Bacon's Rebellion

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IG of the Day: the Price Premium for “Walkable Urbanism”

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by

James A. Bacon
in

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Once upon a time, the Atlanta region epitomized suburban sprawl. But development has shifted dramatically in the past few years. Since 2009, reports Atlantic Cities, “60 percent of new office, retail and rental properties in Atlanta have been built in what Christopher Leinberger calls “walkable urban places.” That new construction has taken place on less than one percent of the region’s land mass.

Urban land may be more expensive to re-develop than building in empty greenfields, but the location is so much more valuable that the rents more than cover the costs. The chart replicated here compares average rents on a per-square-foot basis in walkable urban places to those in drivable suburban places. Overall, people are willing to pay twice the price per square foot for walkable compared to drivable.

In an Atlanta conclave of real estate researchers yesterday, reports Emily Badger, Leinberger “forecast that the vast majority of new square footage built in America in this new real estate cycle will be developed on less than 10 percent of land that’s already occupied.”

Sixty percent of the growth in less than 10% of the already-occupied land: Could that be happening in Virginia’s metropolitan regions, too?

— JAB

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5 responses to “IG of the Day: the Price Premium for “Walkable Urbanism””

  1. TMT Avatar
    TMT

    Here’s some evidence that the new urban life’s draw might not be what it’s all cracked up to be. Fairfax County is considering amendments to the Comp Plan for Tysons that would permit more office space in the TOD areas by removing the cap. While this does not mean there won’t be a big increase in residential construction, it likely means more commuting than was expected.

    1. reed fawell III Avatar
      reed fawell III

      I sense that there is something rotten is Denmark. That the stink has not only been pervasive for a very long time, but that it is chronic, in Denmark.

      1. TMT Avatar
        TMT

        A chance to learn about what’s going on in Tysons with proposed changes to the Comp Plan.

        Tysons Comprehensive Plan Amendment Preliminary Dialogue with County Staff

        Wednesday, October 2, 7:30 – 9:00 PM
        Spring Hill Elementary School
        8201 Lewinsville Rd., McLean, VA 22102

        1. reed fawell III Avatar
          reed fawell III

          Is Oct 2 date correct. That was two day before you posted it. Might it be Wednesday of next week.

  2. reed fawell III Avatar
    reed fawell III

    I assume “walkable urban places” are places where “homes, shops, restaurants, entertainment, and work spaces are in such close proximity one to the other that people can conveniently live there by walking.”

    If that is the definition of that “60 percent of new office, retail and rental properties built with such market success in Atlanta” then it would support the view that in “walkable urban places” 2 plus 2 equals 6.

    Another words that such places are wealth creating places. This correlates to the article herein labelled “America’s High-Productivity Regions” and many earlier articles herein (such as the Fiscal Fix) suggesting that the benefits of such mixed use urban development far exceed their cost by ratios far higher than other sorts of development.

    These values are not absolutes obviously. And should not dictate results. Nor should they limit peoples choices. Here in Atlanta apparently people are given the choices and are voting with their feet and their dollars.

    As positive as these numbers appear, they also suggest that we still have a long ways to go toward understanding and quantifying the dynamics that underlie these rising trends pointed toward a mixed use future. For example, how much social, entrepreneurial, cultural, and artistic capital are created out of thin air by these emerging mixed use urban developments.

    What, for example, is the value of Live Art. See this website’s Live Art.

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