American cities have a conversion problem, and it’s not just offices

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There is an outdated office building on Water Street in lower Manhattan where it would make a lot of sense to create apartments. Once the headquarters of AIG, the 31-story building has windows all around and a shape that accommodates additional corner units. In a city with too few homes, it could accommodate 800 to 900 apartments. Across the street, an office building not so different from this building has already been converted into housing, and another is on its way.

But 175 Water Street has a hitch: Financial District offices are spared some zoning regulations that make conversion difficult — as long as they were built before 1977. And this one was built six years late, in 1983.

“There’s nothing about that building — the construction, the mechanics, the structural engineering — that prevents it from being converted,” said Richard Coles, the managing partner of Vanbarton Group, who developed both of the conversions across the street. Vanbarton owned and also thought hard about converting 175 Water. For a while, it looked like New York would change the 1977 border, a simple no-cost reform to encourage more conversions that had the backing of Mayor Eric Adams and Governor Kathy Hochul. A simple stroke of the pen would suffice, Mr. Coles said.

But that idea died in the state legislature this spring, along with the rest of the governor’s housing agenda. When Vanbarton concluded that no change was imminent, it sold the property.

That city block today tells of a problem that is much bigger than the faltering office sector. There, the city has not evolved, even though so much has changed: the needs of the inhabitants, the nature of the economy, the emergence of new threats such as the housing crisis and climate change.

Healthy cities need to build new things and rehabilitate old ones. But they also regularly perform transmogrification tricks, changing existing building blocks into something new. Factories become loft apartments. Industrial waterfronts become public parks. Warehouses become startup offices and restaurant scenes.

The pandemic forced American cities into temporary transformations. They turned sidewalks into restaurants, parks into hospitals, streets into open spaces. Now, on a sustainable and larger scale, they will have to transform offices into apartments, hotels into affordable housing, parking lots into cycle paths, roads into transit routes, office parks into real neighbourhoods.

“If the past few years have taught us anything,” says Ingrid Gould Ellen, a professor of urban policy and planning at NYU, “it’s the need for flexibility, the need to be open to surprises in the way we use space. “

But over the decades, that flexibility has eroded.

American cities have developed a conversion problem.

That problem is, more precisely, a tangle of interrelated problems.

Destination codes have become more expansive and prescriptive. We have added well-intentioned speed bumps to development, such as environmental assessments and public gatherings, and they have often been used to protect narrow interests over societal interests.

Today we demand much more from buildings than decades ago, including that they are accessible, sustainable, hurricane and earthquake resistant, that they deter flying birds and that they provide public space. Each new purpose, while worthy, widens the gap between buildings built decades ago and what regulations demand today.

And we’ve developed more rigid ideas about the built environment over time: that housing should be valued indefinitely, that politicians should ensure that it is, that property owners have the right to make changes around them to veto.

The cumulative effect today, if you want to turn an office into an apartment, or even turn your back porch into an enclosed home office? The building code says no. Or the zoning plan. Or the neighbors do. Or a sentence in a decades-old state law. Or the politicians asked to change that expression to.

“What a mess we’ve created for ourselves,” says Emily Talen, a University of Chicago professor of urban planning who has studied zoning, or “the birthmark of city rules.”

These rules in many cities say exactly how many parking spaces are needed per 100 square feet of pawn shop (other than the parking spaces needed per 100 square feet of furniture store). They describe the architectural feats builders must adopt, the minimum area a house can occupy, or the size of individual units in an apartment building.

Today, many mandates are disconnected from their original intent. (Keeping slaughterhouses away from real homes? Making sure no one lives above wood-burning storefronts that could catch fire?)

‘You’ve completely lost sight of what kind of city you’re trying to get with all those rules,’ Professor Talen said.

These rules mainly get in the way of conversions. In New York, a hotel requires a 20-foot backyard. But a residential building requires a 30 foot building. Does this mean developers have to chop off the backs of hotels to make housing? Why do we actually draw such thin lines between buildings where people sleep for a short time and buildings where people sleep permanently? A century ago, most American cities did not see such a stark distinction.

And why should we let one office building live and not the other across the street?

The 1977 threshold in Lower Manhattan (and 1961 in other parts of the city) is so important because zoning rules in the area say office buildings can have a larger volume than residential. As a result, only about half of the AIG building can legally become housing.

If that sounds crazy, older buildings are allowed to ignore this rule; they can be completely converted into homes, with some relaxed light, air and garden requirements. For them, the city has offered a little more flexibility.

But that’s rarely what happens.

“It’s pretty obvious when you look at zoning codes — zoning codes have existed for the past century — that they’ve only gotten longer and more complex,” said Sara Bronin, an architect and lawyer who helped rewrite the zoning in Hartford. , Connecticut. New York’s original 1916 code was about 14 pages. Today it is almost 3,500 pages.

Cities have collected more bans, more regulations, more appendix tables. More hitches.

“I have a name for building that stuff,” says Phil Wharton, a New York-based developer. “I call it the kludge.”

There is another part of this story that is not about laws and formal rules, but about the politics and culture that have developed alongside them.

For example, city transportation officials are usually not required by law to hold public meetings for every bike path, or to defer to nearby property owners on every bus route. Cities generally have the power to change public streets and spaces for the common good. But something like that often happens: the neighbors still say no, or a local politician does, or someone threatens to sue. And the city gives in (or wastes years trying not to).

These informal forces are often as powerful as legal codes, but they can be even harder to change, says Noah Kazis, a law professor at the University of Michigan. Lawmakers can rewrite a law limiting the density of residential buildings, but it’s a bigger job to do away with the idea that neighborhood homeowners veto density.

This cultural resistance to change (and deference to neighbors) stems in part from the era of urban renewal. It also stems from Americans’ growing reliance on housing as a means of building wealth. The more people count on rising property values, the more likely they are to block changes they fear could harm them.

Americans have also become more conservative about change as society has become wealthier, Professor Kazis suggested.

“If you go back 70 years, or 100 years, or 150 years, there was a general sense that the housing stock or design of the neighborhood just wasn’t good enough. People had no sanitation,” he said. “So how you solve that might be up for grabs, but whether you solve it wasn’t. And that is no longer true.”

The universe of changes that we can all agree are needed has shrunk.

Inflexibility has also proven lucrative, or at least economically viable, for individuals and entire cities. Scarce homes increase the value of real estate and the tax coffers.

In cities like San Francisco and New York, people realized they didn’t need new growth and development to thrive, said Eric Kober, a former civil servant with the New York Department of City Planning and a senior fellow at the Manhattan Institute. That fiscal reality promoted the policy of saying no, he said.

“It’s a box we got into,” he said. “And maybe we won’t find a way out until something really bad happens.”

The pandemic, the homelessness crisis and high office vacancies have not been the thing in New York so far, he said.

One illustration: The pandemic seemed to offer non-profit developers a rare opportunity to turn closed hotels into affordable housing. Breaking Ground, a nonprofit supportive housing developer, thought it had spotted the perfect property: the vacant Paramount Hotel in Midtown Manhattan, near Breaking Ground’s homeless clientele and in a neighborhood where it hadn’t been able to afford real estate in years. to afford.

The deal eventually fell apart over objections from the local hotel union. Now empty hotels for bargain prices are no longer available. And none in Manhattan has been converted into affordable housing.

“There was an opportunity there — a time-limited opportunity — that unfortunately we and probably others missed,” said Breaking Ground president Brenda Rosen.

At the Paramount, the city opened another type of temporary housing earlier this year: an emergency shelter for migrants.

The rules that allow office renovations in Lower Manhattan date back to an era with echoes of today. In the mid-1990s, the financial district was hit by a real estate recession. Wall Street lost banks to mergers and more modern offices elsewhere. People feared an abundance of obsolete, vacant buildings on what had once been the most valuable real estate in America.

The city’s response at the time laid the foundation for the long-term transformation of the Financial District into a place where more than 80,000 people live today.

“There was a feeling within the government that you could tinker with the mechanisms of economic development and social policy and make a better overall situation for the public,” said Carol Willis, an architectural historian and the head of the Skyscraper Museum. And there was a broader belief that now seems lost, she said, that people could trust the government to do that.

Today, she said, “we are in a different time.”

And yet, as the built environment has become less flexible, something quite the opposite has happened in the patterns of how we live. Many now want their homes to be offices and their offices to feel like homes and guest rooms to function like hotels. Shops in the neighborhood are nowadays for many a facility, not a nuisance.

“The way we live isn’t about separating those things — they’re much more integrated,” said Amit Price Patel, an urban planner at the Dialog firm who has long worked on remodeling projects. “The difficulty is that our operations are more flexible than the physical infrastructure we inhabit.”

To fix that, first of all, we all need to agree that a more agile city will be a better one.

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