A Placemaking Journal
Why Placemaking Matters: The ROI of Cities
Thanks to all of you who made last week’s Why Placemaking Matters: What’s in it for me? conversation so interesting. Robert Steuteville, editor of Better! Cities & Towns, jumped in with his own elevator pitch that beautifully connects much of the wonk-speak that I listed last week. Kaid Benfield from Washington D.C. and Brent Bellamy from Winnipeg both started interesting Twitter conversations, which also sparked a rumination on minimum densities from Winnipeg developer, Ranjjan Developments.
These conversations all remind me of a thought project I’ve been dreaming about for a couple years. While working in Calgary, our urban design team was at dinner with Mayor Nenshi and Andrés Duany. His worship mentioned that one of the forces behind his passion for place is that Calgary and New York City occupy about the same footprint, but NYC has over eight times as many people. Immediately I thought about comparing the return on investment of those two places.
Before I was into placemaking, I was on a mergers and acquisitions team, buying and selling oil and power generation companies. The systematic process we used to mark various income streams to market aggregated an intelligent guess of the future ROI of the company. Imagine taking two cities — Calgary and New York, or Phoenix and Chicago — putting together a faux M&A team, and coming up with what we’d buy the cities for? A fair market price for a city. I think it’d be interesting, and one of the shorter elevator pitches on why placemaking matters.
Cities are used to thinking of economic performance in terms of jobs, population growth, and gross domestic product. While we may calculate ROI on certain municipal investment decisions, we certainly don’t calculate it on the city as a whole. While I’m not suggesting that we run a city precisely like a business, the numbers of near defaults since the Great Recession does suggest we stop legally mandating the sort of development patterns that are money pits, and instead enable the sorts of walkable places that don’t just capture value, but rather drive value.
The amusing media debate last week between the New York Times and The Atlantic’s CityLab brings this into focus. New York Times asked, Will Portland Always Be a Retirement Community for the Young? where “the intelligent urban planning makes my heart sing,” but the young can’t necessarily find a job. CityLab retorts
CityLab retortswell sited statics suggesting, “Rather than being a marker of economic distress, this unemployed period is really a marker of commitment to long-term value of place.” That’s because college grads tend to move to the city for the love of place and then look for a job next, getting counted as unemployed in the mean time.
The sorts of millennials Portland attracts are 50% more likely to start their own businesses than their peers, giving them a fallback position. That’s what my own nephew just did, opening one awesome downtown food truck, Steak Your Claim. Within a year of beginning their business, they will be debt free, thanks to the local appreciation of culinary excellence. Taking the entrepreneurial chance is paying off for many others like them. CityLab goes on with their own elevator pitch on why placemaking matters:
Great environmental policies do more than make a nice place to live—they also reduce the cost of living. While per capita incomes in Portland are slightly lower than in some other larger, better-educated cities, Portlanders get a “green dividend” from the city’s compact development and robust bike and transit systems. Because it has less sprawl, Portlanders drive about 20 percent less than the national average, saving them a combined cool billion dollars a year—real money they can spend on good food, bikes, beer, or even rent.
I’m looking forward to attending CityLab 2014 in LA next weekend. Perhaps I’ll find the last few members of that faux M&A team, and get cracking on telling the story.
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