More on condominiums as a real estate type
It's a rendition of the Florida real estate boom at the time, the machinations of developers and other interests, and in this case, the potential for a hurricane to wipe out beachfront property.
The particular building that is at the heart of the story faces economic problems as it ages, assessments need to increase, some people can't afford it, and the potential decline in the face of new buildings being constructed nearby. From one of the comments at Good Reads:
Condominium is not a novelization of actual events. It does however paint a realistic enough picture of the sorts of things that can go wrong to contribute to as massive a disaster as described in the final pages of this novel. MacDonald doesn't point the finger at just one person making mistakes or cutting corners as the cause. Instead he builds suspense on the knowledge that little mistakes and efforts to cut corners in the interest of saving money add up.It was made into a tv miniseries, but I've never seen it. The plot of the tv program differs a bit from the book.
In the middle of all of this are the families, mostly retirees on fixed incomes, who have maxed out their budgets to buy a retire[ment] home. With Ian on the board of our local HOA, I sympathized with the HOAs in this novel who struggled to undo the mess the developers left them with on their limited budgets.
Labels: Growth Machine, multiunit residential, real estate development
posted by Richard Layman @ 11:03 AM&Permanent Link
13 Comments:
If I remember correctly, Florida does not mandate any reserve requirements on the part of condos.
It goes back to the larger point on the weakness of JJ; she kinds of ignores the finance and law and technology underpinning of it all, and focuses on the exchange value.
In any case, the point is that laws undergrid the policy; you could for instance make condo payments deductible under DC law to encourage investment in the building stock.
I believe in the watergate is a co-op; I think there are advances in the long term to that structure (which is why it might be popular in NYC) and relatively unpopular here in DC.
You're right about the Watergate being a co-op. I am being a bit sloppy in including both types under "condos." And yes, the legal structure is different, and in some respects, it might make co-ops easier to get public financial support and they also would have access to loans from the National Cooperative Bank, which could make things a little easier.
But other than that I am not up on the legal differences between the forms.
In any case, the advantages or disadvantages of these forms become evident over time, and there may be the need for extranormal monitoring and technical assistance on the part of local governments to ensure the maintenance of healthy communities.
I've been aware of this issue, sure, it's not new. But like with UR the need becomes more evident as the buildings age and are supplanted by next new thing.
It should be easier for a co-op to raise money via debt; they own everything.
Also on underpinning -- the fannie mae rules on renting make duplexes and 4 unit condos very risky.
Hell even have the ability to invest the funds from reserves; we have $100K in reserves earning .005 interest rates -- the building is "missing" about 25K in reserves based on the lack of ability to invest at a 5% return over 10 years.
right. While I was riding today, I was thinking of the need for a small building initiative. These things need to be addressed to facilitate long run stability for a building.
Special funding for small buildings. Sure they are more risky, but the rules are made for bigger buildings.
An investment fund by Fannie Mae or the like where condo boards can invest their reserves. Etc.
2. but then this gets to the issue of scale. A lot of communities are too small to be able to pull this off. Could/should be done at a metropolitan scale.
RE: Scale
Again going to be bickering on JJ, I think her economic model of a city life is predicated on a flanneur; essentially density = accidental connection = growth.
And there is something to be said for it.
I've tried to pose a version that says "cities are web of externalities" which means on a base level everything is getting a cut, and the more polite version is "We're all in this together" so we need to work together.
Then there is a sustainable model -- which you have at times advocated -- which is related to to your above paint. That only cities have the scale to attract that needed investment to keep itself fresh.
As I said, take Leesburg Pike in Arlington. Tremendously vital. It isn't burned out like U st or Columbia Heights was.
But you'll never have the scale to keep that level of investments coming. Skyline is a great example of that. Arlington isn't big enough to actually pull of that streetcar line and wasn't also big enough to extend to Mark Center.
somewhat off topic:
http://www.chicagobusiness.com/article/20160919/OPINION/160919839/sorry-chicago-but-peter-thiel-is-mostly-right
re: "cities are a web of externalities" is maybe better expressed through a couple paragraphs on cities as facilitators of exchange by David Engwicht in _Reclaiming our cities and towns_.
"Unfortunately" I lent the book to someone many years ago (but hopefully he still has it). This will have to suffice:
===
rom a review of the book in the Electronic Green Journal published by the University of California Berkeley:
Engwicht begins by examining the reasons he believes cities exist -- to maximize opportunities for exchange by concentrating people, goods, and facilities within a limited area. Transport should enhance exchange opportunities, but Engwicht finds that it sometimes does the opposite. Consider what often happens as traffic volume increases. First, new roads are built, or existing roads expanded, to accommodate the heavier use. Next, more space is designated for parking and housing the growing number of cars. As more space is taken by cars, opportunities for exchange, whether in the form of the corner store, the local playground or park, or someone's backyard, are soon affected. Stores move to the suburbs, children are transported to sports facilities to play, and people restrict their socializing to a smaller area of their neighborhood. Finally, with the distance growing between exchange opportunities, public transport becomes less feasible and, as a result, many people, particularly the poor, the disabled, and the elderly, are denied access to these opportunities.
How can we change our auto-dependent behavior and correct the auto-induced injustices? Engwicht offers many suggestions, from conservative to radical. ...
===
Obviously it's just the first couple sentences that are relevant to your concept.
But the further point about how the transportation system can work for or against exchange is equally relevant.
There is a great diagram in the book where he shows how as road width increases, opportunities for exchange decrease. And research by Donald Appleyard and the resulting diagrams, of how people interact within blocks, based on road width and traffic, and how interaction decreases as road width and traffic increases is another illustration.
of course, exchange is exchange of all types, not just transactional exchange of goods and services.
Hmm, hadn't seen Aaron's piece.
I used to argue that all the time, and it's part of the original creative class argument, when Richard Florida was trying to figure out why even though Pittsburgh had Carnegie-Mellon and many early stage IT startups, as they grew they left the city for the west.
You could say it's the "what's the use" argument.
That argument rests on clustering/ agglomeration etc., it makes the most sense to be where the various development, innovation support, and financing ecosystems are best developed and executed, that market development is expensive, etc.
Now I think it's more nuanced. While anyplace can't become the next biotech center, e.g., Brunswick, GA; many places have economic development opportunities and ecosystems that may not rise to the level of the Silicon Valley but are still pretty good.
Usually universities or certain types of research activity are the center of the knowledge base, and can be harvested, provided there has been some development in the support infrastructure including financing.
E.g., there are some incredible biotech initiatives in places like Kansas City and Phoenix. Some amazing harvesting of former military bases to support technology development and advanced graduate education in the sciences, such as in California or San Antonio. Harvesting and coordination of university programs in Spokane and Greensboro. Some manufacturing initiatives in the South (no unions help). Etc.
Now I would say something like, yes, to absolutely maximize your economic returns depending on the industry it's best to get to Silicon Valley, Houston for oil, NYC for media and finance, Cambridge/Bay Area/San Diego for biotech, etc.
But with development of the various networks necessary to successfully husband successful business and knowledge creation, you can be successful elsewhere. Not anywhere, but in other leading, albeit secondary, centers for various sectors.
You might not be a king of the world like Bill Gates or Mark Furstenberg (or Peter Thiel), but you can have a damn good life.
BUT YES, there can be a parochialism and hermeticism too. E.g., his comments about the connectedness and world awareness of New Yorkers.
Granted, I don't interact with the "Federal" or "National/International" DC, I mostly stick to the local. But as one of those odd ducks that is network-connected, I find local DC to be incredibly hermetic.
- continued -
It amazes me always because it's not like people don't go to other places, and see other things, and have other experiences.
We're like the last place to expect much in the way of serious innovation when it comes to govt. initiatives.
e.g., I was talking to a friend-colleague who is a Council staffer at the H St. Festival. We were talking about innovation and she gushed about the various library initiatives.
I scoffed. Richard Reyes uses my language to describe what they are doing with the library (I know because we had a meeting where I laid it out, and then later I heard it from his mouth at a Section 106 meeting on the Library) but what they are doing is so limited compared to my vision.
Similarly, as I have written the neighborhood library program has been great at building new libraries, but piss poor on reconceptualizing these libraries (other than how now the DCPL system has a great passel of outreach and neighborhood-based programs, programs that are truly quite good) in terms of how to be significant neighborhood cultural and educational and centers of civic life in broad terms.
(In fact Cooper-Hewitt is giving our neighborhood library construction program designation in an upcoming exhibition, and I have toyed with the idea of writing to the curator about how this is such a bad choice, that Medellin's Library Parks or even the Drumbrae Library in the UK are much much better. Or Seattle's neighborhood library program, which adds co-location elements. Or San Diego's, which adds protected outdoor space to each library. I can't remember the term for this element of Mexican architecture. It's not an interior courtyard like in the Mideast, more a side yard. Etc.)
Anyway, maybe the networked-connectedness element is absolutely key. I think it's possible to be that elsewhere, but it isn't easy, and it rarely is appreciated.
oops. e.g., Pittsburgh and Carnegie Mellon (and Pitt I suppose and UPMC), they've gotten to the point with robotics and IT that they have more critical mass and are keeping early stage businesses more, and as you know, companies from outside the area are locating robotics related initiatives there, like the driverless car.
That being said, yes, I probably should have gone to NYC or SF a long time ago. That I can never be successful at making DC a public policy and practice innovator.
"hermetic"
Yeah. I just was reading Cass Sunstein's new book -- which is a memoir of OIRA although it isn't billed that way -- and really enjoying it although in a negative way. I'd say Sunstein is exactly the problem, not the solution. although in a very thesis-anthesis-sythesis sort of way.
And that is pretty much the definition of hermetic.
As I've said before, there have been many Washingtons in the past, and there will be more the future. The question is who be build a system that generates more Mayor Williams and less Mayor Bowsers.
I really like living in my Davao condominium. I feel great about it!
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