Rebuilding Place in the Urban Space

"A community’s physical form, rather than its land uses, is its most intrinsic and enduring characteristic." [Katz, EPA] This blog focuses on place and placemaking and all that makes it work--historic preservation, urban design, transportation, asset-based community development, arts & cultural development, commercial district revitalization, tourism & destination development, and quality of life advocacy--along with doses of civic engagement and good governance watchdogging.

Thursday, March 29, 2018

Initiative to preserve low cost office and working space in London

Book cover, The Death and Life of Great American CitiesJane Jacobs wrote in Death and Life of Great American Cities that cities need "a large stock of old buildings" in order to spark innovation. "Old buildings," paid off, probably somewhat scruffy, have low rents, and startups need low costs to succeed.

From the book:
Cities need old buildings so badly it is probably impossible for vigorous streets and districts to grow without them. By old buildings I mean not museum-piece old buildings, not old buildings in an excellent and expensive state of rehabilitation–although these make fine ingredients–but also a good lot of plain, ordinary, low-value old buildings, including some rundown old buildings.

If a city area has only new buildings, the enterprises that can exist there are automatically limited to those that can support the high costs of new construction. These high costs of occupying new buildings may be levied in the form of an owner’s interest and amortization payments on the capital costs of the construction. However the costs are paid off, they have to be paid off. And for this reason, enterprises that support the cost of new construction must be capable of paying a relatively high overhead–high in comparison to that necessarily required by old buildings. To support such high overheads, the enterprises must be either (a) high profit or (b) well subsidized.

If you look about, you will see that only operations that are well established, high-turnover, standardized or heavily subsidized can afford, commonly, to carry the costs of new construction. Chain stores, chain restaurants and banks go into new construction. But neighborhood bars, foreign restaurants and pawn shops go into older buildings. . . . Well-subsidized opera and art museums often go into new buildings. But the unformalized feeders of the arts–studios, galleries, stores for musical instruments and art supplies, backrooms where the low earning power of a seat and a table can absorb uneconomic discussions–these go into old buildings. Perhaps more significant, hundreds of ordinary enterprises, necessary to the safety and public life of streets and neighborhoods, and appreciated for their convenience and personal quality, can make out successfully in old buildings, but are inexorably slain by the high overhead of new construction.

As for really new ideas of any kind–no matter how ultimately profitable or otherwise successful some of them might prove to be–there is no leeway for such chancy trial, error and experimentation in the high-overhead economy of new construction. Old ideas can sometimes use new buildings. New ideas must use old buildings.
This is basically the concept of filtering or what the Chicago School of Sociology work on cities called "ecological succession" but applied to commercial office space. 

In the residential model, people moved to the place that they could afford, typically a "slum," and as their circumstances improved, they moved up and out(ward), replaced by people in similar economic circumstances compared to their outset, and the process is repeated.

In commercial property development, this is defined in terms of the quality of the building, which is usually a function of age:
Class A the newest, best and most expensive, versus inferior or older properties, typically referred to as Class B and Class C buildings, but I'd say there are even Class D buildings, usually in terrible locations.
The thing is, in the strongest markets, most property owners are motivated to constantly refresh their buildings so that they are the most marketable, profitable, and fully rented.

In those markets, having a large stock of buildings matters less, because the prices aren't any lower.

One way to deal with this is through shared spaces like We Work.

-- "Do companies like WeWork offerany meaningful value?," Chris Harvey/LinkedIn
-- "Why People Thrive in Coworking Spaces," Harvard Business Review
-- "Co-Working Spaces Are Redefining What It Means To Go To The Office," NPR

But like the concept of incubators, it's important to recognize what such spaces are good at, and the needs that they aren't very good at meeting.

Collaborative work spaces are ideal for nano businesses and usually individuals and very small groups, not going concerns with greater demand for space, especially at low cost.

The East End Trades Guild is making affordable commercial rent an issue in local borough council elections.

The New Economics Foundation in London is calling attention to a campaign focusing on the cost of commercial office space in London, with an aim of being able to keep buildings around that exemplify the ability to effectuate what Jacobs wrote about.

-- "LONDON’S SMALL BUSINESSES COME TOGETHER TO DEMAND AFFORDABLE RENTS: 230 SMALL BUSINESSES CALL ON LONDON POLITICIANS TO JOIN THEM IN CONFRONTING THE CAPITAL’S AFFORDABLE WORKSPACE CRISIS," press release

The East End Trades Guild is the lead group pushing the issue, and had a campaign forum a couple weeks ago, which included the launch of their "Affordable Workspace Manifesto for a London Working Rent":

The manifesto calls on councils across the capital to:
  • Recognise Community Value of small and micro business to boroughs’ prosperity and reflect this in economic and planning policy decisions
  • Identify at least one Empty Asset in their borough and convert into affordable workspace before the end of 2018
  • Create a Small Business Community Land Trust to support small and micro businesses in perpetuity
  • Create a Register of Landlords to allow small businesses to compare rents
  • Support the development of an Affordable Rent Formula for small and micro businesses
The concept of a "Small Business Community Land Trust" is not unlike the SEMAEST initiative in Paris.

-- Wrk/LDN: Shaping London's future workplaces, New London Architecture

Again, as part of doing economic development planning, strong market cities especially need to plan for this.

I've become particularly attuned to this within DC, where the height limit ends up constraining land supply and office space, creating the opposite of conditions called for by Jacobs.  

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2 Comments:

At 11:56 AM, Blogger Richard Layman said...

Much of US warehouse space "obsolete" vis a vis e-commerce requirements:

https://www.cnbc.com/id/105102927

 
At 4:17 PM, Blogger Richard Layman said...

EETG and NEF also dealing with plan by Network Rail to jack up rents for "railway arch" spaces:

https://www.theguardian.com/business/2018/apr/07/east-end-small-business-artist-relocate-eailway-arch-rent-rise

 

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