“let us give thanks for living in a world where we can break off bits and eat them”
Pagan prayer…no origin.
Michele Conception Bertomen, Architect
David Christopher Boyle, Poet
Ortega y Gassett has written that in all disciplines there exist nodal points, problems that appear to be insignificant but which, by their very nature have systemic value. We propose to enable existing public space, revealing common ground where water, earth, air, plants and community converge on the vertical surfaces of buildings.
Profound changes await us in the near future as growing seasons lengthen, weather patterns become extreme and global changes fragment existing communities and create new ones. In this situation, new forms of self empowerment are crucial as urban communities seek to engage the positive aspects of these transformations in order to survive.
Vertical surfaces, currently used only for light, air and egress have enormous potential to collect and deploy rainwater, to grow plants and food. In dense urban areas retention of water for the hydrological cycle[i], deployment of water for agricultural purposes, use of embodied energy in rain water, use of plants to improve air quality would immeasurably improve urban life and positively affect the relationship of dependence of the city with respect to its hinterlands. [ii]Building enclosures could be naturally insulated through the use of plants so as to mitigate power usage. Through transpiration, increased plant matter will clean air and reduce the carbon footprint of cities. This new landscape has potential to rejuvenate the social life of cities as they will become, like community gardens, sites of local political independence, communication and negotiation- a catalyst to transform the bureaucratically frozen city into a living metropolis, where people are the city.
Synopsis: Ownership of land is typically allocated two dimensionally, as if earth were a smooth surface parallel to the horizon. Yet the walls of buildings, which are but lines on a property map, abut common air, water and pollutants as surely as horizontal surfaces. And, even in moderately dense urban areas, the square footage of exterior vertical surfaces of buildings is greater than horizontal surfaces of the city. [iii]
We propose to re-conceive this territory as productive, arable ground. Through usufruct, ownership, rent or illicit cultivation, we propose to enable ordinary people grow plants on the vertical surfaces of existing and new urban structures to produce food, deploy rainwater constructively, mitigate storm flooding, help clean air and provide opportunities for new community.
Key words: jury-rig, water, rainwater, stormwater drainage, food, urban gardening, hydrological cycle, community gardening, local food, retrofit, upgrade, green insulation, usufruct, land, urban farms, vertical farms, vertical gardens, vertical trellises.
Convergent situations we wish to improve:
Community, family, garden:
My mother, her mother and her mother always had a garden. Each member of our family had specific garden duties and mine was “to mulch” as I was fond of cucumbers and delighted in finding new ways to serve them. Now that I live in New York City my husband and I tend a plot in the 6th Street and Avenue B Garden in the Lower East Side.
The act of gardening, together, allows the informal, yet directed form of social exchange that sustains community. Like doing laundry, cooking or washing dishes, gardening encourages a liminal atmosphere where important concepts having to do with collective life are aired (rather than discussed) within a space of shared goals. Gardening provokes a systemic understanding of the intertwined patterns of our ecosystem as people touch the meetings of plants, animals, earth, air and water.
Local Food:
I confess I am a bit obsessed with the potential of supplemental, local food in this uncertain time. My grandmother’s “Victory” garden provided sustenance for her, my grandfather, my great-grand mother and seven children through World War 2 and the Depression.[iv]
In an age where a hamburger might contain meat from all over the world, we can trust the tomato we have grown ourselves. Growing food is seasonal, reminding us of the cyclic nature of life on this planet. Garden food has more nutrients and tastes better.
I am not alone. Guerilla gardeners are ubiquitous, it seems[v]. I often spot small, clearly cultivated plots on public land and, just last week, discovered a sumptuous zucchini vine (already harvested) in a neglected triangle of land next to the BQE off ramp. But horizontal surfaces, suitable for gardening are contested spaces in dense, urban areas where we tend to use the ground for transportation or building footprints and rooftops for environmental conditioning equipment.
Storm drainage:
In New York City, all of these hard, horizontal surfaces- roads, sidewalks, rooftops lead to massive problems with storm drainage. Unfortunately, sewers containing biological waste are combined with the storm drainage. These combined sewers release untreated raw sewage into New York’s waterways about half of the time it rains- about 27 billion gallons per year.[vi]
The city has legislated stormwater mitigation: every lot must retain 80% of its water on site for four hours. Unfortunately this water is most often directed towards dry wells: concrete basins underground that allow slow drainage into the sewer mains[vii] rather than used to water plants, flush toilets, clean streets, etc.
Plant life: bio habitats, environmental conditioning and air quality
In a city it is easy to forget the intertwining of ecological systems so necessary to the health of our planet. Plants are our food before we become organic material to feed them. Plants host animals and provide bio-habitat continuity which contributes to the diversity of our planet: our greatest strength. They clean air through transpiration and retain valuable nutrients, including water, in their roots. Plants provide the ideal summer shading, insulating a building from the outside, so that ultra violet radiation never enters the interior during the summer months, and reducing power needs for air conditioning.
Solutions, implementation, financing:
Central to this proposal is that people who live and or work near a site appropriate it for their own. The means to do this must be inexpensive and simple to install and maintain. Our solution encourages common sense, on which past generations relied.
Existing building owners provide supports for floor area incentives.
Even if the area just outside your wall is public space, the wall, most likely, is not. However, all that is required is that the wall, as an element abutting public space, be supplied with a fastening method for a flexible scaffold to support containers of earth perhaps in return for additional floor area or tax rebates. [viii] Devices of this sort are common have been made even more possible with the invention of fasteners that leave a wall surface intact. [ix]
While fasteners would be owner- provided, the scaffold to hold plants and containers would be provided by the would-be gardener. Looking about the neighborhood we thought that an ideal, and appropriately jury-rigged solution for existing buildings would be to attach steel chain link fences to walls. Clinging plants and vines, apparently, love these ubiquitous fences. Their fabric like structure allows for a scattered fastening technique and, even, exterior maintenance since they can be climbed (on belay and with proper insurance, of course).
To hold soil and plants we propose locally produced, bio-degradable, semi-permeable baskets of woven grasses with provision for directing water (drip fronds, as illustrated). These would have to conform to specifications for loading and drainage but could assume diverse configurations. Flexible baskets would add less wind load on a building surface. They could be fastened to the chain link fence at multiple points. Losing soil and plants they could fall to the ground and cause minimal harm and pollution.
New buildings would be given street space on the upper floors, creating a layered public space.
Currently New York City allows buildings to extend a balcony, building ornament or trellis 18” over the property line abutting a street or public way: hence all of these tiny, unusable balconies common in new buildings where floor area is at a premium. Eighteen inches is not usable for growing in this situation but three feet would be ideal. And eighteen inches of that three feet, if given to inhabitants to use, would be within the public space of the street.
This would allow the City to require plant growth in this area, as it is within the public way, albeit above the walkable surface. This type of requirement already exists in the Zoning Resolution, which requires sidewalk trees to be planted and tended in exchange for the additional floor area under Quality Housing regulations.
A three foot terrace would greatly increase the value of an apartment, requiring no further incentive on the part of the City.
Rainwater storage and deployment
Currently New York City requires buildings to retain water on roofs or in dry wells beneath the ground. However, many buildings were built before this code requirement and retain no storm water at all. Water is directed most times from drainage points on the roof through the building to the cellar where it is joined to the combined sewer.
In existing buildings we propose to tap into the storm drain coming from the roof and re-direct the water to exterior plantings. In new buildings the trellis created to support plants could be designed to retain water and be linked, via piping, directly to the roof water runoff.
[i] De Billiers, Marq Water: the fate of our most precious resource Mariner, Houghton Mifflin, NY 2001 p. 30-45 the amount of water on our planet has almost certainly not changed since geologic times but 1) fresh water is renewable and 2) even though only 2.5% or 34,000 cubic kilometers is available, it is more than more than enough for every human on the planet. (1,700 cubic meters per year per person is considered sufficient and our presenet capacity is 8,000 cubic meters per year per person) Our problem is not that we do not have enough water but that it is mis-managed and in the wrong places- (population control is another discussion).
[ii] Ortega y Gasset Investigaciones Psicologicas (Madrid: Revista Occidente en Alianza Editorial, 1979)
[iii] Topologically, exterior building surface area in a dense, medium rise city breaks down thus: 46 % horizontal and 53% vertical.[iii] This gross calculation, based on six story buildings, means that the total growing area of vertical surfaces is slightly greater than all of the horizontal surfaces.. This calculation was based on 6 story buildings 72 feet high on a typical 200 foot by 400 foot block and 56 foot wide street, including the sidewalk.
[iv] Cuba survived the sudden absence of Russian fuel and goods with community gardens. See “the Power of Community: How Cuba Survived Peak Oil” a documentary film produced by The Community Solution, a program of Community Service, Inc. and available at www.community solution.org.
[v] There is even an organization http://www.guerrillagardening.org/ celebrating “acts of illicit cultivation”.
[vi] www.riverkeeper.org
[vii] And even this might not work: according to some engineers the drain orifice required by the city is too large to stem the flow of water from drywell to sewer main.
[viii] or, more constructively when possible, a stoop area where additional plant could be grown and garbage and recycling could be protected as Jane Jacobs has suggested in Death and Live of Great American Cities.
[ix] Hilti
Friday, April 18, 2008
Commodification of Land (2005)
Michele Bertomen Associate Professor of Architecture
New York Institute of Technology School of Architecture and Design
With reference to money and life in general, my grandmother was fond of saying: don't touch the principal, never sell the land. A stocky woman of French descent, she enjoyed tangibles like her slowly accruing savings account at Marine Midland and her 20 some acres in Rockland County. After she died her land was sold. The resulting investment brought her progeny seemingly appropriate rewards.
My grandmother, whom I called Minama, viewed the relationship between earth, water, air and human constructs as common wealth. She had brought seven children, her husband and her own mother through the depression without hunger with her precious land. Her resources included a 5,000 square foot, assiduously weeded and mulched garden, two sheep, sundry chickens, a cow named Alice, a septic tank and a well with a manually operated pump. During the time I knew her, she policed her bit of turf as carefully as her savings account. She protected her compost heap (located next to the house garden), her gooseberry bush, her fruit trees and her somewhat swampy front lawn. This last because the lawn produced a delicious variety of mushrooms after a wet spell. She kept track of her neighbors' resources as well. Long after the depression she would drive slowly, in her golden Studebaker through the two towns equidistant from her land, past the elementary school where many of my aunts and uncles were educated, past the public library where she volunteered time, towards the town common area where a small brook flowed and anecdotally remark, as we passed through her property (which was on either side of the main road) on the state of her corn, how the northern side of the barn had become moldy, how so and so's house needed a coat of paint, that perhaps too many trees were dying in the swamp, etc.
The land my grandmother owned in Rockland County, New York looks a lot like parts of Long Island now where the flower and fauna of exurbia have replaced traditional lawns and garden plots. Although it has been re-planted, she still owns this land, in a sense. Her descendants benefit from her investments in the stock market, her life insurance, her pension fund and the small behest she left her children. These, with other people’s life savings, still administered by the remnants of Marine Midland , underwrite the development and construction loans necessary for large construction endeavors, bringing return to even the smallest unwitting investors, like myself. Financed by such accumulated funds and leveraged by governmental policy my grandmother’s 22 acres has been joined to many other properties so that new flowers like Home Depots, Pathmarks, K-Marts, Costco, McDonalds, Dunkin Donuts and Kinkos can grow. Clustered around a mall, one of the largest in the northeast United States, they surround themselves with new territory conducive to their ecosystem: forbidding stretches of asphalt and a dizzying system of elevated roads designed to attract people in their cars from the highway. At the heart of this system, within the precincts of the mall, a magical dream world has been conjured where all the civic life that my grandmother observed on her short, slow drives has been reconstituted: Main Streets, Town Halls, Greens, Commons, Train Stations, Waterfronts, Piers and even schools, police stations, fire stations and even, fantastically, waterfalls, rain forests, jungles and the like.
It is not always appreciated that such commercial enterprises as described above- Big Box/ franchise commerce clustered around a mall- are not really magic or mysterious growths. They are certainly not built through the whim of some inconceivably rich magnate seeking to further his wealth. Rather, disguised through history and our own complicit interests and through a series of distancing mechanisms, they represent our own invested monies deployed, as it were, automatically in a form that brings the best return. Agglomerated capital, the result of common labor and individual earnings and savings, is gathered together, invested, leveraged, re-assembled and re-leveraged. Lacking the foresight or hindsight of an intentioned mind or minds, each step in this process (which oftentimes happens almost instantaneously) is focused on accretion of money. Low oil prices and enormous sums of money earmarked for road-building [1] produce parking lots, highways, cloverleafs, etc. Thus it is our own flexibly accumulated investments,[2] floating somewhere in the miasma of global speculation, aided by government policies, that plants itself in our backyards like alien life. We , collectively, created the conditions that welcome this hostile ecology- an ecology that now threatens our sustenance: out land.
My grandmother, who died in 1984, lived within a far different economic system, a different culture. In the intervening years checks and balances which, during her generation, often monitored such mindless accumulation and deployment of funding, were dismantled, circumvented or re-invented in a wholly new way, often without public oversight. While we can see and experience a big box/franchise/mall cluster (bbfm clusters for short) many of their salient characteristics are invisible. Even when we catch a glimpse of these characteristics it is often difficult to draw conclusions about the nature of bbfm clusters since they literally shape the conditions through which we experience them. Through this dialectic process they have transformed our world in a manner that, now, seems as natural to us as my grandmother’s did to her. Yet it is important to note the extreme difference between our world and hers. Characteristics that we take for granted as desirable were, in her world, dubiously valuable and potentially life threatening. My grandmother would characterize distanced judgements, speed for its own sake, economies of scale, pulverization of resources, and compartmentalization of expertise as ignorance.
Yet these modes of action, extolled in our society, provide fertile territory for the growth of these fecund clusters. In fact, bbfm clusters, surrounded by ribbons of highway and speeding cars; pulsing with the ebb and flow of automobiles and ; shedding oil and gas over asphalt to percolate back to hidden aquifers; selling many bits of goods made far overseas under contracts based on amassed globally accumulated money to people who live next door but don’t know that they do, are the tangible manifestation of these cultural mores. Although they do not lend themselves to common surveillance, aerial photographs allow us to see clearly how they garner our money for global re-deployment while laying waste to our land.
We might not consider bbfm clusters invisible. Certainly many of us consider them blights on the landscape and many of us do not want them in our back yards. But we cannot see them in the discerning way my grandmother protectively surveyed her neighbors’ lands. Consider the fields of automobiles surrounding bbfm clusters which remove it from ordinary surveillance by creating a tract of land hostile to walking. Communities at the edge of Mall of America, for instance, are so distant because of the depth of the parking and associated roads that it was necessary to create a school within the mall for its employees’ children. The distance of a bbfm cluster from a community is not well gauged by a shopper who decelerates from highway (60mph) to exit ramp (40mph) to parking through a disorienting sequence of roads. Yet aerial photographs often reveal that bbfm clusters are more proximate to a community than perceived.[3] In some cases drainage basins containing polluted run-offs from thousands of vehicles are adjacent to town wells that supply the very communities that protest the visible aspects of a mall.
The bbfm cluster sets the conditions for its invisibility by establishing an amorphous private realm disguised as an exciting new kind of public place. The perimeter of this private territory is difficult to ascertain. Most access ramps surrounding a mall are, in fact, private roads. Municipalities, seeking to reduce maintenance and overhead readily give over private streets to bbfm clusters. Yet many times the state DOT, using taxpayer's money, will build the initial portion of the exit from the public highway, creating a seamless descent into the privately controlled bbfm cluster.
Elimination of public streets accelerates the combination of many small lots into large areas for re-development. Public land is thus co-opted, while private land is removed from daily scrutiny as lot depths change from the traditional fifty to one hundred feet to tracts of land that cannot be viewed , at eye level, in their entirety. Banking practices, municipal laws and zoning have evolved, during the last twenty years, to support this. Developers are given incentives to develop large, rather than several small tracts. Often they are given a seat at municipal planning tables. Municipalities, hard pressed for cash since capital has been diverted towards other routes, welcome opportunities to reduce maintenance of public areas. Banks are quick to recognize that a twenty five by one hundred foot deep lot requires the same infrastructure as three adjoining lots of the same size developed as one and oblige with financing packages.[4]. The New York City Zoning Resolution is typical in that it discourages singular ownership of land, legislating minimum lot areas [5] but no maximum lot areas. In the United States (with minor exceptions) land taxes are low, with tax levied on assessed worth of buildings, encouraging large tracts to be used for parking or for numerous small tracts to be held and assembled into "viable" or "interesting" real estate endeavors.
The absence of public streets in a bbfm cluster is tangible evidence of how these phenomena indicate a fundamental re-ordering of our civic mores, our culture. The evolution of a system of public roads connected to town streets and public places is a negotiation between site specific conditions (topological, geological, geographical) and humanly contrived, cadastral ordering (streets, blocks and lots). It is a system of public ways that are planned in tandem with the organization of collective civic needs. Akin to laws, they govern the relationship of public and private space, establishing a framework for communal interaction and limitations to individual expression. Ironically, bbfm clusters have gained their power to eliminate public ways under the aegis of participatory democracy: our banking and investment mechanisms.
The privatized spaces of bbfm cluster development can, in fact, be described in monetary terms. Speed of return and economies of scale characterize its landscape. Amassed vehicles in over-scaled parking lots have a direct relation to economies of scale necessary to support a Big Box enterprise that sells many goods from all over the world less expensively than a local merchant. The speed and maneuverability of a car is analogous to the speed at which computerized monetary transactions occur. Since the mid 1980's computerization of accounting methods synergistically combined with telecommunications technology have revolutionized the speed and scale at which money is exchanged, salaries paid, taxes calculated and profits allocated. [6] As profits and losses are instantaneously and seamlessly registered, monetary investments swing to respond, creating an attractive virtual cash cow.
Supporting these fluctuating capital formations the aleatory patterns of vehicular movement create territory where any site within driving distance is as good as any other. Site-specific characteristics that formerly determined the success of a commercial enterprise are irrelevant when a "destination" can be artificially manufactured. There are no topological features that discourage bbfm clusters. Rivers, small mountains, forests are moved, leveled, dammed, and re-routed to create the flat, homogenized surface for bbfm cluster residence. State-funded Departments of Transportation widen roads and expand turning radii to make transportation fluid , emulating the net-based fluid capital necessary to sustain these mutations. Cars built to sustain 70 miles per hour extend possible shopping distance by ten to forty miles and facilitate the constant shifting of Big Box formations in tandem with speculative money. Malls, mini-malls, Big Box clusters are built, abandoned, dismantled and rebuilt within a few months and a few miles of each other while remaining assured of an adequate customer base.
Municipalities are often uninformed about actual economics of these ventures. Malls, big boxes and franchise operations seem to offer viable jobs [7] and an increased tax base to hard pressed municipalities. In suburbia, where tax bases tend to be primarily residential, this is a mirage.[8] The actual “return” to a municipality from Big Box/franchise clusters is difficult to measure since large scale commercial building is favored with built-to-order infrastructure, cheap land, readily available loans, federal and local tax incentives and political favoritism.
In fact, bbfm clusters negatively affect local economies because they rely on small profits, gleaned from a large number of purchases, coordinated by few personnel. As fast as the region purchases, the “profits” are relayed electronically back up to the distant structures that control the retail operations. A growing number of studies indicate that many of the jobs created by such enterprises do not pay enough to allow employees to contribute to a municipality. "A locally owned store in a locally owned building typically reinvests 85 percent of its profits in the local economy, but a typical fast food franchise reinvests only 20 percent of its profits in the local economy".[9]
Bbfm clusters are part of a system of money deployment, speculation and redeployment. Developers prize themselves on using "OPM" or other people's money. Recently developed monetary instruments to pulverize land + buildings into bits in order to re-package them for speculative sale have transformed the real estate market, gearing it almost exclusively towards large scale corporate entities . The transformation of “land” into “real estate” and then into discrete, marketable packages of money establishes a distance between land and its “price”, sidestepping notions of local or site-specific value. Constantly evolving monetary instruments and tax laws conceal this distance and make it difficult to predict the consequences of creative financing.[10][11][12]
Forceful examples of this practice are REITS or Real Estate Investment Trusts. Real Estate Investment Trusts are publicly owned entities that manage, or “lease, manage, acquire, hold mortgages on and develop” real estate. A seamless merge, between development and financing, REITS were legalized in the 1960’s but became inordinately profitable after tax laws were changed in 1981 and in 1997.[13] [14]Shares in a REIT are not tied to any particular piece of land. Rather, they are shares in the managed income from property plus the expertise of the management. The mission of a REIT, to "seek higher cash flows by negotiating for rental increases…replacing expiring leases with new ones at higher rates and improve occupancy rates” detaches land from intrinsic characteristics of place and makes land truly "liquid." Reckson Associates Realty Corp, one of the largest REITS in the Northeast and based on Long Island boasts 9,200,00 shares at around $25 per share in April 1998. [15]This value is derived from ownership and management of 20.9 million square feet in Westchester, Connecticut, New York City, Long Island and New Jersey. Scott Reckler of Reckson is clear about his trajectory: "I believe that in the future all real estate services will be outsourced to the real estate companies that are best equipped to provide this service," he said. "These services will include design, site selection development, management and, ultimately, ownership."[16]
Through REITs, and the culture that spawned them, the pulverization of land into homogenous bites of profit making entity is an organic reconfiguration of societal values[17]. Bought and sold on an international market, under laws that promote trade over ecological concerns REITs lay the groundwork, financially, for the destruction of the ecology and compel us to unwittingly participate .[18]
Examples of our unwitting participation abound. According to Anthony Downs of the Brookings Institute, ninety percent of new capital introduced into markets every year comes from personal household savings. One of the largest pension funds in the United States is TIAA CREF, which serves 1.8 million people at over 5,800 institutions. Of the combined assets of TIAA CREF (171.8 billion) its general account manages mortgage portfolios and real estate equity portfolios totaling 28 billion dollars of which almost three quarters (21 billion) consists of investments in office buildings and shopping centers, including malls.[19] In 1998 traditional investors, such as life insurance companies, started selling directly owned properties and reinvesting the proceeds in REIT stocks as a more liquid way to own real estate. [20]
A final characteristic of the world of bbfm clusters is compartmentalization, although a manifestation rather than a cause. Compartmentalization, erecting barriers between areas of knowledge so that an entire understanding cannot be gleaned is the opposite of common sense. We do not understand bbfm clusters in their context and systemically because our sight is limited to descrete aspects of their existence, much as elevated roadways and areas for parking limit oversight of the cluster.
This limiting of oversight begins at the university level where disciplines that think about suburban sprawl are separate worlds, tapping separate areas of knowledge for study, precedent, criteria for judgement, modes of action. The general public, following expert, professional advice often finds contradictory direction. Consider the different roles played in a bbfm cluster by architecture (building façade), financial analyst (real estate markets), transportation planning (how to get in to and out of the cluster), landscape architect (how to drain, plant, park), waste management (how to dispose of waste) etc. New urbanists (combining architects, planners and urban designers) produce plans that look like they allow home ownership and extend public streets into community. But these streets are often private and the homes owned via REIT-like structures, creating enclaved privatized space owned by no one. Smart growth advocates separate bbfm clusters (out of sight, out of mind) from privatized enclaves called planned unit developments (PUD's), exacerbating physical compartmentalization.
Zoning, purportedly used by municipalities to control development, is codified compartmentalization. It separates different land uses, isolating one area of development from another so that a visible understanding of how land is deployed, used and cared for is difficult to obtain. Zoning precepts, which separate commercial from industrial from residential uses are chillingly responsive to methods of financing. Development capital is loaned on the basis of short term, predictable returns, favoring real estate used for a single, catagorizable purpose rather than for an ambiguous mix of uses. [21] Compartmentalization of lending operations means that genuine grassroots revitalization of existing downtowns is difficult to finance since the traditional mix of functions with many different owners and diverse uses is considered an unpredictable investment.
Compartmentalization leads to absurd divisions in our accounting practices. While we can easily calculate profits and losses to financiers as a result of currency fluctuations, we have not been able to quantify the visible destruction left by widened roads, parking lots and single-use structures that replicate the retail operations of singly owned stores. Nor are we able to count how many people in an area are affected by the invisible destruction wreaked by gasoline fumes and polluted water tables. We understand that when the price of gasoline rises by two or three cents, K-mart suffers profit loss because it costs more to transport goods. But have we ever counted the public monies that are expended to artificially maintain low gasoline prices?
This situation destroys the non-quantifiable aspects of existence, which my grandmother most valued. It creates an environment that perpetuates ways of measuring “value” that contribute to its invisibility. In particular, real estate investment “strategies” that rely on monitoring numbers flashing across computer screens for differential rates of change that are, in themselves, merely an indication of how everyone else is investing.[22] In this money game, where value is produced by the thought of value, mini pyramid schemes abound. The self-destructive tendencies thus engendered resemble those of animals rushing unwittingly towards self-immolation. Reviewing the real estate lending by the New England banks, the head of the national bank examiner’s office in Boston commented that “lemmings are individualists next to these guys”.[23]
In this estranged culture of digitized hypersensitivity it is difficult, if not impossible, to count or quantify the value of the unique characteristics of a place or the authenticity of local culture. Perhaps the most damaging achievement of agglomerated capital is our acceptance of its techniques as our own. For capital in the service of itself, value does not exist unless it has a presence on these flickering screens of endless numbers. If we subscribe to the logic of capital, we cannot verify- to it or to ourselves- the disappearance of the un-quantifiable aspects of our existence that make us human.
Daniel Shorr has said " a government's function is to protect people from greed". If the greed is, invisibly and insidiously, our own, who will trace the paths and discover ways to see the complex edifice which allows us to unknowingly support such a counterproductive system? Perhaps Minama's slow drive through Rockland County , pleasantly surveying the commonwealth of land could be instructive.
Travelling slowly because she enjoyed slowness and because her culture encouraged it, Minama saw forests, but also trees, butterflies, birds, corn, small ponds, knolls, and rivulets. With her common-sense knowledge as background Minama was able to see the land as more than the surface of the earth. She did not categorize or compartmentalize land. Rather, she would have agreed with the scholar who wrote that land was “space itself….. (including) water and the beds under it, the radio spectrum, docks, rights of way, aquifers, ambient air, falling water, wild fish, game, and vegetation” all of which, are intrinsically interrelated." [24] She knew each landowner and, with them, was cognizant of her responsibility for the use of the land, our commonwealth. She was travelling on a public way : no one could throw her off the road for trespassing. Public ways encourage proximity, breaking down distance as they encourage public oversight. Experiencing one's own property in relation to others reduces the conceptual distance established by aggregation of many different pieces of land into real estate packages for financial speculation. Traversing the streets and roads scaled to her slow moving vehicle as well as to human ability to apprehend, it was common sense to conclude that people and land are one ecology. For Minama the value placed on land was not solely related to money. She respected money! The value of land was, in the end, sustenance. Could those flickering numbers on the computer screen, ascribing value to real estate packages from second to nano-second, feed her family during a depression ?
Endnotes:
[1] The Federal Highway Act of 1956 and the Highway Trust Fund.
[2] David Harvey, The Urban Experience, Johns Hopkins University Press, Baltimore, Md. 1985 Chapter 9, "Flexible Accumulation through Urbanization: Reflections on Post-Modernism” in the American City. Writing about “transitions in the political economy of advanced capitalism” since 1972, Harvey describes a “seemingly new and quite different regime of capital accumulation….marked by a startling flexibility with respect to labor processes, labor markets, products, and patterns of consumption…. (which is) aided by the rapid evolution of entirely new financial systems and markets. “
[3] See aerial photographs of the Nassau Hub, for instance. Carle Place town well head is behind a big box franchise cluster. The drainage outlet for Roosevelt Field is yards from a residential enclave, Garden City.
[4] See Jane Jacobs, The Death and Life of Great American Cities Vintage Books, New York 1961 Chapter 9: The need for small blocks.
[5] According to the New York City Zoning Resolution a 1,700 square feet or about 18' by 94' is the minimum lot size in residential districts unless the lot was existing. The consequence of this legislation is that it is illegal to subdivide land so that a single family can own both house and land. Yet multiple dwellings (where land is often owned by distanced investors) on larger lots are encouraged.
[6] See “Technological Change and Institutional Innovation” Anthony Downs, The Revolution in Real Estate Finance The Brookings Institution Washington, D.C. 1985 p.45-48.
[7] See Thomas Michael Power, Lost Landscapes and Failed Economies Island Press, Washington, D.C. 1996 especially Chapters 10 and 11.
[8] On Long Island, according to Lee Koppelman, Director of the Long Island Regional Planning Board, the tax base is primarily residential compared to, for instance New York City. In general, commercial taxes are low because land is valued less than buildings and poorly built structures are assessed less than well-built ones. Yet infrastructure to support big box development, for instance, a new road to a new mall, is often more costly to build than in the city, where service is a matter of connecting to existing infrastructure.
[9] Richard Moe and Carter Wilkie, Changing Places: Rebuilding Community in the Age of Sprawl, Henry Holt and Company, New York, 1997 p. 146.
[10] The New York Times, Real Estate Section July 5, 1998 "REITs Place Their New York Area Bets", John Holusha p.1 A good example is the struggle on the part of REIT operators to link maintenance and management costs to depreciation, which would allow greater tax deductions and “allow them to do more than collect rent”. No sooner did tax law curtail REITs from making a profit from both rent and management (e.g., maintenance costs) with “paired share” and “stapled” stocks, another monetary configuration was invented which separated responsibilities of rent and management under the same company. Its name? The “paperclip”.
[11] See Downs, Anthony "From Flood to Drought: The 1990s Shift in Real Estate Finance" The Brookings Review Washington Summer 1991.
[12] Examples are the burst of activity by Real Estate Investment Trusts after changes in the tax laws of 1981 and the accelerated secondary mortgage market after deregulation in the 1990's. Source: National Association of Real Estate Investment Trusts Inc. Also see Market Capitalization of the REIT industry grew from 1.88 billion in 1972 to 15.68 billion in 1992. (Carolyn Colwell "REIT Rush –hot property in a revived market" Newsday 9 27 93
[13] The availability of pension funds spurred government to relax regulations on REITs allowing, for instance, in the 1997 Taxpayer Relief Act allowed REITs to sell non profit bearing properties owned for less than four years without paying excise taxes, accelerating turn around of property.
[14] [14] Newsday 4 21 97 Alan J. Wax, Commercial Real Estate Flood of Cash Boosts REIT Liquidity “Significant, according to industry leaders, is a provision that allows a REIT to earn up to 1 % of its gross income by offering nominal services to their tenants, such as concierge services or operating a health club.
"Among other measures included in the tax package that benefit REITs:
-REIT shareholders will receive a tax credit when a REIT sells a property keeps the proceeds from the sale and pays a corporate level tax. This, Edwards said, provides REITs with a source of capital to make improvements and repairs.
-REITs will be able to sell properties that they’ve owned for less than four years and escape paying excise taxes on the transaction. Thus, a REIT will be able to buy a portfolio of properties and quickly shed those that don’t conform to its investment strategy.
-REITS that fail to send out timely letters to shareholders to track stock ownership will be fined $25,000 to $00,000 rather than lose their REIT status.
-REITs will be able to use interest rate hedging financial tools and count any profit as income under REIT rules
-Phantom income, such from the cancellation of a debt owed by the REIT won’t have to be paid out to shareholders
-Certain rents that previously did not qualify as REIT income now will. An example is rent from a department store whose stock is owned by a pension fund that also owns a stake in the REIT."
[15] This information was gleaned through analysis of Reckson Associates Realty Corp. 1999 Annual Report "What Makes a Great Year", 1999 Press Releases (both made available to the public via www.Reckson.com. I checked www.Reckson.com recently to verify that the analysis was still valid.
[16] The New York Times, Real Estate Section July 5, 1998 "REITs Place Their New York Area Bets", John Holusha p.1 Documents the recent rise of REITs in the New York Area
[17] This wording and thought is from David Harvey, The Urban Experience, Johns Hopkins University Press, Baltimore, Md. 1989 Chapter 6. Money, Time, Space, and the City p. 177. “The homogeneity of space is achieved through its total “pulverization” into freely alienable parcels of private property, to be bought and traded at will upon the market (LeFebre 1974, 385).
[18] See Clement Dinsmore, "The Impact of Public Capital Markets on Urban Real Estate" A Discussion Paper prepared for The Brookings Institution Center on Urban and Metropolitan Policy July 1998 and Dicken, Peter, Global Shifts, The Internationalization of Economic Activity 2nd Ed. The Guilford Press New York 1992 p.360 also see David Harvey The Urban Experience Land Rent Under Capitalism. Op. Cit." …the more open the land market is, the more recklessly can surplus money capital build pyramids of debt claims and seek to realize these claims through the pillaging and destruction of the land itself” p. 97
[19] Source: TIAA-CREF telephone interview 05 01 98 with Real Estate Accounting, John Farmer. The breakdown is as follows: 901 million assets of which 59.7% is owned property. The 59.7% is composed of 31% apartment buildings, 15.4 % industrial, 44.4% office and 8.7% retail. $213 billion is the total (in 1998) of the TIAA-CREF investment fund. In the same interview the statement was made that the REITs rate of return is (at that point) less than stocks and bonds (8.72% as opposed to 10.52%) but were considered a good investment because they were "not as volatile".
[20] The New York Times Sunday July 5, 1998 Real Estate p. 1,8 REITs Placing Their Bets in the New York Area Holusha, John.
[21] I can cite my experience as an architect and hopeful property owner in support of this statement. Mixed-use mortgages are impossible to find. Mixed-use zoning is considered innovative and, on Long Island, destructive of surrounding property values. After eight years of garnering community support (I refer to the Williamsburg 197-a plan initiated in 1996), genuine mixed use zoning advanced by the Re-Zoning Task Force of Community Board One in Greenpoint/Williamsburg Brooklyn (Heather Roslund of Brooklyn Architects Collective, Chair) has been tacitly rejected by New York City Planning.
[22] The lack of research and intuitive decision making based on short term returns is described in Fainstein, Susan S. The City Builders, Property, Politics, and Planning in London and New York, Blackwell, Cambridge, Mass. 1994. "In the words of one developer:'There is a belief that bankers finance what builders build. In fact, the opposite is true. Money is the sine qua non. If you have money, you will build,'"
[23] Richard Moe and Carter Wilkie, Changing Places: Rebuilding Community in the Age of Sprawl, Henry Holt and Company, New York, 1997.
[24] Mason Gaffney, “Land as a Distinctive Factor of Production” C. 1995 Lincoln Land Institute working papers code WP95MG1. This short quote does not do justice to the depth of analysis of this paper.
25. I also found interesting thoughts via the net by typing in "public realm"
"The Privatization of Public Space The State of the Public Realm" Frederique Krupa Spring 1993
"This land is your land: Public Space in Civic Life" JB Wendover.com
New York Institute of Technology School of Architecture and Design
With reference to money and life in general, my grandmother was fond of saying: don't touch the principal, never sell the land. A stocky woman of French descent, she enjoyed tangibles like her slowly accruing savings account at Marine Midland and her 20 some acres in Rockland County. After she died her land was sold. The resulting investment brought her progeny seemingly appropriate rewards.
My grandmother, whom I called Minama, viewed the relationship between earth, water, air and human constructs as common wealth. She had brought seven children, her husband and her own mother through the depression without hunger with her precious land. Her resources included a 5,000 square foot, assiduously weeded and mulched garden, two sheep, sundry chickens, a cow named Alice, a septic tank and a well with a manually operated pump. During the time I knew her, she policed her bit of turf as carefully as her savings account. She protected her compost heap (located next to the house garden), her gooseberry bush, her fruit trees and her somewhat swampy front lawn. This last because the lawn produced a delicious variety of mushrooms after a wet spell. She kept track of her neighbors' resources as well. Long after the depression she would drive slowly, in her golden Studebaker through the two towns equidistant from her land, past the elementary school where many of my aunts and uncles were educated, past the public library where she volunteered time, towards the town common area where a small brook flowed and anecdotally remark, as we passed through her property (which was on either side of the main road) on the state of her corn, how the northern side of the barn had become moldy, how so and so's house needed a coat of paint, that perhaps too many trees were dying in the swamp, etc.
The land my grandmother owned in Rockland County, New York looks a lot like parts of Long Island now where the flower and fauna of exurbia have replaced traditional lawns and garden plots. Although it has been re-planted, she still owns this land, in a sense. Her descendants benefit from her investments in the stock market, her life insurance, her pension fund and the small behest she left her children. These, with other people’s life savings, still administered by the remnants of Marine Midland , underwrite the development and construction loans necessary for large construction endeavors, bringing return to even the smallest unwitting investors, like myself. Financed by such accumulated funds and leveraged by governmental policy my grandmother’s 22 acres has been joined to many other properties so that new flowers like Home Depots, Pathmarks, K-Marts, Costco, McDonalds, Dunkin Donuts and Kinkos can grow. Clustered around a mall, one of the largest in the northeast United States, they surround themselves with new territory conducive to their ecosystem: forbidding stretches of asphalt and a dizzying system of elevated roads designed to attract people in their cars from the highway. At the heart of this system, within the precincts of the mall, a magical dream world has been conjured where all the civic life that my grandmother observed on her short, slow drives has been reconstituted: Main Streets, Town Halls, Greens, Commons, Train Stations, Waterfronts, Piers and even schools, police stations, fire stations and even, fantastically, waterfalls, rain forests, jungles and the like.
It is not always appreciated that such commercial enterprises as described above- Big Box/ franchise commerce clustered around a mall- are not really magic or mysterious growths. They are certainly not built through the whim of some inconceivably rich magnate seeking to further his wealth. Rather, disguised through history and our own complicit interests and through a series of distancing mechanisms, they represent our own invested monies deployed, as it were, automatically in a form that brings the best return. Agglomerated capital, the result of common labor and individual earnings and savings, is gathered together, invested, leveraged, re-assembled and re-leveraged. Lacking the foresight or hindsight of an intentioned mind or minds, each step in this process (which oftentimes happens almost instantaneously) is focused on accretion of money. Low oil prices and enormous sums of money earmarked for road-building [1] produce parking lots, highways, cloverleafs, etc. Thus it is our own flexibly accumulated investments,[2] floating somewhere in the miasma of global speculation, aided by government policies, that plants itself in our backyards like alien life. We , collectively, created the conditions that welcome this hostile ecology- an ecology that now threatens our sustenance: out land.
My grandmother, who died in 1984, lived within a far different economic system, a different culture. In the intervening years checks and balances which, during her generation, often monitored such mindless accumulation and deployment of funding, were dismantled, circumvented or re-invented in a wholly new way, often without public oversight. While we can see and experience a big box/franchise/mall cluster (bbfm clusters for short) many of their salient characteristics are invisible. Even when we catch a glimpse of these characteristics it is often difficult to draw conclusions about the nature of bbfm clusters since they literally shape the conditions through which we experience them. Through this dialectic process they have transformed our world in a manner that, now, seems as natural to us as my grandmother’s did to her. Yet it is important to note the extreme difference between our world and hers. Characteristics that we take for granted as desirable were, in her world, dubiously valuable and potentially life threatening. My grandmother would characterize distanced judgements, speed for its own sake, economies of scale, pulverization of resources, and compartmentalization of expertise as ignorance.
Yet these modes of action, extolled in our society, provide fertile territory for the growth of these fecund clusters. In fact, bbfm clusters, surrounded by ribbons of highway and speeding cars; pulsing with the ebb and flow of automobiles and ; shedding oil and gas over asphalt to percolate back to hidden aquifers; selling many bits of goods made far overseas under contracts based on amassed globally accumulated money to people who live next door but don’t know that they do, are the tangible manifestation of these cultural mores. Although they do not lend themselves to common surveillance, aerial photographs allow us to see clearly how they garner our money for global re-deployment while laying waste to our land.
We might not consider bbfm clusters invisible. Certainly many of us consider them blights on the landscape and many of us do not want them in our back yards. But we cannot see them in the discerning way my grandmother protectively surveyed her neighbors’ lands. Consider the fields of automobiles surrounding bbfm clusters which remove it from ordinary surveillance by creating a tract of land hostile to walking. Communities at the edge of Mall of America, for instance, are so distant because of the depth of the parking and associated roads that it was necessary to create a school within the mall for its employees’ children. The distance of a bbfm cluster from a community is not well gauged by a shopper who decelerates from highway (60mph) to exit ramp (40mph) to parking through a disorienting sequence of roads. Yet aerial photographs often reveal that bbfm clusters are more proximate to a community than perceived.[3] In some cases drainage basins containing polluted run-offs from thousands of vehicles are adjacent to town wells that supply the very communities that protest the visible aspects of a mall.
The bbfm cluster sets the conditions for its invisibility by establishing an amorphous private realm disguised as an exciting new kind of public place. The perimeter of this private territory is difficult to ascertain. Most access ramps surrounding a mall are, in fact, private roads. Municipalities, seeking to reduce maintenance and overhead readily give over private streets to bbfm clusters. Yet many times the state DOT, using taxpayer's money, will build the initial portion of the exit from the public highway, creating a seamless descent into the privately controlled bbfm cluster.
Elimination of public streets accelerates the combination of many small lots into large areas for re-development. Public land is thus co-opted, while private land is removed from daily scrutiny as lot depths change from the traditional fifty to one hundred feet to tracts of land that cannot be viewed , at eye level, in their entirety. Banking practices, municipal laws and zoning have evolved, during the last twenty years, to support this. Developers are given incentives to develop large, rather than several small tracts. Often they are given a seat at municipal planning tables. Municipalities, hard pressed for cash since capital has been diverted towards other routes, welcome opportunities to reduce maintenance of public areas. Banks are quick to recognize that a twenty five by one hundred foot deep lot requires the same infrastructure as three adjoining lots of the same size developed as one and oblige with financing packages.[4]. The New York City Zoning Resolution is typical in that it discourages singular ownership of land, legislating minimum lot areas [5] but no maximum lot areas. In the United States (with minor exceptions) land taxes are low, with tax levied on assessed worth of buildings, encouraging large tracts to be used for parking or for numerous small tracts to be held and assembled into "viable" or "interesting" real estate endeavors.
The absence of public streets in a bbfm cluster is tangible evidence of how these phenomena indicate a fundamental re-ordering of our civic mores, our culture. The evolution of a system of public roads connected to town streets and public places is a negotiation between site specific conditions (topological, geological, geographical) and humanly contrived, cadastral ordering (streets, blocks and lots). It is a system of public ways that are planned in tandem with the organization of collective civic needs. Akin to laws, they govern the relationship of public and private space, establishing a framework for communal interaction and limitations to individual expression. Ironically, bbfm clusters have gained their power to eliminate public ways under the aegis of participatory democracy: our banking and investment mechanisms.
The privatized spaces of bbfm cluster development can, in fact, be described in monetary terms. Speed of return and economies of scale characterize its landscape. Amassed vehicles in over-scaled parking lots have a direct relation to economies of scale necessary to support a Big Box enterprise that sells many goods from all over the world less expensively than a local merchant. The speed and maneuverability of a car is analogous to the speed at which computerized monetary transactions occur. Since the mid 1980's computerization of accounting methods synergistically combined with telecommunications technology have revolutionized the speed and scale at which money is exchanged, salaries paid, taxes calculated and profits allocated. [6] As profits and losses are instantaneously and seamlessly registered, monetary investments swing to respond, creating an attractive virtual cash cow.
Supporting these fluctuating capital formations the aleatory patterns of vehicular movement create territory where any site within driving distance is as good as any other. Site-specific characteristics that formerly determined the success of a commercial enterprise are irrelevant when a "destination" can be artificially manufactured. There are no topological features that discourage bbfm clusters. Rivers, small mountains, forests are moved, leveled, dammed, and re-routed to create the flat, homogenized surface for bbfm cluster residence. State-funded Departments of Transportation widen roads and expand turning radii to make transportation fluid , emulating the net-based fluid capital necessary to sustain these mutations. Cars built to sustain 70 miles per hour extend possible shopping distance by ten to forty miles and facilitate the constant shifting of Big Box formations in tandem with speculative money. Malls, mini-malls, Big Box clusters are built, abandoned, dismantled and rebuilt within a few months and a few miles of each other while remaining assured of an adequate customer base.
Municipalities are often uninformed about actual economics of these ventures. Malls, big boxes and franchise operations seem to offer viable jobs [7] and an increased tax base to hard pressed municipalities. In suburbia, where tax bases tend to be primarily residential, this is a mirage.[8] The actual “return” to a municipality from Big Box/franchise clusters is difficult to measure since large scale commercial building is favored with built-to-order infrastructure, cheap land, readily available loans, federal and local tax incentives and political favoritism.
In fact, bbfm clusters negatively affect local economies because they rely on small profits, gleaned from a large number of purchases, coordinated by few personnel. As fast as the region purchases, the “profits” are relayed electronically back up to the distant structures that control the retail operations. A growing number of studies indicate that many of the jobs created by such enterprises do not pay enough to allow employees to contribute to a municipality. "A locally owned store in a locally owned building typically reinvests 85 percent of its profits in the local economy, but a typical fast food franchise reinvests only 20 percent of its profits in the local economy".[9]
Bbfm clusters are part of a system of money deployment, speculation and redeployment. Developers prize themselves on using "OPM" or other people's money. Recently developed monetary instruments to pulverize land + buildings into bits in order to re-package them for speculative sale have transformed the real estate market, gearing it almost exclusively towards large scale corporate entities . The transformation of “land” into “real estate” and then into discrete, marketable packages of money establishes a distance between land and its “price”, sidestepping notions of local or site-specific value. Constantly evolving monetary instruments and tax laws conceal this distance and make it difficult to predict the consequences of creative financing.[10][11][12]
Forceful examples of this practice are REITS or Real Estate Investment Trusts. Real Estate Investment Trusts are publicly owned entities that manage, or “lease, manage, acquire, hold mortgages on and develop” real estate. A seamless merge, between development and financing, REITS were legalized in the 1960’s but became inordinately profitable after tax laws were changed in 1981 and in 1997.[13] [14]Shares in a REIT are not tied to any particular piece of land. Rather, they are shares in the managed income from property plus the expertise of the management. The mission of a REIT, to "seek higher cash flows by negotiating for rental increases…replacing expiring leases with new ones at higher rates and improve occupancy rates” detaches land from intrinsic characteristics of place and makes land truly "liquid." Reckson Associates Realty Corp, one of the largest REITS in the Northeast and based on Long Island boasts 9,200,00 shares at around $25 per share in April 1998. [15]This value is derived from ownership and management of 20.9 million square feet in Westchester, Connecticut, New York City, Long Island and New Jersey. Scott Reckler of Reckson is clear about his trajectory: "I believe that in the future all real estate services will be outsourced to the real estate companies that are best equipped to provide this service," he said. "These services will include design, site selection development, management and, ultimately, ownership."[16]
Through REITs, and the culture that spawned them, the pulverization of land into homogenous bites of profit making entity is an organic reconfiguration of societal values[17]. Bought and sold on an international market, under laws that promote trade over ecological concerns REITs lay the groundwork, financially, for the destruction of the ecology and compel us to unwittingly participate .[18]
Examples of our unwitting participation abound. According to Anthony Downs of the Brookings Institute, ninety percent of new capital introduced into markets every year comes from personal household savings. One of the largest pension funds in the United States is TIAA CREF, which serves 1.8 million people at over 5,800 institutions. Of the combined assets of TIAA CREF (171.8 billion) its general account manages mortgage portfolios and real estate equity portfolios totaling 28 billion dollars of which almost three quarters (21 billion) consists of investments in office buildings and shopping centers, including malls.[19] In 1998 traditional investors, such as life insurance companies, started selling directly owned properties and reinvesting the proceeds in REIT stocks as a more liquid way to own real estate. [20]
A final characteristic of the world of bbfm clusters is compartmentalization, although a manifestation rather than a cause. Compartmentalization, erecting barriers between areas of knowledge so that an entire understanding cannot be gleaned is the opposite of common sense. We do not understand bbfm clusters in their context and systemically because our sight is limited to descrete aspects of their existence, much as elevated roadways and areas for parking limit oversight of the cluster.
This limiting of oversight begins at the university level where disciplines that think about suburban sprawl are separate worlds, tapping separate areas of knowledge for study, precedent, criteria for judgement, modes of action. The general public, following expert, professional advice often finds contradictory direction. Consider the different roles played in a bbfm cluster by architecture (building façade), financial analyst (real estate markets), transportation planning (how to get in to and out of the cluster), landscape architect (how to drain, plant, park), waste management (how to dispose of waste) etc. New urbanists (combining architects, planners and urban designers) produce plans that look like they allow home ownership and extend public streets into community. But these streets are often private and the homes owned via REIT-like structures, creating enclaved privatized space owned by no one. Smart growth advocates separate bbfm clusters (out of sight, out of mind) from privatized enclaves called planned unit developments (PUD's), exacerbating physical compartmentalization.
Zoning, purportedly used by municipalities to control development, is codified compartmentalization. It separates different land uses, isolating one area of development from another so that a visible understanding of how land is deployed, used and cared for is difficult to obtain. Zoning precepts, which separate commercial from industrial from residential uses are chillingly responsive to methods of financing. Development capital is loaned on the basis of short term, predictable returns, favoring real estate used for a single, catagorizable purpose rather than for an ambiguous mix of uses. [21] Compartmentalization of lending operations means that genuine grassroots revitalization of existing downtowns is difficult to finance since the traditional mix of functions with many different owners and diverse uses is considered an unpredictable investment.
Compartmentalization leads to absurd divisions in our accounting practices. While we can easily calculate profits and losses to financiers as a result of currency fluctuations, we have not been able to quantify the visible destruction left by widened roads, parking lots and single-use structures that replicate the retail operations of singly owned stores. Nor are we able to count how many people in an area are affected by the invisible destruction wreaked by gasoline fumes and polluted water tables. We understand that when the price of gasoline rises by two or three cents, K-mart suffers profit loss because it costs more to transport goods. But have we ever counted the public monies that are expended to artificially maintain low gasoline prices?
This situation destroys the non-quantifiable aspects of existence, which my grandmother most valued. It creates an environment that perpetuates ways of measuring “value” that contribute to its invisibility. In particular, real estate investment “strategies” that rely on monitoring numbers flashing across computer screens for differential rates of change that are, in themselves, merely an indication of how everyone else is investing.[22] In this money game, where value is produced by the thought of value, mini pyramid schemes abound. The self-destructive tendencies thus engendered resemble those of animals rushing unwittingly towards self-immolation. Reviewing the real estate lending by the New England banks, the head of the national bank examiner’s office in Boston commented that “lemmings are individualists next to these guys”.[23]
In this estranged culture of digitized hypersensitivity it is difficult, if not impossible, to count or quantify the value of the unique characteristics of a place or the authenticity of local culture. Perhaps the most damaging achievement of agglomerated capital is our acceptance of its techniques as our own. For capital in the service of itself, value does not exist unless it has a presence on these flickering screens of endless numbers. If we subscribe to the logic of capital, we cannot verify- to it or to ourselves- the disappearance of the un-quantifiable aspects of our existence that make us human.
Daniel Shorr has said " a government's function is to protect people from greed". If the greed is, invisibly and insidiously, our own, who will trace the paths and discover ways to see the complex edifice which allows us to unknowingly support such a counterproductive system? Perhaps Minama's slow drive through Rockland County , pleasantly surveying the commonwealth of land could be instructive.
Travelling slowly because she enjoyed slowness and because her culture encouraged it, Minama saw forests, but also trees, butterflies, birds, corn, small ponds, knolls, and rivulets. With her common-sense knowledge as background Minama was able to see the land as more than the surface of the earth. She did not categorize or compartmentalize land. Rather, she would have agreed with the scholar who wrote that land was “space itself….. (including) water and the beds under it, the radio spectrum, docks, rights of way, aquifers, ambient air, falling water, wild fish, game, and vegetation” all of which, are intrinsically interrelated." [24] She knew each landowner and, with them, was cognizant of her responsibility for the use of the land, our commonwealth. She was travelling on a public way : no one could throw her off the road for trespassing. Public ways encourage proximity, breaking down distance as they encourage public oversight. Experiencing one's own property in relation to others reduces the conceptual distance established by aggregation of many different pieces of land into real estate packages for financial speculation. Traversing the streets and roads scaled to her slow moving vehicle as well as to human ability to apprehend, it was common sense to conclude that people and land are one ecology. For Minama the value placed on land was not solely related to money. She respected money! The value of land was, in the end, sustenance. Could those flickering numbers on the computer screen, ascribing value to real estate packages from second to nano-second, feed her family during a depression ?
Endnotes:
[1] The Federal Highway Act of 1956 and the Highway Trust Fund.
[2] David Harvey, The Urban Experience, Johns Hopkins University Press, Baltimore, Md. 1985 Chapter 9, "Flexible Accumulation through Urbanization: Reflections on Post-Modernism” in the American City. Writing about “transitions in the political economy of advanced capitalism” since 1972, Harvey describes a “seemingly new and quite different regime of capital accumulation….marked by a startling flexibility with respect to labor processes, labor markets, products, and patterns of consumption…. (which is) aided by the rapid evolution of entirely new financial systems and markets. “
[3] See aerial photographs of the Nassau Hub, for instance. Carle Place town well head is behind a big box franchise cluster. The drainage outlet for Roosevelt Field is yards from a residential enclave, Garden City.
[4] See Jane Jacobs, The Death and Life of Great American Cities Vintage Books, New York 1961 Chapter 9: The need for small blocks.
[5] According to the New York City Zoning Resolution a 1,700 square feet or about 18' by 94' is the minimum lot size in residential districts unless the lot was existing. The consequence of this legislation is that it is illegal to subdivide land so that a single family can own both house and land. Yet multiple dwellings (where land is often owned by distanced investors) on larger lots are encouraged.
[6] See “Technological Change and Institutional Innovation” Anthony Downs, The Revolution in Real Estate Finance The Brookings Institution Washington, D.C. 1985 p.45-48.
[7] See Thomas Michael Power, Lost Landscapes and Failed Economies Island Press, Washington, D.C. 1996 especially Chapters 10 and 11.
[8] On Long Island, according to Lee Koppelman, Director of the Long Island Regional Planning Board, the tax base is primarily residential compared to, for instance New York City. In general, commercial taxes are low because land is valued less than buildings and poorly built structures are assessed less than well-built ones. Yet infrastructure to support big box development, for instance, a new road to a new mall, is often more costly to build than in the city, where service is a matter of connecting to existing infrastructure.
[9] Richard Moe and Carter Wilkie, Changing Places: Rebuilding Community in the Age of Sprawl, Henry Holt and Company, New York, 1997 p. 146.
[10] The New York Times, Real Estate Section July 5, 1998 "REITs Place Their New York Area Bets", John Holusha p.1 A good example is the struggle on the part of REIT operators to link maintenance and management costs to depreciation, which would allow greater tax deductions and “allow them to do more than collect rent”. No sooner did tax law curtail REITs from making a profit from both rent and management (e.g., maintenance costs) with “paired share” and “stapled” stocks, another monetary configuration was invented which separated responsibilities of rent and management under the same company. Its name? The “paperclip”.
[11] See Downs, Anthony "From Flood to Drought: The 1990s Shift in Real Estate Finance" The Brookings Review Washington Summer 1991.
[12] Examples are the burst of activity by Real Estate Investment Trusts after changes in the tax laws of 1981 and the accelerated secondary mortgage market after deregulation in the 1990's. Source: National Association of Real Estate Investment Trusts Inc. Also see Market Capitalization of the REIT industry grew from 1.88 billion in 1972 to 15.68 billion in 1992. (Carolyn Colwell "REIT Rush –hot property in a revived market" Newsday 9 27 93
[13] The availability of pension funds spurred government to relax regulations on REITs allowing, for instance, in the 1997 Taxpayer Relief Act allowed REITs to sell non profit bearing properties owned for less than four years without paying excise taxes, accelerating turn around of property.
[14] [14] Newsday 4 21 97 Alan J. Wax, Commercial Real Estate Flood of Cash Boosts REIT Liquidity “Significant, according to industry leaders, is a provision that allows a REIT to earn up to 1 % of its gross income by offering nominal services to their tenants, such as concierge services or operating a health club.
"Among other measures included in the tax package that benefit REITs:
-REIT shareholders will receive a tax credit when a REIT sells a property keeps the proceeds from the sale and pays a corporate level tax. This, Edwards said, provides REITs with a source of capital to make improvements and repairs.
-REITs will be able to sell properties that they’ve owned for less than four years and escape paying excise taxes on the transaction. Thus, a REIT will be able to buy a portfolio of properties and quickly shed those that don’t conform to its investment strategy.
-REITS that fail to send out timely letters to shareholders to track stock ownership will be fined $25,000 to $00,000 rather than lose their REIT status.
-REITs will be able to use interest rate hedging financial tools and count any profit as income under REIT rules
-Phantom income, such from the cancellation of a debt owed by the REIT won’t have to be paid out to shareholders
-Certain rents that previously did not qualify as REIT income now will. An example is rent from a department store whose stock is owned by a pension fund that also owns a stake in the REIT."
[15] This information was gleaned through analysis of Reckson Associates Realty Corp. 1999 Annual Report "What Makes a Great Year", 1999 Press Releases (both made available to the public via www.Reckson.com. I checked www.Reckson.com recently to verify that the analysis was still valid.
[16] The New York Times, Real Estate Section July 5, 1998 "REITs Place Their New York Area Bets", John Holusha p.1 Documents the recent rise of REITs in the New York Area
[17] This wording and thought is from David Harvey, The Urban Experience, Johns Hopkins University Press, Baltimore, Md. 1989 Chapter 6. Money, Time, Space, and the City p. 177. “The homogeneity of space is achieved through its total “pulverization” into freely alienable parcels of private property, to be bought and traded at will upon the market (LeFebre 1974, 385).
[18] See Clement Dinsmore, "The Impact of Public Capital Markets on Urban Real Estate" A Discussion Paper prepared for The Brookings Institution Center on Urban and Metropolitan Policy July 1998 and Dicken, Peter, Global Shifts, The Internationalization of Economic Activity 2nd Ed. The Guilford Press New York 1992 p.360 also see David Harvey The Urban Experience Land Rent Under Capitalism. Op. Cit." …the more open the land market is, the more recklessly can surplus money capital build pyramids of debt claims and seek to realize these claims through the pillaging and destruction of the land itself” p. 97
[19] Source: TIAA-CREF telephone interview 05 01 98 with Real Estate Accounting, John Farmer. The breakdown is as follows: 901 million assets of which 59.7% is owned property. The 59.7% is composed of 31% apartment buildings, 15.4 % industrial, 44.4% office and 8.7% retail. $213 billion is the total (in 1998) of the TIAA-CREF investment fund. In the same interview the statement was made that the REITs rate of return is (at that point) less than stocks and bonds (8.72% as opposed to 10.52%) but were considered a good investment because they were "not as volatile".
[20] The New York Times Sunday July 5, 1998 Real Estate p. 1,8 REITs Placing Their Bets in the New York Area Holusha, John.
[21] I can cite my experience as an architect and hopeful property owner in support of this statement. Mixed-use mortgages are impossible to find. Mixed-use zoning is considered innovative and, on Long Island, destructive of surrounding property values. After eight years of garnering community support (I refer to the Williamsburg 197-a plan initiated in 1996), genuine mixed use zoning advanced by the Re-Zoning Task Force of Community Board One in Greenpoint/Williamsburg Brooklyn (Heather Roslund of Brooklyn Architects Collective, Chair) has been tacitly rejected by New York City Planning.
[22] The lack of research and intuitive decision making based on short term returns is described in Fainstein, Susan S. The City Builders, Property, Politics, and Planning in London and New York, Blackwell, Cambridge, Mass. 1994. "In the words of one developer:'There is a belief that bankers finance what builders build. In fact, the opposite is true. Money is the sine qua non. If you have money, you will build,'"
[23] Richard Moe and Carter Wilkie, Changing Places: Rebuilding Community in the Age of Sprawl, Henry Holt and Company, New York, 1997.
[24] Mason Gaffney, “Land as a Distinctive Factor of Production” C. 1995 Lincoln Land Institute working papers code WP95MG1. This short quote does not do justice to the depth of analysis of this paper.
25. I also found interesting thoughts via the net by typing in "public realm"
"The Privatization of Public Space The State of the Public Realm" Frederique Krupa Spring 1993
"This land is your land: Public Space in Civic Life" JB Wendover.com
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