Lowe Enterprises Mid-Atlantic
1945 Old Gallows Road, Suite 210
Vienna, VA 22182-3931
Thank you, I really enjoy the opportunity to be here. It is a delight and I was honored to be asked. I am going to address the topic today from the perspective of the developer, one who is a practitioner, who puts thoughts and ideas into place and deals with the marketplace. Development is something my company has been involved with for the past 25 years, and I direct our community development division. We are active in doing large-scale planned communities throughout the country-suburban development-sprawl, if you will. I want to begin with the definition of a developer. I say the developer is a guy who was born in a municipal hospital; educated in public schools; attended a state university on an ROTC scholarship; went to graduate school on the GI bill; started his company with a loan from the Small Business Administration; gets his capital from federally insured banks; sells houses through FHA loans; does commercial development through county industrial bonds; does some rehab through tax credits; and then goes into politics and complains about how we need to get government out of our lives! Developers are actually purveyors of goods. Developers are blamed for a lot of our growth problems, but they are in fact just responding to a market. Developers do not go round people up and kidnap them in Michigan and haul them off to Arizona and force them to buy houses. The developer is providing a service in the same fashion as the butcher and the baker and the candlestick maker; he is responsive to a market. Where there is no market, there is no development. Where there is a market, there is lots of development. The problem with development is, of course, that it impacts the public at large, and leaves a mark on the landscape. So there is a very necessary public involvement in that process. One of the many myths is that it is development that has produced all of the traffic congestion and transit problems we face today.
Talking about what we face today, I thought I might begin with a bit of historical perspective. Because I am a historian by avocation, I think it is important to understand how we get to places, and you do that by looking back a little bit. We think that the design, development, transit, commuting, and traffic issues that we are facing today in the middle of the 1990s are fairly recent in most respects. I would say that they were evolved in the last half century from an unusual source. It was the Russians! Why the Russians? Because as a result of the Cold War, and as the result of the conflicts of WW II and Korea, and the threat of spreading Communism in the early 1950s, this country undertook to develop the Interstate Defense Highway System. Everyone forgets that "defense" is in the official title in that term. The concept evolved by General Lucius Clay, under the direction of President Eisenhower, was to come up with a national system of roadways suitable for moving troops and equipment in time of war and for the evacuation of our major population centers. That was the whole point behind it all. Pursuant to the law of unintended consequences, however, it had a completely different result in the context of its impact on our society, and certainly impact on development and on transit. The highway law was signed on June 29, 1956, and within 18 months a huge road-building boom began all over the country. For the next dozen years, we built interstates between cities and beltways around cities, but we also built peripheral roads and feeder roads to access these interstates and beltways; and the road transit system we are familiar with today came into being then, all this was essentially within the last generation.
The impact of that transit system was remarkable. What did it do? The first thing was to cause people to start moving to the suburbs in volume. The evidence of that, I think, can be traced by looking at the composition of the Congress. In 1960 we only had 57 districts out of 426 House districts that were characterized as suburban. In 1970 when the country did redistricting pursuant to the census, that number had doubled to 130. Between 1970 and 1990, it nearly doubled again to 212. Today essentially half of the House of Representatives is representing suburban districts. That is evidence of how the population has shifted. People shifted from the city to the suburbs, and how did they get there? On the Interstate Highway System. As this transition began principally in the 1960s and continuing through the 1970s, the retailers were quick to follow. Again, just a purveyor of goods following his market. By 1990 no one was in the inner cities anymore.
But as recently as 1970, just 25 years ago, the major retailing centers were still in the center cities. In Washington D.C., you had Garfinkels, Woodward, Lothrop, and the Hecht Company and they were all downtown. In Denver you had the Denver Dry Goods, the May Company, Daniels, and Fishers and they were all downtown. Nordstrom was in downtown Seattle and only in Seattle. That was true throughout the country. But as everybody moved to the suburbs, the retailers picked up and went with them. By the 1970s you started to see suburban shopping centers as a distinct pattern of retail development, with all of the retailers picking up and following their market out to the suburbs. The employers were not far behind. They said, "Everyone has gone to the suburbs, we guess we will go too." And so, starting in the late 1960s but dominantly in the 1970s and aggressively through the 1980s, we began to see suburban office development, office campuses, and ultimately the emergence of the edge city.
This trend to suburban development and the emphasis on the automobile and the consequent development patterns are thus a fairly recent phenomenon. A prior speaker pointed out that all of this came about because of a consensus of public will, because the generation making these determinations and controlling these factors at the time was the Depression Generation. The Depression Generation favored roads and they favored suburban growth. There was no public opposition to this, and I think that a lot of people just did not see what was coming. What was coming and where do we find ourselves today? Today we find ourselves facing traffic and gridlock and continuing sprawl and all the impacts that these have on our society, and all the impacts, adverse as well as positive, on our culture as a whole.
There was a lot of discussion of this over the last couple of days, and in eavesdropping on the various sessions, I have heard commentary about where the blame for all of this lies and how this came about. I think there are some myths out there. In my capacity as a trustee of the Urban Land Institute, I was involved a few years ago in an extensive research project that we did trying to address transit in particular and some of the myths associated with suburban growth and suburban transit. One of those myths was that the problems we have today derive from the lack of planning. We countered that myth and said that is really untrue. There actually has been quite a lot of planning; many people at this conference have been involved in that planning. The problem has been that there was a lack of execution. In 1802 Napoleon said "everything is in the execution" and that is as true today as it was then. A conference participant commented the other day that it is about political will. And, it is about political will. There have been many master plans, good roadway networks, transit and commuting networks, and concepts for development that have been well planned in the past, but they have never been implemented. I know that in Northern Virginia, where I live in Leesburg, there is a very heated debate about the infamous Western Bypass or the new North-South Arterial, as a lot of people are starting to call it, because the onus of the word "bypass". It has been pointed out repeatedly that there were very sensible road systems to address this need that were put on paper back in 1963, over 30 years ago, but nobody ever implemented them. The local political jurisdictions never addressed the plans, they let them lay fallow. So today when you try to do it, you have battles between jurisdictions over alignment, this county wants it this way, that county wants it that way. People who have moved into the jurisdiction do not want it at all. People who have been there all along want it in a different place than it is contemplated. So, the traffic and transit patterns continue to become congested, and we are making no progress. But certainly not for lack of planning. It was planned for and well planned for.
Another myth is that we can solve these issues (and this one is dear to my heart) by stopping development. (That's always a solution, aha, the developer, he's the guy, it's all his fault, let's blame him!) Just stop development and we will not have transit problems anymore. That is also untrue, and is not true for a variety of cultural reasons. The myth is that traffic is increasing as a function of development. The fact is that the vehicle population and thus traffic, has been increasing as a function of change of lifestyle which has occurred in our society over the past generation. In Virginia the vehicle population in the 10 years between 1980 and 1990 increased at a pace 65 percent faster than the people population. From that you deduce that if we sent the cadets from VMI out to man the bridges of the Potomac, and not let anybody in, we would have had traffic problems anyway because the vehicle populations were increasing due to the nature lifestyle; kids driving to school, women driving to work, and the necessity to make several trips a day to shop, to get to the gym, and all those other family activities. So, it is not development. Development is not the cause in and of itself, and stopping development is certainly not a solution to the problem.
Another myth that evolved, and this is a historical one dating back to the ?60s when these patterns were just beginning to evolve through the highway system, is that it is necessary to prioritize commuting to the center city. Unfortunately we still see tremendous amounts of public money directed at transit systems that are on the old hub and spoke system, and directed at commuting to and from the center city. Recent studies, however, indicate that the hierarchy of commuting is entirely different these days. Principal commuting is from one suburb to another suburb because the retailers and the employers and the people have all gone to the suburbs. You leave your suburban house to go to your suburban job, to go to your suburban shopping center. There is very little suburb to center city commuting taking place.
The second priority in that hierarchy of commuting is from the city out to the suburbs: people who choose an urban lifestyle and prefer to live in the city find that their jobs have gone to the suburbs so they have to commute to the suburbs to get to their jobs. In third place in the commuting hierarchy do we find what everything has been planned for and funded for: the commute from the suburb into the city.
Another myth, and this is another favorite, is to not build the roads. If you do not build the roads, they will not come. I think the inverse of A Field of Dreams is A Field of Insomniacs because if you do not build it, they are going to come anyway. That has been proven through a number of examples throughout the country. On a local basis, in northern Virginia where I am based, I look at Fairfax City. A long time ago, Fairfax City decided it did not want to have growth, and did not want to have traffic, and they were going to do that by refusing to widen Route 123 where it transits the city. They would not acquire any right-of-way; would not put any restrictions on developing up to the old right-of-way line; they would establish all kinds of historic preservation districts to prohibit this. It worked as intended because they still have a two-lane municipal street going through Fairfax City, but you also have tens of thousands of cars transiting Route 123, causing all this congestion in Fairfax City. So not building the roads is also another myth. If you do not build the roads, that is not going to solve your problems.
On the other hand, building the roads is not going to solve your problems either. At lunch on Monday, Bob McCullough was talking about how you cannot build your way out of this. That is absolutely true. Anton Nelessen at the luncheon presentation on Monday made that point as well. He talked about the transit cycle, about how roads bring development, which brings cars, which bring a demand for roads, which brings more development, which brings more cars. That is sort of an endless cycle, and you can jump on that train at any point. To the extent that you do build roads to address the traffic problems, and you enhance the road patterns, you do create a demand for further development and it becomes an infinite problem. So that is the solution. From a developer's perspective and from an implementer's perspective, that is, these are the problems as we see them.
The issue is in how to address these problems and how we find solutions. One solution for the public sector is to put the solution on the back of the developer. Reference was made to that at one of the workshop sessions I attended. We will have the developer, based upon all this statistical data, bear the cost of making improvements to transit systems that will be impacted by this new development. There are a couple of things wrong with this from my view as a practitioner. One is that a lot of that data is very skewed, and it is skewed intentionally, whether consciously or unconsciously, to find a funding mechanism to address these issues. Many of the databases which come up with formulas and purported solutions are very, very faulty. In the end, it is not just the developer that can solve the problem. There is this perception that the developer is operating from a black hole in space. In fact he is not; he is part of the overall economic network.
I would like to call this approach or putting the issue on the developer a "newcomer's tax". Anything that you get the developer to pay for is going to be translated into the cost of his project, and therefore into the cost that people have to pay when they buy into that project. It is really just a newcomer's tax. In any event, it is not the solution because the developer in making an improvement to a segment of roadway that fronts his property is not addressing the congestion that might exist miles and miles away, even in another jurisdiction. This approach is clearly not a solution. There have also been a lot of attempts to address these issues through urban design. That was one of the topics of the discussions here for the past couple of days. Urban design and how it fits into the equation in terms of addressing the problems and finding the solutions.
Frank Spielberg raised an interesting question in the workshop yesterday. He asked if it is conceivable that subdivision and development ordinances and regulations are too restrictive. They do not allow enough innovation on the part of the development community. He even went so far as to say "what if we did not have any regulations?" I would not advocate that, however. Having no regulations for developers is like giving matches to pyromaniacs; there is no telling what you would get out of it. I will be the first one to tell you that no regulation is not a good idea. In terms of regulations being too restrictive, however, absolutely! They are too restrictive. I cite as an example the 19th century village which is the little town of Leesburg in northern Virginia in Loudoun County. Our county spent a considerable amount of time and effort going through the development of plans and policies and ordinances that would allow neo-traditional development-a "new" 19th century village. When all was said and done, the regulations do not allow that.
I look at Leesburg where I live, and say that if I went in today as a developer and gave them a traditional plan and wanted to develop that way, they would laugh me right out of the planning office. The street I live on is only 18 feet wide. Well, no one likes that, "cannot get fire engines down it" they would say. Well, we do, we have fire engines and ambulances and trash collection vehicles go up and down that street. They would say that the lot widths are not uniform. That is true, lot widths range from 30 feet to 150 feet. They would say that the setbacks are not uniform. True again, we have houses built on that street early in the 1800s that front right on the sidewalk, and we have some built later that are set back 70 or 80 feet. They would say that your side yard setbacks are not uniform. That is also true. We have a few town houses that share a common wall; we have a few single-family historic detached houses that have a 5-foot separation, and we have others separated by 30 to 50 feet as a function of lot size. There is absolutely no uniformity. But what does that street have and what does that historic sector of the town have? It has amazing character; it has tremendous vitality in terms of cultural diversity.
We also have tremendous variety in pricing. That is another issue that comes up, the pricing. Another speaker commented that when you start doing these plans, everybody gets paranoid because of the fear of putting a $125,000 house next to a $150,000 house. Well, I always cite examples like Leesburg, and say that in Leesburg we have houses on a street two blocks long that range in price from 3/4 of a million dollars to $100, 000. We have blue-collar workers, executives, salesmen, doctors, professionals, judges, and clerks, and everybody seems to live together just fine. It is the diverse fabric of a neighborhood, and the fabric of a community, and it all translates back into the product, and back into urban design. We have varying lot sizes, varying products, flexibility with the streets. Yet when this same county said, "Gee, that's a great neighborhood, let's reproduce it," they went out and created a set of subdivision ordinances and a set of development restrictions that basically prohibit you from creating it.
I am somewhat critical of this neo-traditional concept, and say there is not anything traditional about it. It is not even very "neo". The traditional component is that it is traditional suburban subdivisions. There is no ability to reproduce a 19th century village. There is no ability to mix product. There is no ability to show creativity in street design and have interconnection between public spaces and residential units. So I think the answer to the question raised about the development ordinances being too restrictive is "yes". I think they are too restrictive. They are too restrictive because you would find that responsible developers, in combination with creative urban design professionals, planners and engineers and architects, could come up with some terrific solutions to our problems and would really enhance our environment. But they cannot do it because we have a public sector side that is locked into a recently traditional mode: namely, suburban sprawl. That sector gets antsy anytime you propose anything creative. I think that is a significant view about trying to address these problems through urban design. We are going to have to see a lot more flexibility on the part of the public sector. And a lot more creativity on the part of the public sector. That in turn will translate into alleviating some of the terribly restrictive elements we have on design now.
Telecommuting, of course, has been a topic of discussion the last few days. Telecommuting is touted now in many respects as a panacea: it is going to be great; no one will get into their cars when they can work at their kitchen tables. As practitioners, we do not see that at all. Telecommuting has yet to sort itself out in terms of impact on our whole society. One of the views I have on telecommuting is that it is not people working on their kitchen table, it is the ability to conduct your business from a variety of locations. When you look at it in that context, it certainly has impact and presumably positive ones, hopefully positive ones, but not what we are now thinking of. I think you will see, for example, that you will have different commuting patterns because people will be able to do things at home in the morning: you do not have to go in at the rush hours between 7:30 and 9:00, you can go in at 11:00 to 12:00, but the things you have to do for the first few hours, you can do with the modem, the fax machine and the telephone, so you can work out of the house. But you will eventually go to work. This will shift the commuting patterns, but it does not eliminate them. You still have to make the trip. One still has to go from Leesburg to Tyson's Corner in Virginia. One still has to go from Point A to Point B in any major metropolitan area. People are just going to have the ability to go at different times, and more and more people will have that flexibility.
I think that would apply as well in other aspects. Take people who ordinarily would leave on Friday afternoons and go to the local beaches here in Virginia or would leave and go down to Wintergreen in the summertime. Ordinarily we would see all those heavy commuting patterns on Fridays. I know that from Washington D.C. to the eastern shore of Maryland on Friday afternoons is absolutely a madhouse. Traffic gets stacked up on Route 50, backs up at the Bay Bridge. Maybe we will start seeing changes in those patterns because people will be able to go on Thursdays; because on Friday when they get there, they are going to plug in and get online and be able to do a lot of work otherwise done in their offices on Friday. But it does not eliminate the trip. It just changes the distribution of the trips and changes the time at which they occur.
Telecommuting is also having an impact on office patterns. But again, not one that is frequently recognized. Everybody says that the conventional suburban office is going to go away and that we are going to have telecommuting which will significantly reduce the need for offices. In our practical experience, we are not seeing that. But we are seeing a change in usage. The standard office ratio was about 250 square feet per employee. That grew during the ?80s to about 300 square feet because money was loose and times were good and so everyone got a bigger office, more space. That has now dropped to about a 200-foot level, and we think it will be under 200 feet, down to 150 - 175 feet on average. Why? One reason is because we see, particularly in the executive ranks, smaller offices but more offices, and shared offices. I was talking to a partner at E&Y Kenneth Levanthol, a national partner who travels a great deal. He made an observation about this. He said that they figured out that all the partners of senior rank, who had the traditional big 400 - 500 square-foot corner offices, did not need them. It was a waste of money, they were never there anyway. They were traveling all over the world, all over the country, to different offices, and were conducting their business through modems, telephones, faxes, and via Fed-Ex packages. They actually spent very little time in their offices. So they changed it. They cut all their offices down to 125 - 150 square feet. The people who are there every day are the ones who need the most space, not the executives who are traveling a lot. I have found that to be true in my own business (when Marty Wachs was introducing me, he commented on the projects I have in different parts of the country) and from my own personal experience I do not have a big corner office anymore. I have little "cubbyholes", as I call them. I have a little 125-foot cubbyhole in Virginia, an 80-foot cubbyhole in Philadelphia, and a 100- foot cubbyhole in Seattle. I move around to these different cubbyholes, and take the computer with me; the fax machine is on and you have voice mail to check messages. You have a base of operations, but you do not need all that space. So telecommuting is impacting the character of offices, but it is not making suburban offices go away. No one is just working out of their house.
The statistics we saw from Canada, which have to be extrapolated to American levels, that Denys talked about yesterday showed that there was actually very modest growth in home worker employment. It has gone from 1.1 to 1.5 million, not a very large number in a country with a population of 30 million people. I do not think that telecommuting is going to translate into people working from home all the time and not going to work. It will translate into different work patterns and different commuting patterns. It will translate into a redistribution of office spaces, but it will not translate into elimination of office spaces. You are still going to need the office park; you are still going to need the parking that goes with it; you are still going to need the office space; but it is going to be reconfigured. The other view I have about telecommuting is that people go to work for reasons other than work. There was a prior comment made about that as well. I think Denys made a comment yesterday about how there was a lack of social interaction that had emerged in the studies of home workers. We go to work for team building. We are social animals, we go to work to meet our friends and have dialogue with them. We go to work for hierarchy, to get reinforcement that we have a value to an organization. We go to work for ego gratification. You get to walk in and everyone says, "Good morning, Mr. Boss." A lot of reasons we go to work do not have anything to do with work, and I do not think that is going to change. I think the cultural characteristics of our society are such that we cannot look at telecommuting as some kind of a panacea that will resolve all of our transit problems because everyone is just going to stay home and get on-line and that is going to be the end of it.
I think the solutions are in a much more cooperative effort than we have seen to date. Michael Soffert commented in one of the workshop sessions that we need to see engineers, architects and planners working together more when it comes to issues of urban design and transit planning. I absolutely agree with that. But that group has to be expanded; you have to add to the engineers and the architects and the planners, cultural anthropologists and developers and elected officials. The elected officials have their hands on the throttle when it comes to development ordinances and implementation of policy. The developers are going to respond from the aspect of market constraints. We need cultural anthropologists to tell us some things about people and people's interaction that we may either forget or overlook. The solution is in more comprehensive discussion groups and more comprehensive dialogue, not unlike the one we have seen here for the past few days, but with an expanded audience.
I was sorry to see that we did not have more developers here at this particular session. I have in mind a cartoon from "Calvin and Hobbes." It opens with Calvin saying, "The more you know, the harder it is to take decisive action." Once you're informed, you see the complexities and all the shades of gray, and realize that nothing is as clear and simple as it seems, and in the end, knowledge is paralyzing. And it concludes by saying, "As a man of action, I can't take the risk of being informed." Maybe that is why a lot of developers did not come; they do not want to take the risk of being informed because they are out there busy responding to the market!
Those are some comments and views from a practitioner's standpoint, and I hope that it has been helpful. Thank you very much for inviting me.