Wednesday, August 15, 2012

EoS v. EoM - Further thoughts

Rob Steuteville, publisher of Better! Cities & Towns, suggested a follow-up post dealing with how one employs the Economy of Means for real estate development.  This isn't precisely a response to that, but it explores the EoS/EoM dialogue in light of some recent books I've read.  Rob references James H. Kunstler's The Long Emergency.

For a number of years I've been pointing out that among the best lessons Robert Davis taught us was how to develop in this way.  Unfortunately, too few New Urbanist developers/developments followed his wisdom of starting small, working in small increments, etc. even though Andres has included it in his talks/tours of Seaside as long as I've been hearing them (15 years).  The lesson was all but completely lost in the go-go days of the mid-2000's.

One of the things I realized, with regard to the commercial ventures that Robert and Daryl began, was that they scaled the commercial ventures to the market they had at the time.  For example, at the very beginning of Seaside, they sold seasonally, under awnings, with literally "low" overhead!  Daryl even screen-printed Seaside T-shirts in their kitchen.  EoS would  never have recommended that!  As the market grew, the commercial business models grew.  Some grew physically, like Bud and Alley's and Perspicasity.  Collectively the whole commercial realm of Seaside grew along with its market.  Contrast that to the standard model of a chain like Chili's, or Publix.  They have a business model/format (based on EoS) that demands certain market characteristics (traffic counts, rooftops, aggregate spending power, etc.), and they then look for the locations that fit those characteristics.  In another way of looking at it, they scale the market to the business. 

It's not just chain retailers who operate this way.  Homebuilders, Apartment developers, office parks, industrial developers all approach the market this way:  Here's our peg, where's the right sized and shaped "hole" in the market?  EoM approaches it differently:  here's a hole; what sort of peg can I put in it.

EoS brings with it the generic, reductive, mass-produced, which is so anathema to the authentic places people cherish.  New Urbanists have tended to look at this as a design or regulatory problem, but it is fundamentally an economic issue; specifically, the way "economy" is defined (means or scale).  I haven't read Jane Jacobs' post Death and Life work, but I suspect this may be part of why she expanded her focus to economics...

I believe it's not just The Long Emergency that makes this discussion relevant.  The way that technology is progressing these days is frequently in the hands of small entrepreneurs and techno-tinkerers.  These folks are developing RepRap machines, drones, robots, software, iPhone apps, and even manipulating genetic code in an utterly EoM realm of basements, laptops, bedrooms.  And they're frequently doing end-runs around the corporate behemoths, who rely on EoS to fund enormous labs, factories, R&D facilities.

Ironically, it seems post-recession capital markets are searching more voraciously than ever for the mega EoS real estate development deals.  By nature, the larger the deal, the more uniform the "products."  At the same time, market researchers are discovering that consumers are looking for more specific, unique, niche real estate products - with a heavy emphasis on experience rather than "features."  There's a massive de-materialization of consumption going on, and it is bound to have big impacts on urban form (in my opinion, favoring traditional urbanism, but probably not in the ways many would imagine.)  It is apparent that the capital is going one direction, despite the fact that the market is going in the exact opposite direction.  I posed this question to panelists at a recent ULI conference.  The response was dumfoundment:  yep, good question, but we don't know how those two realities will be reconciled.

The book, Abundance, by Peter Diamandis and Steven Kotler, is a fascinating compendium of the exponential growth technologies that are advancing at ever-more-rapid paces, with impacts reaching deep into the developing world.  Stewart Brand writes about some of these, as well, in Whole Earth Discipline.  (Both books are a fascinating antidote - or anti-venom - to Kunstler's writings.  I'd love to see all those guys in a live debate!) 

It is my developing belief that the nature of emerging technologies, the consumer market, and the post-Recession real estate market are all much more animated by EoM innovation and customization than the EoS, mass-production, pre-Recession, 20th Century, Modernist paradigms within each of these sectors.  Tactical Urbanism, and the ethos of the CNU NextGen group are excellent examples of this.  The dinosaur developers, homebuilders, equity funds, etc. will figure this out sooner or later - probably later.  So will automobile companies, media companies, "too big to fail" banks, and governments.  It may be a different response to The Long Emergency.  And it just may mitigate some of the nastier effects of it.

Thursday, April 12, 2012

Legible Urbanism

There is often a desire to reintroduce specific traditional business models (like the corner store) to populate the neighborhood centers we all like to see.  However, that can meet a brutal reality in an economic realm that is occupied by Walmart and ubiquitous, cheap transportation.  Those cynical of urbanism will hold this up as "proof" that traditional urbanism has gone extinct for a reason, that it is no longer economically viable. 

The counter to that, however, is this:  traditional urbanism existed long before "the corner store" as we conceive of it, and was/is able to accommodate changes in economic models at all scales, from individual retail formats (remember where the Department Store was born - traditional downtowns in the 1800's) to city- and regional scale shifts (New York, for example, wasn't always a center of fashion, entertainment, high-tech, international finance, etc.) 

Traditional urbanism is an armature that is able to absorb all sorts of dynamics and change, and it is not dependent on any single business type.  Therefore, I urge neighborhood advocates to not get wrapped around the axle of debate about a particular (largely by-gone, at least for the time being) urban component like the corner store, but rather to embrace urbanism as a system which can accommodate contemporary retail formats, as well as "nostalgic" ones, and future ones, which haven't been invented yet.  One of the main ways urbanism is so resilient to these sorts of changes is because urban buildings (and blocks, streets, even neighborhoods and cities) can change function over time, absorbing the ebb and flow of, for example, the balance between retail and residential units ("rooftops").  Modern Planning holds to the pretense that these ratios are fixed and predictable, but history (even over a few years or a couple decades!) always shows that the ratios of retail (and office, etc.)  to rooftops is quite dynamic.  On the "supply" side, distribution models change, products fall out of fashion, mail-order and on-line shopping rises, etc.  On the "demand" side, residential demographics shift, economies and household fortunes change, occupancy rises and falls.  Yesterday's corner store is today's bagel shop, the next day's Ke-bab Palace, tavern, coffeehouse, social service agency, or something-not-yet-invented store. 

What's important to "future-proof" a neighborhood is to:

  1. get the urbanism right, so that whatever the business, it "works" because of the logic of the place and its surroundings
  2. understand - and prepare for - those places in the urban fabric that will tend to favor commerce (i.e. busier, well-located intersections); which places will tend to favor residences (quieter, non-through streets) and those places in between which may accommodate both and/or the increase/decrease of one or the other through time.  These "in-between" or "transitional" zones are particularly important, in my opinion, and an under-explored area in New Urbanism.  (This continuum is the genesis of the urban transect, an idea adapted from environmental studies.  As an aside, I learned once that "transitional" plant species - those that grow at the edges of wetlands - not in full wetlands or full uplands - are more drought-tolerant than either wetland OR upland species.  The reason is they are adapted to dramatic changes in hydration, whereas upland- and wetland species are not.  There is an analog here, to the "transitional" zones in neighborhoods, which may be residential one generation, commerce the next.)
  3. build commercial buildings that are either cheap/light enough to be disposed of or relocated when their site demands/supports more intense use; OR robust and generic/flexible enough to accommodate dramatic changes in use without major renovation.  Each approach is inherently "sustainable" (resource-efficient) but may be called for in different conditions (some of which may be adjacent.)
  4. finally, employ "zoning" (or get rid of it altogether!) that permits easy changes in use, and let, instead, the urbanism (per #2 above) guide where/how different activities are decanted throughout the town.  If the urban fabric is "right", the quiet, narrow, indirect street will never be attractive for the 7-11 (or whatever) and the busy corner will never make sense for a mansion.  Perhaps this is the next frontier of urban design; "legible" urbanism that directs use through the inherent logic of its fabric.