Joe Urban | Sam Newberg, Urbanist

NIMBYs Beware – You Might Get What You Ask For

Dateline: 10:09 am January 16, 2009 Filed under:

Let me tell you about my favorite NIMBY story. Exactly where it happened and who was involved matters not here, as this story offers many lessons. And by “favorite,” I don’t mean to imply that I like the ending, rather I do wish it turned out different for all involved.

As most of you know, NIMBY stands for Not In My Back Yard, and refers to those opposed to a proposed development. It is typically a new real estate development, and the NIMBYs are typically nearby residents who don’t like the height of the proposed building or some element (real or perceived) that it will bring, like traffic, noise or crime.

A couple of years ago, a reputable developer proposed a 100-plus unit, four-story condominium development on an infill site in a transitional area of a large city. In one direction is a diverse, somewhat gentrifying neighborhood, and in the other direction the most hip, trendy, upscale urban neighborhood of the city.

The condo market was still healthy at the time, and in fact the developer began to take pre-sales after purchasing the building, but prior to getting approvals from the city. Indeed, they got several dozen pre-sales from interested buyers, primarily younger professional singles and couples (no surprise there). Pricing for condos was entry-level to mid-market, and priced competitively compared to more expensive product in the hip, trendy area nearby.

The neighborhood group didn’t like the project, as they felt it was too dense and would create parking problems. Instead of 100-plus entry- to mid-market units, they wanted upscale condos (better, more stable neighbors?), and far fewer of them (i.e., less density). As a consultant, I was contacted and confirmed what the developer already knew: that upscale units would be a hard sell on that site and the proposed development was much more feasible.

I maintain, given the timing of that project to market conditions, that the developer could have moved ahead, received approvals, began construction, beat most of the market crash, and today a 100-plus unit condo project could have been open and mostly sold out. Well, rather than fight the neighborhood group, which would have taken time, the developer foresaw the market trends. Knowing that units would be more difficult to market as time ticked by, they closed the sales office, backed out of the deal and sold the building.

Lo and behold, a developer with a less-than-stellar reputation is proposing a rental project of nearly the same scale and density as the original plan. In fact, this developer has already begun constrcution without acquiring the appropriate permits.

What can we learn from this? There were a lot of moving parts, but I think we can glean a few conclusions.

The original developer was smart, first proposing a viable project in a really good location that would have added new investment and new owners to a neighborhood that has relatively little of either. They were wise not to pursue fewer, more expesive units, as that was far riskier, and in my opinion, not viable in the market. The developer was even smarter to know when to get out of the deal altogether, as the condo boom was about to run out of steam. So why fight the system when there are bigger fish to fry?

The neighborhood lost out on an opportunity to work with a very good developer on a worthy project that would have, in my humble opinion, given the area a welcome shot in the arm. I believe rental housing is a perfectly viable use for that particular site, as it is often a good first use for a transitioning area. The problem is a developer was already selling condo units, and for the neighborhood group to throw that away is unfortunate to say the least.

The city also loses on tax revenue because the neighborhood group shot down a 100-plus unit project in favor of something else, which nobody could know at the time, but turned out to be far fewer than 100 units.

It is purely speculaltion, but one could predict that a well executed condo project could encourage or spur more development and investment in the surrounding area than rental housing. I don’t actually believe that condos trump apartments, as there are other factors at play, but certainly if the current project fails or has other problems, like with tenants or parking, it may discourage more investment in the area. The neighborhood may want those high-end condos, and someday may get them, but their actions have certainly delayed that day from occurring.

I do believe the most important thing is to have educated and knowledgeable neighborhood leaders and city staff and elected officials who recognize a good thing when they see it, and understand that sometimes it takes baby steps to get where you eventually want to be.

So NIMBYs beware, you might get what you ask for.

1 Comment

  1. […] the urbanism of its site, neighborhood and city. I’ve discussed this in past posts about NIMBYism and better planning […]

    Pingback by Joe Urban » Blog Archive » Invisible Cities — August 27, 2012 @ 2:11 pm

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