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Given lack of walkable land in NY region, a new push for greater density outside NYC

In an April interview, New York magazine critic (and author) Justin Davidson, asked about New York City's future, responded:
The immediate question is how it can cope with an affordability crisis. I wish I knew the answer, but I emphatically don't. I think that the solutions to the question are largely out of local control. I think we're talking about large-scale economic mechanisms and national, international policy.
And, perhaps, regional policy, a focus of the Regional Plan Association and other planners. The WalkUP Wake-Up Call: New York, released recently by the George Washington University School of Business's Center for Real Estate & Urban Analysis in partnership with Smart Growth America, recently pointed out that "just 2.4% of the total regional land mass in New York is considered 'walkable urban.'" The full report is embedded at bottom.

And that scarce land is far more valuable than the suburbs. According to the announcement:
Despite the demand for walkable urban places in New York, most real estate investment has been in the region’s core rather than in creating new walkable urban places or growing the region’s rail-served town centers. This represents a lost economic opportunity, and presents a real danger of a substantial affordable housing crisis if efforts to balance the region are not taken. 
A (regional) lack of walkable areas

Consider the map below, in which green is considered WalkUp, defined as a regionally significant Walkable Urban Place; yellow is a locally-serving Walkable neighborhood; and red is a regionally significant Driveable suburban location.



Smart Growth America
 defines its goal of smart growth as "an approach to development that encourages a mix of building types and uses, diverse housing and transportation options, development within existing neighborhoods, and community engagement.

There's clearly a business opportunity. The real estate publication Bisnow on 3/3/17 published what was headlined originally as THE ENORMOUS DEVELOPMENT POTENTIAL OF NEW YORK'S SUBURBS, summarizing the report and suggestion "developers must work with local government leaders to take advantage of the region's potential and build mixed-use projects along an already existing network of rail stations."

Growing demand for walkable urbanism

From the report's Executive Summary:
As lifestyle preferences continue to shift back toward walkable urbanism, its pent-up demand becomes greater and greater.
The overbuilding of drivable sub-urban development was a major cause of the mortgage meltdown that triggered the 2008 financial crisis and subsequent recession. This research shows that this development pattern is on the wane in the tri-state region, which now has among the strongest demand for walkable urbanism in the United States. This pent-up demand is evident to anyone who has recently compared the price per square foot of a condo or coop in Brooklyn or Jersey City with a McMansion in the fringe suburbs.
Our data, which includes rental rates per square foot and market valuations per square foot, shows strong market value premiums on average of 150 percent per square foot for walkable urban products versus drivable sub-urban.
Pent-up demand results in substantial social equity challenges. Gentrification is the result of demand without the supply to meet it. This leads to the displacement of existing low-income residents in walkable urban places and limits incoming residents to the wealthy. However, this demand also creates the possibility of building more mixed-income and multiethnic places in walkable—or potentially walkable—communities that are currently drivable sub-urban.
(All emphases added)

What's the goal?
Meeting the demand for new walkable urban development must include a major new trend: building and expanding walkable downtowns and neighborhoods throughout the region. By this we do not mean developing the suburbs to the levels of urbanization in New York City. This generally means a level of walkable urbanism in between what is experienced in downtown Princeton and downtown Stamford.
...This report identifies 70 “Town Centers” throughout the region that are already walkable. Continuing to invest in their development, and in creating more places like them, is key to meeting this pent-up demand.
How might it work?
Walkable urban development calls for dramatically different approaches than drivable sub-urban development with regards to design and planning, regulation, financing, and construction. Taking a drivable sub-urban approach to walkable urban development nearly guarantees failure, since the needs and context are fundamentally different. A walkable urban development form also requires the introduction of another level of civic supervision: place management. This new field develops the strategy and provides day-to-day management for WalkUPs, creating a distinctive sense of place where investors and residents invest with a generally long-term perspective. Many take the form of Business Improvement Districts (BIDs), although communities can use other structures that incorporate local businesses, residents, and elected officials.
On economics:
• Walkable urban housing costs for low-income households may be lower than drivable sub-urban housing costs, but “the rent is still too damn high.” Across the region, housing costs consume more than 50 percent of the budget for low-income households making less than $40,000 annually. The amount spent on housing should not exceed 30 percent
• Walkable urban areas have greater diversity, a higher share of low-income people, and lower racial segregation compared to drivable sub-urban areas. The share of people of color in walkable urban areas ranges from 59 to 67 percent of an area’s population, whereas in the drivable sub-urban areas it ranges from 38 to 41 percent. This is unsurprising, given past public policies that led to the concentration of people of color in center cities.A similar pattern holds for low-income families. The share of families making less than $40,000 annually is 46 to 48 percent in walkable urban areas compared to 31 percent in drivable sub-urban areas. We also found less racial segregation in WalkUPs.
• When we consider housing and transportation costs, walkable urbanism in the tri-state region is more affordable for a low-income family (at the 50th percentile of area median income) than drivable sub-urban. For such a family—consisting of a single adult with two children, renting their home, and making approximately $32,900 a year—WalkUPs in the region are, on average, 18 percent less expensive than drivable sub-divisions. Transportation costs, specifically, are 35 percent less expensive.• The WalkUPs ranked highest in social equity are concentrated in New York City. Chinatown is the highest-ranked WalkUP by this measure, although a handful of places outside of Manhattan also ranked highly: Melrose Concourse, Bronx (#5); Ft. Greene, Brooklyn (#10); Long Island City, Queens (#13); Downtown Newark (#22); and Journal Square, Jersey City (#34). These rankings are indicative of their high levels of transit accessibility and subsequent transportation affordability.
I'm not sure that Fort Greene is so equitable as that it has an enormous diversity of incomes, given public housing projects and historic brownstones.

What to do

The conclusions:
1. EXPAND & BUILD MORE WALKABLE URBAN PLACES.
Walkable urban land is a minuscule 2.4 percent of the tristate region. This has resulted in world record land prices, the primary reason for the valuation premiums. We should aim to double the amount of land in the region that could be walkable urban to five percent, through rezoning and infrastructure improvements. Increased supply can be achieved through the following:
• Crowd-sourced Planning: Open the planning of an emerging or potential walkable urban place to citizens through online tools that democratize the process and encourage participation.
• Emulate Regional Models: Visit and understand the benefits of a walkable urban place, particularly to its surrounding neighborhoods. Clarify the local fiscal benefits of walkable urbanism to the tax base.
• Adopt Model “Form-based Code” Zoning: There are many “off-the-shelf” models of zoning that will allow for mixed-use, walkable urban development that local jurisdictions can adopt.
I'm not sure that crowd-sourced planning will be used to increase density without more leadership.
2. ENGAGE IN CONSCIOUS SOCIAL EQUITY STRATEGIES.
This research has shown that walkable urban places are inherently more socially equitable for low-income households in the tri-state region. However, housing costs in WalkUPs are still too high. The tri-state region, especially New York City, has a commendable history of providing public and subsidized housing that has had a substantive impact on affordability, but the market is moving much faster than the public sector. Aggressive affordable housing strategies in walkable urban
places can address displacement and provide more affordable housing. These strategies should include elements such as:
• Place management organizations, such as business improvement districts and Main Streets, could be empowered to encourage and possibly even assist in the development of affordable housing.
Inclusionary zoning, which requires a minimum percentage of affordable housing in each new development.
• Enlarge, or introduce, at the local jurisdiction level the development of public and subsidized housing. In addition to state and federal subsidies and incentives, local taxpayers should assume some of the funding for providing mixed-income walkable urban affordable housing. 
• Legalize ancillary housing. Surplus bedrooms and unoccupied basements can be turned into rental housing units with minor redesign. In many jurisdictions, this is illegal. By legalizing ancillary housing, also known as “granny flats,” existing under-utilized assets can provide homeowners with extra income while increasing the supply of affordable housing. 
• Transfer fee for market-rate housing sales. Many jurisdictions charge a nominal fee (less than one percent) of the sales price for any re-sale of a market-rate house; these proceeds could finance affordable and work force housing.
That's interesting--tax the locals and also direct transfer fees to affordable housing. But New York City already has a transfer tax. What isn't mentioned is a more dramatic national policy change like the elimination or curtailment of the mortgage interest deduction.
3. SUBSTANTIALLY INVEST IN A PORTFOLIO OF TRANSPORTATION OPTIONS. The importance of investing in transportation infrastructure—particularly existing rail and bus transit—as well as biking and walking, cannot be underestimated. The major question is where the funding will come from.
The following tools can help make funding available:
• U.S. Department of Transportation low-cost loan programs, referred to as TIFIA14 and RRIF.5 Tens of billions in finance capacity are available in these two programs, and both have been recently modified to finance not just rail transit, but also surrounding infrastructure that is walking distance to the station.
• Increase sales tax: Dedicate existing—or increase—sales and/or other local taxes for the purpose of servicing federal transit-oriented loans. Metropolitan Los Angeles has recently raised sales taxes to finance an additional $120 billion of transit investment.
• Create a catalytic development company, capitalized by deep pocket private investors, universities and foundations, to “push the fast forward button” on walkable urban development. Catalytic developers can assume control of public, nonprofit, and donated land for the development of affordable and work force housing.
• Negotiate with developers and private land and property owners around transit stations to engage in value capture. This is capturing a portion of the anticipated upside of development that has been sparked by the rail transit. This is similar to how rail transit was financed 100 years ago and has been re-introduced in many international cities and some U.S. metros, such as Washington, D.C.
A catalytic development company--interesting idea, but who would control it? There's already a significant debate in New York City over the public-private partnership behind the proposed BQX streetcar line.

Those responsible include Forest City (of course)

Note thank-yous to NYC's Department of City Planning and Small Business Services/Business Improvement Districts, as well as research partners at the Regional Plan Association.

The Private Sector Funders and Advisors include: AvalonBay Communities, Inc.; Cushman & Wakefield, Inc.; Forest City Realty Trust; HOK; Kushner Real Estate Group; Mack-Cali Realty Corporation; M&T Bank Corporation; Normandy Real Estate Partners; Renaissance Downtowns
RXR Realty; Silverstein Properties; Skyline Developers; Taconic Investment Partners

Major Foundation Support and Advice came from the The Rockefeller Foundation.



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