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.

Wednesday, September 25, 2019

The Washington Post article on displacement in Shaw

It's a heartbreaking article ("D.C.'s gentrification is pushing black people out Shaw").

1829 13th Street NW is a relatively new build--it looks like it dates to the 1960s--in the midst of a great deal of historic housing, with nearby rowhouses worth between $1 and $2 million.

Sanathera Price  has lived at 1829 13th Street NW for 40 years, works for the Social Security Administration, knows her neighbors, etc.

But being in the core of the city, with living in DC now being a popular choice after many decades when it wasn't, properties that once were "affordable" are being upgraded for tenants or owners who can pay a lot more.

Gentrification.  DC has become "gentrified" because there is a greater demand to live here than there is housing supply to accommodate all the people who want to live here.

Why the addition of new housing doesn't reduce prices.  The reason that the addition of new housing isn't slackening prices is not just because (1) by definition new housing is constructed at today's cost of labor, land, and materials, (2) it's also because demand is still greater than supply even with the new additions to supply.

So people with more money bid up and successfully bid for and purchase the housing that exists. In a market economy, people with more money win out. It's not a secret.

Displacement.  For a long time displacement wasn't a big issue in DC, because much of the housing turnover was with the renovation of properties that had been vacant for decades (see "More about contested spaces--gentrification," 2004-2006) that's no longer the case.

How to respond.  To maintain a variety of income groups as residents in the face of a hyper strong real estate market there are two things that need to be done.

1. Build more housing.

2. Protect the affordable housing that exists.

WRT (1) we're not building enough housing. Relatedly, the opportunity costs in lost build out capacity, often in ways that would still be pretty low density, are incredible. Thousands and thousands of units aren't built.

That creates the velocity for displacement, because the inability to meet demand means that Class B and Class C housing is upgraded and sold or rented to higher income residents.

(2) There aren't systematic mechanisms for buying, holding, and maintaining affordable housing at scale. And mostly I mean multiunit dwellings. There are two elements. One is buying buildings, like that apartment building featured in the Post article on Sunday about Shaw.

Once a for profit developer buys a property low in a market that is strong, eventually it will be converted. So the agreement the tenants had ultimately didn't matter.

In my writings about culture matters and planning, where the issues are comparable, I write about "Buy(ing) the M* F* Building Already."

If you're whining about change and displacement and not creating the mechanisms to address the problem in a structural way, you're wasting your time, my time, and everyone else's.

So there needs to be a social housing entity that buys these properties.

The rent is too high.  Billboard in the Silver Spring Metrorail Station.  Thrive MontgomeryOrganizations like Jubilee do this, but they probably aren't super active acquirers in the way and scale that I am thinking about.

The second thing is community land trusts. I know some have been created in the city, but they are far too late to the game to make much difference.

And the only real successful urban land trust I know about, in Roxbury, Boston, only has about 200 units of housing in their CLT after 25 years. To me that's pretty insignificant.

Other ways to add to the housing supplyADUs.  There should be massive support of the creation of accessory dwellings in the places where they can be developed at scale (both separate units and basement units).

The thing is that it's still expensive to develop such units, as much as $200,000, and the payoff period is 15 years or more, so people have to be altruistically motivated to do so.  Or you can provide incentives and mechanisms for building such units at scale.  In Portland, Oregon, Dweller is a for profit construction organization that focuses on ADUs. 

Two floors being added to an apartment building off Kennedy Street NW (maybe on 9th Street)Intensifying smaller properties into larger properties (e.g., 3 story apartment buildings on Fort Totten Drive could become 6 story buildings).

The building pictured at left, I think is at 9th and Kennedy Streets NW. 

I don't have a problem with intensification, I just want the building facades to be quality, e.g., if the building is brick, the new part should be brick also.

But surgical projects like these could add a lot of housing units.

Single Room Occupancy Housing to deal with the "homeless crisis." It's not clear how many units we have in the city, formally, but it's likely less than 1000 (So Others Might Eat has more than 600 units, but they never returned my calls when I wanted to write about it).

-- "One of the "solutions" to the crisis of homelessness is a lot more SRO housing," 2017

Opportunity costs for not building to reasonable density.  Plenty of buildings aren't built larger either because of zoning restrictions or placation of opposition to development.

The Willow + Maple Apartments are about three blocks from the Takoma Metrorail Station.  Even one more floor would have added 40 units.

And we're not talking skyscrapers.  We're talking two-story buildings that could be four-story.  Four- or five-story buildings that could be six- or seven-stories (like at Fort Totten Metro).

But this comes at a great cost.  Fewer units mean housing costs more.  Fewer units means DC makes less revenue in terms of personal income and sales taxes, property taxes, and commercial income taxes for rented buildings.  It means fewer people to support local commercial districts.  Fewer eyes on the street, etc.

But mostly, it means higher priced housing and more displacement.

Creating implementation organizations to do this at scale: community development corporations.  DC relies on for profit develoeprs to build housing, alongside mostly small community housing organizations.

WRT the Purple Line light rail program and its likely negative impact on maintaining housing affordability in communities like Langley Park, stating that PG and Montgomery Counties needed to create a community development corporation tasked with the responsibility of buying, holding, developing, and funding the maintenance of affordable housing (and other stuff too).

-- "Creating a transportation development authority in Montgomery and Prince George's County to effectuate placemaking, retail development, and housing programs in association with the Purple Line," 2017

The same goes with housing policy in DC. You need implementation organizations that can do it.

Integrating social housing in large scale redevelopment programs.  In writing about revitalization and housing planning initiatives in Europe, I learned that in cities like Helsinki, when they do master planning, from the outset they carve out sites within the project that are allocated to social housing organizations for the creation of new housing that is 100% affordable and complementary to the sites that are allocated to the creation of market rate housing.

One of the things I wanted to try to do was to create a bid team for the redevelopment project at the Armed Forces Retirement Home, to do just that.  But the likelihood of pulling that off was low.  Not just getting for profit developers together, but getting them to agree to give up some of the parcels to social housing.

It's the kind of thing DC should have done with the redevelopment program for Walter Reed, and the Hebrew Home for the Aging on Spring Street NW.

(Although I was super impressed that Empower DC pulled together a team to bid on the Alexander Crummell School site in Ivy City. It was a shame that they did not win.)

Building affordable units in otherwise market rate projects isn't enough.  We need some buildings in such situations that are 100% affordable. And similarly, many city owned properties need to be used for 100% affordable projects.  Maybe not all of them, but definitely more than none.

Tampa, because they don't have enough money to renovate their public housing, is doing some site redevelopment in a similar fashion, but in reverse, allocating space to market rate housing, and using the money for renovation of social housing. (This has been proposed in NYC too, and people are not in favor.)  But they aren't reducing the number of units that already exist, and they are building more social housing units.


Conclusion.  The biggest thing I've learned being involved in this stuff for not quite 20 years is that you need robust plans in place before market interest changes significantly, not after.

It's not like people don't know what best practice is.

Why it's not being effectuated in DC is another issue. Although DC does a bunch of things that help. The Housing Trust Fund, the law that allows tenants of apartment buildings to organize and buy the property if it is put up for sale, etc.

But the scale and velocity of the "problem" is significantly greater than the organizational mechanisms available to address it.

As long as we rely on the market to be the primary developer and operator of housing, we'll continue to be in the position we are in.

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6 Comments:

At 11:02 AM, Anonymous charlie said...

Saw the article, walk by there every day.

What do you expect when you rent a 2 bedroom apartment for 525 a month? The building was in serious disrepair.

And she got a settlement from leaving, although nobody wants to throw out a dollar amount.

This isn't a supply issue. This is a cost issue - how do you renovate that unit and keep the rent in the "affordable" category -- although again 525 for a 2 bedroom is way way below even affordable housing rates.

Just a wild guess but I'm saying at least 500 a SF to repair, even more if you are doing the repairs and people are living in the building.

Say the building is 300000 SF (14 units plus hallways). That is at least $15M to renovate and probably again closer to $20. The proper response is rip it down and build something larger in the same space.

The white law hotel next door is running around 1500 to give some comps.

 
At 11:24 AM, Blogger Richard Layman said...

Got an extra zero in there. The building's probably 30000 to 40000.

You can't make money on affordable housing. Especially in a high in demand environment. If you want to provide it, it has to be subsidized.

I do think there are issues to discuss about access etc. Then again, people not willing to have slightly taller buildings need to recognize this will come at the cost of affordable housing, as demand leads to its conversion.

And it's expensive to renovate. Yes. Yes.

WRT our house project, we were super super super fortunate to find a guy who is quite inexpensive, relatively speaking. He's not the fastest, but not the slowest either. But he does great work.

As it was, we spent about $8,000 on him, including materials. It would have been as much as double for "regularly priced" people.

And we spent more on the window rebuild guy, the glass replacement guy, the storm window people, landscaping and dump, itinerant help, the guy who took stuff to the dump (as did I by myself), buying the dehumidifier, a "new" fridge, bookshelves and other stuff, other parts, smoke detectors, fire extinguishers, etc.

====
if it were possible, I'd do a tear down and rebuild it bigger. Definitely wouldn't be affordable then.

But the tragedy is in people wanting to still live in the city getting pushed out.

If we didn't own, we'd be on that trajectory. There's no way we could afford to buy a house in the city today, at least not in the neighborhoods we'd want to live in.

I know this mixed race couple that bought in Deanwood. They have two kids. But their life (where their kids go to school, etc.) is in Upper Northwest.

That's just as bad as living in the suburbs and commuting into the city.

Plus, I don't see how Deanwood will ever reach the tipping point. It's just too far out of the core and there isn't enough density to attract amenities.

 
At 11:31 AM, Blogger Richard Layman said...

... in all that, I had forgotten about Brass Knob. Went to Adams-Morgan day, went in. Found a replacement soap dish that would work for the 1920s double sideboard sink faucet set up, $44, etc.

 
At 12:39 PM, Anonymous charlie said...

"But the tragedy is in people wanting to still live in the city getting pushed out."

Good point. But the framework here is saying in the same place vs staying in the city; as I said this isn't 1995 and you can't rent a 2 bedroom for 500. Costs will go up.

And as you said, you have to plan ahead of time. Would be interesting to see how your various community groups (other shaw posts) get evaluated on that metric.



 
At 1:07 PM, Anonymous charlie said...

You're right on the number (30K) SF which does change the price of gutting it out.


Thinking about it overnight -- from your perspective a trategy b/c you have been doing this stuff for since the market off U was truly distressed -- there must have been 4-5 potential interventions (initially in late 90s, again in 2003, then again in 2008) where you could have done something about the property.

And yes the reqliqeushment of tenant rights was a bit suspect.

 
At 2:36 PM, Blogger Richard Layman said...

Yep, like in the context of my arts assets writings, stop f*ing whining, buy the mother f*ing building already.

Or with my writing on the cultural plan, which was direct about the issues of property, but totally fluffed it by not recommending creating an arts CDC to buy, hold, develop and maintain buildings.

There are CDCs here, and other organizations, but they aren't really operating at scale.

And yes, all the missed opportunities.

Now, all I can say is B T M F B A.

 

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