.

 
At 10:00 AM, January 31, 2013, Blogger Michael said...

>>I'd say Houston has developed a very vibrant core with its historical minimal planning regime and tremendous growth. I'm not sure what's suddenly changed that we need to change.

From Crossley's article:
"We have very big issues to face, including the slow growth of the city in the last decade (relative to growth in the surrounding region), an anemic tax base and financial difficulties and the new understanding (from the Klineberg study) that fully 62 percent of city residents want to live in walkable urban neighborhoods with access to stores and other amenities - yet we have no coherent plan to create such places."

As far as what has changed, I didn't say anything suddenly changed. But I do believe as density increases, conflict as well as demand for improved services and infrastructure increases, and as that happens you will have more support for comprehensive planning. And ultimately these plans will happen.

>>but what seems to happen in reality is that it becomes a cudgel for NIMBYS to oppose any and all development. Ultimately, it changes land use from a market process to a political process (the bosses of the planners), and politicians will always respond to vocal neighborhoods (and they get more vocal the more they realize they can kill anything they don't like, esp. any density). Far from leading to vibrancy, it leads to stagnation.

When we say the NYC / Chicago / etc. are "anti-density", the fact is they still are some of the most dense places in the United States, and maybe "anti-density" in these cases means you can only build a 50 story tower instead of a 100 story one. In Houston, anti-density happens all by itself, with people building a suburban-style CVS in midtown, for instance - plus our *existing plans* which make it difficult to build densely where we should.

At any rate, I have a hard time seeing NYC stagnant or "anti-density" when really what they are doing is controlling a very high density of population. Developers would not care if they built 100 story towers everywhere, and the city pollution resembled that of Beijing. However here in the United States our citizens demand more of their cities. I'm not sure that's a bad thing.

 
At 1:20 PM, January 31, 2013, Blogger Tory Gattis said...

I'm not talking about NYC or Chicago. I'm talking about the reality of comprehensive planning as it happens in cities all over the U.S. It is often a blunt instrument used by existing residents to prevent new development, esp. density. In fact, I'd argue that if Houston had had such a regime the last 20+ years, we would have many, many fewer apartment complexes, townhomes, and residential towers inside the loop, and central Houston would be a less affordable, less dense, and less vibrant place because of it.

 
At 1:22 PM, January 31, 2013, Blogger Tory Gattis said...

In fact, I'd argue that if we had had that sort of planning, all of central Houston would be like West U/Bellaire/the Villages, and that, frankly, would suck.

 
At 2:10 PM, January 31, 2013, Blogger Michael said...

>> In fact, I'd argue that if Houston had had such a regime the last 20+ years, we would have many, many fewer apartment complexes, townhomes, and residential towers inside the loop, and central Houston would be a less affordable, less dense, and less vibrant place because of it.

Well, I don't think this is what I or Crossley or anyone else supports. We support dense development inside the loop, but on corridors that should be dense - such as Westheimer / Richmond / Kirby / Main St / etc, etc. We also support dense development outside the loop where it makes sense. What we disagree on is turning 2-lane roads into "Post Oak lite", that will never be able to support the buildings that are going there.

>>In fact, I'd argue that if we had had that sort of planning, all of central Houston would be like West U/Bellaire/the Villages, and that, frankly, would suck.

These are residential areas mostly. I don't see how that compares to an entire city that is obviously going to have some low-density residential areas, but also commercial areas / mixed use / high density as well. People in Houston want planning, so all of the places you mentioned are actually very popular to live in. As are the suburbs, which are by and large master-planned or deed restricted, and growing faster than central Houston. What we need is more planning in the city of Houston so that people can live there and have some comfort level about the quality of infrastructure, transportation, and future development that is likely to occur.

I don't think rules / planning generally hurt the market - and in fact may sometimes help the market - as long as everyone understands the rules and there is a level playing field.

 
At 2:42 PM, January 31, 2013, Blogger Tory Gattis said...

What I'm saying is that your and Crossley's idealized vision for planning in Houston would almost certainly not happen. As soon as there is a path for neighborhoods to stop development, they will take it, no matter what areas you idealize for that high-density development. You're assuming a backbone in the political/planning community that will not exist in reality.

It's an example of be careful what you wish for, because you might just get it good and hard. I think you'd find dense development all but gets shut down, and you'll wish for the good old days when developers could actually build apartments/towers/townhomes over the resistance of NIMBY neighbors, even if they weren't in your favorite ideal locations.

 
At 3:45 PM, January 31, 2013, Blogger Michael said...

>> As soon as there is a path for neighborhoods to stop development, they will take it, no matter what areas you idealize for that high-density development. You're assuming a backbone in the political/planning community that will not exist in reality.


Maybe so, but I think it would be fairly easy to specify height limits etc. as a function of neighboring streets. I think this is what they do in DC - and aside from the limits being too low for density in DC's case, I don't think there is a problem with the idea of tying form limits to the surrounding infrastructure. So if you are right on 8-10 lanes, as in the case of Westheimer, or a frontage road, you can build whatever sort of supertall structure you want. If you are right on a BRT or LRT or other mass transit line, same deal. This would probably encourage BRT / LRT to be built along major thoroughfares, but that should be the case already. This would give developers the certainty that if they purchase on a certain street, they know exactly what they can build without any sort of legal fight. It also gives homeowners the knowledge that if they are buying on a 2 lane road, some oil company or apartment developer is not going to come in and build a 45 story HQ right outside their front door. I think something like this would be good for Houston and is still a really light-weight way to manage things.

 
At 5:52 PM, January 31, 2013, Blogger Tory Gattis said...

OK, even if you engineered it so there was no public process way to block high-rises as you so describe, what about apartment complexes and townhomes?

 
At 6:00 PM, January 31, 2013, Blogger Michael said...

I would subject apartments and townhomes to the same height regulations that would apply to high-rises. I would think the height limits would be kind of an exponential curve though - so if you are living on a one lane street, the most someone could build is 2-3 stories, 2 lanes one way or 4 lanes total you could build somewhere around 8-10 stories (or some height - 150-200 ft), etc.

 
At 8:05 AM, February 01, 2013, Blogger Tory Gattis said...

So you're not talking about comprehensive planning, just a simple rule linking height restrictions to road size? I once proposed something similar during the height of the Ashby controversy: http://houstonstrategies.blogspot.com/2008/02/simple-rule-for-high-rise-development.html

 
At 9:43 AM, February 01, 2013, Blogger Michael said...

>>So you're not talking about comprehensive planning, just a simple rule linking height restrictions to road size? I once proposed something similar during the height of the Ashby controversy:

I would think the height limits would be the main component of it.

But I would not be opposed to the city doing some things to incentivize or otherwise make sure that the areas designated for dense development are redeveloped to take advantage of this. For instance, I would hate to see the NE corner of Post Oak and Westheimer redeveloped at some point as only a 2 story building with a huge parking lot (unless perhaps it was a new wing of the Galleria). If the city / Metro were also investing more in mass transit along some of these corridors, I think that would also serve as an incentive to builders to take advantage of the maximum density allowed. And I think we could get rid of a lot of surface parking by doing something to facilitate / encourage shared parking garages for entire neighborhoods. For instance the Village garage is useful, but seems like a lot of other places could use something like this.

 
At 2:27 PM, February 01, 2013, Blogger Tory Gattis said...

And I've heard that part of the code overhaul they're going thru is to make it easier to set up shared parking arrangements. Would be a great tool for developments and neighborhoods. Does not require comprehensive planning.

Generally speaking, developers are perfectly aware of good high density/high infrastructure areas like that corner you mention (they pay a *lot* for the land), and don't need encouragement to pack as much as possible on that land.

 

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