Upzoned

This $15 Trillion Market Is On the Verge of Collapse

“Commercial real estate is in trouble,” Katy O’Donnell wrote in Politico earlier this month, “and turbulence in the $15 trillion market is threatening to bleed over into the broader financial system just as the U.S. struggles to emerge from a recession.” She continues:

The longer the pandemic paralyzes hotels, retailers and office buildings, the more difficult it is for property owners to meet their mortgage payments—raising the specter of widespread downgrades, defaults and eventual foreclosures. As companies like J.C. Penney, Neiman Marcus and Pier 1 file for bankruptcy, retail properties are losing major tenants with no clear plan to replace them, while hotels are running below 50 percent occupancy.

The United States was way overbuilt before the pandemic decimated brick-and-mortar retail. The U.S. has about 23.5 square feet of retail space per capita, more than five times as much as the U.K. (4.6 square feet per capita), Japan (4.4), The Netherlands (4.1), and France (3.8). (Note: Other sources actually have that figure much higher, and our friend Josh McCarty of Urban3 showed back in 2017 that if we consolidated all U.S. retail space and its parking, it would be visible from space.) We’ve been propping up large-scale retail (malls, strip malls, and big-box stores) for years. But now those supports are crumbling, and it’s not hard to imagine this sector collapsing—with devastating direct impacts and ripple effects throughout the economy.

That’s the topic on this week’s episode of Upzoned, with host Abby Kinney, an urban planner in Kansas City, and regular cohost Strong Towns president Chuck Marohn. Abby and Chuck  discuss the past—why malls and big-box stores were perfectly adapted to the suburban development pattern—as well as the future, including the possibility that existing big-box stores may become distribution centers for delivery and drive-through services. They also talk about why conventional retail space is so difficult to revive, and which types of retail are more likely to survive than others.

Then in the Downzone, Chuck recommends The Structure of Political Positions, by Blake Pagenkopf. (Blake will be Chuck’s guest on the November 9th episode of the Strong Towns podcast.) And Abby talks about getting ready for winter, including gearing up for cold weather biking.

Additional Show Notes

• “The next economic crisis: Empty retail space,” by Katy O’Donnell

• Abby Kinney (Twitter)

• Charles Marohn (Twitter)

• Gould Evans Studio for City Design

• Theme Music by Kemet the Phantom (Soundcloud)

• Further reading from Strong Towns on retail and commercial real estate

  • “What Comes Next for Commercial Real Estate,” by Charles Marohn

  • “Want more local businesses in your neighborhood? Then legalize ‘Accessory Commercial Units.’” by Ashley Salvador

  • “Here's how much of America is occupied by big box stores.”

  • “The Real Reason Your Local Mall Is Failing,” by Charles Marohn

  • Big Box Stores: America’s Rigged Game for Retail (free ebook)

Bonus Episode: The Bottom-Up Revolution

Here’s a taste of our newest podcast, The Bottom-Up Revolution, hosted by Rachel Quednau. In this episode, you’ll hear from Alexander Hagler, an entrepreneur and urban gardener based in Milwaukee, WI who founded a store called Center Street Wellness, a space for local makers to sell their handcrafted products focused on mental and physical wellbeing. And you’ll learn about how to support entrepreneurs in your own community—or become one yourself. Find out more about this new podcast and keep up with new episodes here: https://www.strongtowns.org/podcast

"We Can't Micromanage Great Urban Design Into Existence."

Last week, Jason Segedy, the director of planning and urban development for the City of Akron, Ohio, published a piece in The American Conservative called “Towards a More Inclusive Urbanism.”

Segedy contends that too much of the urbanist conversation is permeated with “an unmistakable strain of elitism.” It emanates from, is focused on, and takes as its model “front-row cities,” where issues like high housing costs, rent control, NIMBY-ism, and rail transit are among the most-discussed topics. At the same time, urbanism tends to be “dismissive of disinvested and economically challenged places,” the back-row cities. He writes:

The most widely read and disseminated urbanist thinking around urban design and public policy has little or nothing to say about heavily disinvested places. It is written mostly by, and for, people who live in economically successful places.

This week on Upzoned, host Abby Kinney and regular co-host Chuck Marohn discuss Segedy’s article. They talk about why good planning looks more like social work than a kinder-gentler Robert Moses, what front-row and back-row cities have in common, and why urban planners go astray when they try to please other urbanists instead of responding to the needs of people. They also describe an option that goes beyond the conventional choices of Top-Down Beautiful or Top-Down Pragmatic. “We can’t micromanage great urban design into existence,” says Abby, an urban planner in Kansas City. “It needs to happen naturally.”

Then in Downzone, Chuck recommends The Myth of Capitalism by Jonathan Tepper and Denise Hearn. (Hearn will be a guest on an upcoming episode of the Strong Towns podcast, which recently returned from hiatus.)  And Abby recommends two articles by Mark Manson as well as a recent episode of James Howard Kunstler’s Kunstlercast.

Additional Show Notes

• “Towards a More Inclusive Urbanism,” by Jason Segedy

• Abby Kinney (Twitter)

• Charles Marohn (Twitter)

• Gould Evans Studio for City Design

• Theme Music by Kemet the Phantom (Soundcloud)

• Related reading from Strong Towns

  • “Why Urban Design Should Come from the Bottom Up,” by Nolan Gray (Part 1 | Part 2)

  • “A Reminder for Planners: ‘Every Projection Is Wrong,’” by Daniel Herriges

  • “6 Rules for Unlocking the Potential of Mid-Sized Cities,” by Dennis Strait and Abby Kinney

  • “The Living City vs. the Mechanical City,” by Andrew Price

  • “The Dignity of Local Community: A Conversation with Chris Arnade” (Podcast)

Winter Is Coming: Will Restaurants (and Customers) Adapt to Help Businesses Survive?

The pandemic has obviously been brutal on the economy, and restaurants and coffee shops have been especially hard-hit. During the warm, dry summer months, outdoor dining proved to be a lifeline for many establishments. But as we head into fall and winter, when colder temperatures and wetter weather make dining outside more challenging, many restaurant owners are worried about their business and their employees. According to the Washington Post, between 40% to 85% of restaurants (depending on who’s doing the estimating) don’t expect to survive the next six months. Celebrity chef Andrew Zimmern warned in August of a restaurant “extinction event.”

To discuss all this, Abby Kinney—an urban planner in Kansas City and the host of Upzoned—invited a special guest onto the podcast. Kevin Klinkenberg is an urban designer, writer, and the executive director of Midtown KC Now. (He last joined the podcast in May, in a kind of Part 1 to this episode called “Is Your City Willing to Be Flexible So Small Businesses Can Survive?”) Together, Abby and Kevin talk about how restaurants will adapt (again) for the fall and winter, why business owners aren’t banking on a new federal stimulus, and how the challenges of COVID-19 are compelling restaurants to find new models and new collaborations.

Then in the Downzone, Kevin recommends an article called “Why You Should Quit the News?”—as well as a new novel by his brother. And Abby recommends two recent documentaries: The Social Dilemma and a fascinating look at the world of fungi.

Additional Show Notes

• “Outdoor dining has helped restaurants avoid disaster. But winter is coming.” By Tim Carman

• Kevin Klinkenberg (Website)

• Kevin Klinkenberg (Twitter)

• Midtown KC Now (Twitter)

• Abby Kinney (Twitter)

• Gould Evans Studio for City Design

• Theme Music by Kemet the Phantom (Soundcloud)

• Recent Strong Towns content on the “open streets” movement:

  • “The Evolving 2020 Open Streets Movement, or What if We Threw Out the Rule Book and Everything Was Fine?” by Daniel Herriges

  • “4 Lessons from a Temporary Street Redesign Process,” by Rachel Quednau

  • “What Do Americans Love More than Car Access? Partying.” by Arian Horbovetz

  • “Hearing One Engineer's Call to ‘Sit in the Ambiguity’ of Transportation Planning,” by Daniel Herriges

Why Cities Shouldn’t Wait for the Feds to Do Something about Reparations

In late September, Strong Towns president Chuck Marohn published an article making the “local case for reparations.” Drawing on a detailed study conducted by the economic consulting firm Urban3, Chuck described the long-term fiscal impact of redlining policies in Kansas City, Missouri. He wrote:

This difference in margin of error is perhaps the most pernicious aspect of redlining. The people in one neighborhood [chosen for investment] are dealt face cards and aces. Those in the other [redlined] neighborhood get dealt twos and threes. It doesn’t matter how good you are at poker. It’s hard to mess up a winning hand, just like it’s hard to play your way to success when the deck is stacked against you.

The economic and social impact isn’t just felt by people who live in formerly redlined neighborhoods. For example, in a single half-square-mile neighborhood, redlining has cost Kansas City $30 million in lost tax revenue. Now multiply that across many such neighborhoods in Kansas City—where more than 50% of the city was “redlined” in the 1930s—and then consider that most towns and cities across the Unite States implemented similar policies. We start to get a clearer sense of the broad economic devastation wrought by decades of disinvestment in poor, predominantly black—though not exclusively black—neighborhoods.

Chuck goes further, though. Conversations about reparations often focus on a federal response to redlining—whether it should happen, and what it should look like. But Chuck says that cities shouldn’t wait for the federal government to do something about reparations. There are things towns and cities can do right now, using tools already at their disposal, to begin building last prosperity in disinvested neighborhoods.

On this week’s episode of Upzoned, host Abby Kinney—an urban planner in Kansas City—is discussing “The Local Case for Reparations” with the article’s author (and regular cohost) Chuck Marohn, as well as with Joe Minicozzi, principal at Urban3. Abby, Chuck, and Joe talk about Urban3’s data-driven analysis in Kansas City, the policies that have made Kansas City financially fragile, and what it will take to stop the bleeding in disinvested neighborhoods. (It’s less than you might think.) They talk about the high price cities are paying for inaction, and why cities already have the tools they need to make the change they say they want.

Then in the Downzone, Abby talks about an upcoming mountain biking trip to Arkansas. Joe recommends a trifecta of books on race, as well as a book on human behavior. And Chuck recommends the newest book by Bob Woodward.

Additional Show Notes

• “The Local Case for Reparations,” by Charles Marohn

• “An Old Building Should Get a Birthday Present,” by Daniel Herriges

• “Ready, Fire, Aim: Tax Incentives in Kansas City,” by Daniel Herriges

• Read more Strong Towns articles about Kansas City

• Urban3

• Joe Minicozzi (Twitter)

• Abby Kinney (Twitter)

• Charles Marohn (Twitter)

• Gould Evans Studio for City Design

• Theme Music by Kemet the Phantom (Soundcloud)

• Recent Strong Towns articles by Joe Minicozzi

  • “Not So Fast: Density Isn’t Plague-Inducing”

  • “Greetings from Anywhere: Supporting Postcard-Worthy Places”

  • “The Power of Information Equity”

Fragile Policies are Making California More Vulnerable to Megafires

California is experiencing its worst fire season since 1910. So far (the fire season typically runs into December), more than 3.4 million acres have burned. Among the state’s six biggest fires of the last 90 years, five are from August or September 2020. The Creek Fire alone has destroyed nearly 287,000 acres in two counties, making it the largest single fire in California history.

Superlatives like these—superlatives we seem to update every year or two—suggest that we really don’t know how to prevent megafires. But that’s not the case. We know what to do...we just lack the cultural and political will to do them. As Elizabeth Weil recently wrote in ProPublica:

The pattern is a form of insanity: We keep doing overzealous fire suppression across California landscapes where the fire poses little risk to people and structures. As a result, wildland fuels keep building up. At the same time, the climate grows hotter and drier. Then, boom: the inevitable. The wind blows down a power line, or lightning strikes dry grass, and an inferno ensues.

On this week’s episode of Upzoned, Abby Kinney, an urban planner in Kansas City, and Strong Towns president Chuck Marohn, talk about fire suppression, development, and other policies that are putting California’s land, people, and economy more at risk from megafires. They talk about the “spooky wisdom” of Native Americans who used controlled burns to clear underbrush and encourage new plant growth...and how we’ve largely ignored that wisdom. And they discuss why laying all the blame on climate change obscures the things we can do right now to make our lands—and our cities—stronger and more resilient.

Then in the Downzone, Chuck describes the joys of watching Minnesota Twins baseball with one of his daughters. And Abby is looking ahead to Halloween.

Additional Show Notes

• “They Know How to Prevent Megafires. Why Won’t Anybody Listen?” by Elizabeth Weil

• “The Spooky Wisdom of Cities,” by Charles Marohn

• Collapse, by Jared Diamond

• The World Until Yesterday, by Jared Diamond

• Abby Kinney (Twitter)

• Charles Marohn (Twitter)

• Gould Evans Studio for City Design

• Theme Music by Kemet the Phantom (Soundcloud)

• Select Strong Towns articles about California

  • “5 Questions Facing Local Leaders Right Now (and 5 Creative Responses),” by Rachel Quednau

  • “California’s Housing Crisis,” by Daniel Herriges

  • “Can we make California wildfires less destructive by changing the way we build?” (Podcast)

  • “Mapping the Effects of California's Prop 13,” by Connor Nielsen

  • “Crony Capitalism,” by Charles Marohn

  • “What happens after half your town burns down?” by Johnny Sanphillippo

  • “A Small Town Mayor Living a Big Life,” by Rachel Quednau

For City Planners, Community Consensus Shouldn't Be the Standard

Aiming for community consensus when making planning decisions sounds like a noble goal. Yet in practice, says Jeremy Levine in a recent article in Shelterforce, a consensus approach to community participation often supports “elite authority” and the status quo rather than challenges them.

Levine uses an example from the affordable housing debates in the Bay Area, where public meetings were, in effect, “veto points that can block new development.”

New projects generally require community agreement in order to move forward, and so all it takes is a handful of opponents to signal a lack of consensus. By design, then, public meetings give the people who say “no” a much louder voice than the people who say “yes.”

Levine’s article in particular—and community consensus in general—is the subject of this week’s episode of Upzoned. Host Abby Kinney, a planner in Kansas City, and Strong Towns senior editor Daniel Herriges, discuss the ways in which conventional public engagement can actually hurt the planning process. They talk about why asking people where they struggle (not to mention observing firsthand) can yield better results than asking people what they want. They also discuss why reforming public engagement should go hand in hand with reforming public works.

Then in the Downzone, Daniel recommends The Overstory, a Pulitzer Prize-winning novel about trees that inspires awe, wonder, and even humility in the reader. And Abby is getting ready for Fall with a scary yet thought-provoking film.

Additional Show Notes

• “It’s Time to Move On From Community Consensus,” by Jeremy Levine

• “Stop Asking the Public What They Want,” by Daniel Herriges

• Abby Kinney (Twitter)

• Daniel Herriges (Twitter)

• Gould Evans Studio for City Design

• Theme Music by Kemet the Phantom (Soundcloud)

• Select Strong Towns articles about public engagement

  • “Most Public Engagement Is Worthless,” by Charles Marohn

  • “Most Public Engagement Is Worse than Worthless,” by Ruben Anderson

  • "‘Public engagement’ is about knowing your neighbors, not planning a meeting.” by Rachel Quednau

  • “Don't Leave Your Community's Challenges to the Professionals,” by Rachel Quednau

  • “We Don't Need More ‘Invitations to the Table.’ We Need a New Table.” by Charles Marohn

For U.S. Transit, "Death Spiral" Shouldn't Have Been an Option in the First Place

A recent article in The Guardian described the “death spiral” looming for public transit in the United States. Country-wide, the pandemic has resulted in a 90% drop in ridership. This has led to cuts in services—which means even less ridership—and higher fares to make up for lost revenue. Higher fares lead to fewer riders…which means more higher fares, more cuts in services, or both. And so on. You see where this is going.

To save public transit, Congress may have to fill a $32 billion funding gap...but no funding package currently exists. Transportation advocates also warn that cuts in services exacerbate a “mobility crisis” that already existed for our cities’ most vulnerable people.

This article prompted a lively conversation on this week’s episode of Upzoned, with host Abby Kinney—an urban planner in Kansas City—and cohost Chuck Marohn, president of Strong Towns. Abby and Chuck discuss why the mortal danger facing public transit was always going to be an option when you overlay a dysfunctional transportation system on a dysfunctional land-use pattern, why public transit is a long-term investment in people, and how the U.S. subsidizes automobiles too. They also discuss whether making the “compassionate argument” may unintentionally undermine transit advocates’ case for public transportation.

Additional Show Notes

• Public transit faces 'death spiral' without $32bn injection from Congress, by Miranda Bryant

• Abby Kinney (Twitter)

• Charles Marohn (Twitter)

• Gould Evans Studio for City Design

• Theme Music by Kemet the Phantom (Soundcloud)

• Some recent Strong Towns articles on public transit

  • “The Only Thing More Expensive Than Saving Transit is Not Saving Transit,” by Daniel Herriges

  • “In Transportation Costs, ‘It's the System, Stupid,’” by Daniel Herriges

  • “What the Left Gets Wrong about Public Transportation” (Podcast)

  • “Transit’s Chicken & Egg Fallacy,” by Chuck Marohn

  • “Why Development-Oriented Transit is better than Transit-Oriented Development,” by Rachel Quednau

Can the Right and Left Come Together on Zoning Reform?

As the suburbs—and, more specifically, single-family zoning—emerge as a political issue in the presidential election, what can get lost is context, nuance, and even the opportunity for consensus.

The irony is that, in the first half of the 20th century, the Suburban Experiment—an approach to growth (not actually limited to the suburbs) in which Americans build human habitats in large blocks and to a finished state—was launched and sustained through nonpartisan consensus.

Today, ending the Suburban Experiment should have broad bipartisan appeal. Because the Suburban Experiment hasn’t worked. In fact, it’s been a disaster. People on the political Left and the political Right might get there via different paths and priorities, but moving on from the Suburban Experiment could be an opportunity for common ground and the chance to point our towns and cities toward financial strength and resilience.

That’s the topic of this week’s episode of Upzoned. Host Abby Kinney, an urban planner in Kansas City, and Strong Towns president Chuck Marohn discuss a recent article in The American Conservative, “Zoning Reform Is Not Leftism.” They look at how we’re being pressured to view this issue through an increasingly partisan frame, why the predictability of single-family zoning is necessary when building at huge scale, and how the Left and the Right could actually find consensus on this topic.

Then in the Downzone, Chuck talks about a new book he’s reading on the life and death of ancient cities. And Abby recommends The Geography of Nowhere. She also talks about a recent visit to a lovely town in Northwest Arkansas.

Additional Show Notes

• “Zoning Reform Is Not Leftism,” by Theo Mackey Pollack (The American Conservative)

• “It’s Time to Abolish Single-Family Zoning,” by Charles Marohn (The American Conservative)

• Abby Kinney (Twitter)

• Charles Marohn (Twitter)

• Gould Evans Studio for City Design

• Theme Music by Kemet the Phantom (Soundcloud)

• Related articles from Strong Towns

  • “The Is the End of the Suburban Experiment,” by Charles Marohn

  • “Nobody wants to ‘destroy the suburbs.’ But everyone should want to end the Suburban Experiment.” by John Pattison

  • “The Conservative Case for Ending Single-Family Zoning”

Pandemic Fallout: Will New York City Experience Long-term Decline?

Every week on the Upzoned podcast, host Abby Kinney, an urban planner in Kansas City, takes one big story in the news and she “upzones” it—examining it through a Strong Towns lens. Strong Towns founder and president Chuck Marohn is back this week as Abby’s co-host.

Today, Abby and Chuck look at a story playing out in New York City. Apartment vacancy rates there are climbing, as people flee the city due to the pandemic, and rental costs are plummeting. According to a recent article in the New York Times, the number of apartments available for rent in July (67,300) was the highest in at least a decade:

In June and July combined, more than 120,000 apartments were for lease, a nearly 26 percent increase over the same months in 2019.

The surge in supply has driven down rental costs across the city and forced landlords to offer generous concessions, including up to three months’ free rent and paying the expensive fees brokers command.

Abby and Chuck discuss the “great reshuffling” happening in America’s largest metropolises, the fragile model that undergirds so much of the rental housing market in New York City, and how likely it is that New York will experience a long-term decline. They also discuss why “the Lindy effect”—named for a deli in Manhattan—gives hope that New York will survive the coronavirus fallout...though the journey is likely to be a painful one.

Then in the Downzone, Chuck describes his own journey back from an accident, as well as his experience with a doctor-prescribed media fast. Abby looks ahead to a mountain biking trip to northwest Arkansas and recommends a meditation app from neuroscientist Sam Harris.

Additional Show Notes

• “Manhattan Vacancy Rate Climbs, and Rents Drop 10%,” by Matthew Haag

• “This Is the Great Reshuffling,” by Johnny Sanphillippo

• Abby Kinney (Twitter)

• Charles Marohn (Twitter)

• Gould Evans Studio for City Design

• Theme Music by Kemet the Phantom (Soundcloud)

• Additional reading related to this episode:

  • “10 Tasks for Cities Responding to the Pandemic,” by Charles Marohn

  • “Pandemics Take Advantage of Everything Good in Cities. Here’s How we Protect Them.” by Tristan Cleveland

  • “Is COVID-19 the End of Cities?” by Joe Cortright

  • “Effective Quarantines and Strong Towns” by Spencer Gardner