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October 1986

How Business is Reshaping America

The rapid growth of office space in suburbs is creating "urban villages," which are confronting local governments with new kinds of urban-planning problems.

by Christopher B. Leinberger and Charles Lockwood

Since the end of the second world war planners and academicians have warned Americans that suburban sprawl is an evil to be fought with every ounce of our national energy. They have condemned cars as the cause of city-killing growth. They have idealized mass transit. Yet, other than business and political interests in city downtowns, few have paid attention to their cries. We Americans have allowed sprawl to happen. In fact, we have reveled in our low-density suburban housing, our automobiles, and our decentralized living.

Now it appears that the much-reviled postwar suburban sprawl, with its sea of split-level houses surrounding retail businesses and apartment complexes strung randomly along its highways, was merely a transitional phase between the traditional compact pre-war city and today's metropolitan area. Our cities are becoming groups of interdependent "urban villages," which are business, retail, housing, and entertainment focal points amid a low-density cityscape. Each urban village has its core--a kind of new downtown--where the buildings are tallest, the daytime population largest, and the traffic congestion most severe. And each urban village has its outlying districts, which may stretch as far as ten miles from the core.

Urban villages represent a dramatic restructuring of America's cities and suburbs--one that is already affecting how millions of Americans live and work. Almost every city is swept up in the urban-village phenomenon--not only fast-growing Sunbelt cities like Atlanta and Phoenix but also slow-growing older ones like St. Louis and Kansas City, and archetypal cities like New York and Baltimore.


Los Angeles is perhaps the most evolved example of the urban-village phenomenon. Although downtown Los Angeles has recently experienced an unprecedented boom in office-building, the metropolitan area has simultaneously given rise to sixteen smaller urban-village cores, among them Century City, Costa Mesa/Irvine/Newport Beach, Encino, Glendale, the Airport, Warner Center, Ontario, Pasadena, Universal City/Burbank, and Westwood.

One of the easiest ways to gauge the growth of Los Angeles's urban villages is to look at the downtown's market share of the metropolitan region's office space over the past decades. (Office space is used as a standard measure of changing patterns of urban development in this article, because the office is the "factory of the future." In parts of some metropolitan areas 40 to 60 percent of the people hired for newly created jobs go to work in office buildings--not only white-collar workers but also support staff like janitors and food-service workers and security guards.) Since 1960 downtown Los Angeles's share of the metropolitan office market has declined from 60 to 34 percent, as expansion has shifted to the faster-growing urban-village cores in the suburbs.

The Costa Mesa/Irvine/Newport Beach complex, in Orange County provides a good example of how the urban-village phenomenon is reshaping greater Los Angeles. Until the early 1960s a series of small towns in a county whose total population was 868,000, the complex today is California's third largest downtown, as measured by office and business-park space. The first phase in the creation of the urban village's core was the construction of a regional shopping mall, as it has been in many other locations. In this case there were two--South Coast Plaza, in Costa Mesa, and Fashion Island, in Newport Beach, both of which opened in the early 1970s. Next developers completed modest two-story office buildings nearby for local professional firms, and light industrial facilities for aerospace and high-tech outfits.

In 1980 the population of Orange County reached 1,932,708, and jobs there numbered 1,670,100. The boom transformed the emerging Costa Mesa/Irvine/Newport Beach subcenter. Office space there now totals 21.1 million square feet--well behind downtown Los Angeles's 36.6 million square feet, but gaining fast on downtown San Francisco's 26.8 million. Both the architecture and the tenants of the new high-rises are often the equal of those of office buildings in Los Angeles and San Francisco. The urban village's new hotels include a Westin, a Meridien, and a Four Seasons. South Coast Plaza has more sales than any other shopping center in the country. It is projected that once an addition is completed later this year, the plaza's annual retail sales will surpass those for both downtown San Francisco and the "Golden Triangle" of Beverly Hills. South Coast Plaza has most of the exclusive shops found in those locations.

Many of Los Angeles's established urban villages are gaining their own identities. Los Angeles's aerospace industry is increasingly concentrated at the Airport and in Torrance. The entertainment industry, which has traditionally been located in Hollywood, is now moving over the Hollywood Hills to Universal City/Burbank. Los Angeles's insurance companies, traditionally found in the mid-Wilshire Boulevard district two miles west of downtown, have recently selected Pasadena as an insurance subcenter, because it is closer than the mid-Wilshire location to neighborhoods from which they can expect to attract clerical workers and is also close to an executive-housing neighborhood.

The insurance and financial industries are transforming Pasadena, a city of 128,500 residents eight miles northeast of downtown Los Angeles, into an urban-village core. Perhaps the best-known city of its size in America because of the annual Tournament of Roses Parade and Rose Bowl, Pasadena's history and image have long been conservative and "old money." However, by 1970 downtown Pasadena was marred by empty storefronts, fading turn-of-the-century resort hotels, and half-empty parking lots. Low-income, primarily black and Latino northwest Pasadena was troubled by crime, gangs, drugs, and welfare dependency.

In the early 1970s the I-210 freeway was completed, connecting the city to the rest of the San Gabriel Valley and eventually resulting in a spurt of office-building. Pasadena became a back-office employment center for insurance and banking offices that wanted to hire middle-class Angelenos living in the rapidly growing San Gabriel Valley suburbs. Since 1980 twenty-eight mid- and high-rise office buildings have gone up.

Because of all this office construction, the character of downtown Pasadena has changed radically. A shopping mall several blocks from City Hall, which opened in 1980, is among the most successful in southern California. Entire blocks of handsome 1920s and 1930s two-story commercial buildings have been restored, and restaurants, espresso bars, and shops are now moving into ground-floor retail space that had gone begging for many years.

On the edge of downtown, within walking distance of the new offices and shops, badly run-down single-family housing has been replaced by new condominiums and townhouses. Thousands of houses in nearby residential neighborhoods have been renovated as young families have discovered the city's turn-of-the-century architecture and tree-shaded streets.

Change has not come easily to Pasadena. Not all of the city is being renovated; residents of the still decaying northwest section fear that new construction will squeeze them out of the neighborhood. And the many new jobs have created traffic problems. Today about 60,000 people commute to work in Pasadena, whereas approximately 25,000 leave the city for jobs elsewhere.

Pasadena residents worry about the long-range impact of the downtown construction on the overall community. Why has Pasadena attracted back-office operations instead of professional and corporate tenants, which would be more in keeping with the city's lingering blue-blood image? Does Pasadena want more high-rise office towers of any kind? How will the growing traffic affect downtown Pasadena and the nearby reviving neighborhoods?


This debate over growth is being repeated in neighborhood associations and city councils across the nation, in such widely dispersed locations as Walnut Creek, California; Princeton, New Jersey; Schaumburg, Illinois; and Bethesda, Maryland. In fact, attempts to control growth and traffic congestion are among the hottest issues in local politics today. And the reason is that the urban-village phenomenon is reshaping our cities. However, most people do not see the larger picture; they simply see the consequences. The phenomenon has occurred simultaneously in all kinds of cities across the nation, mostly for five reasons. Four of these have helped to create or further the postwar pattern of sprawl. When the fifth reason comes into play, it is easier to see why our metropolitan regions are coalescing into these sub-centers.

One reason for the growth of urban villages is that the nation's economy is shifting from a manufacturing to a service and knowledge base. The number of industrial jobs has declined from one third of all jobs in 1920 to one sixth today. The figure may drop to less than one tenth by the year 2000, with service and knowledge employment making up the difference, much as agricultural employment fell and industrial employment rose during the transition to an industrial economy in the late nineteenth and early twentieth centuries. From 1973 to 1985, while five million blue-collar industrial jobs were lost, the service and knowledge fields-- which are as diverse as computer programming, the professions, retail sales, and fast food--accounted for all of the nation's employment growth (from 82 million to 110 million jobs). The Bureau of Labor Statistics reports that the number of service and knowledge jobs can be expected to grow by nine million in the next ten years. The shift to a service and knowledge economy has greatly accelerated the restructuring of our metropolitan areas by creating a need for much more office space. In eight years, from the beginning of 1978 through 1985, 1.1 billion square feet of office space was constructed in the United States--the equivalent of 220 World Trade Center towers.

People are willing to live near the office now, whereas they were reluctant to live near factories that were dirty, noisy, and visually unattractive. Traditionally the poor and the working class have lived near factory districts. Across the nation office buildings and high-tech business parks have appeared in middle-class and even exclusive suburbs, such as the horse country around Valley Forge, outside Philadelphia; Bellevue, near Seattle; and the Buckhead district, in the north Atlanta suburbs. In Newport Beach, California, south of Los Angeles, a new subdivision of homes costing from $300,000 to $2 million abuts a Ford aerospace facility doing research and small-component-part assembly for military contracts.

A second reason for the emergence of urban villages has been changes in transportation patterns. Business shipments have shifted from rail to truck and Americans have decided that they prefer automobile commuting to mass transit. With fixed-rail transportation, all shipments must go from central terminal to central terminal before delivery. With trucks, shipments can travel from door to door. Similarly, with automobiles, people can go from door to door whenever they choose, without having to pass through central stations and terminals at fixed times. By 1960, the first year that the U.S. Bureau of the Census kept track, 69.5 percent of all commuting trips were made by car. By 1980 the figure had increased to 86 percent.

A third reason has been recent telecommunications advances, notably the dramatic drop in long-distance telephone costs. More and more day-to-day work is being done over the telephone. Not only cheaper long-distance telephone rates but also overnight mail, telecopiers, Zap-Mail, and computer modems allow communication without physical proximity.

Fourth, it is cheaper for businesses to operate in urban villages than in cities. Suburban office, industrial, and retail rents are far lower than downtown rents are. Although construction costs are approximately the same in the two areas, land outside cities costs less--$10 to $50 per square foot in suburban office locations versus $50 to $1,000 per square foot downtown. The cost of building parking spaces is also lower in the suburbs, where most parking is located in above-ground structures or surface lots, both of which are much cheaper to construct than a downtown office tower's subterranean garage. The difference in land and parking-garage costs shows up in office rents--$15 to $24 per square foot per year for prestige high-rise suburban space versus $18 to $42 for comparable downtown space in most American metropolitan areas.

These factors might only have encouraged more suburban sprawl if another factor had not come into play: most Americans like cities and the concentration of services that they provide. A critical mass of employment and housing is necessary to support desirable everyday services such as a good selection of shops, restaurants, and hotels. But this critical mass is achieved at well below the size of the prewar downtowns. For instance, it takes about 250,000 people within a three-to-five-mile radius to support a modest regional mall and about 20,000 middle-class people within an equal area to keep a good restaurant in business. And it requires roughly 2.5 million square feet of offices (about fifty typical three-story suburban office buildings) to support a 250-room hotel.

Since people do not want to drive very far for these services, particularly office workers looking for lunch or business travelers needing a hotel, a degree of concentration much greater than that of a low-density suburb is necessary. Only so many potential locations have the necessary highway access and visibility to permit this concentration, a fact that has led to the focusing of postwar suburban sprawl into urban-village cores. When prime urban-village cores become congested, developers and employers hopscotch to outlying locations where land is cheaper and commuting is easier.

Thus our metropolitan areas have expanded tremendously. In the past twenty-five years, for example, metropolitan New York's sphere of direct influence has tripled in size. The metropolitan area extends as far north as New Haven, Connecticut, and into once-rural Dutchess, Ulster, and Sullivan counties, in New York State. On Long Island the metropolitan area now encompasses Yaphank and Brookhaven, in the middle of Suffolk County, and fades away just miles from the Hamptons. Metropolitan New York has swept southward past Princeton and into Ocean County, New Jersey, and Bucks County, Pennsylvania. In several years New York's suburban growth will collide with that of slower-growing metropolitan Philadelphia.

Los Angeles has always had an enormous metropolitan area; it was knit together before the Second World War by the world's largest trolley system. By 1960 metropolitan Los Angeles's sphere of influence stretched to Santa Monica in the west, Pasadena in the east, Long Beach in the south, and the San Fernando Valley in the north. Now metropolitan Los Angeles extends westward into Ventura County, east to San Bernardino and Riverside, and south across most of Orange County to span an area many times the metropolitan area's size twenty-five years ago. Other cities--among them greater San Francisco, Phoenix, Dallas, Houston, Boston, Chicago, Atlanta, and Washington, D.C.--are also expanding quickly.

As outlying urban-village cores become more urban, with their high-rise office buildings and hotels, increasingly sophisticated shopping, and high-density housing, the center cities are becoming more suburban. This emerging trend extends beyond the fast-food restaurants on downtown business streets and festive retailing complexes like South Street Seaport. In Lower Manhattan, and Harborplace, in Baltimore. Suburban-style shopping centers--where you buy children's clothes and household appliances, not just clever T-shirts and scented soaps--have recently opened in several American cities, and are doing quite well. Large, privately financed apartment and condominium projects have been built in cities without a downtown residential tradition, including San Diego, Detroit, Atlanta, and Los Angeles.


Few cities have been transformed by the urban-village phenomenon as rapidly as Atlanta, whose metropolitan region has a population of 2.2 million, having gained 90,000 residents last year and 78,000 the previous year. In 1980 downtown Atlanta was the metropolitan region's unchallenged center for all kinds of office employment. Although urban-village cores were emerging around shopping malls at the intersections of major highways, office space was limited. And neither in the appearance of the buildings nor in the quality of the tenants were the fledgling urban-village cores any match for the downtown high-rises. Most of the buildings were two-story wood-frame structures, and many of their tenants were banks and insurance companies renting inexpensive space for back-office operations.

By 1985--just five years later--this pecking order had changed completely. Downtown Atlanta had gained 4.3 million square feet of new office space, but Perimeter Center, at the I-285/Georgia 400 intersection, due north of downtown, had gained 7.6 million, and Cumberland/Galleria, at the I-285/I-75 intersection, northeast of downtown, 10.6 million. Many of the new buildings were gleaming, architecturally distinguished high-rises of the kind that once had been built only downtown. If present trends continue, the amounts of office space in both the Perimeter Center and the Cumberland/ Galleria urban-village cores will easily surpass the amount in downtown Atlanta by 1990.

Downtown Atlanta, like downtown Los Angeles, is losing its metropolitan hegemony and becoming just another one of the region's urban-village cores. The urban villages around it, like those around downtown Los Angeles, are gaining distinct identities. Government, professional services, finance, wholesale trade, and the convention business are still in downtown Atlanta. However, as prestigious high-rises have been completed at Perimeter Center and Cumberland/Galleria, those areas have lost many of their price-conscious back-office banking and insurance tenants and have become instead favorite Atlanta locations for corporate headquarters and business services. Nearly every major accounting firm and many downtown law firms have offices in Perimeter Center and Cumberland/Galleria, the better to serve their clients. The regional corporate headquarters of Northern Telecom and HBO are in Perimeter Center.

Despite their importance as business locations, Perimeter Center and Cumberland/Galleria do not boast that traditional downtown symbol, a soaring skyline of office buildings. The high-rises in these two urban-village cores are not clustered. Instead they are widely separated by parking lots and heavily landscaped open space. In keeping with the non-urban mood, the developers have even neglected to add sidewalks connecting the buildings, and most people use their cars instead of walking. From the top floor of a seventeen-story high-rise in Perimeter Center the view is mostly trees and lawns, not other office buildings. Like many (though not all) urban-village cores, these relatively low-density north Atlanta developments visually blend into the suburban landscape. Yet the explosive rise in the number of office workers and their cars at Perimeter Center and Cumberland/Galleria has affected once-peaceful residential neighborhoods, including the Spring Mill area, near Perimeter Center.

One surprising result of Perimeter Center's boom has also been seen in suburban Dallas, Chicago, and Washington, D.C., and may be a trend. Residents of middle-class subdivisions near high-rise office clusters are banding together in corporations, getting their neighborhoods re-zoned for offices, and selling large "assembled" land parcels to real-estate developers, who either raze the houses or move them to new sites and build high-rises on the land. The suburban homeowners see the chance to leave an increasingly congested neighborhood where house prices are not keeping pace with those in comparable but quieter subdivisions nearby. Often they can sell their lots for twice what the homes on them are worth.

One such group formed three years ago in Spring Mill, a subdivision abutted on three sides by the high-rise office complexes of Perimeter Center. Randy Campbell, a former Spring Mill resident, recalls seeing a notice in a neighborhood newsletter in July of 1983 asking residents if they wanted to sell their property to office developers. "If you were interested," Campbell says, "you tore off a strip of paper on the bottom of one page, filled in your name, and sent it to the head of the neighborhood association. All but three or four of the 117 homeowners mailed in that piece of paper, so we got together in the community room of the Perimeter Mall. The average Spring Mill house sold for $70,000 to $75,000 then, but we learned that the half-acre lots were worth three times that figure to office-building developers. We didn't know how to go about the re-zoning or sale. So all the neighbors appointed a committee of five men and four women--small-business owners, several attorneys, a clergyman, an accountant, and a stockbroker. That was me."

For the next few months the committee met almost every night, learning about real-estate development and discussing strategy. By the end of the summer Alston & Bird, Georgia's largest law firm, had agreed to represent the homeowners on a contingency basis, and the firm drafted an option agreement to create Kingsborough-Spring Mill, Inc., a nonprofit corporation. By signing this option agreement a homeowner gave Kingsborough-Spring Mill's three-person board of directors power of attorney to accept a minimum of $225,000 in cash for his home, net after any expenses. It was understood that no deal would be final until the county commissioners changed Spring Mill's zoning from single-family homes to high-rise offices and multi-family units.

The night that Alston & Bird presented the agreement, in October of 1980, eighty homeowners signed it, and by January of 1984 the figure had risen to 114 of the 117. "Once the neighborhood was 'tied up'," Campbell says, "we looked for a buyer. They weren't knocking the doors down, because we wanted top dollar and all cash. As we explored various deals, all the neighbors wanted to know what was happening. So we prepared a newsletter almost daily, ran it off on our office copying machines, and stuffed it into everyone's mailboxes during our lunch hours."

In October of 1984 the board of directors located a buyer. "Albritton Development wanted to redevelop the twenty-seven-parcel Lake Hearn Place subdivision adjacent to Spring Mill," Campbell says. "But the Dekalb County commissioners rejected the re-zoning, reportedly because the project was too small, too piecemeal. So we made a deal with Albritton, which combined Lake Hearn's twenty-seven lots, the hundred and fourteen lots that we represented, and the three other Spring Mill owners that didn't join the neighborhood corporation. That made eighty-two acres--hardly piecemeal."

In June of 1985, however, the Dekalb County commissioners denied the re-zoning request for the site. Six months later Kingsborough-Spring Mill, Inc., the Lake Hearn Place homeowners, and Albritton Development sued the county commissioners. By last June the case had ended up in the Georgia Supreme Court, which ruled six to one in favor of the homeowners.

Baltimore is another kind of city being reshaped by the urban-village trend. Despite all the good news about Harborplace and the renovation of nineteenth-century row houses, the Baltimore metropolitan area is essentially stagnant. The population of the metropolitan area, as defined by the City of Baltimore and Baltimore County, declined from 1.53 million in 1970 to 1.44 million in 1980, and it is projected to drop to 1.40 million in 1990. Employment is growing only modestly--from 771,300 jobs in 1980 to 782,400 in 1985 and to 813,400 estimated for 1990. The Baltimore metropolitan area hardly seems like the place for a surge in construction. Yet there has been a boom in the outlying districts of Towson, Owings Mills, White Marsh, and perhaps most notably Hunt Valley.

Hunt Valley, twenty miles north of downtown Baltimore, was farmland until recently. Now it has a prestigious high-rise office and hotel core, which is surrounded by surface parking and low-rise industrial and office space. The low-rise industrial and office complexes came first, when well-to-do Baltimore businessmen decided to move their plants and offices closer to their homes in the north and northwest sections of the metropolitan area. After Hunt Valley was established as an employment center that offered low rents, the major landowner--McCormick Properties, owned by the family that owns the McCormick spice company--upgraded Hunt Valley by building high-quality mid- and high-rise office space and a Marriott Hotel. The PHH Group, Westinghouse, Burroughs, and Allstate Insurance promptly moved in. Now Hunt Valley is Baltimore County's top corporate address.

Even New York City has fallen under the sway of decentralizing urban-village development--which is surprising, considering that New York is the classic example of the traditional pre-Second World War city and that Manhattan has never been more prosperous nor its skyline more crowded with construction cranes. But although Manhattan gained 23.5 million square feet of office space from 1982 to 1985, during this short time its share of the metropolitan area's more than half a billion square feet of office space fell from 67 percent to 60 percent. This year, too, 7.6 million square feet is scheduled to be completed in Manhattan, bringing its total to 317.6 million--and 16.1 million square feet of office space is scheduled to be added to suburbs within a sixty-mile radius of Times Square, bringing the suburban total to 216.1 million.

In the past the typical new office building in New York's suburbs was part of the campus-like headquarters of a major corporation in Westchester County or southwestern Connecticut. Today, though, the exodus of corporate headquarters from Manhattan--to the suburbs or other parts of the country--has slowed. Now the typical new building is built on speculation, in an urban-village core such as Stamford or Danbury in Connecticut, the Route 110 corridor on Long Island, or Morristown or Princeton in New Jersey. One kind of tenant is a corporation's back-office operations or an entire division that can be separated from the Manhattan headquarters at considerable savings in rent, taxes, and business services but linked to the main office by computers and telecommunications.

As more and more jobs move to the suburbs (most of the metropolitan region's employment growth in the next decade is expected to take place not in New York City but in northern New Jersey), housing construction is booming in outlying towns. At Brookhaven, in Long Island's Suffolk County, 4,000 homes were built last year and another 8,000 are planned. At Dover, New York, a Dutchess County town of 7,200 residents northeast of Poughkeepsie, developers have filed proposals with the planning board for 1,200 new condominium units. The transformation is likely to be even more rapid at Chester, New York, fifty-five miles northwest of New York City. The population is 7,000, and the town board has received proposals for 3,000 new condominiums and homes.

In attractive communities near urban-village cores the prices of existing homes are rising fast, owing to the sudden demand from employees of relocated companies. That is one reason that metropolitan New York city experienced a 24.6 percent increase in the price of housing between the first quarter of 1984 and the same period in 1985. In Stamford, for example, a typical three-bedroom house now sells for at least $250,000.

The Princeton, New Jersey, area illustrates the impact of the urban-village trend on metropolitan New York. Seemingly overnight a metropolis-sized urban-village core has emerged several miles east of this tree-shaded college town on U.S. Route 1. It is estimated that by the mid-1990s the Princeton corridor will have 12 to 15 million square feet of office space--surpassing the amount currently in downtown Milwaukee, downtown Newark or southwest Connecticut's I-95 corridor between Greenwich and Stamford. Two luxury hotels have opened in greater Princeton: a Marriott and a Radisson are planned. The number of housing units is expected to double, with over 25,000 scheduled for completion by 1990. If current growth projections prove to be accurate, greater Princeton will become New Jersey's largest city in ten years.


None of the far-reaching social, economic, and political issues raised by urban villages has a broader and deeper impact than housing. Urban-village cores generally arise at the outskirts of cities and grow in a limited number of directions. Nearly all of Atlanta's urban villages, for example, are in the northern suburbs, leaving the southern part of the city largely unaffected. Dallas is growing mostly toward the north and northwest. St. Louis, not exactly a booming metropolitan area, is heading west and northwest. The vast majority of America's urban villages, in fact, have one thing in common: they are growing in white, upper-middle-class areas. Executives and business owners usually make the decisions about office locations and industrial sites. Most of them are white and upper-middle-class, and they usually decide to bring their offices or industrial plants nearer their homes.

This arrangement is time- and energy-efficient for executives and business owners but not necessarily for clerical, light-assembly, and service employees, nor for the employees of the stores, restaurants, and gas stations near offices and plants. These workers cannot afford the executive-priced single-family houses, townhouses, and condominiums near most urban-village cores. They face a long--and often expensive--car or bus commute to the suburban or city home they can afford to live in.

The scenes in the parking lots of north Atlanta's Perimeter Center at 5:00 show the results of this geographical mismatch. Executives and professionals get into their Cadillacs and BMWs for the relatively easy drive home or a visit to one of the nearby "formula" restaurants for a drink. At the same time, many black employees are walking through the parking lots--Perimeter Center has few sidewalks--on their way to the bus stops, which are little more than a pole with a bus sign on top, planted on a flat, grassy spot that usually turns into mud when it rains. Atlanta's working-class black sections are south of downtown, fifteen to twenty miles from Perimeter Center, but the roads and bus lines to them don't follow a straight line. With one or maybe two transfers, many bus passengers endure a one-to-two-hour ride twice a day.

Suburban fast-food restaurants, hotels, department stores, car washes, and cleaning services are already experiencing a shortage of low-paid service employees. In some fast-growing suburbs businesses are offering bounties for new employees, raising the starting pay from the $3.35 minimum wage to $4.00 or more, and offering raises after several weeks rather than a year. One solution to the shortage is to bring affordable housing closer to the employment in the suburban urban-village cores.

This idea is one of the most polarizing issues in local politics today. Most suburbs have raised the drawbridge against housing for the poor and the working class, as epitomized by new guarded and gated "secure" communities. Affluent families do not want low-income housing in their one-acre-lot neighborhoods. Nor do they need to allow it. Our urban villages now encompass areas the size of many pre-Second World War cities. They have more than enough land for all kinds of housing--and socioeconomic groups--if zoning boards permit affordable housing.

The key to truly affordable, non-subsidized suburban housing is allowing higher density, primarily in the form of rental apartments, so that fixed land costs are spread over more units. Building suburban apartments in smaller than average sizes, to reduce rents, should be permitted. Empire West, a Tucson developer, has built smaller than average apartments in the Southwest. Situated in 250-to-500-unit projects, the apartments range from 320-square-foot studios (equivalent to a l4-by-23-foot space), to 615-square-foot two-bedrooms (a 20-by-30-foot space). All apartments have complete kitchens, bathrooms, and closets, and are outfitted with scaled-down furniture.

These complexes usually offer the lowest rents in their local markets--typically from $225 to $400, at least $25 to $50 a month below rents for the cheapest conventional apartments. These rents fit the budgets of clerical employees, security guards, and maintenance workers who make less than $15,000 a year. Yet the complexes still offer "luxury" features like swimming pools, tennis courts, volleyball courts, and social events.

Of course, upper-middle-class suburbanites fight almost any kind of high-density housing. But attached housing complexes don't have to be built in affluent neighborhoods. They have been successful near commercial districts, where they create a buffer between a single-family-home neighborhood and an office-and-retail district. Another logical place for apartments is next to an urban village's commercial core. It seems likely that the vast surface parking lots of regional shopping malls will eventually be redeveloped as high-density housing and commercial buildings, with the cars going into above-ground or even underground structures. When these apartment and condominium developments are built near the shopping centers that form the focal point of so many urban villages, the members of more age groups and economic classes will be able to live near where they work and shop.


In most metropolitan areas the suburban rush hour now rivals downtown traffic, and in some surpasses it. The 1980 census reported that 27 million Americans commuted from one suburb to another, whereas only half that number traveled from suburbs to downtown cities. The imbalance has increased sharply since 1980, owing to the boom in suburban employment. Today's suburban highways are so overcrowded that once-easy five- and six-mile commutes take forty-five minutes of stop-and-go driving in locations as widely dispersed as north Dallas; Contra Costa County, east of San Francisco; and northern Virginia, near Washington, D.C. And the emergence of urban villages at the edges of the metropolitan areas--like Chesterfield, twenty-two miles west of downtown St. Louis--have brought bumper-to-bumper traffic to two-lane country roads that still run past farms and cow pastures.

Living up to its image, Los Angeles has the most heavily traveled freeways in the nation. The three busiest points on them are now near urban villages--miles from downtown Los Angeles and its four-level interchange, which once held the city's traffic record but has now fallen to fifth place. To reach their record-setting traffic levels, these Los Angeles freeways--like the slow-moving highways outside other cities--do not have a morning rush hour in one direction and an evening rush hour in the other. Commuter traffic now comes to a standstill at morning and early evening in both directions, and slowdowns occur frequently throughout the day.

Unfortunately, some city planners examining metropolitan-area congestion do not acknowledge the traffic near urban villages and repeat time-worn cliches about automobiles destroying cities. Others recommend the expansion of highways and mass-transit systems, but continue to think only of access to downtown, just as transportation needs soar in the suburbs. Still others recognize the rise of urban-village cores in the suburbs but propose transportation plans that are years behind the demand.

Planners and governments are working under a serious handicap in alleviating suburban traffic problems. Most urban-village cores are being created by private developers in a series of unrelated, uncoordinated decisions. To make matters worse, the process of formulating a transportation plan, gaining its approval, finding the funds, and completing the project is so time-consuming that traffic problems are bound to become painfully obvious before any action is taken.

How can government alleviate suburban traffic congestion near urban-village cores? The answer is not the construction of subways or elevated trains. Fixed-rail projects (unlike light-rail construction--for example, trolleys) justify their enormous capital expenditure and high operating costs "only when you have both trip originations and destinations highly clustered," according to Peter Muller, a professor of geography at the University of Miami and one of the earliest observers of the urban-village phenomenon. "We are building 1920s-style mass-transit systems for our 1990s metropolitan areas," he says.

One example of the gap between urban image and reality is Walnut Creek, California, near San Francisco, which has experienced considerable office and light-industrial development in the past decade. Although most of the new buildings are near the BART mass-transit station connecting the town to San Francisco, Walnut Creek now has such severe traffic congestion that last year it enacted an office-construction moratorium. Muller suggests that mass transit failed to help the town avoid traffic problems because the vast majority of the local workers commute by car regardless of a mass-transit option. "A great many of the people who ride the new fixed-rail mass-transit systems in cities like San Francisco, Atlanta, or Miami, used to ride buses," he says.

Nonetheless, fixed-rail transit remains a gleam in many a downtown businessman's or politician's eye. Some proponents may imagine that it takes a subway for a city to be a city, and some may have in mind that the federal government has paid up to 90 percent of the bill in the past (though it will not in the future, if the policies of the present Administration remain in place). Even Los Angeles--the capital of California's "car kingdom"--wants to build an eighteen-to-twenty-mile "metrorail" subway system, at a cost of 53 billion. According to an official of the Southern California Rapid Transit District, the metrorail system "may come close to breaking even on an operating basis, but there is no way that it will pay for the construction of the system." Of course, this statement is based on predictions of operating cost and ridership. The reality of Atlanta's new MARTA fixed-rail system is that the fare box brings in only 35 to 40 percent of the annual operating budget, which would more than double if a reasonable amortization of the capital cost were included. Moreover, the proposed Los Angeles subway route serves downtown and only two of the sixteen other urban-village cores in the metropolitan region.

Even buses do not fully meet the needs of the emerging urban-village cores, because serving all the possible permutations between where people live and work would require too many routes to be economically feasible. In the new urban-village cores office and industrial buildings are not closely packed together, as they are in midtown Manhattan or Chicago's Loop; they are widely separated by parking lots and landscaped areas.

This lack of density means that only a few people will find it convenient to walk to any given bus or subway station, and that office workers must have a car during the day if they want to visit a client or go out to lunch. And where internal transit programs using buses and mini-vans have been tried, such as Tysons corner, Virginia, and south of the Los Angeles International Airport, they have quickly failed for lack of patronage. In fact, even an official of the federal Urban Mass Transportation Administration asserts that conventional fixed-route transit systems will never carry more than a small percentage of non-downtown commuters. The official thinks that the only kind of mass transit with any chance of significantly decreasing commuter traffic is ride-sharing, and particularly car-pooling.

That leaves us with our automobiles. The new office complexes provide more room for cars than for the workers who drive them. The typical building allots approximately 200 square feet of space for each employee. The usual planning assumption is that one out of five workers uses a car pool or public transportation, and so a building will require four parking spaces for every 1,000 square feet of office space. Each parking space requires approximately 325 Square feet for the space itself. ramps (if a garage, rather than a lot, is planned), and aisles. That means the developer must set aside 1,300 square feet of parking for every 1,000 square feet of office space.

Two years ago some of the nation's leading urban planners gathered in Scottsdale, Arizona, and searched for solutions to suburban traffic congestion. The planners expressed considerable disagreement, presented a myriad of solutions but little data to support the ideas, and were greatly concerned about finding the money to pay for any transportation improvements. The planners did for the most part agree on an approach to the problem: government working together with developers. This is already happening. In north Atlanta's fast-growing Buckhead urban-village core, for instance, developers paid $1 million toward a new $5.2 million bridge over a highway interchange. And in Montgomery County, Maryland, developers will pay half of the $109 million needed for road improvements around Germantown, an emerging urban-village core. Many developers favor this new spirit of public-private cooperation, because they realize that the alternative could be government-ordered construction slowdowns or moratoriums.


Local governments can resist developers, but they can't resist them indefinitely or protect their communities from the bad effects of rapid growth. They are decentralized nineteenth-century entities trying to deal with far-reaching twenty-first-century issues. Greater Los Angeles, for instance, consists of well over a hundred cities and five counties. Metropolitan Atlanta has forty-six cities and seven counties. How can so many governmental jurisdictions possibly coordinate their actions to handle the amorphous growth of urban-village cores, which, like multinational corporations, know no loyalty to any single governmental body?

Real-estate developers most often deal directly with local governments. In this high-stakes game the developers hold many of the cards, because they can play one jurisdiction off another. Many local governments, in their desire to expand their tax bases, generate employment, and welcome "progress," try to entice developers with liberal zoning, temporary tax abatements, and improvements to such things as roads and sewers at little or no cost.

Contrary to what their residents often think, well-to-do communities cannot totally control growth on their own, unless they are geographically isolated, like Santa Barbara, California. When a town is part of a metropolitan area, its fate is inextricably tied up with the region's, no matter how wealthy its residents or how stringent its growth regulations.

Even Beverly Hills finds itself relatively powerless to resist the relentless development pressures from Los Angeles, which almost completely surrounds the 5.7-square-mile city. Several years ago Four Seasons Hotels wanted to build a high-rise hotel on Wilshire Boulevard near Rodeo Drive, in the heart of the city's commercial Golden Triangle. The issues of building density and hotel-generated traffic congestion became so controversial that the city council refused to vote on the Four Seasons project and instead placed a hotel-development ordinance on the ballot. Last year Beverly Hills voters overwhelmingly defeated the ordinance, thereby eliminating the possibility that another major hotel will open in the city. That didn't stop Four Seasons. Earlier this year the company started construction on a 287-room, 15-story hotel on Doheny Drive and Burton Way, literally across the street from the Beverly Hills city line. Beverly Hills lost the new hotel's sales and occupancy tax revenues but will still be affected by the traffic.

What can local government do about growth pressures? Probably the best solution is the creation of strong, effective, multi-city and multi-county agencies, and perhaps even entire government structures, that correspond to the actual economic and psychological boundaries of a metropolitan area and its urban villages. Such broad-based government has already been pioneered by Indianapolis (Marion County) and Miami (Dade County.) This governmental reorganization is not easy, because it can involve jealously competing towns, townships, cities, and counties--not to mention states, as are involved in greater New York, Philadelphia, Washington, D.C., St. Louis, and Kansas City. But much as the number of school districts nationwide has shrunk from 100,000 in 1940 to 15,000 now, the number of planning jurisdictions can be brought down.

One possible first step toward the creation of more-effective local governments is metropolitan-wide zoning and planning boards that have real clout in granting zoning changes and allocating improvements to the region's physical facilities. Some metropolitan areas are already moving in this direction. In 1979 Phoenix--the nation's ninth largest city, according to the most recent census--took the revolutionary course of adopting the urban-village concept in its planning process. In 1985 the city finished its General Plan to guide the municipality's growth, and this established nine urban villages. "Each [urban village] would become relatively self-sufficient in providing living, working and recreational opportunities for residents," the General Plan said. The city also encouraged the "concentration of shopping, employment and services located in the village core."

Phoenix is using zoning approvals and planned allocations of money for physical improvements to try to match employment with housing. The city has clearly specified goals. In 1980 only two of the now defined urban villages had more than half as many jobs as people, indicating that they had moved beyond being bedroom communities. Phoenix hopes that by the year 2000 five urban villages will have more than half as many jobs as people, with the remaining four urban villages having between one fourth and half as many, clearly showing that jobs and people have moved closer together.

Elsewhere, developers, employers, and local governments have created transportation-management associations (TMAs) to find solutions to transportation problems. What are perceived locally as transportation crises have brought TMAs into existence in Baltimore's airport area; Warner Center, in Los Angeles's San Fernando Valley; north Dallas; and Tysons Corner, Virginia. According to Kenneth Orski, the president of Urban Mobility Corporation, which is a TMA proponent based in Washington, D.C., TMAs "fill a vacuum in suburban areas."

Besides organizing ride-sharing and van pools, promoting staggered work hours, and lobbying for government-funded capital improvements, some TMAs are expanding their role into child care, private police, and other services for their geographic areas. It is imaginable that TMAs, born of the traffic-congestion crisis, could mature into an echelon of government well suited to the realities of our emerging urban villages.

Considering what has happened so far, is the urban-village trend a good or a bad thing for our cities and our citizens? To a certain extent the question is irrelevant, because the trend is already so advanced that it is irreversible. But it is hard to imagine the ideal urban village as being anything but very good. The opportunity for all kinds of Americans to live, work, shop, and play in the same geographic area--while retaining easy access to other urban-village cores with specialized features that their own district lacks--seems almost too good to be true.

As the nation's cities reshape themselves along the urban-villages model, we must ask ourselves, What are the design features, housing policies, transportation solutions, and governmental structures that will make our cities and the lives of their residents more productive and satisfying. Unfortunately, the questions and opinions vastly outnumber the solutions and directions. A great deal of study, experimentation, and planning needs to be done--and done quickly--to help cities that are being rebuilt almost from scratch.

Copyright 1986, Christopher B. Leinberger and Charles Lockwood.
"How Business Is Reshaping America"
The Atlantic Monthly, October, 1986, issue. Vol. 258, No. 4 (p.43-52).

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