A Short High-Rise Editorial

First, many thanks are owed to this week’s guest author, Tom Steidl, for producing such a great, detailed post about the impact of building codes on high-rise development in Los Angeles. A few follow up thoughts:

Long-time readers will know that this blog has strongly advocated for low-rise and mid-rise density as the key to affordability in LA, since these types of construction can take advantage of lower costs of construction and will pencil out all over the city. However, there clearly is demand for high-rise living in some neighborhoods in LA, and we ought to allow and encourage it in those areas. The more efficient we can make these developments, the more units will pencil out, and the more demand can be accommodated by these projects. That’s a good thing all around: it gives more people the opportunity to live in a high-rise, and it reduces rent pressures on existing low-rise and mid-rise apartments.

The post also serves as a great example of the complexity of land use regulations and of the decisions that private sector actors make. Too often, the popular narrative about development holds that developers build the projects they build because they are excessively greedy, or excessively stupid. This is poor analysis and it leads to poor policy. Solutions that seek to mandate certain actions by developers, without understanding why developers do what they do today, run a large risk of having unexpected effects and exacerbating existing problems. As the post says, developers build chunkier towers in LA due to specific regulatory causes that encourage them to do so. Additional regulation that says “thou shalt build Vancouver-style towers,” without understanding what motivates developers to build the types of projects they do today, might result in no towers being built, rather than Vancouver-style towers.

To give an analogy, mandating that developers build certain types of projects, without addressing the zoning and building code regulatory regime, is like putting up a 25 mph speed limit sign on a road designed for 50 mph, without changing the design of the road. If you design a road for 50 mph and sign it for 25 mph, the drivers who go 50 mph are not foolish, you are. If you want a road where drivers go 25 mph, you need to understand what motivates their decisions and design accordingly.

Likewise, land use planning needs to look beyond the concept of simply mandating what development should be built. We need to look at all the elements of the process, and design the process so that all elements are contributing to making the desired results be the ones that make the most sense to develop.

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High-Rise Codes & Housing Affordability in Los Angeles

by Tom Steidl – AIA, LEED AP

Pull up a photo of the Vancouver skyline and you are greeted with an image of slender towers rising toward the sky with snow capped mountains beyond and mirrored in glassy water below. People don’t seem to mind this style of density as many, myself included, believe it’s urbanism done right. Vancouver is rightfully lauded as an urban planning success. The city is able to balance density with livability; Vancouver is the 4th densest city in North America while offering walkability, plenty of public open space and a variety of transit options. The housing typology that is largely responsible for this type of urbanism is the “pin” or “point” tower that has defined the Vancouver style.

These towers are quite slender in proportion, feature articulated facades and have compact floor plates, often under 7,000 square feet (SF). Smaller floor plates increase the feeling of separation between towers, which increases the sense of privacy and allows for territorial views. Tower separation is actually mandated in Vancouver (80′ minimum) and this is achieved in large part thanks to the small floor plate sizes.

In comparison, towers in Los Angeles tend to be rather, well, chunky (to use the proper architectural term). They are more squat and massive in appearance. And there is a good reason for this: they actually are more massive. Towers in Los Angeles tend to have significantly larger floor plates than those in Vancouver and US cities that have embraced high-rise design. The primary reason for this isn’t differences in land use or zoning codes. It’s mainly building code and fire department regulations that require additional floor area be added to the core of the tower. In addition to making our towers more bulky, this added floor area increases construction cost and reduces affordability.

Beyond increased cost, one could argue that the desirability of some units is being compromised. As neighborhoods like Downtown and Hollywood continue to fill in, towers with larger floor plates don’t always have as much spacing as might be desired. Units located above an alley might be separated from another structure by as little as 20 feet.

The Watermark Tower in Downtown Los Angeles, with unit windows +/- 35′ from a commercial office tower.

Recent changes in the LA high-rise code do away with the helipad requirement, and will allow for more interesting caps to our high-rises in the form of spires, tapering floor plates, and so on. But this change isn’t going to give us pin towers, nor is it going to usher in an era of more affordable high-rise living. To do that, we will need to re-examine what design elements are necessary in the central core of the tower. However, these requirements do provide additional degrees of safety. Can we better balance safety with desirability and affordability?

 Floorplate Efficiency is Paramount

The key to high-rise design is efficiency. A typical floor layout is repeated multiple times, so any wasted space is magnified 20, 30, 40 times or more. Developers are typically a practical lot, and know that if too many inefficiencies are baked into the prevailing floor layout, the project won’t pencil and it won’t get built. Roughly, the key metric in residential tower design is an efficiency factor of +/-85% on a typical residential floor. That is, the net rentable or saleable area of a given floor (the total area of the dwelling units) should be close to or in excess of 85% of the gross indoor area. The other 15% consists of corridors, exit stairs, elevator lobbies, trash rooms, electrical closets and so on – also known as the core of the building. The core also contains area that is taken up by structural elements, such as shear walls that are often located around elevators, and stair shafts, which are often located in the middle (hence “core”) of the floor plate. For each square foot of area you build in the core of the building, the rest of the floor plate has to become bigger by 6-10 SF.

This is why a central core that is as efficient as possible is critical to the design of any high-rise. Every modern day tower is going to need a certain number of elevators, a corridor from the elevators to the various unit entry doors and at least 2 exit stairs. Access to trash chutes and electrical/data closets located off the corridor are also pretty much universal. In a Vancouver pin tower, that’s typically it. The goal is to keep the central core as small as possible while maintaining adequate life-safety standards. Minimizing the floor area of the core keeps the rest of the floor plate from ballooning out further than needed and this is what creates the iconic pin tower. Thanks to this approach, Vancouver pin towers are able to achieve floor plate efficiencies in excess of 85% and, in many cases, close to 90%. There was a conscious effort to pair building code standards to desired planning and land use outcomes. This required a critical look at what provisions of high-rise building codes are truly necessary to maintain life safety. Vancouver has adopted their own building code (the City of Vancouver Building By-Law) that is modeled after the provincial and national building code, but with some key changes to better accommodate efficient high-rise construction.

But the City of Los Angeles requires more. Los Angeles requires that elevator lobbies on each floor be separated from corridors, that the two stairs be separated and that access to each stair must also include a separate vestibule from the corridor before you reach the stair itself. Trash and recycling chutes must be accessed from a room that is separated from the corridor by a fire-rated wall.  This is thanks to the desire to control the spread of fire and smoke from one floor to another by creating different air pressurization zones, and to provide disabled residents with an area of refuge. Much like the helipad requirement, these provisions are there to provide an added level of fire safety, but they do require additional floor area, and thus additional cost, to accommodate. And once floor area in the core is added for these elements, the cost of construction plus associated soft costs are usually passed on to residents.

Below is an illustration of the difference in the codes and how they manifest themselves in the layout of a floor plate. On the left is the floor plan of the Wall Centre Central Park tower in Vancouver. On the right is the typical floor of 1133 S. Hope Street in Los Angeles. Both are in the pre-construction phase and feature approximately 30 stories and 10 units per floor. They are shown to scale (I added color to the plan on the right to delineate the extents of the floor plate):

You will notice that in the Vancouver tower on the left, the elevators empty immediately into the corridor and the scissor stair (two stairways that stack above one another in the same enclosure, but are separated with fire-rated construction) without entry vestibules. In comparison, much more floor area is given to circulation in the Los Angeles tower. The elevator lobby is its own fire-separated room and the stairs are separated into two enclosures with entry vestibules. There is a separate room before accessing the trash and recycling chutes, which are located directly off the corridor in the Vancouver tower. There are some similarities between the two towers: both are located in seismic zones and provide lateral force resistance through similarly thick concrete shear walls, and both towers have similarly sized elevators. The building and fire code provisions of LA lead to a core that is almost twice as large in area, including cross-sectional areas of shafts and hoistways, than the Vancouver tower – 2,065 SF vs 1,080 SF.

[Please note that in my measurements for this post, I am using the same standard across all projects for measuring net residential area: outside of exterior wall, corridor side of corridor wall, center of demising walls. Some of the projects list “paint-to-paint” area measurements in their marketing collateral which skews average unit sizes smaller.]

This to-scale diagram overlays the cross-sectional area of the two cores:

Two other things to point out: first, the efficiency of each tower. If the LA tower was to match the efficiency of the Vancouver tower, the gross floor area would have to grow to nearly 16,600 SF. Second, and more importantly from a housing affordability standpoint, the cost of constructing the extra floor area is passed along to tenants. Assuming a construction cost of $300/SF of built floor area (i.e. not including shaft areas), that’s an extra $28,000 per unit on the floor, to accommodate an additional 951 SF of circulation area serving the same number of units.

Another interesting aspect is that the Vancouver project features much smaller average unit sizes: 636 vs 819 SF. This was likely more of a market-driven choice that wasn’t solely dictated by building code factors, but there are code-based influences to having smaller floor plates. Assuming a sales price of $600/SF, which isn’t far off of market conditions in both cities, that’s a difference of over $100,000 for an average-sized unit, before you take into account the additional cost for the added circulation areas. There are aspects to the building code (such as disabled access clearances in bathrooms and kitchens) and planning code (open space and parking requirements) that make smaller units cheaper to build. While this might be worthy of a separate post, requiring more area of the floor be dedicated to non-revenue uses does have an influence on unit size.

Same Developer, Different Standards

Another good comparison would be to look at two residential towers by the same developer. Onni is one of the largest developers in Canada with a portfolio of over 5,000 completed units and another 4,000 in the pipeline. They recently moved into the LA market and are in the process of constructing three separate towers: 888 S Olive (32 stories, under construction), 820 S Olive (50 stories, going through permitting) and a twin tower project at 12th & Flower (40 & 32 stories, also going through entitlements). Onni recently completed a 47-story tower, The Mark, on a corner lot in the popular Yaletown neighborhood of Vancouver that provides a good comparison to the 12th & Flower project in LA. I was able to scale the plans of the development permit application for The Mark tower and cross check it against marketing information and overall site dimensions (this is always a challenge, but I believe I was able to adequately scale the drawings so that the overall floor plate dimensions are accurate within 1 or 2 feet and areas represented are within +/- 1%). The quality of the development application plans were difficult to read, so I redrafted a typical floor layout to generate area data.

Again, Los Angeles has the added elevator lobby, separated stairs with vestibules and a trash room. With this added area, it becomes necessary to run the corridor around the perimeter of the structural core which adds even more floor area to circulation.

The added circulation area requires a larger floor plate to get to an efficiency ratio just above 80%, which then causes even longer corridors to reach further into the enlarged floor. With the floor plate becoming larger, you start chasing inefficiencies by forcing more circulation area. This isn’t a result of an inexperienced developer trying out high-rise residential construction. This is a developer with a proven record of creating thousands of units in efficient towers elsewhere.

Somehow, Vancouver has determined that their high-rise towers are safe enough without these additional building core elements. They made it a point to only require what they felt was truly necessary for life safety, and removed elements from the building code that might add significant cost. It’s worth acknowledging that Vancouver is in a different country with a different set of laws and building codes. As mentioned above, Vancouver uses a modified version of the British Columbia Building Code which is based on the National Building Code of Canada. Most of the United States has adopted the International Building Code (IBC) as a model code to follow, with individual states and cities making edits to the IBC where they see fit. California has adopted a modified version of the IBC as the California Building Code (CBC) with Los Angeles adding its own amendments to the CBC. So Vancouver and Los Angeles are starting from different places and that does drive some of the differences. But other US cities that have embraced high-rise residential design have building codes that look much more like Vancouver. For a good example, you just need to drive about 2 hours south.

Seattle vs Los Angeles

Like Los Angeles, Seattle uses the International Building Code as a model code with specific amendments. However, the city government of Seattle has made a conscious effort to amend the code in a way that encourages dense infill development in areas they have dubbed “Urban Centers,” which are mostly located in downtown and first ring neighborhoods. They are also actively working to encourage development of dwelling units to keep housing affordability in line during a time of strong job creation and an influx of new residents. Over the years, the city has adopted specific amendments to the high-rise provisions of the IBC to eliminate separate elevator lobbies and stair vestibules, provided that hoistways and stairways are pressurized, and the requirement for separate trash rooms. However, unlike Vancouver, they do not allow scissor stairs, which would save additional space inside the core (most US cities don’t allow scissor stairs, with New York being an exception). Even without the allowance of scissor stairs, there are significant differences in the size of the core when comparing a residential tower in Seattle and one in Los Angeles. Below is a typical floor plate of a tower that is about to begin construction at 9th & Lenora in the South Lake Union neighborhood. In my opinion, SLU is the Seattle equivalent of South Park.

When comparing projects between these three cities, noticeable tends begin to emerge. I selected a handful of projects in Vancouver, Seattle and Los Angeles, either proposed or recently completed, that shared similar infill sites close to downtown cores. All cities do a decent job of posting PDF drawings that are easily scalable. I believe that the towers I chose are representative of what is currently being built in each city.

Going beyond the obvious, that cores are larger in LA, note that even as the gross floor areas expand, three of the LA projects don’t reach the 85% efficiency mark. For the two that do, the Mack Urban tower uses a significantly larger floor plate to reach 85%, and the 888 Olive tower uses an offset core and loads most of its units to one side of the floor. I’m honestly a little surprised to see towers with relatively low efficiency ratios going forward. I think this is due in large part to atypically high rent and sales price growth in Los Angeles. The cost of building added circulation area is getting passed on to tenants and, in this area of reduced housing supply, there are some capable and willing to pay more. But there is likely a limit to the number of people who can afford rents of $4.00/SF and up. Once this limit has been reached, it wouldn’t surprise me if other projects didn’t move forward unless they improved on efficiency ratios. This would further starve LA of much needed housing supply.

Another metric to look at would be circulation area on a per unit basis:

It’s worth noting that the average unit size of the Seattle projects is the largest, with the 9th & Lenora project skewing things a bit). Based on my experience, this is historically atypical, as Los Angeles tends to have larger average unit sizes than Seattle and Vancouver. A large factor is that the LA projects are all located in the Downtown Parking District, which only requires one parking stall for most units and can be further reduced by providing bike parking. Additionally, projects in Downtown LA do not have unit density limitations, they are only FAR constrained. This allows developers to provide more, smaller units than in other parts of the city, where 1.5 or 2+ cars per unit are required for anything above a studio and unit density limitations come into play.

Looking at this data in terms of floor plates and core areas as a percentage of that in LA, the circulation area per unit, and the average circulation area per average unit area, we have the following:

Note how much larger the circulation area needed relative to the average unit area (the lower right corner) is for Los Angeles. The LA projects have an additional 19.8% of the average unit area dedicated to circulation, while it’s only 13.7% in Vancouver and 17.7% in Seattle.

This relationship would only get worse if LA started limiting overall floor plate sizes or requiring tower separation, something Vancouver and parts of Seattle require. It’s not outrageous to suggest that an additional $20-40k is already being added to a typical high-rise unit in Los Angeles thanks to building code provisions alone, before considering other factors such as parking requirements or drawn out environmental reviews and appeals.

Zoning Changes Coming to LA

So are residential high-rises in Vancouver or Seattle less safe than those in Los Angeles?  Should LA modify its requirements?  It’s a complicated subject to tackle and I couldn’t do it justice in a short post. I do believe that it is important to understand the cost implications of these requirements, and why other cities often require less. Vancouver and Seattle are in active seismic zones with the potential to deliver large earthquakes, like the 6.8 magnitude Nisqually quake in 2001. On the other hand, Los Angeles is subject to greater ground acceleration per the IBC. Fire sprinkler, alarm, and detection system requirements have come a long way in recent decades and this has reduced number of high-rise fires and associated deaths (both down nearly 50% since 1985), which might allow for building code amendments.

The City of Los Angeles is in the process of reimagining the zoning code and neighborhood plans, known as re:code LA. They are scheduled to unveil a new Downtown zoning code in 2015. This code will likely include a number of requirements for high-rise design, which may carry over to high-rise design in other parts of the city. Many cities, like Seattle, that have recently revised zoning code standards have included provisions for tower spacing and floor plate limitations. Ideally, any proposed high-rise zoning changes in LA would be done in tandem with a review of high-rise building and fire code requirements that affect building floor plate sizes. Limiting overall floor plate sizes while keeping provisions that lead to larger cores would only make efficiency ratios dip further, which could lead to fewer units being delivered to an undersupplied market.

A review of the code shouldn’t be limited to fire & life-safety provisions. Any truly comprehensive review of the code would look at all requirements that drive costs and effect affordability, such as parking minimums. Beyond potential zoning code changes, the city should look at the building code to identify what provisions truly make an impact in fighting fires and saving lives versus what might needlessly be adding costs without much or any real benefit. In the meantime, don’t expect to see pin towers dotting the LA skyline. Maybe we can learn to love our chunky Angeleno towers.

People Move to Suburbs Because They’re Cheap, Volume 1

As part of trying to keep track of larger trends, I’m following the suburban development homes being offered by the major builders. Partly, this is because others (like Curbed) are already keeping good tabs on development in LA County. But also, urban redevelopment projects tend to be more unique, depending on the specific developer goals, location, land costs, difficulty of permitting, and so on. In the suburbs, we can look at projects in different communities by the same developer, which makes it easier to compare costs across communities, or we can look at projects in the same community by different developers, which makes it easier to compare developers.

In this post, I’m going to take a quick look at some different developments by D.R. Horton, which as of late February has 33 developments in some stage of progress in LA, Orange, San Bernardino, Riverside, and Imperial Counties. Of these, 19 were in Riverside County, highlighting the uneven nature of the recovery. Note, D.R. Horton doesn’t put prices for all models on their website, so I’m making some reasonable assumptions indicated by with a ~, e.g. assuming that “high 200s” is about $290,000.

Now, you can get different customizations and finishes, but the big home builders are basically working off a few common plans they’ve developed. Peruse D.R. Horton and you’ll see a 2,798 SF option pop up regularly, priced as follows:

• Indio (Mountain Estates): ~$315,000
• Murrieta (Iris): ~$385,000
• Temecula (Morgan Heights): ~$500,000
• Eastvale (Noble): $550,400

Those are all in Riverside County.

Nothing too surprising here. Temecula is closer to San Diego County than Murrieta. Eastvale is one of the closest Riverside County cities to Orange County. Indio is the suburban fringe of the Coachella Valley. In other words, location matters, just like you’d expect.

There’s a common thread of urbanist thought that goes something like “operating a car costs about $8,000/yr, so you can afford to pay more for housing if you live in a place where you don’t need a car”. This has been extended to suggest that banks should consider household transportation costs when deciding if they should make loans, i.e. if household needs one less car, they can afford a larger loan. And indeed, the difference between Murrieta and Temecula at current 30-year fixed rates (4.35%) is about $6,950 per year – about the same as the cost of operating a car.

So let’s say that living in Temecula instead of Murrieta would let one person in the family bike to work instead of drive, allowing the family to get rid of a car. Why wouldn’t a bank give the family a larger mortgage to buy the same house in that case?

Because it’s a 30-year loan, and few people work in the same place for 30 years. If the person working in Temecula in the family living in Temecula loses his/her job and finds a new one in Menifee, now the family needs another car. Or, if the person loses his/her job and can’t find a new one, there’s no way for the family to quickly reduce its fixed expenses. If the person working in Temecula in the family living Murrieta loses his/her job and can’t find a new one, the family could reduce fixed expenses pretty quickly by selling a car. Simply put, it would be crazy for a bank to make a 30-year loan that depends on transportation costs being stable.

To finally reach my point, the real tradeoff that you make when you decide to live closer to the city is housing size: you accept a smaller dwelling in order to be closer. For example, you could get a 2,414 SF house in Fontana for around $390,000, or you could get an 1,851 SF townhouse in Rancho Cucamonga for about the same price. Of course, this pattern is distorted by zoning and other things like Prop 13, which encourages communities to try to drive up housing prices.

If you look at things on a per SF basis, prices increase as you move towards the more desirable areas, and there will be thresholds at which more expensive types of construction become feasible. While prowling around Save Marinwood and Quiet and Safe San Rafael, I found a presentation by John Burns that gives relative costs of construction: about $60/SF for SFR, about $90/SF for garden apartments, and about $200/SF for podium construction.

D.R. Horton’s most affordable properties, in Adelanto and Imperial, are selling for about $100/SF, around 165% of construction costs. Assuming that zoning allows for it, and market conditions and regulation don’t favor buying over renting, that means garden apartments become economic when prices hit about $150/SF, and podiums when prices hit about $330/SF.

The threshold for garden apartments is pretty low; based on D.R. Horton’s SFR pricing, they already make sense in places like Fontana and Murrieta. Podium construction has a higher threshold; Santa Clarita is getting close, but only LA and Orange County pencil out. Note that this is a gross simplification. Small (1-2 person) households often don’t want dwellings as large as SFRs. In a place like Adelanto, a lot of single people could be accommodated in things like garage apartments, let rooms, and so on, if permitted. At small dwelling unit sizes, prices don’t scale linearly because of fixed costs like bathrooms and kitchens, which are more expensive per SF than bedrooms or living rooms.

However crude it is, this analysis is consistent with the expectation that there is a logical progression of densities as you approach more desirable areas: SFRs to garden apartments to podiums.

I should point out that by this logic, high-rise construction doesn’t make sense until prices go above about $500-$600/SF – a level that only some places in LA have reached. Not to beat a dead horse, but I feel compelled to again emphasize that the debate is not about the aesthetics of mid-rise versus high-rise construction. It is affordability versus unaffordability. If your vision is high-rises instead of mid-rises, your vision is an unaffordable Los Angeles. There’s no two ways about it.

Where Should We Have Skyscrapers in LA?

Perhaps as a compliment to my posts on how we don’t need to worry about the pace of skyscraper construction in downtown LA, here are some quick thoughts on where skyscrapers do make sense.

In most cities, high-rises are only economic near the core of the city. For example, I doubt there’s much demand for residential or commercial skyscrapers outside of Boston proper and parts of Cambridge – maybe a few beachfront condo towers, but that’s it. In Chicago, it’s the Loop. Philly, Center City. Las Vegas, the Strip. SF, mostly just SF city itself, but not in the suburbs (though the Bay Area’s natural beauty would encourage some high-rises simply for the sake of views). And so on. Your North American megalopolises, New York and Toronto, have managed to get big enough to support skyscrapers in the first ring suburbs – Brooklyn, NJ suburbs on the Hudson, Mississauga – and a few even further out, like New Rochelle.

So naturally, the focus in LA is downtown LA, with Councilmember Huizar’s proposal to encourage skyscrapers, and architects like Gensler fantasizing about adding 3m people inside the downtown freeway loop.

But LA, with its undense density and highly decentralized employment, isn’t like other cities. Efforts to remake LA in Manhattan’s image would take a tremendous amount of energy, and ignore all of the strengths of LA’s land-use patterns. These ideas are also probably dead on arrival – if you add another million people to downtown LA, how enthusiastic are they going to be about adding the second million?

LA’s polycentric nature means that downtown LA is relatively unimportant in the regional scheme of things. This is a strength, because growth and its impacts are distributed around the region. If you’re in the LA tech scene, you probably want to be in Santa Monica, Venice, or Playa Vista. If you want to make TV or movies, you probably want to be in Burbank. If you want to be in aerospace, it’s El Segundo or the Antelope Valley. The priciest finance and law firm addresses are in Century City. And all of those industries have major nodes in Orange County.

Notice that we covered some pretty major parts of the LA economy without even mentioning downtown. On the other hand, if you’re a major part of the New York economy, odds are you want to be in Manhattan, below something like 72^nd St.

Logically, it follows that any of LA’s major nodes are logical places for high-rises. Century City could probably support residential high-rises, along with increased development along the Wilshire Corridor. Santa Monica and Westwood. Hollywood. El Segundo and Long Beach, probably. Burbank, Glendale, and Pasadena could support residential high-rises if they want them. I bet you could make a few work in Universal City, Studio City, Sherman Oaks, and the Warner Center. Orange County, I’m not sure it works yet, and that’s not really their style.

And honestly, if your goal is letting more people live closer to where they work, you should support allowing construction of high-rises in all those places. Downtown LA is a small percentage of regional employment, and that number isn’t changing much anytime soon. Channeling all residential growth into downtown LA would have the perverse effect of greatly increasing the number of “reverse” commuters (reverse in scare quotes because the “reverse” direction already is the dominant direction on the Westside).

That’s not to say we shouldn’t allow residential high-rises in downtown LA – we should! If developers want to build them, I’m more than happy to see them built. But we should realize that we have several other parts of the region where high-rises also make sense. We should be happy for that, and allow construction of high-rises in those areas as well.

(Note: any beach city could support high-rises on the shore, but that’s one case where I’m sympathetic, instead of skeptical, to the argument about views – skyscrapers along the beach are like a row of giant middle fingers to the rest of the city.)

A Modest Zoning Proposal

There’s a rezoning effort underway in Los Angeles, branded as recode:LA, that’s going to rewrite the city’s entire zoning regulation. This is a huge opportunity to make it easier to build in LA, restoring affordability and capitalizing on infrastructure investments. I’m planning to get involved and start attending meetings, and I encourage everyone interested in seeing LA flourish to do the same.

Where Are We Today?

First, a quick summary of where we are. Typically in LA, the arterials on the grid are zoned for commercial uses, and the area between the arterials is zoned for residential. For example, here’s the general zoning for Palms and Cheviot Hills.

To simplify things, there are 10 major residential zoning groups in LA, designated A through R5. Note that the default zoning in many New England suburbs equates to the lowest density zones available in LA, which explains why LA isn’t sprawl and is denser than everyone thinks. Here’s a summary of the major residential zoning requirements:

There’s also RAS3 and RAS4, which are basically R3 and R4 with ground-level retail permitted, and slightly less restrictive setbacks.

Where Do We Want to Go?

Now, before we start rezoning, we have to ask ourselves what we’re trying to do here. What goals are we trying to achieve? What do we hope LA will become?

For me, as I have said before, my main goals are affordability and opportunity. I want LA to be a place where low-income people can afford a roof over their heads, and where all people have the opportunity to pursue their goals in education, starting a business, etc. In my mind, that should be LA’s raison d’etre. Better infrastructure, including transit, is not a goal unto itself, but a means of achieving those two cardinal goals. Achieving these two goals would help address many other social concerns. Other benefits that might flow out of that, such as reduced per capita energy use, would be nice, but they’re not my main concern.

Part of my project here is to try to convince you that affordability and opportunity are the two best goals for improving LA. But obviously, not everyone is going to share my goals, and that’s ok. I don’t expect people in Rolling Hills or Calabasas to give a rat’s ass about affordability in their cities, because that’s not the reason those cities exist. The important thing is to recognize and be honest about your goals. If you say you’re in favor of affordability but also want to protect SFRs, you’re lying about one of them.

Of course, there’s a huge social justice and equity component to affordability and opportunity that I haven’t addressed on this blog yet, mainly because I know planning/engineering much better, and planning/engineering challenges are much easier to solve.

Back to the zoning.

How Do We Get There?

If I had my way, we’d just let people build however many apartments they want wherever they want. The collective knowledge of the market is almost certain to be better than anything planners could devise, not because planners are no good but because of the inherent complexity of the system. It would be like trying to do an analysis to figure out how many trees there should be in the forest and where they should grow.

It’s easy to sit around, say “upzone everything”, and then hit the bar and start pounding beers, but that’s ultimately an academic exercise. Any proposal to just upzone everything is probably dead in the water. It’s much harder to come up with a plausible plan that has a chance of being implemented. So here’s my attempt at a plan that I hope could win some public support. As with everything here, consider this a starting point; comments and suggestions for improvement are encouraged.

So, here’s the basic idea. The following rules would apply to areas currently zoned R1 through R5:

Pace of Redevelopment

• In any neighborhood, 4% of lots will be permitted for redevelopment each year.
• If a developer consolidates lots, the project requires a number of permits equal to the original number of lots. Future redevelopment of the consolidated lot would need only one permit. This encourages small-scale development.
• The neighborhood council can decide to permit more than 4% at its discretion.
• Permits are auctioned off to the highest bidder. This will encourage the best projects to be built first. It also gives opponents of development the opportunity to put their money where their mouths are – if they don’t want new development, they can buy all the permits.
• Revenue from permit auctions to be invested in neighborhood improvements by the neighborhood council.
• Permits expire 18 months after sale if no construction initiated – i.e. no permit hording, and opponents can’t foreclose on redevelopment forever by buying up permits for a few years.

Permitted Development

• Any structure of up to 3 stories and up to 6 units per 5,000 SF lot is automatically permitted.
• Any structure of equal in height to the 85^th percentile height, plus one story, is automatically permitted.
• Where automatically permitted, 4-story structures may have 10 units, 5-story structures may have 16 units, and 6-story structures may have 25 units, per 5,000 SF lot.
• Mixed use development up to 6 stories and 200 SF lot area per unit automatically permitted on arterials (e.g. Venice, Western, Pico). Mixed use includes light industry that does not produce noise or odors. Commercial uses not restricted to ground floor.
• Setbacks per current R4 standards, except arterials, to be per RAS4.
• Nothing in these rules shall be interpreted as making existing zoning more restrictive.
• Rules become effective 15 years after initial subdivision is recorded. This would allow owners in new subdivisions some certainty that property won’t immediately be redeveloped in newly established neighborhoods. This provision would have little effect in LA, where most neighborhoods are long established.

When it comes to the large lot zones – A, RA, RE – I would propose allowing them to be subdivided per current R1 zoning standards. After 15 years, the subdivided lots could be developed according to the above standards. But really, A/RA/RE are a small component of the plan. The major benefit is the above rules applied to zones R1 through R5.

In neighborhoods where these rules would result in buildings up to 75’ – the maximum for Type 3 construction – being automatically permitted, the neighborhood council and city could begin to consider allowing high-rises. I’m mostly ignoring high-rises in this proposal, because we don’t need a single high-rise in LA to make the city more affordable and welcome many more future Angelenos to our city.

Parking would be handled like Donald Shoup says it should.

How Does This Work?

Perhaps the best way to explain this concept would be by example. Take an existing R1-zoned neighborhood. In the first year, up to 4% of properties could get permits to be redeveloped into 3-story 6-unit apartment buildings – assuming, of course, that 4% of owners want to redevelop their property, and they don’t get outbid for the permits by opponents. Replacing 1 out of every 25 SFRs with a 3-story duplex where every floor is an apartment isn’t going to change the character of the neighborhood much. Under this plan, it would take at least 25 years for all structures to be replaced – a low rate of change.

In the second, third, and fourth years, the same thing would happen. Assuming 4% of lots are redeveloped every year for the first four years, by year five, 16% of the lots in the neighborhood would have 3-story buildings. Therefore, the 85^th percentile height would be 3 stories, and 4-story buildings would become automatically permitted. Again assuming 4% of lots are redeveloped every year after that, in year nine, 5-story buildings would become automatically permitted, and so on.

Starting Points

Again, this proposal is just a starting point. I’d expect a healthy debate about the percentage of lots that can be redeveloped every year, the number of units allowed, and the percentile trigger that permits another story. We could also define a few different zones with different rates and triggers, some more permissive and some less permissive.

I will also note again that this is not necessarily my preferred solution; I’d rather leave more up to market forces. But this is a proposal that can hopefully accommodate a significant amount of new development to improve affordability, spread out the development so that no one area is overwhelmed, and still provide property owners with the certainty they desire.

So, what do you think? Is this a viable proposal? And what would make it better?

If Jose Huizar Wants More Skyscrapers Downtown, He Should Make It Easier to Build Mid-Rises

One of the more frustrating things about land use and transportation in LA is that we don’t even realize what we’ve done right. Because of that, lately we’ve started to get dangerously close to getting things wrong, as some people are promoting adoption of the worst policies from other cities. See, for example, the current fixation on getting rail into LAX. I’ll have more to say about that soon, but today’s issue is City Councilor Jose Huizar worrying yet again about the supposedly insufficient number of high-rises being constructed downtown.

I’ve written about this issue before, and everything I said then is still true. But today, we have a motion proposed by Huizar to look at in detail. The motion calls everything up to 75’ tall “low-rise”, but by any rational definition 7 stories is mid-rise – especially in LA. “Type III construction” refers to wood-frame construction, the only type of construction economically feasible for mid-rises given the seismic loads that structures in LA must endure. As has been written elsewhere, developers say that due to the cost premium of concrete/steel construction, buildings between 8 and 15 stories tall don’t make sense in LA – once you go to concrete/steel, you need to go to at least 15 stories to be profitable.

I’m in favor of everything on the first page of the motion: getting rid of parking minimums, making permitting much easier, eliminating restrictions on density, and removing limitations on reusing existing buildings as hotels. But on the second page, Huizar proposes prohibiting mid-rise construction in “Zone 1” (roughly everything from the 110 to Flower, from 7^th to the 10) and curtailing mid-rise construction in “Zone 2” (roughly everything from Flower to Olive, from 7^th to the 10, or within 1000’ of Pershing Square station). I’ve sketched these zones in Google Earth – Zone 1 in red, Zone 2 in yellow – excluding the Pershing Square area.

Now the first thing you might notice in that graphic is that there is a ton of surface parking in the area. If I have time, I’ll update the post with a more accurate calculation, but I feel comfortable saying at least 30% of the parcels in the area are surface parking lots. On top of that, there’s a lot of older, truly low-rise construction, 1-2 stories tall. There’s no reason at all to worry about running out of space for redevelopment, even if you restrict tall building to this area, which you shouldn’t.

Prohibiting mid-rise construction will slow down development in one of the few areas in LA that’s growing as fast as it should. That will drive up housing prices in the area and reduce employment in construction.

But even worse, the motion will fail at its own purpose – prohibiting mid-rise construction will make high-rise construction less likely. Why? Well, if you’re going to build high-rises, you need to attract the kind of people who can afford high-rises. And the kind of people who can afford high-rises expect a lot of amenities in the neighborhood like shopping and restaurants. The easiest and fastest way to increase the amenities of the neighborhood is to make it easy for developers to construct the kind of buildings they want – in this case, a lot of mid-rises.

The high-rises? They’ll come naturally when the neighborhood becomes more desirable. We’re already seeing that in the more established parts of downtown. So if Huizar wants more skyscrapers downtown, he should make it easier to build mid-rises.

When Does More Expensive Construction Make Sense?

One of the most common criticisms of things like Portland’s Urban Growth Boundary is that they increase housing costs. This is undeniably true, at least on a per SF basis, because denser construction costs more. While prowling around Save Marinwood and Quiet and Safe San Rafael, I found a presentation by John Burns that gives relative costs of construction: about $60/SF for SFR, about $90/SF for garden apartments, and about $200/SF for podium construction. While you might be able to save on transportation costs by living closer to your job, in general the tradeoff you make is accepting a smaller dwelling in exchange for living in a more desirable area.

Still, even with no urban growth boundary to speak of, at some point, agglomeration effects cause prices to rise to the point where more expensive types of construction make sense. See, for example, Los Angeles. When does that happen?

As part of trying to keep track of larger trends, I’ve started following the suburban development homes being offered by the major builders. Partly, this is because others (like Curbed) are already keeping good tabs on development in LA and Orange County. But also, urban redevelopment projects tend to be more unique, depending on the specific developer goals, location, land costs, difficulty of permitting, and so on. In the suburbs, we can look at projects in different communities by the same developer, which makes it easier to compare costs across communities, or we can look at projects in the same community by different developers, which makes it easier to compare developers.

D.R. Horton is a major builder in the region, as of early November it had 25 developments in progress in LA, Orange, San Bernardino, Riverside, and Imperial Counties. Of these, 14 were in Riverside County, highlighting the uneven nature of the recovery. D.R. Horton’s most affordable properties, in Adelanto and Imperial, are selling for about $100/SF, around 165% of construction costs.

Therefore, assuming that zoning allows for it, and market conditions and regulation don’t favor buying over renting, that means garden apartments become economic when prices hit about $150/SF, and podiums when prices hit about $330/SF.

The threshold for garden apartments is pretty low; based on D.R. Horton’s SFR pricing, they already make sense in places like Fontana and Murrieta. Podium construction has a higher threshold; Santa Clarita is getting close, and LA and Orange County pencil out. Note that this is a gross simplification. Small (1-2 person) households often don’t want dwellings as large as SFRs. In a place like Adelanto, a lot of single people could be accommodated in things like garage apartments, let rooms, and so on, if permitted. At small sizes, prices don’t scale linearly because of fixed costs like bathrooms and kitchens, which are more expensive per SF than bedrooms or living rooms.

However crude it is, this analysis is consistent with the expectation that there is a logical progression of densities as you approach more desirable areas: SFRs to garden apartments to podiums.

I should point out that by this logic, high-rise construction doesn’t make sense until prices go above about $700/SF – a level that almost nowhere in Los Angeles has reached. Not to beat a dead horse, but I feel compelled to again emphasize that the debate is not about the aesthetics of mid-rise versus high-rise construction. It is affordability versus unaffordability. If your vision is high-rises instead of mid-rises, your vision is an unaffordable Los Angeles. There’s no two ways about it.

Palms Power

As I’ve said before, the affordability of Los Angeles for people and businesses is one of the greatest challenges facing the city. If we don’t want LA to become a boutique town like San Francisco or Boston, we need to make it easy to produce cheap apartments and workspaces. By definition, affordable development does not include any space that is produced by giving developers subsidies or forcing developers to sell or rent at below market rates. Those strategies are not scalable in a meaningful way.

To that end, I’ve defended and promoted the LA pattern of low-rise and mid-rise development, contrasting it with some architects’ and planners’ preference for high-rise towers near transit hubs, surrounded by single-family neighborhoods with restrictive zoning. In previous posts, I’ve called this “Vancouverism”, since this is the strategy pursued by Vancouver. This strategy is often more politically palatable because it aligns the preferences of architects and planners with the belief of NIMBYs in single-family neighborhoods that the city should protect them from change.

However, Vancouverism can never produce affordable development at the same scale that the LA pattern can, because the construction costs are so much higher. As the LA Downtown News reported, high-rise construction costs 1.5 times to 2.5 times as much per square foot as low-rise and mid-rise construction – about $200/SF for low-rise and mid-rise buildings, and $400/SF for high-rise buildings.

Example: at a 10% rate of return and a 30 year term, you need to collect about $1,250/month in rent to cover the cost of building a 700 SF low-rise apartment. High-rise, you need to collect at least $2,500/month. This doesn’t include the cost of maintenance and management, but $1,250/month is down into the realm of affordability. And anyway, the point of new construction is often not to build new cheap apartments, but new upscale apartments for people with more money.

The key thing to realize here is that the cost of new construction sets a reference price for existing apartments that have already had their capital costs paid off and just need to cover maintenance. If new apartments are going for $2,500/month, then you can charge up to $2,499/month for an old apartment. But if new apartments are only $1,250/month, you can never charge more than $1,249/month for an old apartment. So, the less costly the new construction, the larger the market segment that can be targeted with new construction, and the less price pressure on existing apartments.

In other words, if we really care about affordability, we need the traditional LA pattern of development. And since I live in Palms, I’m going to frequently use Palms as a good case study. I’m planning to do some more detailed research, but for now let’s trust Wikipedia and assume Palms was upzoned in the 1960s. At a glance, Palms might look like it’s all apartment buildings of the same size and vintage, but that’s not the case – there’s a variety of building types, sizes, and ages. This includes a considerable number of remaining single-family houses. In a few upcoming posts, I’m going to take a closer look at selected streets in Palms, including the types and ages of buildings, with an eye on the fact that none of the single-family houses have been ruined by the nasties that are supposed to come with apartment buildings.

Skyscraper Sueños

Here we go again with the skyscrapers. This time, it’s an editorial in the LA Downtown News worrying about the lost opportunity of the current spate of mid-rise construction. The basic thought process behind these pieces is “I really like skyscrapers” and from there, proceeding to come up with reasons for their construction. Kind of like the streetcar fad.

I’ve said before that I have no opposition to skyscrapers. I think they’re cool. I’m pretty excited to see the new Wilshire Grand go up. If developers want to build skyscrapers, more power to them!

However, the editorial is wrong on just about every count. Here’s a rundown:

• This is a once-in a generation opportunity to go tall. It doesn’t matter. In 1983, how many people thought Downtown LA would be the way it is today? Anybody telling you that they know what downtown will or should be like in 2043 is overconfident in their ability to predict the future.
• Once the parking lots disappear, so does the opportunity to go tall. Not really. Towers going up in places like New York are replacing mid-rise construction. If the market for skyscrapers exists and they are not precluded by foolish zoning and permitting laws, they will be constructed.
• We’ll run out of sites to redevelop. LA is an enormous city. The idea that we are going to run out of parking lots and low-rise buildings that could be redeveloped any time in near future just doesn’t pass the laugh test.
• Downtown is the center of the region. LA is the prototype of polycentrism. There are job centers all over the place. It makes just as much sense to have more residential development in Burbank, in El Segundo, in Long Beach, on the Westside, in the Valley – basically, everywhere – as it does downtown.
• Downtown has the region’s best public transportation. This is true to some extent, though it sort of equates “public transportation” with “rail transportation”. But even if you ignore the possibility for easy improvements to bus service, which we obviously shouldn’t, rail lines are going to be coming to other places with projects like Crenshaw/LAX, Sepulveda Pass, and so on.
• Downtown can and should support more density. This is true, but it implies that other areas can’t and shouldn’t support more density, which is false. The editorial cites the battle against Millennium Towers in Hollywood, but that project is more symbolic density than anything else. We could get more density more quickly by allowing mid-rise construction in a larger part of the city than we could by encouraging skyscrapers downtown.
• We need to go tall close to Metro stops. I have written before that TOD plans are an oversimplification of how cities work, and presume a level of knowledge no one has, so I’ll refer you to those posts.

Thankfully, the conclusion is pretty accurate: it recommends against ill-advised policies like minimum density zoning, and suggests that we need to make the permitting process easier. I’m in complete agreement there. But we shouldn’t be spending limited public resources on subsidizing developers. The idea that urban planners or city officials know what type of development is appropriate better than the market is just wrong.

Los Angeles: Density Done Well

Wait, what’s this, an actual post on LA? ‘Bout time. I’ve been trying to cover the philosophical stuff up front to give context of where I’m coming from. I’ve still got a lot of ground to cover there, but this post provided a good opportunity to use real LA examples to back up the theory side of things.

I recently had an interesting exchange with Neal Lamontagne on Twitter, about density in Santa Monica and mid-rise versus high-rise development.

I guess that still sounds like tastes to me. Some people prefer towers – call it Vancouverism – and some people prefer sprawling low-rise and mid-rise density – call it the LA pattern, since LA invented it, perfected it, and turned itself into the densest US metro using it. Given that I’m an unabashed LA cheerleader, you can guess which way my tastes run. The LA pattern: tastes great, less filling. You can get a ton of density that doesn’t feel dense, which is perhaps LA’s most underrated achievement. It’s one of the main points of my project here.

Now, another premise of this blog is that personal tastes shouldn’t get force of law through zoning and permitting. So if I’m gonna come at you with the LA pattern, I’m gonna come correct, and give you some solid theoretical reasons you should learn to love it.

Note: Neal also raises an interesting point about the street-level impact of developments that take up an entire block. This is worthy of discussion in a separate post. For now, I’m going to focus on low-rise and mid-rise development in comparison with high-rise development.

For one, low-rise and mid-rise density offers more development model options, which leads to more diversity of use – something both Neal and I highlighted as being important. Why does low-rise and mid-rise offer more possibilities? Well, for the reason that Neal notes: it’s cheap. Lower construction costs mean lower rents, which makes it possible for a greater variety of land uses to make a go of it. There’s a good reason why skyscrapers are overwhelmingly built by the FIRE industry, luxury residential developers, and the government. It’s something Joe Satran touched on recently in the context of restaurants, too. LA has space for everybody to try their idea, and that’s an asset we ought to strengthen and reinforce when we have opportunities like Recode LA.

Lower construction costs also open the door for a wider variety of players to try their hands at land development. A low-rise or mid-rise block can be built by small-time local developers, backed by local banks, insured by regional firms. That means the development will be built and backed by people who know the city better, have a better feel for the local market, and have a bigger stake in its success. Skyscrapers require bigger developers, bigger banks, and bigger insurers, which means more generic development and less concern for the city. When I lived in Boston, a major skyscraper was derailed because Anglo-Irish Bank and CalPERS pulled funding. Not surprisingly, people in Dublin and Sacramento don’t care that much about their impact on Boston. People in LA care more about LA.

This being LA, there is one other thing we should mention: earthquakes. Contrary to what you may have heard from armchair engineers on the internet, geotechnical and structural design have made some major advances since 1906, and there is no technical reason we can’t build skyscrapers in LA, at least provided we’re not building it right on top of the damn fault. However, if you look around LA, you’ll notice that a lot of the new construction going in – say, NMS buildings in Santa Monica or the Italian series buildings downtown – tops out at, oh, I’ll guess 65’. Why? Well, get out your ASCE/SEI 7-05 and flip to Table 12.2-1…

Wait, you don’t have an ASCE/SEI 7-05?

It’s the standard design loads for buildings. Unfortunately, it’s copyrighted, so I can’t reproduce it here, but the point is this: for Seismic Design Categories E and F, the maximum height for a wood frame structure is 65’. If you’re in California, it’s almost certain you’re in E or F. If you want to go taller than 65’ you’re into special moment frames or eccentrically-braced steel frames or some other fancy structural system. This means that in LA there is a very real break point at 65’, about six or seven stories, above which there is a major non-linear jump in construction costs. Again, low-rise and mid-rise density allows for a variety of uses without breaking the bank.

None of this should be taken as being anti-skyscraper. I think skyscrapers present more significant architectural challenges than low-rise and mid-rise buildings because they present two problems that low-rise and mid-rise buildings do not: the potential for monotonous repetition of surface treatments in the middle, and the skyline view at the top. For a long time, these problems were solved by the International Style, which said that monotony and boxy tops were good things; now, they are being solved by Gehry-esque mind tricks. I’m not really a fan of either, though I do think that the early Art Deco and Neo-Gothic skyscrapers proved that these challenges can be addressed elegantly. But again, all of that is tastes. So, if a private developer thinks they build a profitable skyscraper in LA, I’m all for it!

The question we need to ask ourselves is this: what are our goals? What outcomes do we hope to achieve through things like Recode LA? Only then, goals in hand, can we proceed to determine what the best policies would be. My goals are as follows:

• Increase housing affordability so that people spend less of their income on housing and transportation. This is usually pitched as a problem of low-income people, but it’s increasingly applicable to the middle class.
• Make it easier and cheaper to do business, which together with the previous goal, would allow LA to resume its historic role as a place for people of all backgrounds to come and get another chance at life.
• Make efficient use of previous capital investments in infrastructure.
• Use the market to help reduce environmental impact.

When it comes to zoning, the best policy for achieving these goals would be allowing more low-rise and mid-rise development.

On the other hand, maybe you like the way Vancouver looks, and you want LA to be more like Vancouver. There’s nothing wrong with that, but if that is your goal, you need to understand that, and realize that other goals, like affordability and diversity of use, are going to take a back seat. But if you want to allow for density to increase quickly and cheaply, for different development models, and for greater diversity of use, you should learn to love LA!