The Revitalist

Auto Week reports that the SmartCar will be available in the US in 2008. CoolTown Studios proclaims this a victory for pedestrian-friendly streets. The smart fortwo has been very successful in Europe (I understand that smarts are exempt from the center city driving tax in London), and DaimlerChrysler is betting that the time is right for smaller is better in the US. Who will buy them?  The press release says, "smart, as one of the youngest car makes on the market, stands for innovation, functionality and joie de vivre and especially appeals to customers who are interested in new, clever and trend-setting solutions in the automotive sector. smart drivers are characterized by attitude, not by age, profession, gender or any other 'traditional' criteria clustering groups of people. smart people are open minded, question the existing and live consciously." Hmm, so that sounds like Europhile Manhattanites. Do you think that anyone in Nashville or Phoenix will buy one?

 While I think the idea of a super tiny, zip-around-town car is great, the smart just leaves me cold. I love the super stylish MiniCooper, but there is something buggish and chopped-off about the smart.

Over the weekend Gov. Romney vetoed portions of the Economic Stimulus bill, including the $50m increase in the state historic rehab tax credit. The veto was part of a $225m exercising of the line item veto in this election year (insert your favorite political gripe here). In his official letter, the Gov says, "This provision [the increase in the cap] will cost the Commonwealth up to $44 million annually and is not tied to job creation or promoting technology industries." Now, I'm not an expert with the job creation numbers associated with the tax credits, but it seems to me that this statement misses the point. The tax credit is just as much about economic stimulus as is its much more popular cousin, the brownfields tax credit, which was also in the Econ. Stim. package and was not vetoed. There is no doubt that WM Lofts and the Morehouse Bakery Building project will bring new jobs to Lawrence: construction, building management, new commercial businesses and, in the case of Morehouse, job training. WM Lofts will bring new residents, eventually new homeowners, who will bring their spending power to Essex Street. We have no doubt that these projects will bring new life to this neighborhood of downtown Lawrence, which will spur new business activity and increased tax revenue for the city and state. This is most certainly economic stimulus work, and we are counting on the Legislature to override the veto.

The latest installment in Mayor Menino's war on potholes is a moratorium on new street cuts. The Mayor is fed up with poorly repaired cuts made for construction or utility work that create uneven road surfaces and potholes. He is "tired of it," and he's "not going to stand for it." Understandably, contractors are bewildered and upset - yesterday, they had a full work schedule - today, there is no predicting when they will be allowed to dig. The moratorium will be in effect until the DPW develops a plan that gets the work done and ensures that "our streets are restored to their former condition." Begs the question of just what that former condition is.

However, potholes are one of those lifestyle issues that make a big difference to city dwellers, like trash and graffiti. I think it's great that the City is taking an aggressive position. I'm sure it's very satisfying for the Mayor to say I'm not going to take it anymore and demand that Joe Casazza do something to fix it. I don't envy Casazza's job, though. Let's hope that the City can come up with a plan to ensure that street cuts are fixed in a timely and quality fashion and can do it quickly, but I'm not holding my breath.

The NY Times has an inspiring story about the urban living market heating up in Nashville. The article highlights one developer who is "single-handedly creating a market for residential housing in the central business district, which 3 years ago had all of 10 units for sale." He's now working on plans for a new, 65-story luxury tower (see photo), but the article points out that his first downtown project broke even and needed significant subsidy. A lesson in what it takes (from developers and from the municipality) to build momentum for a new idea like this.

The article also mentions that several smaller adaptive reuse projects have contributed to the trend and that an entirely new neighborhood called the Gulch is growing up out of a former warehouse district. It's great to see that this model can make it in the second and third-tier cities, even in a pretty conservative/traditional one like Nashville. Perhaps it really is the wave of the future...

The Globe reports that the average monthly rent (residential) in Greater Boston is up 3.6% from this time last year. The new average rent is $1,355 and the average occupancy rate hit 96.1%. The article cites the declining home buying market (driving some to rent instead of buying) and new high end residential units coming online as causes of the increased average. One developer says that his company has stopped offering to pay brokerage fees, free months, and flat-screen tvs as incentives - now the new tenants are paying their own way.

We obviously like to see an average 96.1% occupancy rate. A thriving and competitve rental market is just what a developer wants to see as we head into construction.

Robert Kuehn, 1943-2006

We are shocked and saddened at the loss of our friend and mentor. The Affordable Housing Institute remembers his visionary contribution to the development community in Boston and his passion and sense of humor.

A memorial service will be held on Wednesday, June 21st at 2:00 pm in the courtyard at West End Place.

 

The Globe reports on the Romney administration's efforts to encourage Transit Oriented Development and links to a ULI report on Boston's transit future. The ULI report points to growing demand for high quality transit options and Station Area Housing and says that more people are doing a housing affordability v. transportation costs calculus - it's not actually cheaper to live in the 'burbs if you are paying through the nose for your two cars. Plus, it suggests that demographic shifts (read: aging Baby Boomers) are linked to increase demand for housing in walkable, mixed use environments. The hang up here is the MBTA and its woeful financial situation. Along with suggestions for municipalities to encourage more TOD, the ULI report has some interesting recommendations for improving the T's finances.

WM Lofts is within 1/4 mile of the new Patricia McGovern Transportation Center on the MBTA's Haverhill Line - less than an hour's ride to North Station. We certainly hope to capitalize on this location and plan to do what we can to make the connection between the building and the station more convenient.

To follow up on the teardowns article, the Wall Street Journal (via the Sun-Sentinel) has an article about the declining market for McManions, defined for the article as a house larger than 5,000 sq ft (that's double the national average). Apparently it is getting much harder to sell these "garage mahals," "faux chateaux" and "tract castles." Rising utility costs (Connecticut Light & Power estimates that it can cost $5,000 a year to heat/cool a 5,000 sq ft house in Farmington), the declining size of the average household, downsizing Baby Boomers flooding the market with their trophy  homes, and the increased demand for smaller but cooler homes are all driving down the market. "Sellers are dying out there," says a broker in Loudoun Co., VA. The article details the selling woes of several families, including one seller who had to drop his price by $180,000 and throw in his high-def tv, lifesize Spiderman statue, and cookie jar (which happened to say "Biscuit" - the name of the buyer's dog)!

 

The NY Times has caught on to the uproar over teardowns (the tearing down of smaller, older homes to replace them with much larger new construction). The National Trust has been campaigning against this phenomenon for a couple years now. The article notes that it is most common in resort areas where the land is more valuable than the house (e.g., coastal towns with older bungalows). Although, I have also noticed this trend in Raleigh where my family is. The older neighborhoods "inside the Beltline" are (always have been) the most desirable addresses and are being re-populated with giant cubes of brick veneer and pre-cast.

I sympathize with the argument that sometimes these older houses don't fit modern lifestyles very well, and not everyone is willing to put up with inconveniences in the name of character. At the same time, I feel the loss of coherent identity in these neighborhoods (and I am more than a bit uncomfortable with the conspicuous display of wealth). The article mentions several municipal strategies for coping with this trend, including incentive zoning. I think encouraging behavior is generally more effective than punitive regulation, but this is going to take an unusual combination of dedication to the concept and willingness to compromise. Ultimately, I think we're likely to wind up with self-selecting neighborhoods where people who care about the integrity of these neighborhoods will be willing to live with the limitations, and those who don't will go elsewhere. That probably wouldn't be such a bad thing...

The House and Senate have voted to approve the $700+ million economic stimulus package. The bill has been languishing in conference committee for months, while the health care bill took center stage. The bill will now go to the Governor's desk for signing.

We are excited about this because the legislation raises the cap on the State Historic Rehabilitation Tax Credit from $10m/year (which wasn't enough to fund all the projects who were eligible) to $50m/year. In addition, we understand the legislation makes the increase retroactive to 2005, meaning that there is a big pot of money available - enough to fully fund all the applications in the pipeline. Going into the future, there will hopefully be enough to provide for future projects to receive the full amount that they are eligible for. This is big news for the redevelopment community!

Now we are waiting with bated breath for the Governor to sign the bill and then for Secretary of State Galvin to make the allocations. A lot of good work will be done.