Can Uber & Airbnb Lyft Urban Neighborhoods?

Helllooo PPPers, Detroiters, and those of you who were more excited about the Season Premiere of Game of Thrones than Hillary Clinton's announcement of her candidacy on the same day!

Next time I request a trial by combat, I'll just handle it myself.

Next time I request a trial by combat, I'll just handle it myself.

Executive Summary for busy PPPers

Municipalities should explore how the sharing economy could support economic development and improve the quality of life of its most challenged residents and neighborhoods. 

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The sharing economy is here to stay.  That's what happens when an industry was estimated to have $15 billion in global revenues in 2013 and is projected to have $335 billion in global revenues in 2025.  Hell, those numbers might be low -- Uber is projecting $10 billion in revenues by itself in 2015!  Whether it's Uber, Lyft or Sidecar for transportation, or Airbnb, VRBO or FlipKey for short-term lodging - the sharing economy is changing cities around the world. 

However, many municipalities and neighborhood residents are fighting against the spread of the sharing economy.   Airbnb and its competitors are being attacked as mostly illegal, a drain on the stock of affordable housing, and bad for housing markets around the world.   Residents are calling them disruptive to the fabric of neighborhoods.  Uber and its competitors are being hit with unfair competition lawsuits and charges of exploiting its drivers.  One Salon article argued that Uber must be stopped.  

I don't want to wade into the debate on whether the critics or the champions are right or wrong, but I do want to throw out another perspective:

Sharing economy companies could be leveraged to improve the quality of life of lower-income residents and revitalize neighborhoods.

Leverage Car-Sharing for Good. Through thoughtful public-private partnerships, vehicle-sharing companies could offer subsidized service to low-income seniors who need to get around town.  Through P5 Partnerships vehicle-sharing companies could also offer subsidized lower-cost ride shares to lower-income residents who can't afford a car but live in neighborhoods not adequately served by public transit or taxis.  As an example, construction workers who don't have a car but have to be at the construction site by 5am can't use public transit to get themselves to work.  Residents of certain urban or rural areas only have access to very poor public transit options.  A low-cost ride sharing option could bridge these gaps.

No one should have to walk 21 miles to work.  Image via Huffington Post & Detroit Free Press.

No one should have to walk 21 miles to work.  Image via Huffington Post & Detroit Free Press.

Make Short-Term Rentals Have Long-Term Upsides.  A report by the NY Attorney General alleges that short-term rentals are disproportionally centered outside of certain neighborhoods. 

Image Source:  Airbnb in the City/New York State Office of the Attorney General

Image Source:  Airbnb in the City/New York State Office of the Attorney General

Short-term rental companies could be incentivized to get more listings posted in urban neighborhoods, rural towns and other areas that could benefit from the additional vibrancy and activity brought by short-term renters.  Maybe these short-term renters would realize what they've been missing in these areas.  Some of them might consider moving there. Or over time the increased activity might give owners a market-based reason to improve their properties.  Or values might rise in those neighborhoods as people see real estate and investment opportunity in overlooked places. 

Conclusion.  I have no doubt that there are 100 issues to be resolved to make sure these potential sharing economy arrangements are equitable.  They must be structured to promote economic development and improve quality of life, not just company profits.   These deals won't be easy.  However, the potential upside is worth it.  Municipalities should explore how the sharing economy could support economic development and improve the quality of life of its most challenged residents and neighborhoods.

 

-- Calvin

 

 

 

 

 

 

Posted on April 12, 2015 and filed under Most Read.

3 Issues Transportation Plans Often Miss

Helloooo Detroiters, PPPers and those of you who didn’t know that Jared Leto cut his hair

jared leto hair.jpg
jared-leto-haircut.jpg

Just in case you're wondering, the Oscar-winning actor has never played Jesus in a movie.


Quick Summary for my busy PPPers:  A thoughtful transportation and mobility plan that takes into account:

  1. Economic Development
  2. Real Estate Market Economics
  3. Placemaking Issues, one of the Five Pillars of a Citywide Revitalization Strategy

Unfortunately, transportation plans often miss or ignore these three issues. There are some exceptions - there are DOTs, planning firms and A&E firms out there who are including these issues in their analysis and plans.  Transportation decisionmakers should request that these three issues be analyzed upfront to gain new stakeholders, obtain critical information that will better their decisionmaking, and help secure public/private funding or approvals for their projects.  Assessing and addressing these issues will not only improve the quality of our transportation plans, but it will also improve the quality of life in our cities.

3 Issues Transportation Plans Often Miss

3 Issues Transportation Plans Often Miss


Full Blog Post:

I am not a transportation planner.  I don’t even play one on Netflix (See what I did there?).  But I do see a startling trend when I look at neighborhood level, citywide or regional transportation plans:  They often don't assess the economic development, real estate market, and placemaking ramifications of their transportation planning decisions.  More often than not, these three issues are missed or ignored. 

This is how transportation plans usually deal with economic development & real estate issues.

This is how transportation plans usually deal with economic development & real estate issues.

Why do most transportation plans usually ignore these issues?

  1. Many DOTs don't consider economic development and real estate market issues as part of their purview, so they don't request that analysis from the staff or firms they hire;
  2. The engineering firms hired to create transportation plans usually: a) Don't have staff members who are expert in these issues b) Don't put on their team a firm that does that work and/or c) Don't recognize that these are issues that should be analyzed and integrated into the transit plan;
  3. Decisionmakers haven't read this blog post yet.  ;-)

There are some enlightened players out there.  There are some DOTs (e.g. DC's DOTAtlanta's MARTA & theJacksonville Transit Authority), planning firms (ASGGensler and Nelson/Nygaard (Hi Karina!) come to mind) and A&E firms (HDRHNTB and RS&H get shoutouts here) which are including these issues in their analysis and plans.  This list is not exhaustive -- there are others who get it too. Let me know in the comments who YOU think gets it.  

It takes some guts to be a DOT or city planning department talking about economic and real estate development issues when developing a transportation plan.  It requires some cojones for a planning firm or A&E firm to talk about economic development or placemaking when competing for a transportation planning project. I applaud the organizations who are doing it and spreading the gospel. 

THOU SHALL consider the effects on neighborhood redevelopment! WE MUST understand the implications to businesses on our commercial corridors!  I DO DECLARE affordable housing impacts are important!!

THOU SHALL consider the effects on neighborhood redevelopment! WE MUST understand the implications to businesses on our commercial corridors!  I DO DECLARE affordable housing impacts are important!!

Why should transportation decisionmakers care about Economic Development, Real Estate Market & Placemaking Issues?

  1. Your plans could gain key stakeholders and champions by addressing these issues.
  2. You may obtain information that changes your transportation decisions for the better. 
  3. You might Find Money Under the Mattress.

  1. Your plans could gain key stakeholders and champions by addressing these issues.  These are stakeholders that vote, attend community meetings and call their local elected officials.  These issues are the type of kitchen table issues that people come out to fight for or against!  If transportation plans did a better job of assessing and addressing neighborhood placemaking, economic development and real estate challenges and opportunities, decisionmakers might find themselves with new stakeholders who are championing their projects, rather than, ahem, derailing them.   Have all the stakeholders you need?  Times change quickly my friend.  Ask DC streetcar proponents with a partially-built line who are losing critical political support, and the streetcar proponents in Alexandria, Virginia who lost their entire project, whether you can ever have a diverse and broad enough set of stakeholders and champions for important transportation projects.

    Real Estate Market Economics - Not Just Finance! A second shout-out goes out to my friend Karina for reminding me to clarify this point.  There are many DOTs, planning and A&E firms that include on their transportation planning teams a firm that analyzes how to finance the construction and operation of transportation systems.   That finance related work is not what's missing from these plans.  What I'm referring to as missing is an analysis of the real estate market and real estate development implications of a transit system - not how it pays for itself.  As I mention below, these two points (how you finance the new transit and the transit's effect on the real estate market) can intersect, since value capture and tax assessment strategies can unlock new funding options for the system!
     
  2. You may obtain information that changes your transportation decisions for the better.  What if it turned out that the economic and fiscal impact of a transportation decision could be increased if changes were made?  What if more affordable housing could be subsidized through additional development if the new line went down that block rather than that block?  What if a struggling commercial corridor could be brought to life if a new bus or streetcar stop were put on one corner rather than another? What if putting a new rapid bus, streetcar line or major bike lane on one street would only minimally increase the transportation headways (time between arriving vehicles) but double the economic benefit to a neighborhood?  If there are potential upsides, why wouldn't you analyze these issues upfront?

    Sometimes we learn what transportation-related economic development mistakes we've made only because of nature:  It took the 7.1 magnitude Loma Prieta earthquake in 1989 to sufficiently damage the dreadful, double-decker Embarcadero Freeway to give decisionmakers the guts to tear it down and replace it with grand boulevards and great open spaces.  The quality of life, economic development and real estate benefits of tearing down the freeway cannot be denied.
Before and after. From Flicker user Vision 63, via the Seattle Transit Blog.

Before and after. From Flicker user Vision 63, via the Seattle Transit Blog.

3. You might Find Money Under the Mattress.  No one ever has enough money to build the transportation project they want right?  The most innovative projects in recent years leverage value capture, tax assessment districts, and public private partnerships for funding.   The property owners and private sector actors who participate in these structures are often focused on the real estate development and placemaking ramifications of the transit decisions.  Transportation plans should assess these issues upfront to build the case for future stakeholders who hold the key to these funding sources!

Conclusion.  A thoughtful transportation and mobility plan that takes into account economic development, real estate market and placemaking issues is one of the Five Pillars of a Citywide Revitalization Strategy.   Transportation decisionmakers, contractors and stakeholders must demand that these issues be analyzed and addressed when transportation plans are being developed.  Not only will that work improve the quality of those plans, it will improve the quality of life in those cities.

--Calvin  

P.S. If you want to hear how the preacher might sound in real life click HERE.

Posted on March 7, 2015 .