Historic Preservation (Heritage Conservation) has done it again. Oak Park became one of the United States’ top ten neighborhoods, according to the American Planning Association, and it did it the old fashioned way: it saved its historic buildings.
The Frank Lloyd Wright and Prairie School of Architecture Historic District, listed on the National Register of Historic Places in 1973 and made subject to local landmark controls in 1994 (notice the distinction, Kenilworth???) is the best place to live in Illinois, according to the planners. As the article notes, Wright and the other Prairie architects wowed them a hundred years ago and they still are. Must be some good architecture, no?
My only quibble with the report is that it lauds Oak Park for being a rare combination of historic preservation and urban development. This is a false dichotomy, as I have reported before. PRESERVATION IS DEVELOPMENT. Clearly, preserving Oak Park’s historic buildings have been the centerpiece of its development strategy. And it works: only two other Midwestern neighborhoods made the top 10 list.
Posts Tagged ‘historic districts’
Historic Preservation (Heritage Conservation) has done it again. Oak Park became one of the United States’ top ten neighborhoods, according to the American Planning Association, and it did it the old fashioned way: it saved its historic buildings.
My graduate student seminar this Spring at the Master of Science in Historic Preservation program is focused on historic districts: their history as an expression of community planning and their evolution as an aspect of the historic preservation movement. It builds on my dissertation, which argued that the historic district impulse is about community control in a much broader sense than the more refined motivation of architectural and historical building conservation. Mostly I focus on the residential neighborhoods where the movement has been prevalent over the last eight decades, places like Greenwich Village in New York and Old Town in Chicago.
This semester we had the opportunity to survey two commercial areas in Oak Park, the South Town district on Oak Park Avenue near the Eisenhower Expressway and Harrison Street, the arts district Oak Park has been promoting just north of said expressway along its eastern edge.
Besides fulfilling the “real world” project standards we prefer at The School of the Art Institute of Chicago, the survey project has also been an interesting investigation into the nature of non-residential historic districts, which have their own history. In the 1970s, numerous courthouse squares and historic Main Streets and downtowns were listed on the National Register of Historic Places. Nearby examples include Lockport, an 1930s canal town just 35 miles from Chicago.
Some of these commercial historic districts have also achieved some form of local landmark status. In Oak Park itself, the Avenue district at Lake Street and Oak Park Avenue is part of the Ridgeland district on the National Register and now reviewed by the Oak Park Historic Preservation Commission.
The Avenue district has been quite a commercial success over the last two decades it has been a landmark, in contrast to Downtown Oak Park, which has resisted BOTH historic district status and consistent economic vitality.
I’m not saying those two are correlated: you can certainly have economic vitality without historic district status, and you can have historic district status without economic vitality. Historic districts tend to stabilize and increase values, a pattern more evident in residential neighborhoods, although the Avenue is a good example of how it works in commercial areas. Recently Chicago has designated more commercial districts, beginning with Armitage-Halsted in 2003 and continuing this year with Milwaukee Avenue, part of the Wicker Park National Register district that was originally excluded from the Chicago Landmark district in 1990.
Now all of this is prelude to what my graduate students are doing, which is following the preservation process: survey, evaluate, register. Tomorrow night they will present their findings to the Oak Park Historic Preservation Commission. They may find sufficient buildings of merit to recommend a potential historic district: they may not. They may identify some buildings that merit designation (South Town already has one local landmark) or they may not. Their findings will be presented tomorrow night. The process is what is important.
Another downtown bites the dust – or should we say drinks the Kool-Aid? The latter phrase has been overly misused the last decade or two but it is quite appropriate. Historic downtown Plainfield – a lovely Will County town west of Lockport, has voted down historic landmark status, despite a 21-20 majority of downtown property owners being in favor of it. This was reported in the Chicago Tribune today.
Despite the slim majority of owners in favor, Village trustees voted 4-2 against the district, essentially caving to a minority. Negative motivations – like fear – tend to trump the positive motivations, like the economic security provided by knowing what kind of downtown you are going to have in the future. Another negative motivation: fear of the frightening property regulators, who have somehow not interfered with two renovations of this historic property owned by Pat Andreasen, listed on the state, national and local registers.
Actually, the economic motivations of historic districts are complex, because they are on both sides of the issue. Historic districts have ALWAYS been motivated by a desire for economic stability – to reinforce the investments people have made in their property and to insure the value of their property’s surroundings. This is natural, because real estate is an asset whose value is almost entirely external – it is based on location, location and location. Historic districts create a palpable, physical security about location.
Yet the opponents also have an economic motivation. But it is not a rational, steady economic motivation but more of a “dropped-from-heaven” fantasy motivation that works wonderfully in the abstract and JUST often enough in reality to keep hope alive. Because while historic districts insure and protect and enhance value, they also limit WINDFALLS, those magical moments when the property you owned your entire life suddenly becomes the object of desire of a heaven-sent hotel-condo-highrise developer and you are able to finally realize the POTENTIAL value the zoning board so generously gave you six decades ago.
It is sort of like the lottery – it happens, just not to you or me. But there is enough hope there to keep some people dreaming, and their dreams fuel a sometimes rabid opposition to historic preservation – even the kind that DOESN’T prevent demolition – which is the kind proposed in Plainfield. Repeat after me: this historic designation DOES NOT prevent demolition. But it might force you to talk to your neighbors.
So, here is the pull quote, from local property owner John Bates: “I’m not opposed to historic preservation. I’m opposed to something that limits the options for me to maximize my investment.”
Dude dreamt the dream and drank the Kool-Aid. Sorry, Mr. Bates, but you ARE opposed to historic preservation. You can’t have it both ways.
Chicago’s Old Town was one of the city’s first historic districts, designated in the 1970s along with its neighbors Mid-North and Astor Street and Kenwood on the south side. Unlike its landmarked contemporaries, Old Town’s history and architecture were more modest. The landmark plaques on the streets describe a working-class German neighborhood and even today the enduring image of Old Town is a simple worker’s cottage, 1-2 stories high in frame or brick, perhaps with some decorative window hoods and brackets at the eave.
Architecturally, then, Old Town remains among the most modest of historic districts, and in a town that celebrated the modernist architectural narrative of Louis Sullivan, Frank Lloyd Wright and Ludwig Mies van der Rohe, Old Town offered little beyond a five-house row of early Adler & Sullivan townhouses. Daniel Bluestone reports the famous quote by Chicago’s first preservationist, Earl Reed, and Old Town resident who lamented that his neighborhood “exhibited not even a hint of the International Style in Architecture.” It was like Greenwich Village in New York, a bit of an architectural mongrel, but still a place with a strong “sense of place.”
Old Town also shared with Greenwich Village a passion for community activism that more than made up for what it lacked in architectural elitism. Community groups arose immediately after World War II in an effort to create a stable, family-friendly community a short distance from downtown and only steps from the Lincoln Park lakefront. Old Town also shared a community narrative about artists and freethinkers. The Old Town Art Fair – the first in Chicago – began in 1949 and cultivated the artistic image of the community Greenwich Village had pursued even earlier in the century. Both Greenwich Village and Old Town traded on their bohemian nature but became uncomfortable with that status during the countercultural upheavals of the 1960s.
Old Town actually supported urban renewal in an effort to improve their neighborhood, although public sentiment turned sharply against it once the bulldozers started rolling. In the 1970s they turned to Chicago Landmark status – and downzoning – in an effort to limit the highrises that were walling off Chicago’s lakefront. Their success in stopping highrises was limited, another parallel to Greenwich Village, where those godawful white brick behemoths soared in the 1960s during the four years it took for the neighborhood to become a designated New York Landmark.
Community activisim took the shape of an historic district and Old Town has always been one of the most active communities, participating in permit review meetings at the Commission on Chicago Landmarks. The uninitiated think of landmarks review as some form of “architectural police” but in reality it is quite simply a forum for the community to make their feelings known – an attempted democracy of the built environment. The historic district gives the community a place to voice their opinions – and they have done so in Old Town – markedly – for over 30 years.
When I take my students to Old Town today – as I did last week – I ask them to look not just at the architecture, but also at the sense of place. There is a scale to Old Town, a closeness of building to street and street to cross street and curb to curb that you simply don’t find anywhere else in the city. It is not so much about the rope mouldings above the windows or the paired brackets and dentils at the eave or even those Furnessian ornaments on Adler & Sullivan’s Halstead Houses. It is about a premodern relationship of buildings and streets and narrow alleyways – something not unusual in Rome or the old part of Edinburgh but exceedingly rare in Chicago.
And when I walk through the streets of Old Town I also see the narrative of community activism – an activism that continues more than three decades later as Chicago Landmark status becomes a forum for community groups to provide input into the disposition of their built environment. How will buildings look after they are rehabilitated? What kinds of new construction or additions are acceptable to the community?
I researched Greenwich Village and Old Town for my dissertation and one of the things that struck me was how both communities lacked traditional architectural distinction but planned to use district designation in order to make the community more architecturally coherent over time. And it has happened. Old Town has seen more of its cottages and brick flat buildings brought back to their original design. Areas around Old Town have also “improved” but with new construction at a new scale and style that diminishes the sense of place.
Thirty years ago you would see the same kind of neighborhood north and west of Old Town and today you don’t. The historic district retains layers of history, a rootedness, a sense of unique, distinct and coherent place. Those areas outside are nice enough, but they are like a lot of other places. Their sense of place is every place. Old Town may not have the fanciest architecture, but at least you know where you are when you are there.
I just finished reading Andrew Dolkart’s new book “The Row-House Reborn: Architecture and Neighborhoods in New York City, 1908-1929” (Johns Hopkins 2009) and I loved it. Dolkart tells a story that is fascinating from several perspectives in the history of building conservation, and he tells it very well. The book springs from a simple fact: people started rehabbing rowhouses in New York (and elsewhere) in the early 20th century. Sometimes these rehabs respected the original exterior of the buildings, essentially following current preservation practice for locally designated historic districts. Sometimes they heavily altered the exterior, following emergent fashions for “Colonial” or Mediterranean renaissance stylings. This involved chopping off no-longer fashionable stoops and window surrounds and other extraneous Victorianisms.
Near Bleecker Street, Greenwich Village. Photo copyright Felicity Rich 2006.
You see these rowhouses everywhere, and Dolkart has unearthed tons of period commentary and reportage on the conversions: they usually involved complete interior remodeling of partitions, kitchens, and the like. They also often involved exterior remodeling that typically eliminated the stoops for new groundfloor entrances; shaved off many of the window and door mouldings; rendered the facades with stucco; often added multipane, casement or studio windows; developed rear gardens in an early and successful attempt at gentrification.
93 Perry Street facade. The archway at left leads to the garden and rear building in this 1928 rehab by local architect Floyd McCathern. Dolkart includes a 1932 photo in his book. This photo is copyright Felicity Rich 2006.
Dolkart’s investigation therefore explores one of the philosophical issues that constantly recurs throughout the history of conserving the built environment: when does something become historic and WHEN are we trying to restore things too? Clearly changes to rowhouses that happened in 1912 or 1922 are now “historic,” yet Dolkart notes that many such changes are eliminated with the full approval of landmarks agencies when owners propose restoring a rowhouse to its original condition of the 1840s or 1880s.
Dolkart’s contribution is significant in his detailing of how these remodelings were considered in terms of architecture and real estate development. He first details the many projects of Frederick Sterner, who redesigned many houses for himself and other high-end patrons, transforming the East 60s from an immigrant area to an island of elite pied-a-terre. Dolkart crafts a compelling architectural context for these conversions as representing a distinct social and aesthetic history that is implicitly worthy of some preservation.
The Parge House on East 65th, Frederick Sterner’s final house. The use of ornamental relief in the exterior stucco (pargetry) was a feature of Sterner’s work. Photograph copyright 2006 by Felicity Rich.
Dolkart devotes a significant section to Greenwich Village, which I studied as part of my dissertation. The Village is fascinating for two reasons, both of which are central to Dolkart’s story of early 20th century creative rehabilitation. First, the Village had a strong artistic identity, an identity I explored in my dissertation, relying on many of the same sources Dolkart cites (and critiques). This artistic identity was turned into both heritage tourism and real estate speculation, as the artistic identity of the community became a rationale for rehabilitating buildings by adding artist’s garrets, large studio windows and the like, even as the buildings were being rehabilitated beyond the means of most artists to rent or own.
Greenwich Village – another photo copyright 2006 by Felicity Rich. I guess she was noticing these buildings a few years back…
In my dissertation I dealt with Greenwich Village because it was central to the adoption of local landmarking and preservation in general but it lacked traditional architectural integrity, and these 1910s and 1920s row-house rehabs are part of the reason it was originally proposed to be 18 separate historic districts. Thanks to a centuries-old artistic identity and the concept that landmarks designation would help make the district more architecturally cohesive over time, it became a single district in 1969. I used it as an example of the community-planning impulse in landmark designation, which has at least two aspects: first, the motive to preserve not simply architecture and history but community in the largest sense, and secondly a future-orientation focused on community improvement and employing landmark designation as the motor and model for that improvement. Certainly many of the 1910s and 20s rehabs have been “fixed” since the designation of Greenwich Village, which is why Dolkart began looking at this issue in the first place.
My only critique of the book is its perhaps natural limitation – an Epilogue of less than 10 pages called “Beyond New York City” with brief mentions of Boston, Philadelphia and Charleston. In my work I compared the ongoing conservation development of Greenwich Village – “Zoning Bohemia” – to its Chicago counterpart of Old Town, certainly smaller and about 10-15 years behind its Big Apple cousin. But as soon as I started reading the book it immediately brought to mind the same type of 1910s and 1920s rehabs in Chicago’s Old Town, like this:
Now this is of course one of the now-famous and independently landmarked homes that Sol Kogen and Edgar Miller fabricated out of existing building stock in the 1920s. But Old Town also has stuccoed, Mediterranean-Revival-roofed houses on Lincoln Park West and altered Italianates with casements and studio rooftops – all added during the transformation of the district into an artistic enclave in the 1920s. There was even a wave of 1960s rehab that inspired the district itself in the 1970s, and much of that did not follow traditional architectural preservation standards.
I am grateful that Andrew has written such a nicely researched and crafted book and I hope it inspires us to look at the early waves of rehabilitation and how they thought about buildings and communities. It was a welcome, enjoyable and inspiring read.
JANUARY 19 update:
Here are the buildings on Lincoln Park west I was thinking of. I haven’t researched these so I don’t know when they were altered, but the first (actually on Menomonee at the foot of Lincoln Park West) has extra-long windows, a rendered upper facade, and diamond panes in the lower windows:
Next, a few houses north on Lincoln Park West, are these two old Italianates made into Spanish Colonial houses with render, a pent tile roof, and adobe-like walls. Again, I haven’t done the research but I am guessing 1920s.
And of course the Crilly Court gardens remind one of the many rear garden schemes Dolkart found in Manhattan. This is where the Old Town Art Fair started in the 1940s, 15 years after Greenwich Village started its art fair.
I found another near Michigan Avenue -as I knew I might, since the area around the Water Tower – Towertown – was the artsy area before the creation of North Michigan Avenue in 1920. I also noticed several over on La Salle near Burton Place, the ultimate arthouse block done by Kogen and Miller in the 1920s. Here is the one off Michigan Avenue:
AND THE HAMMER OF JUSTICE COMES DOWN
Earlier this year a Chicago lawsuit hobbyist with lots of money and neighbor-management issues got the Illinois Appellate Court (“Precedent? We don’t need no stinking precedent!”) to strike down the Chicago Landmarks Ordinance based on its “vagueness,” so naturally someone else thought they could pull the same sort of isolationist garbage elsewhere, namely Seattle.
They just LOST BIG TIME. Read about it on PreservationNation:
Turns out the Washington Court of Appeals rejected the “vagueness” challenge by recognizing the OBVIOUS: Landmarking is a process that encourages the preservation of historic sites, districts and structures, based on the criteria that those sites, districts and structures possess. This is not vague, it is entirely specific: you cannot detail what needs to be preserved in all situations because each sites, district and structure has its own individual characteristics that make it significant. Landmarking treats buildings like individuals, not categories.
The court said it better than I can, explaining that the supposedly “vague” standards, “gain specificity from application to a particular landmark and particular proposal.”
Or even better, they noted that because “each landmark has unique features and occupies a unique environment, it is impracticable for a single ordinance to set forth development criteria or standards that could apply to every landmark.”
This is what I have been saying all along (see my post “Appellate Nuttiness” on January 31, 2009).
Now, I understand that people, and even judges, are more comfortable with absolutes and doctrines and everything being the same. But everything isn’t the same, or I could use my Epson printer inks in the Hewlett Packard, but I can’t.
Turns out a vagueness challenge is one of the first things you learn, sort of a Lawsuit 101. See Gary Cole’s blog here.
Here is what the court said:
“The doctrine of vagueness does not require a statute to meet impossible standards of specificity”
The crude medicine of basic zoning and building codes offer predetermined absolutes and specific standards: you must set back 5 feet, you are limited to this square footage, you are required to have this many exits, etc. Everything is the same and every building is treated the same, and you know what is going to happen before it happens and there is no vagueness. It is the sort of straightforward rules and procedures one needs to successfully operate a pre-school day care facility.
But for grownups, the world has nuances.
People are individuals, not numbers.
Communities are individual as well.
Within Chicago, the Villa does not equal Wicker Park and the landmark review process will not follow the same path on an Astor Street Georgian Revival that it will on a South Shore Foursquare.
Landmarking is a PROCESS, and reviewing changes or additions to landmarks is also a PROCESS, and the rules are defined individually for each landmark. Every Chicago Landmark, when designated by the City Council, includes a list of significant architectural and historical figures so that every owner knows what is important about their building. But what is appropriate for a bungalow may not be for a Queen Anne, and vice versa.
Here’s one for individualism. Thanks, Washington state.
WEDNESDAY UPDATE FROM SAIC HPRES STUDENT MITCH BROWN:
“Connor is denied on each and every count. I hope the good judges of Illinois’ Supreme Court read the decision.
Deprivation of substantive due process – NOPE, landmark preservation is a legitimate state interest.
Regulatory taking – NOPE the safeguarding of the public interest in legitimate in this sphere (they got RFRA wrong)
Hidden indirect tax, fee – NOPE even had the SLPB required the stipulations Connor’s alleges (which they didn’t) it would’ve been in the service of mitigation in protection of the Ordinance 11022.
Wrong application of the Law 20 – NOPE as the hearing examiner properly applied SMC since under SMC and Standard 9, Connor’s proposal would adversely affect the landmark and there were alternatives available. Connor’s argument rests on his insistence that the “owner’s objectives” are not subject to review (who is this guys lawyer!?) “A party who purchases a property subject to agreed upon landmark controls cannot thwart those controls by defining his objectives under SMC entirely in terms of the return he wishes to make on the property” (hearing examiner with court concurrence)
“The Landmarks Preservation Ordinance is impermissibly vague because it does not tell me exactly what I can do with my property” – REJECTED – Can Conner ascertain the requirements for an acceptable project? – YES – The LPO contains both contextual standards and a process for clarification and guidance as to individual sites.
LPO and Ordinance 11022 describe specific features to be preserved with corresponding contextual standards for application.
“The doctrine of vagueness does not require a statute to meet impossible standards of specificity” I like this one the best.
“Clear Error” NOPE – Court reviewed hearing examiners review which was based on publicly passed Ordinance 11022, not the Report on Designation used by the Board.
Scope of the Designation? Is the site protected? Connors – ” ‘Satterlee House and Satterlee Residence’ is proof the city council intended only the house and not the site to be recommended…!”
Lets all hope Hanna and Mwroka’s cases are as ham-fistedly argued as Connor’s was.
I own a house in a historic district and last year I blogged about how thankful I was for that fact. Real estate is an asset whose value is largely external – it comes from its location, which is to say, its surrounding buildings and environment. Because my house is in a historic district, its value is assured. Economic studies for over 40 years have confirmed this fact in communities across the United States.
If you look at the history of historic districts – which I did in my dissertation – you find that the first modern historic districts emerged in the 1950s in communities that were concerned about drastic changes to their environment and thus the value of their homes. Urban renewal was one threat, which proposed outright demolition. The other threat was posed by postwar zoning ordinances, which dramatically increased density and thus owners of brownstones or single-family homes faced the prospect of massive highrises next door.
So homeowners in places like Beacon Hill in Boston and Brooklyn Heights in New York did what their forefathers did a generation earlier with zoning: they crafted legislation to protect their environment and thus their home value. Often they also secured downzoning – this happened in Greenwich Village in 1961, and in Chicago’s trio of lakefront landmarks in the 1970s – Astor Street, Old Town, and Mid-North.
Now, some people, motivated by greed or some sort of Ayn Rand ideology, argue that they don’t want historic districts because it will limit their value. How can this be true? Well, we have the examples of teardowns, where people are able to cash in on windfall profits because they can tear down a house and build a bigger one.
The libertarian ideology goes right out the window as soon as you realize that what allows the teardown is zoning: it’s just another government handout. In fact, the zoning that makes teardowns possible and profitable ALSO protects the value of some of those teardowns by insuring that I can’t build an abbatoir next door. Indeed, that it why a Supreme Court Justice (Sutherlan – who was as conservative then as Scalia is today) upheld zoning in 1926. So people who bought houses wouldn’t have knackering houses next door.
Historic districts were born at the same time as zoning and for the same reasons and they are in fact simply a more precise and surgical tool compared to zoning, which can sometimes be a blunt instrument. They also secure value, and I will not be surprised when some teardown neighborhoods hit the skids when McMansions start falling apart in 2020 during the height of the baby bust. After all, I have seen how they were built.
There is a vital economic principle at work in historic districts: uncertainty. The reason people get all NIMBY about things and fear change is simple: they fear uncertainty. This has economic agency because uncertainty discourages investment and consumer confidence and other things that are seen as positive for a growing economy. This is another stick in the eye of free market ideologies, because in reality, markets only operate well under conditions of security and certainty. Bandits and plagues and earthquakes are generally BAD for markets. Historic districts, like other zoning devices, create a sense of certainty that insures value over the long term, even if it might discourage short-term windfall profits.
Historic districts create another alchemy which led me to question one of the basic assumptions I have been talking about here. Ownership. We want the certainty of a stable environment to preserve our home value, an argument Dartmouth economist William Fischel has made excellently. But I also studied historic districts in Manhattan, and found a strange condition. People wanted historic districts and the certainty of an attractive, healthy and wealthy environment, but they didn’t own. A majority of the residents of places like Greenwich Village and Hamilton Heights were renters, not owners when they sought historic status. Moreover, I found that renters were investing tons of sweat equity in Greenwich Village rentals from the 1910s onward. This counters the ownership and equity theory.
Why? I think it comes back to the certainty principle. You might have equity, but that is an abstract concept. And in the 2009 world of upside-down mortgages, it has proved often illusory. But where you sleep and eat and the buildings and streets you travel to work and shop and recreate – those are real. They are certain, and you derive value from your environment whether or not you accumulate value in it. You can’t take it with you. But you can have it with you all the time you are here.
As long as I live in a historic district, I will have this value and this certainty.
There was a great symposium Saturday at the Chicago Architecture Foundation, one of several in conjunction with their exhibit on the history of Chicago preservation: “Do We Dare Squander Chicago’s Great Architectural Heritage?” that runs through May 9 (See it now!). Prof. Bob Bruegmann opened it up with an excellent history of teardowns and the inquisitive, expectation-overturning perspective he brings to everything. Prof. Richard Dye, an economist, explained the economics of teardowns. Both men suggested that an upside of teardowns was that they shouldered a bigger portion of the tax base, a fact that neighbors of teardowns are perhaps loath to admit. Bob did note that increased values could mean higher taxes for the teardown-adjacent in their little historic houses as well, and he also sagely discussed the new penchant for small houses, which are of course greener and thus more chic and popular with the wealthy.
Which is part of the objection to teardowns – lots of people hate them not for what is lost but what replaces them – ersatz castles with turrets and lions and gargoyles and balustrades that scream “I just got a lot of money and I don’t know how to use it!” (That is of course an Obamaesque elitist opinion).
Anyway, back to the economist Dye, who talked about how markets work to maximize value in good locations, which lead to teardowns, and markets fail because houses are durable goods built for current fashion but last longer than those fashions. Cathedral ceilings, great rooms, bathrooms that would make a Saudi prince blush, and other trappings of 1999 are popular examples of the fashionista excesses of McMansions and Lollapalazzos.
So I was suddenly struck – as a historian – by the fact that the teardown phenomenon emerged at the same time as the TIF phenomenon, and mindful of the big fight in Oak Park over extension of the downtown TIF, I asked whether there was a connection between these things, since teardowns occur largely in inner-ring residential suburbs that rely on a residential tax base, and since (I presumed) TIF districts limit the amount these places can rely on commercial taxes, hence teardowns – by increasing the tax base – might be related.
This got Dye’s hackles up. His short answer was no but his long answer – which came first – was that I had an understanding of TIFs that was much clearer than his and he has studied them. Zing! TIFs are simply a financing mechanism he said. Fair enough, but I told him later it was an honest question – I noticed a cohort and asked if there was a correlation. In my neighborhood the school district negotiated carve-outs to the TIF district and blamed it for their reduced income. The first TIF happened at the same time as the first teardown. That doesn’t mean they are related but you can see where the question comes from.
And my hackles get up when people describe any development – commercial or residential – as shouldering more of the tax burden. The suggestion is that I would be paying more taxes if the development didn’t happen. I hope someone at the various land institutes is studying this, because it counters both intuition and experience. Consumers have a hard time with this argument basically because taxes are historically unidirectional, and the conceptual leap “But your taxes would have gone up 200% if we hadn’t spent $25 million of public money on that shopping center” is hard for the average guy to make.
If there is a new development, property values go up and so do my taxes. If I oppose a new development and granted some queer quirk of history, stop it, values presumably are depressed, and so are my taxes. This seems to me related to Bruegmann’s argument – shared by a whole lot of economists – that regulations add costs to real estate and thus reduce affordability.
But of course real estate economics is about location, not cathedral ceilings or giant master bathrooms or high end appliances or Frank Lloyd Wright, as Dye and so many others noted. Teardowns occur in choice locations near transportation, amenities and where zoning suggests it.
Oh – there it is. A stick in the eye of the free market. Zoning. Seems government controls that, and it seems to have an oversized influence on the teardown market. My town downzoned a bunch of areas – to their actual size – recently because of outrage over teardowns of small houses just outside the historic district. Interestingly, inside the historic district there are loads of cases where they simply add lots of units on the rear, thus capturing more of their land value. Land value that comes from zoning.
Now, I’m not an economist but I am an historian and I know that Justice Sutherland was a fierce advocate of property rights and I know that the reason he upheld zoning in 1926 (I mean gee whiz he could have gotten someone else to write the opinion – he wanted his fingerprints on this one) was that it upheld property rights in the abstract and property values in specific. Location makes the big differences in price, but zoning creates the demand for teardowns in all sorts of markets – which is where teardowns are occurring. Teardowns have ripped across this country in the last 15 years with unprecedented speed affecting all sorts of communities.
Correct that – there is a precedent and it is zoning. Between 1916 and 1926, 591 zoning ordinances were enacted regulating the properties of 30 million people. Talk about a fad – that is like the iPod. Don’t tell me it didn’t have to do with property values. But somehow this topic – government granting value through zoning – doesn’t have much place in the discussion, which is queer. The whole point of Chicago’s 1957 zoning ordinance – which doubled downtown density – was to get downtown development going. TIF is a form of financing yes, but it is also a government subsidy to stimulate development in the same way zoning is a government subsidy. They are both clever in the sense that they are subsidies where you don’t have to write a check.
Now before the numbers crunchers get their knickers in a twist, look at the history. We zoned in the 1920s and then we rezoned in the 1950s, so we should have zoned again in the 1980s, but we didn’t. We didn’t rezone until the aughty-aughts (2003) and then zoning had so many damn community activist inputs raising costs that it wasn’t much good at granting value.
Oh wait, I thought of another precedent for teardowns – blockbusting. The Austin neighborhood in Chicago – about three square miles – went from all white to all black in 5-6 years. Now blockbusting was a technique whereby a speculator offered one or two white homeowners on a block a lot double what their house was worth and then sold it to a black family at a slightly inflated price, because they were buying in a white neighborhood. The speculator could afford to lose money on the transaction, because once it was complete, thanks to racism, they would be able to buy all of the other houses on the block for half price and sell them for full price.
Teardowns are different of course. Speculators find a nice neighborhood location with good amenities, offer someone a good price for their house, knock it and build a newer bigger better house. The neighbors see that and often decide they would like to cash in as well, so they get the same good price for their house, right?
The trick here – as far as an amateur like me can understand – is that real estate is all about externalities. I was taught that real estate is a commodity and an asset whose value is not intrinsic but based entirely on its surroundings. I had a real experience of this in the early 1990s when I bought two Frank Lloyd Wright houses for a dollar. As we priced out the rehab, it became clear that these houses – despite their pedigree – had a negative value of at least $40,000 apiece. Why? Location. I should share this story with Dye and Dan McMillen, since it underscores their contention that location outweighs all other factors. Even regulations, I suppose, since those are generally advocated by residents who want to maintain their property values, just as they did in 1926. I agree with the economists who say that regulations increase prices (by increasing costs) but there is a massive “D-OH” here: that is the economic expression of what the people wanted.
But the real stick in the number-crunching eye is this: people aren’t rational consumers. The majority of our economy is a consumer economy and the biggest consumer item is the personal home. There are economists who study consumer rationality, and maybe they should look at the uber-tacky McMansions and dissect some of that consumer irrationality (I suspect it is simply the absence of a visual sense).
I have studied some economists who look at land value and regulation like Glaser and William Fischel, whose most brilliant insight (related in the Homevoter Hypothesis) came at a zoning meeting when a neighbor he knew and respected opposed a development that was obviously going to be good for the neighborhood. Fischel’s eureka moment came when he realized the property owner was motivated by a simple principle: uncertainty. You can tell me it is going to be good, you can tell me I will bear less of the tax burden, but all of that is in the future and I want to keep what I have now. I am not certain how that development will turn out and I am not certain what will happen to my taxes.
Zoning arose in response to what Fischel terms “the radical uncertainty created by the truck and the automobile” and all of the various regulations from historic districts and moratoriums in response to teardowns arise from the same motivation. Some people hate what is lost and some hate what replaces them. But everyone hates uncertainty.
I was at Texas A & M University this weekend for a preservation symposium. Several of the Texas schools presented their projects, notably student study trips to Mexico and Elizabeth Louden’s amazing work with a 3D Laser scanner, which her graduate design studio used to model (and animate and fly-through etc. etc.) the main street in Troy, Texas. I am no technophile but this thing is pretty neat, and apparently you can get one for less than half what they cost a few years ago. A bargain at $100,000 ( I wonder if it is Mac compatible??)
I also did a presentation about my historic districts research, which is also the subject of a graduate seminar I am teaching this semester. The reaction was pretty good to my basic thesis, which is that community planning activists have infused the preservation movement with a broader set of goals and objectives and altered its nature. The students in the seminar have done a nice job digging through the past of districts in various cities – especially the early ones in places like Boston, Philadelphia, New York, San Francisco and Pittsburgh. Next they are going to tackle various Chicago districts.
This is fun research because like all good fact-finding, it kicks the stuffing out of popular myths and preconceptions. I mean, we all know that historic district preservation was a reaction against urban renewal, right? Just ask anyone. But the historic record shows that great preservation neighborhoods like Old Town actually supported and organized urban renewal efforts in the 1950s and 1960s! Huh? Well, at the time, it seemed like a good way to save their neighborhoods. Once the bulldozers got going and the neighborhood started to lose both buildings and diversity, then the blush wore off the project and everyone started fighting it. Plus it was 1968 by then and fighting it was in the air. Of course, the flip side of this is that historic districts (see last blog) tend to knock up the value of property – at least over the last 60 years, which means they can weather cycles better than ARMs, so there is something essentially conservative and middle class about the whole enterprise too.
I have to give a shout out to Michael Tomlan, who opened the symposium with a fabulous thing on preservation and the trades. He noted how Judaeo-Christian our preservation practice is – very focused on the physical, material nature of things. We prize the thing that we call authentic and aren’t bothered if we use a nail gun to fix it or a $200,000 Leica LDS to model it, while the Shinto temples in Japan are demolished every twenty years and rebuilt with the same tools and techniques used a thousand years ago.
What are you trying to preserve?
In the last month I have read two articles both titled “Home Economics” and both might be said to be profiles of anti-landmarks persons. The first was in Chicago magazine and profiled a local lawyer who helped quash landmark designation in the Sheffield/De Paul neighborhood. Her argument was that designation would hurt property values and cause all sorts of expenses for homeowners.
The other “Home Economics” profile was of economist Ed Glaeser in the New York Times, and he said just the opposite.
On Thursday the Wall Street Journal published an article about the proliferation of local historic districts driven by residents’ desire to raise their property values. That counters our Chicago attorney-cum-economist, but it supports Glaeser.
Like most economists nowadays, Glaeser is a fancily-dressed bomb-thrower, famously lobbing one at New Orleans saying it shouldn’t be rebuilt. His big argument is that regulations like zoning and landmarks laws have contributed mightily to the recent rise in real estate values. It is the kind of argument that tickles the curlies of right wingers eager to dispense with environmental regulation and return to the urban paradise of the Wild West boom town.
At first I thought, this is crazy – everyone knows zoning caused huge upticks in value in the 1950s and 60s. I have spent my life fighting to save buildings – like the Berghoff – saddled with double-for-nothing-zoning. In Chicago in 1957 they doubled the zoning downtown. New York did the same thing in 1961, planning for a city of 16 million by 2000. Talk about government largesse.
Now, Glaeser’s tipping point is actually 1975, long after the postwar zoning ordinances had doled out their added value. The year corresponds to the triumph of the community planning movement, which started in the late 1950s when community groups decided they should have as much a voice in their environment as any downtown professional architect or planner.
I love economists and economic historians because they don’t get swayed by the mythologizing and ideologizing that plague most people. But they also make the fatal mistake of assuming that all commodities can be alienated. Historic buildings and districts and cities are particular, non-transferable and inalienable. Their value does not correspond to rules of supply and demand. Glaeser’s enterprise consists of progressively stripping away variables until he can declare that regulations have restricted supply.
Now, I ain’t as smart as this guy and God knows he’s got me beat silly in the silver cufflinks, three-piece suits and cigars department. So maybe he is right and indeed highly regulated places like Manhattan have become geographic luxury goods, surviving their oppressive regulatory hell only by virtue of a stock of human capital supplied by universities and businesses.
But why do the humans stick it out? Why do they stay in Boston or New York or Chicago when they could be like everyone else and enjoying their 48 minutes of daily automobile commute in Houston or Las Vegas? Maybe there is something to PLACE that can’t be alienated and quantified on a commodity basis. Maybe the kind of thing that makes people buy a three-piece suit when everyone knows two pieces will do fine.
Glaeser loves Jane Jacobs, whose most wickedly good argument 45 years ago was that the urban experts were using 200-year old science: Newtonian mechanics that dealt with simple problems of one or two variables. Jacobs said that modern science allowed us to deal with problems of disorganized complexity – multiple variables impossible to isolate but possible to predict in aggregate. This is how much of economics works – they don’t know what I’m gonna buy but they can tell you how many cufflinks they will sell to people my age.
But Jacobs said cities were neither simple problems NOR problems of disorganized complexity but biological problems – issues of organized complexity insoluble by statistics – organic and particular problems akin to genomes and mitochondrial markers. I wonder if Glaeser is pushing economics toward this type of analysis? If he does he’ll be bombing us for a long time to come.