Friday, August 26, 2011

Noodling Railroads and Life Stuff

Nood-ling (nōōd’lĭng) n. 1. Fishing for catfish using only bare hands, practiced primarily by crazy people who cannot afford proper fishing gear. 2. The intentional annoyance by bloggers who are skeptical of the news as it’s reported, as in “Noodling bureaucrats is more fun than fishing bare hand for catfish and a lot more surprising.” This is now an end of the month feature.

Even the Best Intentioned Social Planning . . .
It seems that one of the darlings of the New Urbanist Movement, King Farm development in Rockville, Maryland is in the news. The community with its grid street pattern, broad mix of residential types, interconnecting parks, and a right-of-way for a future light-rail, has a problem – the residents don’t want the train running through their neighborhood. Right now the state wants to shove it down their throats. “You will be environmentally conscience, like it or leave!” (my quote). See article (SEE HERE).

Can Free Enterprise Kill the High Speed Rail?
 In two recent articles, one by friend Aaron Renn and the other by columnist Michael Barone, the entrepreneur is doing an end run around the high-speed rail (HSR). It seems that some savvy guys in "private" transportation have found out that it you provide good to excellent bus service, with decent toilets, wi-fi, and AC power, passengers will come. Buses are still around after almost one hundred years because they work. Now with a better service model, the ability to avoid traffic issues (what happens to a train when the one in front breaks down?), flexible schedules, and just plain nicer buses, these intercity services will blow the doors off HSR. These are called by various names: Megabus and Chinatown (due to the New York to Boston route used by Asian immigrants – cost $20). They don’t have expensive terminals and other fixed costs. Tickets are bought at the door – first come - first served. Take a longer look (HERE-Renn) and (HERE-Barone). My guess, since they will compete with state owned systems, efforts will be made to kill them or drive them out by regulation.

A New Player with a New Idea in the Home Foreclosure World
A friend’s son Alex, looking for a job after college a few years ago in this wonderful employment market, took what he could. It was working for a firm that bought foreclosed homes, fixed them up, and did what was needed to make them rentable. His first job was to clean and fix them. Fast forward to now, he has his broker’s license and is helping to acquire more and more properties. And Alex is with the same company. This article in the SF Chronicle (SEE HERE) does a very good job of pointing out the obvious: hard work and a good plan can make things happen, even in this poor housing market. One very important and telling quote by Doug Brien in the article: “There is a looming housing shortage on the horizon as new household formation continues at full speed while the construction ramp-up happens slowly (or not at all – author).”

Housing Collapse?
How many months, one after the other, do we have to hear that new home and existing home sales have fallen? It’s now the worst housing market in the United States since Columbus landed or since the fall of Rome. The dream of owning a home is sullied, but like all things, will soon pass. But we are always looking forward, we are optimists. The consumer is king, and as Ludwig von Mises said, "The market is supreme." 

Even thirty-six years ago this was true and as they say in the old 1975 Tubes song, What Do You Want From Life?

“A heated kidney shaped pool, : a microwave oven--don't watch the food cook, a Dyna-Gym--I'll personally demonstrate it in the privacy of your own home, a king-size Titanic unsinkable Molly Brown waterbed with polybendum, a foolproof plan and an airtight alibi, real simulated Indian jewelry, a Gucci shoetree, a year's supply of antibiotics, a personally autographed picture of Randy Mantooth and Bob Dylan's new unlisted phone number, a beautifully restored Third Reich swizzle stick, Rosemary's baby, a dream date in kneepads with Paul Williams, a new Matador, a new mastodon, a Maverick, a Mustang, a Montego, a Merc Montclair, a Mark IV, a meteor, a Mercedes, an MG, or a Malibu, a Mort Moriarty, a Maserati, a Mac truck, a Mazda, a new Monza, or a moped, a Winnebago--Hell, a herd of Winnebagos we're giving 'em away, or how about a McCulloch chainsaw, a Las Vegas wedding, a Mexican divorce, a solid gold Kama Sutra coffee pot, or a baby's arm holding an apple.

While this video is not as good as the album (yes one of those black hard vinyl disky things with the little hole in the middle that went round and round), the band is still around and, in fact, are playing tomorrow night, August 27 in Warren, Michigan, and on September 9th in Pleasanton, California (SEE HERE). Check out this video, and yes we are all getting old.

Have a good weekend.

Stay Tuned . . .

Friday, August 19, 2011

Urban Jargon Defined

I have always been astounded by the terms cooked-up in the urban development world. Many of these are imports from the Old World used by academics to show how traveled and cool they are. Others are just so vague that anyone from a five year old to the most senior city planner can hide behind the term and do what they want.

Let’s just look at my definitions for a few of these terms:

Greenfields: Any proposed project site that lies just across a city border. This land is so valuable that it has the ability to grow organic spinach in such quantities that, if lost to development, thousands of people will starve. It is best to not develop Greenfields, think of your conscience and those people in Africa.

Brownfields: Land that is so spoiled by man’s use that it will take billions of dollars to clean-up and develop. The site is valuable due to its location. So, it’s imperative that a federal grant be sought to make it happen. Many of these brownfields can be classed as Super Fund sites. (But just try to get some money from the fund to make your project happen.) While everyone feels good about cleaning up brownfields, there doesn’t seem to be any slack given to cut through the red tape. (These are also called greyfields by the really cool people.)

High Speed Rail: A huge fund of money from grants and bonds that is used to employ thousands of out-of- work planners, engineers, and politicians. At one time this term actually meant something: moving people very quickly from location to another. Now it’s define by its opposite result – High Speed R.A.I.L.(Real Asset and Income Loss)

EIR (Environmental Impact Report): 1) A useless document that costs hundreds of thousands of dollars (or more) that tells the community what it already knows and wants. 2) A document that can be interpreted any way the opponent or supporter wants. 3) A document that is used as a threat to prevent development. As in: “If you don’t agree with me I will force you to do a complete EIR for your six unit development!”

Traffic Levels, A, B, C, D, and F: Grades given to proposed automobile circulation system intersections based on flow of traffic. While traffic level ‘A’ means unimpeded flow, traffic level ‘F’ is gridlock. While we all want good traffic flows, if I were the city manager of a vibrant and profitable city, a level ‘F’ means people want to be in my town. I sure wouldn’t want my store in a level ‘A’ community.

Best Management Practices (Bmps): A cool term meaning you have developed an unenforceable program of conservation practices and measures that assures the community that you have hired experts to make everything okay when the project is finished. Typically these are too expensive to operate long term and are soon forgotten.

Charrette: A design and programmatic system developed by architects and planners where everyone is called into a large room and is given a powerpoint presentation by an expert who likes to hear himself speak. Most charrettes cost a lot of money, produce a booklet and a new powerpoint show, and are soon forgotten. See BMP.

High-Occupancy Vehicle (HOV): A car with two or more people during rush hour; it's not an HOV when it's not rush hour, then it’s a car with two people in it. Me, I always thought that a bus was an HOV.

High-Occupancy Vehicle Lane: The lane on a freeway that is set aside for HOVs during rush hour, thus increasing traffic in the other non-HOV lanes. It is also a lane used by mothers with children going to daycare and students going to class. It is also known as IBTU (I’m better than you) lane when driven by one person in a cool approved hybrid car.

Infill Development: Development that is very expensive to buy and uses property left over by earlier developments that couldn’t make the project pencil.

Intermodel Surface Transportation: Buses, trains and cars living together illicitly.

Affordable Housing: Housing that uses money from new owners paying market rate prices in the same complex that subsidizes someone who shouldn’t be living in the complex in the first place and will soon be foreclosed.

Pedestrian Oriented Design: An urban complex with sidewalks.

Sustainable Design: Development that has no impact on the earth anywhere. In most cases the EIR is used to assure the public that the project is sustainable. That is, everything consumed by the project has been balanced with appreciable and over-the-top off-site improvements to rain forests, whales, dolphins, wolves, and will aid in ending global warming. The LEED certification system is used to confer sustainability sainthood on a project that spends millions of extra dollars in unnecessary improvements to prove that the project really doesn’t exist, that it has had no impact on anything anywhere, forever. See also HOV cars above since they must be sustainable.

Stay tuned . . . . .

Friday, August 12, 2011

Apartment Redux

I heard an interesting comment today during a meeting. The legal representative for a client works for a national law firm that specializes in land. This is land trusts, acquisitions, conversions, and operations for companies that buy, hold, and operate rental complexes. The recent collapse in land values had also reduced the value of existing apartment complexes in many regions; some were even forced into foreclosure. These investors, represented by these national firms, see a tremendous opportunity to the upside and are now buying class B and C properties, doing facelifts and rehabs, updating appliances, fixing the pools, and raising them to A- status. In many areas, very few rentals had been built during the last ten years; there is now pressure to the upside in rents. These investors see an excellent short term return and even a long term return, 3 and 4 percent is better than treasuries. Ain’t the free market great!

I haven’t done a rental complex in years, all our planning efforts since 2005 have focused on for sale, both attached and detached. I am starting two apartment complexes now. A small 130 unit complex and a five story Texas wrap (that’s where the garage is the core and the units literally wrap and hide the garage structure). We were force fed by the government for the last ten to fifteen years on the notion that home ownership was a right; the banking system was turned on its head by regulations and requirements, cheap money, and a bubble of demand. Now all those failed purchasers need a home, rentals are back.

With per unit apartment values now well north of $200,000 per unit, and in some markets above $250,000, the only direction for rents is up (in fact the The National City Tower Lofts in LA was converted to 93 apartments, they are asking $350,000 per unit, got a spare $32.7 million?).

While the building industry wants to believe that some balance between ownership and rental exists somewhere, it is seldom achieved. The vagaries of markets, employment, interest rates, and demographics all play into rent to own ratios. Again the market must be served, and as always the development industry is there to help. They plan and build, then overbuild, try and twist things with more gov’ment regulations, then the inevitable collapse. Then they start over. Ain’t it great?

Stay tuned . . . . .

Friday, August 5, 2011

Urban Videos for a Quick Summer Vacation

A friend of mine, Aaron Renn, has an excellent blog (CLICK HERE) (in fact maybe the best on urban issues - especially Midwestern issues and the video he has posted this week is great, especially if you own a BMW) Aaron has periodically posted videos on the urban scene, especially Europe, but he is non-denominational and will post things about anything, anytime. So, for your viewing and listening pleasure, I have borrowed some of the videos he has featured over the last month, enjoy:

This one on London, my favorite city in the world (sorry Paris and Barcelona), is exceptional.
Can't see it CLICK HERE

Berlin - Great production and music for a really wonderful city (actually only 50 years old!) 
Can't see it CLICK HERE

Tokyo and all its movement and excitement
Can't see it CLICK HERE

Sorry I couldn't embed the image but the video is worth CLICKING

And my favorite American City - Chicago
Can't see it CLICK HERE

Hope you enjoyed the mini-vacation. If you have any other leads on great urban videos, send me their URLs, a lot of hard work goes into these and the world just has to see them.

Stay Tuned . . . . .