Before diving into this blog post, I ask you to take a minute to sit with these two images and ask yourself: Which place has greater value?
Did you feel any sense of inner conflict? Did your inner environmentalist, conservationist, and nature lover tussle with your inner urbanist? If so, chances are that that turmoil was caused by the fact that we have different definitions for the word “Value.” Webster’s Dictionary offers these two definitions first:
1) The monetary worth of something, market price2) A fair return or equivalent in goods, services, or money for something exchanged.
When it comes to this definition of value in regards to the built environment, I have to give a lot of credit to Joe Minicozzi and his team at Urban3 who developed a method of analyzing a city’s development pattern through the lens of a financial value per acre analysis by mapping its ratio of property value to acreage. Here, one finds that older downtown areas have a higher financial value per acre, and therefore a higher tax base return per acre, then traditional suburban style development. If one starts pealing the layers of the onion, this higher financial value per acre correlates most directly to properties with a higher floor to area ratio, just as in the Empire State Building example. Put another way, if any given site is made up of building, parking, and green space – of those three components, the building is what adds the most financial value. The higher the square footage to area, the greater the financial value. From a real estate perspective this value is directly tied to the ability to receive rent or mortgage payments, cash flow positive, as well as the possession of an asset to sell (thank you John Anderson and the Incremental Development Alliance for helping me understand this aspect of real estate).
But now let’s consider Webster’s next two definitions of value:
3) Relative, worth, utility or importance.
4) Something (such as principle or quality) intrinsically valuable or desirable.
Here is where our inner environmentalist feels vindicated: with these definitions there’s a strong case that can be made for the greater value of the forest, the Grand Canyon, riparian areas, and our other green spaces and natural wonders. These areas may not yield rents or produce cash flow, and yet I believe few would seriously argue that natural areas don’t add value or are not worth protecting. In fact, I think most of us would agree that as people we would be a lot poorer if we were a world fully developed with no room for the wild. In a very real way, one of the great challenges of our times is the question of how do we value what is important and intrinsically valuable (our land and natural resources) in the face of financial pressures to make that same land yield financial benefits.
To make the above point I’ve so far used two extreme examples: the Empire State Building and an undisturbed forest. The reality is that most places where people live fall somewhere in-between as what the New Urbanists have illustrated in the below “Transect”. Here, we see how financial value (money green) and the intrinsic, natural value (environment green) interact over an area.
Adding the Value of Accessibility to the Mix
If one understands the transect as different shades of black, white and grey to balance the financial and natural values of development then where do our fierce debates about creating places people love come from? After all, aren’t these just two good values in which we’re finding the right combination in different contexts? Here, I would like to argue that most of our planning debates and shortcomings are over-balancing these previously mentioned values with values related to making properties accessible and useable for people.
In terms of land use planning, accessibility comes in a few different forms. The first and most obvious is transportation accessibility. In order for buildings to yield their financial value and for people to enjoy a piece of land’s natural intrinsic value, they need to get there – literally have physical access. While transit and bicycle facilities can help us make efficient use of this space particularly in denser, urban environments, for most other places in the era of the automobile, whether we like it or not, that has meant carving out dedicated space for parking. The ironic reality, bemoaned by planners, is that this space in itself is neither financially productive nor inherently, naturally beautiful. Compared to those two values, parking lots seem like a waste of space. Yet, it too has its own value: it’s useful – it allows people from long distances to access and therefore, take part in the activities of the building or natural area. As failed pedestrian malls have shown us, not providing enough physical access means that there’s not enough visitor density to financially support the development. Put another way, if there’s the perception that a place is hard to access then it builds in the perception that, “No one goes there anymore, it’s too crowded” and alternatives such as shopping on-line become all the more attractive.
The second type of accessibility that is a little bit more discreet is affordability. If I can’t afford the price of admission, the price of the goods and services, the payments to rent or to own, etc. then for all intents and purposes, the place itself is inaccessible to me. Here, people have a funny relationship with this type of accessibility. As advertisers bombard us with images of “luxury living” and “luxury cars” they reveal this weakness in our human nature of the desire to feel special and better that others. – that we are part of some exclusive club not available to everyone else. At the same time, people loath being excluded, in the position of being on the outside looking in and will often jealously demonize others that have these special privileges. Reconciling this form of accessibility within the land use context is not only difficult, it all too often gets ugly and embarrassing. Take a look at that transect again, and ask yourself where in each T-zone, is there a place for the poor? How do we reconcile a well-documented unfair past with the financial reality of making the numbers work? More on this in a future post.
The origins of this post started when I started diving into what we mean by “value per acre.” In many cases, I found we are implicitly speaking of financial value, which while important and worth measuring is only one form of value that comes into play with real estate and planning. This post highlighted two others in an area’s natural/intrinsic value and an area’s ability to be physically and affordably accessed by people. Of course, there are still countless other values such as perceived safety and the quality of the school district, proximity to a community of faith or friends, and distance from polluters and nuisances. It’s the balancing of all these different form of values with circumstances of people and land that by their nature are unique with financial realities which makes planning and development for a flourishing people and environment such a worthwhile endeavor.