Housing & urban design – March 9

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Many more articles are available through the Energy Bulletin homepage

Trouble at the mall
Tom Philpott, Gristmill
Mall-operating behemoth General Growth Properties plunges in value
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… Does General Growth’s plight augur the un-malling of America? Maybe. The Wall Street Journal reported recently that:

Last year, [mall-based] retail sales on a per-square-foot basis in the top 54 U.S. markets declined by their greatest extent since the 1990-91 recession…. Vacancy rates at U.S. malls climbed to 7.1% in the fourth quarter, the highest rate since real estate research firm Reis Inc. started tracking the figure in 2000. And average rents have started to decline.

The mall industry, like so many industries in the modern global economy, thrives on rapid growth fueled by easy credit. Now credit has dried up, debt needs to be repaid, and sales growth has gone into reverse.

Time to start thinking about other economic models?
(8 March 2009)

Kunstler: Retooling Suburbia (audio)
KunstlerCast #54
Abandoned subdivisions and population decline
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James Howard Kunstler explores the topic of building traditional town centers in suburbia, where town centers are typically absent. Though it may be possible to retrofit the suburbs, Kunstler doesn’t believe that Americans will have the money to remake some of the worst suburbs into more traditional, mixed-use neighborhoods ? even if they wanted to in the first place. As more and more suburbanites find themselves unemployed, some of the more isolated housing subdivisions are simply being abandoned.

In the second half of this podcast Kunstler explores the topic of future population decline in the United States. Kunstler believes that Americans will face enormous problems producing food for its population as financial problems make agribusiness increasingly expensive. Moreover, suburbia has destroyed much of America’s agricultural land, which most people wouldn’t know how to farm anyway.
(5 March 2009)

How the Crash Will Reshape America
Richard Florida, The Atlantic
… How might various cities and regions fare as the crash of 2008 reverberates into 2009, 2010, and beyond? Which places will be spared the worst pain, and which left permanently scarred? Let’s consider how the crash and its aftermath might affect the economic landscape in the long run, from coast to coast-beginning with the epicenter of the crisis and the nation’s largest city, New York.

… Some (though not all) of these mega-regions have a clear hub, and these hubs are likely to be better buffered from the crash than most cities, because of their size, diversity, and regional role.

… Economic crises tend to reinforce and accelerate the underlying, long-term trends within an economy. Our economy is in the midst of a fundamental long-term transformation-similar to that of the late 19th century, when people streamed off farms and into new and rising industrial cities. In this case, the economy is shifting away from manufacturing and toward idea-driven creative industries-and that, too, favors America’s talent-rich, fast-metabolizing places.

The Last Crisis of the Factory Towns

Sadly and unjustly, the places likely to suffer most from the crash-especially in the long run-are the ones least associated with high finance. While the crisis may have begun in New York, it will likely find its fullest bloom in the interior of the country-in older, manufacturing regions whose heydays are long past and in newer, shallow-rooted Sun Belt communities whose recent booms have been fueled in part by real-estate speculation, overdevelopment, and fictitious housing wealth. These typically less affluent places are likely to become less wealthy still in the coming years, and will continue to struggle long after the mega-regional hubs and creative cities have put the crisis behind them.

… The Limits of Suburban Growth

Every phase or epoch of capitalism has its own distinct geography, or what economic geographers call the “spatial fix” for the era. The physical character of the economy-the way land is used, the location of homes and businesses, the physical infrastructure that ties everything together-shapes consumption, production, and innovation. As the economy grows and evolves, so too must the landscape.

… Suburbanization was the spatial fix for the industrial age-the geographic expression of mass production and the early credit economy. Henry Ford’s automobiles had been rolling off assembly lines since 1913, but “Fordism,” the combination of mass production and mass consumption to create national prosperity, didn’t emerge as a full-blown economic and social model until the 1930s and the advent of Roosevelt’s New Deal programs.

… But that was then; the economy is different now. It no longer revolves around simply making and moving things. Instead, it depends on generating and transporting ideas. The places that thrive today are those with the highest velocity of ideas, the highest density of talented and creative people, the highest rate of metabolism. Velocity and density are not words that many people use when describing the suburbs. The economy is driven by key urban areas; a different geography is required.

The Next Economic Landscape

The housing bubble was the ultimate expression, and perhaps the last gasp, of an economic system some 80 years in the making, and now well past its “sell-by” date. The bubble encouraged massive, unsustainable growth in places where land was cheap and the real-estate economy dominant. It encouraged low-density sprawl, which is ill-fitted to a creative, postindustrial economy. And not least, it created a workforce too often stuck in place, anchored by houses that cannot be profitably sold, at a time when flexibility and mobility are of great importance.

Richard Florida is the author of The Rise of the Creative Class and the director of the Martin Prosperity Institute at the University of Toronto’s Rotman School of Management.
(March 2009)
Very long article. Richard Florida predicts the continuing de-industralization of America and the further growth of what he terms “the Creative Class.” I’m not sure that I would go along with that. -BA

Social Darwinism fell out of favor after the experiments of the Third Reich, but economic Darwinism still reigns. As though the two are separable!!