Excessive sprawl is not a result of pure free market activity. The 'burbs are heavily subsidized, legally encouraged, and heavily regulated. My personal hypothesis is that the 'burbs served (intentionally or not) as a massive post-WWII work project to employ vast numbers of people in construction and real estate.
(Not necessarily a free market fundamentalist ideologue, but this is one thing you can't blame on them.)
I do agree with the article to a point though. America certainly has a nostalgic preoccupation with agrarian and rural life that has been used to sell the faux-ruralism pastiche of suburbia. It's a contributing factor in that it makes these ridiculous wastelands marketable.
Are people moving to cities because fuel and automobiles are more expensive compared to stagnant incomes? In some cases. It probably also helps that people value their time more (commute time/distance to services and social venues) and that there are more opportunities for work in cities than suburban and rural areas.
I am curious to see what happens with remote work; I see a big push happening right now, at least in the tech sector. Not everything can be done remotely, but if the advantages are truly great enough, companies will compete against each other to hire quality remote workers (who can live anywhere its convenient for them).
The primary factor is concentration of capital: it is exponentially easier to raise money in the Bay. The second is concentration of talent and peers -- early customers, beta testers, development partners.
The Internet was supposed to make place less relevant, but as far as I can tell it's had a paradoxically opposite effect. When I was younger, I didn't have such a strong sense that you must be in one of maybe ten urban areas (but preferably SF) to do anything. Today it feels a bit like things happen in one of maybe ten cities, and everywhere else doesn't exist. Americans have always joked about the "flyover country," but I've distinctly noticed a massive increase in this effect since circa 2000.
SF, Seattle, NYC, DC, Boston, etc., are still the major magnets, but "hip" urban living isn't as confined to the coasts as it used to be IMO.
Some industries are very centralized in one city - tech in the bay area, finance in NYC, entertainment in LA, etc.
It's frankly pathetic that the so-called "biggest innovators" and people who "get the internet" feel the need to be constrained in an already crowded city.
Face to face communication is important, but there are tools to help with day to day communication
The Linux world knows much better how to deal with this then your average "Web 2.0" company
http://www.amazon.com/gp/product/B0078XGJXO/ref=as_li_tl?ie=...
I have never thought [citation required] was more necessary than with this comment.
We're technology professionals or enthusiasts primarily here.
Y Combinator also donates to efficient non-profits in the tech space, no strings attached. That's not traditionally capitalistic.
That's exactly what I mean as well. I'm a socialist looking to replace jobs with cheap renewable energy, software, and robotics automation. Definitely not a capitalist. To each their own.
The 1960s are over. Nobody cares about your crappy office tower in the middle of nowhere. The ones that did are retired.
> Nobody cares about having a 'big shiny building'
Suburban office parks may have a lot of issues but it's where you can have lots of space for cheap (and sometimes you need this)
The entire social structure that produced these towers, a well-paid, conservative, culturally unambitious middle class, is imploding.
Now you have Millenials who value living and working closer to interesting coffee shops, restaurants, clubs, and bars than living in Nowhereville which has a Denny's, a Subway and a Dunkin Donuts as the only options. Plus they're so deep in student debt that buying a suburban house or leasing a car is not an option. They're stuck living in a cheap apartment that's typically in an urban area and living a more thrifty lifestyle. What little money they have goes towards entertainment and social activities.
I'd rather work in a condemned office in the right location than some suburban hellhole where I had to drive a minimum of a half hour to and from work. At least the office in the right location could be renovated and spruced up. The suburban office will always be in the wrong spot.
This is only possible for "knowledge workers".
- You can't do this, for example, if you're a doctor/nurse
- You can't do this if your job has a high level of secrecy required (that is, no peering eyes)
- You can't do that if you require special equipment to do your job (think lab or shop). You can't take your big screen Mac with your fancy Wacom tablet there as well
Also most work requires a collaboration level that's still not supported by infrastructure. It is possible but the companies haven't adapted
Not to mention, remote work gets old. Quickly
What's left? The sorts of jobs where a personal office is a luxury that few companies are willing to pay for. You get a desk, at best, and a laptop.
Still, as difficult as it is to purchase office space in some markets, it's not impossible. You just need to make do with less. No on-site parking, no gigantic health-club facility or cafeteria.
It's cyclical. One day (sooner than you think)those millennials are going to be 30, with families and they won't care nearly so much about clubs and bars. They're going to start wanting to grow gardens and have a safe place for their children to play.
Plus they're so deep in student debt that buying a suburban house or leasing a car is not an option.
I guess that it's just a function of the local real estate market but my suburban mortgage payment is lower than the urban rent that one would pay in any decent part of this town.
The suburban office will always be in the wrong spot.
Don't be so sure about that. One day, you're not going to be the hip youngster anymore. One day, sooner than you think, you're going to be annoyed by the stupid nonsense that the kids of the day are doing. One day, you'll have a lot more fun in your house than out on the town.
If you were gonna throw out a spitball estimate for the 3 numbers:
1) Tax impact in city vs burbs
2) Cost of land / lease in city vs burbs
3) Company payroll/benefits
What would you guess the ratio of #1 to #2 + #3 is?
So as a business manager you ask: what do we lose by exiting this tax jurisdiction and what do we gain? And most importantly, what's the ROI? If my margins are tiny (say, most retail and restaurants) then saving 2% of my budget per year on taxes can mean the difference between a 4% and 6% ROI if the other factors remain equal.
That may sound like a small difference but it is not: it is as large as the spread between equities and bonds at most points in time (so if I'm only going to make 4% why be in business at all?) Why not just fire all my employees, use my budget to buy Walmart corp bonds, get 4%/year, and not have any management headaches or employer liabilities?
As economists say, most decisions are made "on the margin"; so the total amount that goes into tax is not as relevant as how much can be gained or lost by shaving off tax liability vs other kinds of costs.
I live in Minnesota and United Health Care has done both. they've bought newer buildings that were vacated and just built a huge (72 acres) campus on the outskirts of the city: http://www.bizjournals.com/twincities/print-edition/2011/09/...
Cargill several years ago built a huge new campus at an abandoned Super Value production plant:
http://www.opus-group.com/OurWork/Excelsior-Crossings
Also, I've seen older 1970's corporate buildings demolished and there's an area in a nearby suburb where they're trying to rejuvenate the area where nearly all the buildings are empty with a $500 million project plan:
Demolition: http://hillcrestdevelopment.com/pentagon-park-south-tower-de...
Renovation of area buildings: http://hillcrestdevelopment.com/renovation/pentagon-park/
Redevelopment Plan: http://www.startribune.com/edina-aims-at-a-signature-project...
With respect to the particular building mentioned in the article, it is hardly surprising at all that the NIH is contracting its footprint given recent funding history.
Edit: As mentioned by another commenter, it turns out the NIH didn't move things downtown. Instead, it's just opened a brand new campus that's even further away.
And anyway, Montgomery County, MD, is an unusual case. There was a lot of speculative building going on there due to rumors that the city of DC was going to put in a subway line through the country (going back to 2003). That dream has evaporated, with current estimates putting the project out to 2030 and later, so you have a lot of speculators left holding the bag.