Montage (Nye's redevelopment) - 116 E Hennepin Avenue

[MNdible]

Since I brought up the Pillsbury A Mill project, let me clarify that I wasn't suggesting that this will solve the housing affordability problem in the area. But I did want to point out that the public sector is putting a lot of money into housing, and that subsidized (as opposed to true Public) housing is likely the way that we'll maintain affordability going forward.

And, even if we significantly increased the funding available for subsidized housing, it's still not going to be enough to "solve" the problem.

[FISHMANPET]

Further, can I just state for the record that this talk of "not trying to save historic buildings" is absolutely terrifying? We are nowhere NEAR the density where this even needs to be considered. Can we agree on having historic and new coexisting peacefully? There are plenty of old, shoddy buildings in this city to tear down and replace and empty lots to fill. China is tearing down ancient villages and constructing high rises for people who don't exist yet in order to keep their economy afloat - not exactly a good example to aspire to.

Well the vacancy rates aren't at all similiar so it's not a reasonable comparison. If somebody said "tear down Rogers and replace it with 1000 towers paid for with public money" I'd agree that's a pretty stupid idea, but that's not at all what's being discussed.

And if you value old buildings, that's fine, everyone has a right to that. And enough people value old buildings that we've setup a legal framework to protect them. But let's not forget the opportunity cost there, every building preserved in some way prevents a bigger building that can house human beings. If you value old growth wood moulding and the bricks that we can't quite replicate the color of anymore and all those things that will really truly genuinely be lost, then that's fine. But remember that in many cases preserving those things comes at the expense of providing a place for real actual human beings to live.

I think we preserve far too much, for dubious reasons, which usually boil down to "I like this thing." But those are my values, they don't have to be yours.

[amiller92]

And I just want to add that Peter summed up exactly how I feel without all my vitriol and abrasiveness.

I will add that I should usually just let Alex and Peter talk.

I won't, but I should.

[amiller92]

China is tearing down ancient villages and constructing high rises for people who don't exist yet in order to keep their economy afloat - not exactly a good example to aspire to.

When last I was there (four years ago?), in Shenzhen China was tearing down what appeared to be 10-20 year old mid-rises to construct high rises to keep up with housing demand.

I don't really have an opinion about what their motivations were or whether that's something to aspire to, but it's definitely not what we'd do here.

[FISHMANPET]

Also I'll add that Japan doesn't have the attachment to old things the way we do. It's just a cultural thing. The Ise Grande Shrine, one of Shinto's most sacred sites, is rebuilt every 20 years.

So yeah, our Western culture is different. But if you want to look at why a city like Tokyo can be affordable, this is one of the reasons. Emulate it or not, but at least understand it.

[mulad]

I just want to mention that, from 2010 to 2014, the Twin Cities metro population grew by more than 37,500 people per year. That means the region needs to add, 10,000-15,000 housing units annually to keep up with population growth, plus additional units to handle turnover of old housing stock. Most of that construction has been happening in the suburbs over the last several decades, though the core cities, especially Minneapolis, have seen a large uptick in recent years (I think it's been around 6,000 new units annually in the last year or three?).

The population growth probably only accounts for a fraction of total number of people who move from one place to another in the metro each year, though, so even a modest shift in taste for housing style or desire for location could easily swamp the market (or at least certain segments of it). We do need to build quite a lot of housing to keep up, both to keep prices down and to reduce the desire and/or need to add sprawly developments out near the MUSA boundary.

[FISHMANPET]

I went on a big link hunt through my twitter feed to find those previous examples, but also I found this from a group in Austin that is what I said just stated another way (though it's not explicitly about small scale development it is implied throughout) http://www.aura-atx.org/what_we_believe

[EOst]

Are we assuming that there is infinite pent up demand for luxury housing in any particular area of this city? Because that's the only way the induced demand theory plays out. If we keep building and building an infinite number of people will appear and the housing will never filter down.

First off, thanks for taking the time to respond! This is a level of specificity I wish people did more here (myself included!).

That said, both Minneapolis and St. Paul have seen really quite incredible jumps in population in the last few years, and only part of that is simply new buildings filling up. Minneapolis has absorbed the equivalent of the population of Golden Valley in the last four years alone. Even if only a fifth of those people are looking for housing in a trendy neighborhood, that's still quite a lot of people, every year for as long as this "urban trend" lasts.

I would say also as a counterpoint to show me an example where supply was restricted and prices did not raise or did not raise very much or even fell without an intense drop in demand (aka Detroit doesn't count). Show me the in demand area that kept rents low by limiting supply.

I don't think that's possible either. See below.

But anyway here's five examples, one of them Chicago: http://danielkayhertz.com/2015/02/20/wh ... ents-down/
Here's another example, literally right down the street:https://twitter.com/evanrobertsnz/statu ... 8290358273

That second one isn't what the tweet advertises.

As for the first link, I appreciate what it's doing, but none of those examples really holds up. The most obvious/egregious one is DC, which I've heard bandied about a lot; yes, its rent growth slowed, but that's due in large part to the fact that its job growth slowed dramatically after the Sequester.

Houston: http://blog.chron.com/primeproperty/201 ... complexes/

Yes, because Houston's economy fell apart.

Also I'll add that I agree that there aren't two firm camps with two distinct ideas, there's a broad spectrum. So let me lay out what I believe. I believe that we need more housing, at any and all levels. I don't think that private developers will exclusively meet that need, and I don't think that public housing can exclusively meet that need. I think we need all of the above. I think the rich are going to do whatever they want. If they want a place they'll outbid you and renovate to be whatever they want. We can't keep the rich out. They're coming for your homes. So let's build them homes, to keep them out of our own. I think that the only possibly feasible long term solution to the problem of housing prices is an increase in supply. I think we're in a sad situation now where we haven't been building enough the last few decades so we have nothing filtering down right now.

Now all that being said, I am concerned with the construction cost of new housing. As Alex says, successful developers are making a modest 9% return. I don't think that's at all unreasonable. If that's all they're making on new development, then we shouldn't be shocked that they're only building luxury, anything else won't pay the bills. So I want housing to be cheaper to build. I'm interested in parking minimums, because structured parking is a significant cost in new apartment construction. I'm interested in technologies that make taller buildings more affordable (going above 6 stories requires moving to steel and concrete construction, which significantly increases the cost of new construction). I'm interested in restrictive zoning and lengthy approval process that ensure that only wealthy developers can take on the risk of new construction. I'm interested in housing being cheaper to build so that profit can be made building more affordable housing (as long as it's still safe, I'm not going to advocate throwing out building codes). I'm interested in making easy for small local developers to build small projects in their communities.

To summarize, I think we need more housing built by a variety of parties (large national developers, local residents, governments, non-profits, etc) to keep prices affordable for all.

To be honest, I don't disagree with you. We need more supply in most of the city, and it's only going to get worse.

But I also don't think we can build our way out of this problem, either. We can play around at the margins with making affordable housing cheaper, but the reasons that so little affordable housing is being built has less to do with those costs and more with structural inequality. As long as the city remains an attractive place for those with wealth (and I believe we're seeing that wave here, albeit at least a few years behind other cities), building new luxury housing is likely to be more profitable than the affordable--besides, . That's why we need much stronger tools to protect the affordability of existing housing stock (probably including rent controls) and a commitment to helping support local businesses. And that's why, in the long run, we need serious wealth redistribution.

[FISHMANPET]

I don't think we can expect housing to bear the full brunt of solving the problem where a person just can't really live on $8 an hour right now in this world.

But no to rent control, yes to more supply. Economics is the dismal science and there have been plenty of economists with bad ideas but the general consensus is that rent control is bad and increasing supply is good.

[FISHMANPET]

Wait, no, lack of housing supply isn't a wealth redistribution. If income inequality was 0, everybody made the same income, we'd still have the same problem. There's not enough housing in places where people want to be. It's as simple as that. We need more housing. I can't say it enough. We need more housing.

[FISHMANPET]

I also notice you didn't refute /all/ of my examples so you can't definitively say it's not possible for an increase in supply to slow rent increases or even decrease rent. But you readily admit that the San Francisco model doesn't work anywhere so I'm not sure where to go from there. We could all cryogenically freeze ourselves until such day that... I don't even know what. Because distribution of wealth isn't going to solve the fundamental problem of there not being enough physical units of housing for people to live in. Solving that problem won't solve the supply issue of housing.

Which is why I snarkily call it a socialist/communist solution. The way I see it, the hope is that somehow the entire economic system of the country will be replaced by one where the government builds and owns all the housing and provides it to residents at probably below cost and somehow people with money won't be able to get their way. But communist Russia was certainly nothing to emulate, and a lot of the Nordic socialist countries have housing policies that basically amount to massive rent control, but they do that by excluding foreigners and I don't think that's something to emulate. So pick your poison, but it always comes back to a lack of supply.

I know I can get to sound like some kind of far right libertarian when I start talking about this stuff, but I'm really not. Except that I still believe the free market is the most powerful force that's ever existed to match up producers of a good and consumers of a good. It's been distorted in this country with tax rates on corporations and wealthy that are too low and laws giving corporations too much power and blah blah blah and I'm not saying I'm in favor of any of that. But ultimately, at the end of the day, the ability for a person that has a good (or the capability to produce a good or provide a service) to provide that good or service to a person that wants it, at a mutually agreed upon price, is incredibly INCREDIBLY INCREDIBLY powerful.

I'm looking around in my living room right now, looking at the things in it. My TV, my couch, my chairs, my rug, the books and games on my bookshelves, the art on the walls, the laptop I'm typing this on, none of it required me to be subsidized to buy it. None of it required onerous public hearings for me to acquire. Nobody limited the number of laptops or pieces of art that were available to me for fear of changing the character of the neighborhood. Nobody prevented these things from being produced because they were worried that some people might not want them or might not be able to afford them. Now I realize that a building has impacts on an area in the way that the size of TV I choose or color of couch I have don't. But fundamentally, it's all the same.

[Didier]

If there was ever a time to split a tangent into a new conversation.

[twincitizen]

Maybe easier to just let it go and not have this conversation in every development thread.

Moving on...

[beige_box]

This is the only conversation we should be having, in every thread. Discussing individual development projects in isolation marginalizes the deep-structural sociopolitical context in which development occurs. That's a formula for bad land-use policy if there ever was one. I thought that's what these forums were about?

Just kidding. So, how about the color of those bricks, eh?

[MNdible]

Great!

Tonight we'll be coming over to your house and telling you what you should be having for dinner.

[beige_box]

I don't get the joke.

[MNdible]

Somehow that doesn't surprise me.

[beige_box]

C'mon guys, let's move on. I think the bricks are an OK color, but maybe they could've gone with something else. What do you think? This is important land-use stuff. I think it would be better urbanism if the bricks were different.

[FISHMANPET]

I think there are people that just want a news aggregator for the latest info on projects, and there are people who want to talk about how a building looks, and there are people that want to talk about how a building "acts" for lack of a better term, and there are people that want to talk about the broader socio-political ramifications of development. I don't think anyone is "wrong" for wanting what they want out of the forum, and I don't think there's enough of us that we could just completely segregate ourselves from each other (especially when interests overlap). So sometimes various desires will overlap and a thread will go off topic, but I think as long as the tangent starts with the project in question, and eventually comes back to the topic of the thread, everything is fine.

[TroyGBiv]

I vote for all opinions and discussion topics to co-exist in harmony!