Future Cities: Vertical or Horizontal?

California Buildings News • Q2 2021

By Ed McMahon, Senior Fellow, Urban Land Institute

When it comes to land development, Americans typically dislike two things: too much sprawl and too much density. For half-a-century, the pendulum swung sharply in the direction of spread out, single use, drive everywhere for everything, low density development.

Then the pendulum swung back. Energy prices, smart growth, transit-oriented development, new urbanism, infill development, sustainability concerns all coalesced to foster more compact, walkable, mixed use and higher density development. Cities were cool again.

The pendulum swing was both necessary and long overdue. In addition, there was a growing demand for higher density housing because of demographic and lifestyle preference changes among boomers and young adults. The problem was that many developers and planners decided that density required high rises: the taller the better.

Buildings 20, 40, 60, even 100 stories were proposed and built in once low and mid-rise neighborhoods all over the country. All of these projects were justified with the explanation that if density is good, even more density is better. The problem was that the units in these buildings were almost always very expensive and invariably small. Even the larger units were typically a maximum of two bedrooms with an open concept, living room, dining room, kitchen. The idea was that the amenities in the neighborhood: parks, bars, restaurants, theatres and other urban assets would make up for the lack of space. The tallest and most expensive buildings, like the pencil towers in New York, were, according to the NY Times “mostly empty, most of the time” because the units were simply investment vehicles for the super-wealthy. When the Pandemic Hit...

Then two things happened. First, millennials started to have families and then the pandemic hit. All of a sudden, both parents were working from home and then they realized that there was no place to put a desk, a bookcase or a file cabinet, unless it was in front of those lovely floor-to-ceiling windows. And how were we supposed to work with small kids at home?

The office sector saw a similar compacting of space. Before the pandemic, there was a trend toward “open offices”. This meant more employees in less space, reduced boundaries between staff, interaction encouraged, centralized supervision and of course, more offices downtown. The pandemic has turned these trends upside down. Now we are seeing fewer employees in more space, increased boundaries among staff, staggered workdays, the return of cubicles, more employees working from home and a shift to offices in the suburbs.

A big question is: how many employees will go back to the office, once the pandemic has subsided? According to a recent report by the National Association of Business Economics, few employers expect to completely abandon office space, but only 1 in 10 employers expect all employees to come back into the office. The post pandemic office will include much more flexibility. A majority of companies are developing hybrid offerings in which people work from home some days and in their office’s other days. What’s more, the long duration of workplace disruption has caused some people to prefer the new normal, while others are over it and are ready to go back to the office. The Future of Vertical Cities

An even bigger question is what is the future of cities, especially vertical cities, following the pandemic? In the short term, the pandemic has accelerated the out-migration of people, jobs and capital from high rise, high-cost cities like San Francisco and New York, to smaller cities, suburbs and high amenity small towns. In the longer term, big gateway cities, could become more affordable again. We already see lower rates and higher vacancies in urban multifamily projects and in Center City office buildings. So what happens, if many of those offices never fill up again? Well, older office buildings can be converted to housing and some tenants from the older buildings will now be able to relocate to Class A space in the newer, but now more affordable buildings. Vacant

office buildings can also be adaptively reused as hotels, student housing, data centers or even vertical farms.

To be clear, big cities, despite the current adversity, have a bright future. There have always been cities across history, no matter the time or place. Cities have always facilitated commerce, government, worship and social and cultural interaction. Also, cities have always had health challenges, from the time of Rome, to the dawn of the industrial age to the tenements of the early 20th century, but cities have evolved and improved. Cities are adaptable and resilient. As rents and prices reset to more affordable levels, the laws of supply and demand will ensure that cities will prosper once again. Horizontal Living?

So, what about the suburbs? Does the urban exodus mean more sprawl? Not necessarily. Even before the pandemic, the suburbs were changing to become more walkable, compact and mixed use. What’s more, many of the people leaving cities don’t want their parents’ suburbs. In the future, we are likely to see many more suburban retrofits. Office parks are adding retail and housing, suburban town centers are popping up all over the country, underperforming parking lots at dead strip malls are turning into multi-family housing and suburban TOD projects are likely to grow in the future.

Managing density in the suburbs requires developers and planners need to recognize several things: First, that we don’t need density everywhere. Density works best in a few key locations: near large transportation investments, along underperforming commercial corridors, in suburban town centers, and in former office parks and light industrial areas. Density also does not require high rises. Tremendous density can be achieved in compact, low and midrise neighborhoods. Paris for example, has almost twice the density of New York, despite a general lack of high rises. Finally, density demands high quality design and compensating amenities like parks, playgrounds, sidewalks and bike trails. The question is not vertical vs. horizontal, but creating density that makes communities more liveable, affordable and attractive. n

For our members, for our industry, for our communities.

The Carpenters Union works with signatory construction, mill-cabinet and installation contractors to keep our jobs safe and to keep our industry moving forward.

Joaquin Galindo and Eriberto Bolanos, Carpenters Mill-Cabinet Local 2236, complete a custom-built cabinet at US Millwork Mission Bell in Morgan Hill.

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