Height Limits: Still a Bad Idea

In a pair of recent articles on Strong Towns, Charles Marohn, best known in the urbanist community for introducing the term stroad (street+road) for a pedestrian-hostile arterial street, argues for height limits as a positive force for urbanism. He does not make the usual aesthetic argument that tall buildings are inherently unpleasant (“out of scale”), or the usual urbanist one that tall buildings lead to neighborhood decline; instead, he makes an economic argument that allowing tall buildings greatly raises land costs, and makes redevelopment of vacant lots less likely. He uses the following example:

Let’s say the local code allows [a] vacant lot to be developed as a one story strip mall, but nothing higher. If the strip mall is worth $500,000, then the vacant lot is going to be somewhere around $75,000.

Okay, but what if the development code allows that vacant lot to be developed as a sixteen story tower? If the tower is worth $20,000,000, then that vacant lot is going to fetch a much higher price, maybe as much $2.5 million.

You own that vacant lot. I come to you with an offer to buy it for $75,000. What are the odds you are going to sell it at that price when you look to the other side and see the same piece of property going for millions? Not very good.

In most cities, as Charles notes, there is not enough demand to redevelop every vacant lot as a high-rise, and therefore, if high-rises are permitted, a few vacant lots will be redeveloped as high-rises, while the rest remain vacant. This is not the case in large cities, which Charles specifically exempts in his article (see also Daniel Kay Hertz’s response), but part of the problem with the argument, as we will see, is that the boundary between large cities and small ones is fuzzy.

Let me now explain why this argument fails, like all the other arguments for zoning restrictions: it makes implicit assumptions on future uncertainty. The reason the vacant lot owners are not willing to sell for $75,000 is that they hope to get $2.5 million. In a stable market, with low enough population that most lots cannot fetch such a high price, the lot owners know that holding off on $75,000 offers is a gamble and that they are unlikely to ever get a higher offer. People have optimism bias and might overrate the probability that they’ll get the $2.5 million offer, but also have risk aversion; in most cases in economics, risk aversion dominates, so that safer assets cost more and have lower returns.

So when do we see holdouts? Risk aversion predicts that the probability of obtaining a $2.5 million offer should be higher than the total demand for new towers divided by the number of vacant lots. If we explicitly assume that the cost figures in Charles’ example, including land costs, are unchangeable, then this means vacant lot owners expect there to be more high-rise towers in the future, which comes out of growth regions. Charles’ example is based on Sarasota, which like most of Florida has high population growth.

The other possibility is regulatory uncertainty. In a competitive market, land costs are already as low as they can be while letting lot owners cash out on past investments. Developer profits are also as low as possible, and represent the developer’s wage for managerial work. However, zoning restrictions will greatly raise both figures, and a lot owner who expects future developments to brush up against the present zoning code can hold out until prices rise.

This is the danger of a system that is based on arbitrary rules (Charles proposes up to two floors or 1.5 times the average present height, whichever is higher), and arbitrary distinctions between small cities in which height restrictions are desirable and large cities in which they are not: these introduce political discretion in the details, which introduces additional uncertainty among lot owners. True windfalls usually involve the boundary between regulatory regimes, and this creates political incentive to game the system in order to be one of the few owners whose lots can be developed as high-rises. In contrast, once a ground rule is established that there is no zoning, such as in Houston, introducing zoning is difficult, even when there are rules that are zoning in all but name, such as parking minimums.

Once we get into the realm of cities with a large proportion of their lots developed, as Charles proposes, future development can only replace old development, and this introduces a key difference between new development and redevelopment: redevelopment requires buying out the preexisting property. If a two-floor building is replaced by a three-floor building, then the developer has to not only pay construction costs for three floors, but also buy out two floors, effectively paying for five floors. But the revenue is still only that of a three-floor building, which bids up effective costs by a factor of five thirds. The formula is that if it’s possible to multiply the total built-up area by a factor of x then the buy-out factor will raise the cost of each housing unit by a factor of 1 + 1/x.

This effect is why, in major cities, we usually see buildings replaced by much larger buildings: for example, a three- or four-floor Manhattan building may be replaced by a fifteen- or twenty-story tower on a base. Charles laments that this is not small-scale or incremental, but even his example of good incremental development is similar: in Houston, single-family houses are replaced by low-rise apartment buildings, generating similarly high ratios of the floor areas of redevelopments with the buildings they replaced. Incrementalism in these cases consists of replacing small buildings by much larger ones, gradually, until a few decades later the entire neighborhood is tall.

One way around redevelopment’s need to buy out preexisting buildings is to mandate that future buildings be built to allow adding floors on top of them. Chicago’s Blue Cross Blue Shield Tower is an example. This is a regulation that increases the average cost of construction but reduces the marginal cost and thus the price. It’s also a regulation that only really matters in situations when it is difficult to have a high ratio of new to old floor area, such as in areas that are already high-rise, especially major city CBDs. (It is easy to quintuple floor area ratio when the preexisting buildings have three floors, but not so much when they have twelve.) The current styles of construction of most small buildings, for example sloping roofs common in American and European urban and suburban houses, tend to make adding floors impossible. Of course, the implication that such a regulation should only apply for buildings above a certain height introduces political discretion and hence uncertainty, but at least this is uncertainty that would apply equally to all buildings in an area, which is not always the case for zoning.

What Charles proposes, to develop all vacant lots first and only then start going taller, is then a recipe for high marginal costs, because of the buyout factor. In a small city uniformly developed up to one or two floors, it is difficult to spread the new development across many buildings up to three floors, precisely because there is no way to build single-family houses that are recognizable as such to Americans or Europeans from countries I’ve been to (It’s different in Canada, but this is considered a feature of the low quality of Vancouver’s housing) and that can have floors added to them. In such an environment, building tall is the only way to avoid high housing costs.

40 comments

  1. Charles Marohn

    Yes, I’m not trying to achieve maximum efficiency or optimal marginal costs. I’m interested in how 21st century American cities can grow without going bankrupt or putting huge costs on subsequent generations.

    Almost all American cities need to thicken up, mature their existing neighborhoods, to stay solvent. The tower building approach dramatically undermines this.

    In a system where taxpayers are already on the hook for the infrastructure maintenence, a floating height limit that allows for incremental growth is a modest local intervention. And I’m against most other zoning regulations, FYI.

    • Nathanael

      You’re basically trying to solve a non-problem.

      In practice, in smaller towns, when you remove height limits, you do *not* get towers-in-a-sea-of-parking. Developers have taken a dislike to them as they tend to be big gambles and often end up being unprofitable. Only institutional operators (like schools or universities) will build them.

      • Nathanael

        If you pay careful attention to construction costs, you’ll notice that there are certain thresholds, where if you go one story taller than the threshold, there are suddenly a bunch of added fixed costs (usually due to fire safety regulations or structural issues). Nobody ever wants to build one story taller than the threshold. As a result, you get particular sorts of jumps.

        An obvious one is the ADA: for everything except single-family residential construction, you never ever want to build 2 or 3 floors, because it requires an elevator, and if you’ve got an elevator, you might as well leverage the elevator by going to 4 floors.

        There are other similar thresholds; one is the maximum height managable with cheapo wood construction, after which steel framing is neeeded (since nobody builds straight masonry any more); if you have to have the steel framing, you really want to leverage it by having at least 6 floors, probably more like 10.

        After about 15 floors, it starts getting more and more expensive to get taller, though; you need to add more and more stairwells and elevator shafts, which use up space on every single floor and reduce saleable space. So there’s a natural disinclination to go taller than that.

  2. woolie

    Well, this is testable. With Houston again as the experiment, land owners throughout the 1970s and 1980s leveled what remained of the historic city center, laid parking lots to provide revenue to cover property taxes, and sat perfectly content for years (decades) waiting for payouts commensurate with high-rise corporate HQ land values.

    Would lower height limits have avoid this? When any lot can become a 50′ building, does the highest and best use become a land bank? Is a barren, land banked CBD an acceptable trade-off for the great diversity of new housing types and construction permitted in nearby neighborhoods?

    • anonymouse

      Would this have happened without the sewer moratorium, though? Apparently that had a big effect on development in Houston, and meant that effectively nothing could be built in downtown in that time period.

      • Alex B.

        Right – there’s a difference between the decision to build something tall and the decision to raze existing buildings in favor of surface parking.

        There are similar pictures of Minneapolis, where large swaths of the areas adjacent to downtown were purposefully razed as a part of urban renewal; they weren’t replaced by anything but parking lots.

    • George Carty

      Would this not be a good rationale to replace traditional property taxation with a land value tax, in order to deter land banking and ensure that the best possible use was made of city land?

  3. letsgola

    This is similar to something Stephen Smith has talked about with 1-story retail developments. A new building wouldn’t have any more commercial space, but that’s the part that generates the highest rent. So unless the site can be developed with a much taller building, it doesn’t make sense. You see this in LA, where C2-zoned lots with 1-story retail on major streets stay that way, despite the zoning allowing R4 (1 du per 400 SF lot space) development.

    • Alex B.

      Yes, I think this is the fundamental problem with Marohn’s proposal. He wants to embrace incremental development, but I think he misses how chunky this kind of development can be, particularly on the parcel by parcel level. That difference in scale is also a problem.

  4. Shane Phillips

    I think the redevelopment argument is the much stronger one here. As you and letsgola both said, when you want to build taller you typically need to tear down the existing building, which means paying not just for the land but for a revenue-producing building, and the expense of demolition.

    The point about uncertainty and risk aversion I find a little weaker, in large part because of the incentives for optimism bias. If, based on the various potential uses of my land, it’s worth anywhere between $75,000 and $2.5 million, I’m unlikely to take the $75,000 offer, even if I’m not going to hold out for a home run. The incentives come in to play in that property taxes are typically based on current use/revenue, so whatever I’ve got on that land — even a parking lot — is probably at least covering costs. If I wait another year that minimum land price might rise to $100,000, and the max to $2.7 million. I’m not losing any money in the mean time, so why not wait and see how things shake out?

    This is especially true in California, where property valuations can’t increase more than 2% each year and reappraisals are only done after change of ownership, new construction, or major renovations, so even extremely unproductive uses of land can still be profitable for long-time owners.

    This is basically an argument for a land value tax, which I’m sure everyone here is familiar with, so I won’t litigate that issue any further.

  5. Rico

    Maybe I am too tired, but I had trouble understanding your last paragraph. Could you please rephrase? Thanks.

    • keaswaran

      I think the point is this. In a healthy urban core, the population and economic activity might grow at a rate of 10% per decade (or something like that). As long as you have vacant lots, that’s fine, you just build single story buildings on a bunch of vacant lots, and you’re fine.

      If you don’t have vacant lots, then growing 10% either requires doubling the height of 10% of the existing buildings every decade, or tripling the height of 5% of the existing buildings every decade, or quadrupling the height of 3.33% of the existing buildings every decade, or something similar.

      Doubling the height of two existing buildings is much more expensive than tripling the height of one existing building, because you have to knock down and rebuild twice as much floor area. But striving for similar heights on all buildings means avoiding tripling or quadrupling the heights of any buildings, so you’re forcing all redevelopment into the most expensive mode of mere doublings.

      Thus, a height limit (or any policy that tries to strongly encourage buildings of similar heights at every time) makes growth much more expensive.

  6. Peter Brassard

    It’s not just height limits, it’s zoning itself!

    The single family house along with its front setbacks, parking minimums, and exclusive zones, which prohibit any other kind of use, multi-family or commercial, is the backbone behind the high cost of housing, as least in the US.

    In smaller cities the domination of cars as the primary transportation mode, coupled with single-family zoning encourages empty lots in the form of surface parking lots in city cores and commercial corridors.

    Parking minimums artificially increase construction costs for anything other than a single-family house. In most places a surface parking space costs $15,000 each to build, In an above grade structure the price goes over $30,000 each and underground can hit the $50,000+ realm.

    • threestationsquare

      Yes, everyone here agrees that we need to get rid of exclusive zoning, parking minimums, and the vast majority of limitations on density; Charles and Alon are just quibbling about whether a few minor limits make sense in certain edge cases. (Somehow, even though the abolition of most zoning is essentially the only credible position amongst urbanists on the internet, it’s completely outside the Overton Window in real-world politics… funny that.)

      • simval84

        Relaxation of zoning is often put aside in politics because of the localized nature of zoning decisions. The simple fact is that those who suffer from density limits in an area are unlikely to be residents of the area, they can’t find affordable housing. So when the decision is left to residents, only those who already can afford housing there and who likely benefit from higher housing values (as they already have homes) have a voice in the debate.

        Thus, upzoning or getting rid of zoning may be somewhat popular on a regional level, but face local opposition everywhere it’s tried. It’s an insider-vs-outsider issue, and those who benefit from the rules are all insiders, those who pay the price are outsiders, with only insiders having a voice in the debate.

        Hence why I think zoning should be controlled at a regional level, or at least its practice should be strictly guided by regional/national governments.

  7. James

    First time commenting on this site, although I’ve enjoyed reading it for a while.

    I’m not totally committed to either side of this, but it occurs to me that maybe a tax on surface lots would be a better safeguard against towers in the parking lot than height limits. The proposal I have in Providence is fairly modest, but if I was in a situation like Houston in the 1980s and could impose changes by fiat, I might say that putting an extraordinarily high tax on lots to make them unfeasible would be a good idea (similar, in some ways, to how the 90% tax bracket used to act as an effective upper wage limit in the U.S. pre-JFK).

    http://www.rifuture.org/how-to-structure-a-parking-tax-for-providence.html

    Again, 40% is the rate I chose just because it happens to be the highest existing in the country, but maybe an insane rate like 70-90% would make sense in extreme cases. I imagine 40%, if passed, will still result in some surface lots, though smaller ones.

    Curious of how this stands up in your view, versus the height limit proposal.

  8. simval84

    I’ve also made a reaction post on my own blog and I’ve come to the same conclusions as you did: 50% increase in density in case of redevelopment is not really economically viable. Except I think that it’s even worse than you said. I think that in general, housing will only be built when they can be built for less than the market value new units would have. So in a place with well-maintained housing (typical of neighborhoods in demand with housing shortages), that means that housing may be built only when housing gets supremely expensive. And before that happens, developers will move to the fringe instead and sprawl, because the costs of construction there are much lower.

    For example, let’s take the example of a 2-unit duplex to triplex conversion, supposing that building a triplex costs 450 000$ (so 150 000$ per unit). If the units in duplexes cost 250 000$, then the construction cost of the triplex units (cost of previous building plus the cost of building the triplex) will be around 320 000$. That is significantly more expensive than current units, so this conversion will not occur as the new units will not be cost-competitive, or if it does, it will only target the luxury housing market.

    It’s only when units in duplexes get to 450 000$ (per unit) that triplex conversion becomes economically viable.

    Still, I think there is some good in his proposal. There are cases I know of such form of development full of vacant lots, parking lots and relatively high-rise buildings. Sapporo in Japan sees this form of development near subway stations as 10-story condo buildings are built next to vacant lots and parking lots (what I call “stonehenge”-style of development). Making sure to favor rapid development of vacant lots is, IMO, a good thing, but there is the issue of it being hard afterwards to redevelop at an affordable price the existing built area to allow higher density to respond to demand.

    The solution I came to in my own reflection is that incrementalism should be based not on height limits, but on FAR (Floor Area Ratio), a much better measure of density, and be based not on the buildings around, but on the building on the current lot that is to be replaced, with vacant lots being limited to the average FAR of current buildings. For instance, buildings are limited to 3 times the FAR of the build they replace. This could mean a bungalow to rowhouse conversion, or a triplex to 4- or 5- story condo conversion. It would also limit land value as vacant lots are not allowed to build very high buildings, but also take care of keeping housing relatively affordable in high-demand neighborhoods.

    See here for more detail: http://urbankchoze.blogspot.com/2014/11/incrementalism-height-limits-and.html

    • Alon Levy

      This seems backward: a limit on redevelopment FAR does nothing for the issue of vacant lots.

      But you are of course right in your modeling of actual prices in the face of redevelopment FAR limits: the building to be replaced needs to be bought out at market price and not construction cost, and this changes the formula from 1 + 1/x to 1 + 1/(x-1).

      • simval84

        Actually, the point was that vacant lots cannot be developed to the highest density, but only to the first rung of the development “ladder”. That way, the value of vacant lots wouldn’t increase very fast because what could be done with them would be very limited, whereas the redevelopment potential of already built lots would be tremendous.

        If people want to leapfrog the limits, then they would have to pay development fees to the city, not to the land speculator, which again would keep the value of lots down (though in the end, the cost to the developer would be the same, the only thing that would change is whose pockets the money would go in… IOW, the city would get it to upgrade infrastructure of the neighborhood).

        • Alon Levy

          The smaller, economic, problem with the idea of capping land values via density limits: density limits do not reduce land value, unless land values (and profits) are so small a percentage of overall property values that the density limits are a dead letter.

          The larger, political, problem: any attempt by the state to extract value from land profit faces equivalent or higher political resistance than abolishing zoning; it’s the same reason why taxing land profits 100% is not a good strategy to prevent homeowners from using density restrictions to raise their asset values.

          • simval84

            From what I understand, when there is plenty of lots available, density limits do lower the value of land. I think Donald Shoup cited an example in Oakland where parking requirements reduced significantly the value of lots for development due to reduced profits from the development of the lots. Developers were not willing to pay as much since they would make less profit, so it created downward pressure on land prices. In suburbs that still have room to grow, single-family housing zoning does lower land value too.

            However, when you enter a shortage situation where the amount of land available for development is very much below the amount of development that is desired, then the market favors the owners of such lots and pushes prices up. Well, to be technical, the shortage of housing pushes housing prices up, which makes development more profitable, so developers are willing to pay more for land and lot owners therefore ask for more.

            The incremental approach I came up with allows essentially all lots to be redeveloped, so that should deal with the shortage situation, so the first situation should theoretically apply and density limits would allow for lower land prices. At least, from what I understand of pricing dynamics.

            As to the political problems… Any reform of land use is fraught with political perils. Yet, there is already something that is akin to my development fee to “break the limit”: performance-based zoning. “Do X and we allow you to build 2 more floors”, or “Pay us a neighborhood park and we’ll allow your building”. The big difference with the approach I spoke of is that it is more lax than performance-based zoning and doesn’t ascribe specific goals, only that money should be paid to the city. And as it is merely a possibility and not an imposition and allows developers to go around traditional limits, it might be more palatable than a land profit tax or the like.

            But I recognize that I may be wrong.

  9. Rico

    I was actually having trouble understanding the last paragraph of the article. How is Canada different?

    • Alon Levy

      Vancouver’s low-rise buildings are boxy, which makes it possibly to add floors without needing to completely tear down the roof.

      • Nathanael

        It was common in the 19th century to build masonry buildings which were designed to have extra floors added later. This isn’t done so much any more, but it’s a good idea.

  10. T. Caine

    If the goal is a walkable, urban environment that provides for the capacity of reducing car use (what all cities should arguably be shooting for) then it seems like density would play a role in establishing how many people you need in a given area to make that vision plausible. A two story max doesn’t seem like it provides enough residents in a given area to support local, walkable destinations. When you factor in access to open/park space, it seems even less likely. Once too many daily trips need a car again, then parking only further strips down the equation, diluting the integrity of the pedestrian environment.

    4 to 6 stories seems like a better target to support healthy local retail with enough of Oldenburg’s “third places” that make the transition from car-accessed, “destination” retail to a sidewalk realm with enough foot traffic to make ground floor business viable.

  11. Jeffrey Jakucyk

    Good comments, which outline some of the criticisms and explanations of Chuck’s idea. One thing that I think gets lost in this discussion is the basic problem that is being addressed, namely vacant lots that aren’t being developed, even in places where there’s demand for new buildings.

    In greenfield developments this can be an issue too. In one of Andres Duany’s many lectures, he mentioned that where they zoned areas to allow for 5-7 story buildings, where there were no buildings presently, it caused speculators to buy up the land and sit on it. When they then lowered the limit to something like one or two stories, stuff actually started getting built. This could be addressed with more reasonable land/location based property tax schemes, which have been mentioned before. Maybe that’s all it would take in fact? No point using a hammer if the problem is a loose screw.

    Anyway, you can still get highly urban places even with single-story buildings, just so long as the streets aren’t that wide and the buildings front the sidewalk. Uses can still be mixed, they’re just next to or behind each other rather than one over the other. It’s a good increment to start with, because very cheap construction types can be used, no stairs and elevators are required, and complex fire separating floors are not necessary which you would need for residential over retail and such. It’s also not so dense that you can’t still accommodate cars and parking, but having narrow streets is critical.

    So I think a height limit is a method of priming the development pump, such as it is. The situation is different when you’re talking about and empty greenfield versus an empty lot in a built-up area versus redeveloping already built-up parcels. It’s the vacant lots in built-up areas that are the biggest problem here, and I think that’s the one Chuck is focusing on.

    Along with that, height restrictions are fairly simple form-based regulations that are closer to what were used to build the type of cities that people love. You can argue that it’s maybe too simple, and thus too dumb, as opposed to something more chaotic and smart, but reasonable height restrictions do seem to make for more pleasant and financially stable places.

    The trick is to know when it’s time to relax the regulations. Places like Washington DC and Paris are famous for their height restrictions, and it’s gotten to the point, especially in Paris, that they’ve essentially been built out, so prices are skyrocketing. That’s a good problem to have though. Had these cities not had the height restrictions in the first place, they could very well be just like all the other bland American and Canadian cities with peaky central business districts surrounded by a dowdy inner city and miles of low-density suburbs.

    So when a city has reached the apex of its development pattern, it’s then time to discuss raising the limits so it can grow up some more. Leaving everything as a free-for-all from the start seems to just get you Houston.

    • simval84

      Houston is not really a free-for-all. There were some very strict density limits on the book for decades, thanks to minimum lot sizes and very high parking requirements.

      The peaky North American cities surrounded by endless sprawl isn’t the result of free-for-all, but strict zoning that essentially forbids anything BUT low-density sprawl everywhere but in the historical center. A truly limitless city would probably not yield that result but would result in much more mid-rise density, because densely built mid-rises tend to be more economical to build than high-rises in the context of high land prices. High-rises would emerge only in a few areas of exceptionally high demand (subway stations for example) or be scattered in certain areas to respond to a niche market demand for high-rise living.

      Japanese cities aren’t limitless, height is limited by street width, but this is what they tend toward.

    • Alon Levy

      You’re sliding a lot of unjustified urbanist assumptions in this comment:

      1. “Anyway, you can still get highly urban places even with single-story buildings, just so long as the streets aren’t that wide and the buildings front the sidewalk.” That’s missing the entire point: by assumption, the areas in question do not have the demand to support that level of density.

      2. “Regulations that are closer to what were used to build the type of cities that people love” is the usual aesthetic statement that tall buildings are icky. It’s not even an argument (is Vancouver icky?). But at any case, there were no height limits back when the original American downtown cores were built in most cities.

      3. “Reasonable height restrictions do seem to make for more pleasant and financially stable places.” Again with that aesthetic statement.

      4. “Had Paris and Washington not had the height restrictions in the first place, they could very well be just like all the other bland American and Canadian cities with peaky central business districts surrounded by a dowdy inner city and miles of low-density suburbs.” Well, Washington is in fact surrounded by a dowdy inner city (now gentrifying because of spillover from zoning-restricted central areas) and tens of miles of low-density suburbs, and I don’t remember its CBD being any more interesting than Philadelphia’s Center City, San Francisco’s Market Street area, or Downtown Boston. Paris I haven’t been to in years, but Stockholm is equally low-rise, and its CBD is no more interesting than Vancouver’s.

      5. “Leaving everything as a free-for-all from the start seems to just get you Houston.” The only way in which Houston is a free-for-all is that it makes it easy to build. That’s why prices there are not much higher than construction costs. The auto-oriented quality of Houston in contrast is not about a free-for-all: on the contrary, the city mandates high parking minimums and setbacks, and encourages developers to deed-restrict properties to single-family residential; these do not really impede the growth of the city, but do compel it to be auto-oriented.

      • simval84

        I think what is important to point out to the people who have the urbanist fear of heights is that the economics of high-rises aren’t very strong anyway. High-rises are significantly more expensive to build per square foot than low-rise structures. So high-rises tend not to appear in cities when demand can be satisfied by low-rise or mid-rise structures.

        So it’s not because you allow high-rises that they will sprout up everywhere. They will likely only appear in places where they are absolutely required to deal with demand, say near transit stations or in the CBD for office space, and only in high-population urban centers. A few may be built here or there as some do want high-rise living, but there won’t be an invasion of them everywhere. But if you don’t allow them, then prices will explode where they normally would appear because a shortage has just developed, and the market rations goods in shortage by hiking prices.

        The reason that so many new buildings in North American cities are high-rises is simply that zoning prevents the construction of housing units in most places. So a very few places have to deal with a very large pent-up demand. The result is that these places will go very, very high. If height limits were removed everywhere, the replacement of 2- or 3-story buildings by 4- to 6-story buildings would likely be much more economical and would easily satisfy demand in most cities.

        • Nathanael

          Yep. Developers will go out of their way to
          (1) avoid high-rises because they burn space on each floor with vertical circulation
          (2) avoid mid-to-high-rises because they require steel rather than wood construction

          This is the current economic situation. Changes in construction techniques could change that, but this is the current situation.

          The main reason for developers to build high-rises is actually land prices; if it just costs too much to buy out the adjacent lots, or they’re simply not for sale, the developer will instead cram a taller building onto the lot they got. They’d really prefer to just buy out the adjacent lots and build wide, short buildings, though.

        • Wanderer

          The economic fragility of highrises is an argument for lower height limits. I’m writing from California, where Prop 13 makes it all but free to sit on an undeveloped piece of property. If a city allows far more height than demand can absorb, many property owners will just sit and wait for that highrise to be built. After all, the city is sending a signal that it expects and wants tall buildings, except that the market can’t support them. It’s easy to be optimistic when it hardly costs you anything.

          Maybe a solution, which would be quite difficult politically, is to change the zoning after some actual (say) 6 story buildings get built, and allow taller buildings. Or be very targeted in allowing height; Berkeley’s Downtown Plan (which survived a NIMBY attack on the citywide ballot) allows something like 3 buildings over 10 stories in its small low-scale downtown; one is making its way through the process now.

          And the city does need to deal with the shadowing and wind tunnel effect of tall buildings. That was much of what New York City’s early zoning was about. It can be done, but it’s another reason why urban building can’t just be The Amazing Game Without Any Rules.

          • Alon Levy

            I’d buy that modern zoning is about shadowing and wind tunnels if there were an effort to increase both shadowing and wind in warm areas. The 1916 zoning code in New York allowed very tall buildings everywhere, as long as they tapered like the Chrysler and the Empire State Building. It was about light and air, and not about banning high-rise development just because it’s icky or something.

      • Jeffrey Jakucyk

        Alon, I never said anything remotely along the lines that “tall buildings are icky.” However, many more people go to cities like Paris, Venice, Copenhagen, Amsterdam, and Prague just to be there compared to those who would go to New York, Chicago, or Vancouver for the same reason. This is not an aesthetic judgment on my part, but the manifestation of the preferences of the general public. Yes some people like the bright lights and hustle and bustle of Times Square, but American downtowns are not so overrun by tourists and in such demand that nobody can afford to live there like many of the medieval cores of European cities are.

        Also, that you can still get urban places even with single-story buildings IS the entire point. Chuck’s original example was referring to high rises surrounded by vacant or otherwise underutilized property in Sarasota, a place that DOES support that level of density. His whole premise is that you can spread out the same number of units as you’d find in a single high rise over a few blocks and have not only a more efficient use of the space and public infrastructure, but also a better place to be in since the vacant lots and strip malls that would otherwise be there encourage driving rather than walking.

        I said a height restriction is closer to what was in place when historic cities developed, not that they were exactly what was used. There were form-based codes in place in those times (built-to lines especially), property tax structures that affected built form just as significantly as any zoning code, and there was a de facto height limit due simply to the construction technologies available.

        I’ll agree that Washington DC is kind of strange in that it has some weird scale issues. The streets and public spaces are so huge that you could built Manhattan size buildings in it and still have lots of empty space left. However, my point is that by having the height restriction in place, the CBD of a city like DC or Paris occupies more area than it would otherwise, spreading the development love through more of the city, so to speak. Had skyscrapers been allowed in those cores, there’d be a smaller downtown core with more low-density adjacent inner city.

        Think of taking a place like Chicago and squashing down all the skyscrapers as if they were made of clay. They’d expand outwards over surrounding neighborhoods. Even though there’s a lot of skyscrapers and they’re quite high, spreading that evenly over just a few inner city neighborhoods would actually not add up to a whole lot of extra height. Going over the whole city, even without all the vacant lots, might even be nearly imperceptible from the ground. The problem in DC and San Francisco and even New York is that those surrounding neighborhoods are frozen in amber by zoning so that can’t happen. As simval said, when a parcel becomes available to build a high rise on it has to be maximized because there’s nowhere else for that supply to go other than some greenfield that by this day and age is 20, 30, or 40 miles away.

        • Alon Levy

          I want to exclude Venice from this discussion, since it’s a specialized tourist city, due to unique features like the canals or the medieval history. Same reason why the very high volume of visitors to Monaco relative to its size is not an indication people especially prefer high-rises built on several floors of parking. This leaves us with your ordinary European capitals, versus the major American and East Asian cities, and at that point I don’t think there’s any obvious preference for the European capitals. The European capitals have higher numbers of foreign visitors, but that’s an artifact of smaller countries – the US and Japan are so big that American and Japanese cities have mainly domestic tourism. Tellingly, Singapore punches way above its weight in foreign visitor volumes, and so does Bangkok for a middle-income city; and yet I am happy to denounce both cities’ urban forms as pedestrian-hostile.

          Your bringing up unaffordable central city housing in Europe is really problematic. It’s as if housing segregation is a good thing. More fundamentally, you’re confusing supply and demand: the centers of Stockholm, Amsterdam, etc. have high demand and limited supply, and this leads to high housing prices. So do the favored-quarter suburbs of American cities, and increasingly the centers of the richer cities; the fact that it’s expensive to live in Palo Alto and Great Neck does not indicate that there’s any mass preference for single-family detached houses, only that those places have tight zoning that causes a housing shortage. In areas in high demand with flexible supply, what you see instead is rapid population growth, and temporary bursts in housing costs in some boomtowns like Fort McMurray, where population growth strips the ability of homebuilders to build more; here, the demand is not for the great urbanity of Houston or wherever but for its strong economy. In New York, and Paris, and Stockholm, and San Francisco, the strong local economy leads to stratospheric housing prices; in Houston, it leads to fast population growth.

          Washington is actually surrounded by a low-density inner city. It’s not Paris; by the time you go just north of Columbia Heights, you run into single-family houses, duplexes, and triplexes. For what it’s worth, most European cities are not Paris, either: Stockholm’s density is 4,800/km^2, marginally more than Chicago, and once you get out of Central Stockholm the density isn’t very high. The main effects the height restrictions have are exporting gentrification to the rest of the city and promoting job sprawl, as businesses can’t pay the office rents, which are the highest in the US. Businesses do not actually like to be spread all over the city, because transit doesn’t work that way. The result is that employment in Washington is still concentrated around Farragut, and employers who are priced out of it go to Bethesda and Tysons Corner. Stockholm appears similar: employers who are priced out of the mid-rise office buildings of the CBD aren’t heading in droves to my neighborhood, but to Kista; as far as I can tell, you only need to go a few blocks north of T-Centralen to find bustling neighborhoods where, nonetheless, the buildings are entirely residential above the ground floor.

  12. Steve S.

    I am reminded of the definition of e: lim(x->∞) (1+1/x)^x … I wonder if further modeling would show a relationship between redevelopment costs and e?

    I would also point out, Alon, that your model also needs to have a dampening factor: price maximalization on any given site depends on “highest and best uses” being achieved on the overwhelming majority of adjacent sites. Part of Chuck’s argument is that most construction of the sort seen in the US today — with high-value uses occupying a site surrounded by sites occupied by marginal-value uses — represents an unequal distribution of value in a geographic area, and that e.g. optimism bias contributes to this core distribution problem.

    I would suggest then that as the value of distribution becomes more equal models like yours come into play … which of course, again, raises the thorny question of how that happens. I definitely buy your concerns more in active urban cores than in inactive ones.

  13. Pingback: Limites de altura: ainda uma má ideia | Caos Planejado

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