The Business City Structure 2.0

The future of cities post-Covid

The recent VPELA webinar City Structure 2.0 – The future of cities post Covid explored the conceptualisation of cities as labour markets, and through this lens what effect Covid-19 will have on the shape of our cities and the role of planning.

Chaired by Mark Sheppard, Principal of kinetica and author of Essentials of Urban Design, the event featured Alain Bertaud, New York based international Urbanist and author of Order Without Design – How Markets Shape Cities, Sally Capp, Lord Mayor, City of Melbourne and Peter Seamer, former CEO of the VPA and author of Breaking Point – Future of Australian Cities

It is a widely observed and acknowledged truth that land value and density patterns in a city largely respond to the proximity and availability of jobs, and that housing choice is primarily a function of commute time and affordability. A shorter commute is the trade-off for the smaller home that is affordable, given higher land values near employment concentrations, while a longer commute to areas of lower land value provides opportunity for a larger house or property. With the event of Covid-19, that counterbalance has been disrupted. Those with longer commutes that are able to work from home are enjoying the benefits of greater work-life balance, and those with smaller living spaces are now realising the difficulties of accommodating dedicated work spaces without compromising the primary role of the dwelling as a home. However, for the large part, we have discovered that working from home is not only largely achievable, but often provides significant upsides as well.

If the city is indeed the physical manifestation of a labour market, how will shifts unlocked by the pandemic such as the finallyrealised flexible work arrangements and working from home alter the shape of the post-Covid city? And, what is the role of planning in managing or responding to this change?

The role of the city

Bertaud began by stating that planners do not design cities. The labour market is the essence of the city; people trying to sell their labour to companies, and companies looking for the best and brightest available in the area. The standard urban model that is observed in large cities globally, with land values and density increasing toward the centre, is the physical manifestation of this market.

Melbourne follows this model, with increased densities around the CBD, and a sharp drop-off beyond the inner ring suburbs. Similarly, the largest concentration of jobs is within and adjacent to the CBD. There are notable emerging exceptions, such as Box Hill, though it must be noted that decades worth of policies attempting to create a more polycentric city have had little success. Bertaud’s conceptualisation of the city as a labour market offers an explanation for this.

Tim Nichols Kinetica

This monocentric model of both density and jobs is reflected in the radial-centric transport systems of Melbourne, particularly public transport. As noted by Lord Mayor Sally Capp, pre-Covid Melbourne had over 1 million people coming in and out of the city daily. The city is currently being ‘devastated’ by the effects of over 800,000 people working from home and as a result not visiting the city every day and supporting its restaurants, retail, and cultural institutions. Noticeably this has led to empty streets, with the lowest pedestrian count being recorded in some 41 years of data collection. Looking ahead to 2021, Capp noted that this is only expected to return to around 64% of pre-Covid rates.

A significant market signal that the pandemic may lead to a more permanent shift in work and commuting patterns is commercial vacancies, which Capp noted have increased from an all-time low of 1.9% to around 6%, and are likely to get up to around 10-14% in 2021. Major commercial developments are being cancelled or put on hold. 39,000 jobs have been lost already in the city centre. Fewer city workers equals lower foottraffic volumes, which has a devastating flow-on effect for the service sector within the CBD.

While Bertaud and Capp focused largely on the role of the city and CBD in terms of labour, jobs and commuting, Peter Seamer took a contrasting stance that set up an enticing discussion with the keynote speaker Bertaud. Seamer started with the observation that (in the pre-Covid condition) the standard urban model requires review. More specifically, he considers that the role of CBD, while essential, should not be expected to do everything. He advocates a focus on tourism and cultural uses in the centre, rather than such high volumes of workers moving in and out every day.

Seamer sees emerging changes that suggest a vision of a postCovid city. Small apartments are a problem, and crowded city streets and public transport systems are not particularly safe environments. Working from home and more flexible working hours will continue, at least to some degree. These will change the shape of our cities, especially with the dispersal and localisation of densities.

The shape of the post-Covid city

The flow of daily commuting – the ‘tide’ of cities and their labour markets – reflects the city’s role as a labour market. Bertaud showed that as a city grows to be a large city, the classical monocentric model shifts to a hybrid model accommodating some dispersal of jobs throughout the wider city. In a blow to those who for, decades, have seen the ‘urban village’ model (of numerous dispersed centres providing housing within close proximity to jobs) as the post-Covid future, Bertaud shows that this does not actually exist in the real world. He asserts that this is because it contradicts the role of the city as a labour market; namely that employers position themselves to be within reach of the greatest number of potential employees.

Either of Bertaud and Seamer’s visions of a post-Covid city may prove to be accurate, and each may be implementable. However, each vision of a post-Covid city appears to correspond to its speaker’s planning truth: what the role of the planner is in the contemporary city.

The role of planning post-Covid

Within Bertaud’s prism of a city as a labour market, the job of a planner is to ‘keep an ear to the ground’ and know what is happening; what is changing. Market signals in the form of prices are a good indication of this, and the role of the planner is to allow the market to shape the city through private land development and follow the signals sent by the market, intervening as required or responding by further modifying the underlying structure. At the same time, Bertaud sees an important role for top-down design and city planning, which must shape (though not necessarily build) the city’s public realm: its streets, parks, utilities, infrastructure. However, this must be balanced by being bold enough to step back and consider the private lots of a city as space for the private market ‘to play’.

This approach shouldn’t be interpreted as a withdrawal of planning from the city shaping process, but rather that by removing the focus from the daily minutiae of planning approvals, planning and planners can look more to the long term strategic goals of a city. An example of a critical role of planning in this market led process described by Bertaud is to prevent the fragmentation of labour markets, which Bertaud describes as occurring when limited affordable housing is paired with travel times of longer than one hour across a city. It is up to planners to ensure regulation is not increasing housing costs, and the transport systems provide efficient movement.

In contrast, Seamer promotes the more ‘localised city’ approach of a polycentric city, the 20-minute city of state policy and strategy. He sees covid-19 as the strategic window for planning to step in and deliver the ambition of more localised live/work/ travel scenarios. While Bertaud concedes that there is likely to be an increase in working from home he sees this as stretching the monocentric city model, rather than a dispersal of jobs. (For example, 3 days a week at home, with an arrangement that would facilitate a longer commute for the other two days – shifting the balance towards housing choice for some.)

The efficient functioning labour market set out by Bertaud requires:

• Land use flexibility to allow affordable housing within 40 minutes from job locations; and,

• The possibility of travel to any part of the city within 1 hour.

The Lord Mayor described how the City of Melbourne hopes that a slower rate of growth post-Covid will enable the City to be more ‘thoughtful and considered’ about how to manage growth. This perhaps reveals an anxiety within the Melbourne planning profession about a market-led approach, and the ability to respond to market signals and maintain an efficient functioning labour market in the face of such rapid growth. Capp notes that in the past the City has achieved incremental change to the structure of the city, and that has been in the context of massive growth in private development, hoping that covid might allow instead for transformational change in the vein of Postcode 3000.

Seamer sees the role of planning as continuing to guide growth in a top-down manner and, in particular, to start planning for and investing in a shift to the suburbs. He notes that the CBD has historically seen a great deal of higher-level investment and believes that this needs to change post-Covid. In agreement with Bertaud, he advocates for a freeing up of planning systems; decentralising to allow a greater number of planning systems to co-exist, particularly for development and redevelopment of suburban centres. This shift would reallocate spending of infrastructure dollars on projects that exacerbate CBD congestion to those that instead spread activity around the metropolis. Seamer called on the government to use this time of crisis to review lame-duck political promises such as the airport rail.

Short of a massive societal or political upheaval it is likely that post-Covid Melbourne will continue to be shaped by the forces of the neoliberal economy where growth is not only assumed but the goal itself, even if this approach takes on a decidedly more local or national focus. Too often in this city, planning finds itself choosing between the two extremes of either ‘managing growth’ (to mitigate or minimise its negative impacts) or cutting through ‘red tape’ (to facilitate growth and development). Bertaud provides us with an approach that enables planning to get out of the way and facilitate a market-led growth paradigm, while also harnessing this growth to ensure that it works for the people of this city; strategically navigating toward a desired social and economic vision of the city, with less emphasis on the physical representation of that city.

Tim is an experienced planner and urban designer with over fourteen years of professional experience working for the private sector across a broad spectrum of strategic and statutory planning, and urban design projects

Tim Nichols can be contacted at timn@Kinetica.net.au