TheNiche

I think what I am most alarmed by is converting current free roads into toll roads, as Rick Perry and company propose for the TTC, a deal which would funnel profit into private companies for a road that was formerly free.

To be clear, the TTC involved having private companies build new toll roads from scratch, not the tolling of existing roads.

We built the road, we insured the bonds, and now they get to skate in and profit. Its absurd.

Actually, TXDoT operates on a pay-as-you-go requirement. Counties, municipalities, and special districts issue and guarantee bonds, the federal government can issue treasuries, but TXDoT pays with cash.

It would be nice if every tolled highway built would have a strong law attached to it so that the tolls are removed after the road has paid for itself.

I only know of this ever happening once -- I-95 in Connecticut used to be the Connecticut Turnpike. In the 90's (IIRC) the tolls were removed because the road paid for itself. Never seen that since.

Well then there's the other nice thing about toll roads, which is the prospect of congestion pricing as a means to efficiently ration capacity to the users with the highest economic need.

I agree that governmental accountability is important, but it's also important to realize that it's OK for certain portions of the government to subsidize other portions that are less profitable. Like the way Microsoft used Windows and Office revenue for years to prop up the Xbox (and might still, for all I know).

Well yeah, definitely. That happens all the time it's all accounted for above the "bottom line" and feeds into the "bottom line". What I'm saying, though, is that seeing as how government financials read somewhat more like cash flow statements than private-sector income statements, red ink at the "bottom line" can have an immediate and devastating effect on cash reserves. We have to be mindful that funds have to come from somewhere, whether from operating revenue, from taxes, from bonds, or from outside agencies. Otherwise our credit rating tanks and payroll checks start bouncing. Nobody wants to see that happen.

And that's why Mayor Parker's comments about METRO not minding the "bottom line" so much raised an eyebrow. She should know better.

That said, there are many ways for the private sector to fill portions of the transit gap. For example, many of the larger office towers in Chicago operate their own (really nice) bus service to ferry people between their buildings and the train stations. It's one of the ways the better buildings seek to differentiate themselves from each other. There's no reason the JPMorgan Chase Tower in Houston couldn't operate a shuttle bus service out to a park-and-ride or two. Or even a bunch of neighboring buildings could do it in Houston, like all the Allen Center buildings.

Forgive my ignorance if this is already going on. I didn't see it in the time I lived in Houston.

That's not a bad idea. There's even the political infrastructure for that to be done in most of the major business districts around Houston, by way of Management Districts that levy a tax within their jurisdiction that is separate and independent of that from the City or from METRO.

This is an interesting discussion itself. Many people argue for regionalism in transit. I think that there's a place for that in certain kinds of transit infrastructure, but I also think that there's a place for neighborhood-level transit in certain places (and most definitely not others) for which the burden ought to be borne by those who benefit from it. The Woodlands Express is a prime example.

The Eastwood Civic Assn. along with the two Super Neighborhoods that serve our area sent a mass email to residents asking that we make our wishes known to all the city and county officials. The aim is to convince the powers that we prefer the stadium over the jail.

The interesting part is, according to the email, that Ms. Garcia said she was unaware that residents actually supported the stadium. Additionally, Ms. Garcia was UNAWARE of any plans for a jail or inmate processing facility "at least in terms of a county facility". Garcia also said the City had not contacted the County about the stadium since the new administration took office.

Where did all of these rumors about a new jail facility come from? It's not the first time I've heard them, but placing a jail facility so far from the courthouse complex just seems...dumb.

And I believe her when Garcia says that she hasn't seen any evidence that the Eastwood Civic Assn. or the Super Neighborhoods support the stadium, but it sounds like somebody is stoking rumors of a jail just to freak these people out so that they'll actively embrace the Dynamo. I know it's a conspiracy theory, but this stuff just doesn't add up.

Nobody expect freeways to make money, but we keep building them.

Actually, once the Crosby Freeway is finally completed, it'll probably be the last un-tolled freeway ever built in the Houston area. And toll roads are designed, built, and operated with the expressed intent of being 100% paid-for by users. There has even been significant private-sector interest in purchasing and operating them.

I like that she's recognizing it doesn't have to be about the bottom line. ... We shouldn't expect public transit to operate in the black, either.

Bear in mind that operating profit (or loss) is different from the "bottom line". The bottom line in governmental accounting is really damned important.

http://www.chron.com/disp/story.mpl/metropolitan/6856178.html

...

“I've been concerned that Metro has been drawing the line in the wrong place,” Parker said. “They're too concerned with the bottom line and not concerned enough that their job is to provide transit to people who really don't have any other option.”

Metro says its operating ratio — the share of its costs covered by fare collections — has increased from 17 percent in 2005 to an estimated 21 percent this year, still well below the national average of 33 percent.

Eliminating fares, of course, would make cost-benefit analysis meaningless, since every route would be fully subsidized. But allowing passengers to ride for free might attract enough riders to reduce congestion for drivers and produce other benefits, Parker said.

“I don't really care so much what they collect at the fare box,” the mayor said. “I'm not going to tell them to do this, but I am personally interested in exploring — unless we're leveraging those dollars in some ways for other kinds of matches — dropping the fares to get more people on board.”

...

Wow, for a policy wonk and former comptroller, I wasn't anticipating some of this stuff. Statements to the effect that a transit agency in the midst of financial turmoil ought to be less concerned with their bottom line (pretty much under any circumstances or in the context of any other statements) are dangerous ones.

If METRO reduces or eliminates its fares, then in order to maintain balanced books, it will have to reduce costs by a matching amount if outside matching funding proves elusive...which it probably will be, given that the City is itself not on fiscal terra firma. On the one hand, the elimination of fares (which would overcome a psychological barrier to transit use) paired with a reduction of service could be cause for fewer seats to be empty, meaning that asset utilization would be dramatically increased. Efficiency is good. (And yes, Mike Snyder, we CAN do cost-benefit analysis even without fares. ) On the other hand, if METRO is expected to maintain or expand services to poor neighborhoods as Mayor Parker has stated should be its focus, then it will have to sap resources away from more well-off neighborhoods to accomplish that. And that may also create a systematic long-term PR problem, as well, if Mayor Parker's philosophy about the bus system being a feeder for light rail coupled with her views about transit being primarily a means of moving poor people culminates with light rail getting a reputation as being transit for the poor. On-vehicle vagrancy could also contribute to that problem, particularly during bouts of inclement weather. There'd definitely be some kinks to iron out, here.

To her credit, I'm glad to see that Mayor Parker recognizes that the FTA rules may not be accommodating to the idea of transit without fares. However, the FTA's primary concerns have always seemed to be gross costs and ridership, project-by-project. Eliminating fares system-wide could possibly induce such significant ridership as to move us toward the front of the line for federal matching funds. But of course, there's a lot more to it than just that, so her caution is justified.

One could read every word of your narrative, and agree with it, and still reasonably make the statement that Dallas's CBD vacancy rate is "pretty bad". Because, let's face it, Dallas CBD's vacancy rate is, by any rational analysis, pretty bad... and has been for, oh, about 25-30 years.

Well yeah, but primarily because Uptown had perennially sucked the life out of it during the boom years. Downtown and Uptown Dallas are in direct competition for the same tenants and ought to be considered the same submarket for purposes of comparison with other CBDs, including Houston.

Lots of people like baked beans.

You wouldn't know it, to watch the Super Bowl...which sucks because that could've been a very memorable advertising opportunity for Heinz.

I suppose I should be grateful for their commercial successes. Otherwise, practically nobody would know about the good music. Seems to work that way for a lot of artists.

Having said that, I wouldn't be sad to see them retire. They are too old to preserve the memory, IMHO.

Show respect for The Who. People used to die (literally) to see them. Townshend created great music.

Yes, none of which was played tonight. The Who Sold Out.

...

( -- Nobody's going to get that but you and I, probably.)

Who was performing for half-time?

A crusty 70s band that went out of style years ago?

Nope, they were from the 60's. And they crappily performed their Clear-Channel-approved "hits".

Here they are from before the incontinence. Note Keith Moon and Pete Townshend's cam-toe.

Dallas vacancy rates within earshot of Detroit's... pretty bad.

You didn't read the narrative either.

Fort Worth could handle another office tower.

Downtown Fort Worth is a relatively stable submarket, but it is small (about a quarter the size of downtown Houston) and its prospects for growth are weak. I'd say that one or two new mid-rise office buildings over the next decade is plausible, however a new speculative building even the size of Houston's MainPlace would about double the vacancy rate and require achievable rents that are significantly higher than market conditions allow. So a skyscraper in Fort Worth is not plausible.

Of course, if you'd read the narrative, then you'd know better than to try jumping to such conclusions based on evidence that I had already established as superficial.

Pock-mark is the operative word here. If homogeneity is a pimple inside 610, it's a rash at best or small-pox at worst outside the beltway and farther beyond 6/1960. Most housing stock built after a certain time period lacks (for lack of a better word) character. I'd put that time period around the mid-70s to mid-80s, though perhaps you can pinpoint a date with far greater accuracy than I. Not coincidentally, that's also about the same time suburbs went from being inspired by the Levittown model with higher density and gridded streets to the master planned communities a la Friendswood or the Woodlands. Examples of the Levittown model in Houston are in great abundance here and easily include areas like Bellaire and Sharpstown, and frankly, I have no problems with that type of 'burb. I recognize the architecture doesn't break any new ground in those 'burbs either, but there's at least the pretension of distinctiveness that the cookie-cutter homes in Copperfield cannot come close to replicating. For all the design improvements in the newer type 'burbs, when your next door neighbor's house is an exact replica of your own, prehaps with a different color coat of paint but identical nonetheless, homogeneity reigns. And it sucks.

West U, Bellaire, Rice Military, and significant portions of Montrose can now be characterized as I did earlier. Perhaps "pock-marked" wasn't the right word. Parts of the inner loop have been so completely transformed that "localized rash" might be applicable. West U, in particular, would be unrecognizable to someone who lived there even 15 years ago. And anywhere that there's been a reasonably large tract, homogeneity has run amok (horrifying case in point, the old Markle Steel site).

As for homogeneity of the ages, I'd submit to you that whenever at any point in our history there's been a compelling reason to build new housing for people of few means, poorly-built homogeneity reins supreme. Only, you don't see much evidence of that before WW2 because so much has already been knocked down; we mostly just see evidence of the former upper-middle and upper classes and are thereby led to believe that they had better taste back then. Then you get into post-war structures, and I'd have to say that the worst offenders are the Levitown-like subdivisions. That was an era where poorly-built homogeneity was taken to a whole new level; there was now mass production, they started building on slabs that are all too often un-reinforced, they started to frame out houses with yellow pine instead of hardwoods, and building codes hadn't yet caught up. By the late 1960's, population growth rates were starting to decline and most cities were large enough that an influx of poor people merely took the older subdivisions and the middle- or upper-classes took on the mantle of buyers of new homes. This was the beginning of white flight. Higher interest rates persisted for a good long while, too, so that was part of the calculus. Once again, most of the new for-sale housing stock from an era reflected the buying power of people with means (and to the extent that it did not, witness the vast cluster of forgettable condos near the Astrodome). Mass production stayed with us though, because urban populations were large enough to support it; and that'll never go away for as long as a reasonably large tract can be developed, pretty much anywhere in or out of the city. Then, in the mid- and late-1990's as interest rates continued to decline and the political and regulatory environment shifted towards being friendly to home buyers, people of few means once again were able to buy crappy new homes. It started as a trickle, and ended with...Copperfield. I wish that I could say that we won't witness that again any time soon, but I don't think that anybody in politics is serious about de-incentivizing the purchase of crappy houses.

But the one common thread in all of this historical context is that housing built for poor people sucks. It always has. When you get right down to it, the lack of mass production, the postage-stamp-sized lots, and the existence of street grids makes Eastwood comparable to the new West U in many respects. Each neighborhood was built (or re-built, respectively) over a matter of decades, each features mostly custom homes that are exemplary of only a handful of different styles, and Eastwood has deed restrictions to keep out businesses while West U has zoning. They're the same neighborhoods from different eras.

And bear in mind that Eastwood was the first "master planned community". Although the limited size of the market precluded a development at the scale of The Woodlands, that was the idea behind it. I'd think it fair to say that Eastwood is to The Woodlands as Magnolia Park is to Copperfield. And The Woodlands and Copperfield have very little in common beyond that they happen to have been developed during the same period of time.

So I guess that would mean, Houston and New York will be the first to see many new building going up?

NO! Read the narrative that accompanied the stats.

don't you think it makes the most sense for people who post on a board ostensibly devoted to architecture in Houston that there'd be a bias against homogenized and poorly built houses flung far from the city?

As opposed to what, the homogenized and poorly built stylistically-derivative multifamily buildings or the enclaves of McMansions built from off-the-shelf prints that pock-mark the inner city?

It's pretty much never about architecture for the haters on this forum. My observations are that it's about history (which is actually kind of absurd in many instances because old architecture is so frequently mistaken as a proxy for good architecture), it's about environmentalism and the notion that others should feel compelled to live near where they work (which is also kind of absurd in a city where the majority of the jobs are beyond the areas commonly thought of as "urban"), and it's about mostly-young relatively well-educated tech-savvy people without children hating on lifestyles that they haven't (and aren't expected to have) given serious contemplation towards yet. And sometimes we see subcultural influences come up, where a person can't be secure in their identity as a member of a group (or their identity as an individual in the context of various types of other individuals) if they don't live in a place that the group and/or type of other person defines as being acceptable...even if that results in a hardship to them.

Maybe it just seems that way, but when will it be Houston's turn to develop like its no tomorrow like all the other cities did in the past few years and Houston sat pretty much dormant? It was just about to happen right before the bust. Just Houston's luck!

We already had our turn. Be thankful that the investment bankers practiced more restraint with this commodity price bubble than they had in the past. I don't think that there were any significant buildings started downtown between about 1984 and the mid or late 90's, and that's not something we should be gunning to repeat.

So do you have any idea how say a New York or a Chicago are doing compared to Houston, i.e are they looking at any significant new skyscraper construction?

Some comparative office stats from Grubb & Ellis are provided below. But be careful about reading too much into these snapshot indicators, especially as they pertain to the likelihood of new construction. Each city has unique factors affecting it, especially with respect to their economy, geographic barriers to entry as reflected in the land prices, political barriers to entry, property tax and corporate income tax rates, unionization rates within the construction trades, exposure to the credit crisis, and submarket desirability. Additionally, these data only indicate asking rents, not actual effective rents that take negotiated concessions into account.

Dallas is a good case in point. Downtown Dallas has nearly as much vacancy as downtown Detroit and lower rental rates to boot. I don't know of any developer that'd be interested in starting a project there even if financing were available. However, just opposite a freeway from downtown is an office submarket with buildings that are still under construction, where vacancy is 14.2%/16.6% and rents for Class A space are $32.03 psf. That's not horrible (like Atlanta), but it doesn't reflect in the CBD stats.

Chicago is another good case in point. On the surface of things, it looks slightly distressed but still has relatively high rents. It looks like they ought to still be able to cope with things. But in truth, the prevalence of "zombie buildings" is distressing the whole market, and the impact to investors has yet to be fully reflected in a snapshot of market data.

New York is probably the best case in point that there ever was. Out of every city on this list, rents there are the highest and vacancy is the lowest. But .and is expensive, the bureaucracy is tough, union labor is expensive and entrenched in practically every construction and property management function, and taxes are utterly ridiculous. There was a time in the not-so-distant past that that didn't matter. Class A rents used to average about $90 psf, concessions used to be unavailable, and vacancy used to be <4%. So stuff got built--sometimes--and even then, only eventually. But in the context of where it had been, NYC has suffered more than any other city, and with current owners unable to refinance, there will be a tremendous glut of inexpensive office buildings available to any of the investors left standing for many years to come. Why build when you can buy something relatively new for bottom dollar? Aside from one project in Midtown Manhattan, the only still-active construction is related to the WTC redevelopment, and that was only made possible on account of insurance proceeds and an insane amount of state and municipal leasing of space within those symbolic buildings.

Detroit is by far the worst out of any city, but at least the decline there was steady and predictable. Real estate prices are crazy low, but should be more stable going forward. NYC's toughest days are ahead of it. And as for Houston, we may be hanging on...barely...but aside from that vacancy is increasing and that effective rents are coming down, aside from that commercial foreclosures have begun to become problematic, aside from that debt financing remains elusive, we (in particular) are fraught with political risk. Energy and environmental policy could still whoop our ass even if the rest of the economy begins to recover in earnest.

City, Submarket - Direct Vacancy - Aggregate Vacancy - Class A Asking Rent

Houston, CBD - 10.7% - 11.9% - $35.75

Dallas, CBD - 24.9% - 26.4% - $21.95

Ft. Worth, CBD - 8.7% - 9.1% - $27.98

San Antonio, CBD - 11.3% - 18.3% - $21.69

Atlanta, CBD - 19.2% - 22.2% - $21.13

Miami, CBD - 12.4% - 14.8% - $43.16

Chicago, CBD - 14.2% - 16.7% - $38.62

Detroit, CBD - 29.3% - 29.6% - $23.37

Washington DC - 11.3% - 13.1% - $54.69

Los Angeles, CBD - 12.9% - 14.1% - $38.52

San Francisco, Financial District - 12.2% - 14.0% = $32.90

Seattle, CBD - 17.6% - 18.9% - $32.90

New York, Manhattan - 7.0% - 9.4% - $65.47

our society often considers "25th anniversary" to be worthy of some formal acknowledgment.

Bear in mind, those that felt the tragedy most acutely were engineers. And, perhaps because they are familiar with number theory and as a group are notoriously skeptical of most things--including numerology--engineers cannot be counted as members of any society that places particular importance on the number 25.

I wonder how that compares with other top 5 U.S. cities

I would expect pretty favorably. We're only a relative newcomer to this recession. Most other cities have been slogging through it for years now.

  Reading yesterday's Alison Cook column about the Reading Terminal Market made me think this is something very doable for Houston and could be a great attraction if done right and in the right location.  I have never personally been to Philadelphia’s Reading Market but I have been to Pike’s Place Market in Seattle which appears to very similar. A market here combining Gulf Coast seafood and our abundant Tex-Mex influences I think would be a big hit. 

Why can't Houston have a Reading Terminal Market?

From Cook's article:

"It occurred to me that half the fun was getting mustard all over me and trying to balance my coffee cup on the nooks and crannies of various stalls."

A likely-stained shirt or pants along with a risk of being drenched with my own scalding hot coffee...neither of these things sound very fun to me, so I can only possibly conclude that the other 50% must be equally underwhelming.

There aren't very many cities that have larger downtown office markets than Houston, but Philly is one of them. Their downtown area is also genuinely mixed-use, measured in neighborhoods rather than a handful of residential buildings. It's also an old city, and old cities by nature of their pre-automotive legacy are typically tourist-friendly by their very nature. A place like this Reading Terminal Market fits with the context of that environment.

We are not that city, and we shouldn't pretend to don its vestiges.

But perhaps more importantly, we're the city that eats prairie and poops restaurants (credit to memebag for that phrase). Having everything under one roof in Houston is for the unadventurous. SCREW THAT. If either a tourist or a resident isn't willing to drive a lot and go out of their comfort zone to experience our city then all they're going to get out of it is a very small slice of it, mostly contrived and boring. And there's absolutely nothing unauthentic we can do to change that.

Don't get me wrong. We can improve downtown and it's cultural offerings, just not by offering up an imitative and derivative urban form. We should instead do what makes sense for us, given our climate, our neighborhoods, and our local culture. The downtown tunnels are a good example of that. It's not that the idea of tunnels are unique to our city, just that they make the most sense here, so we've taken them to a much further extent. We should promote them and make them more tourist-friendly.

We should also promote places such as the Bellaire corridor and make tourists slog down it to select from one of dozens of anonymous little Asiatic holes-in-the-wall if they want to experience Houston's culture. That kind of experience cannot be transplanted to a glorified food court. Dare I say...you'd miss out on 'half the fun.'

KBR's news certainly helps downtown.

We still haven't heard anything about Devon Energy's plans... I am thinking that if they don't move into Main Place then we're likely to hear something about 5 Allen Center again (the proposed 50 story tower).

Class A space in downtown is still healthy. Maybe not healthy enough for a spec tower, but tight enough for a highly pre-leased tower to rise.

The downtown sublease space competes directly with the direct lease space, however is excluded from most market data. So that's part of what makes it look like it's still OK. Vacancy is a lagging indicator, direct-lease vacancy even more so.

He's been to Atlanta, so he probably knows what 3rd world looks like.

oh snap!

So in your opinion do you think we'll be out of this recession by then?

And i mean in terms of how weve been hearing so much of "oh X project was put on hold because of the economy" or "The pavilions isnt fully leased out because of the economy" or "No one is lending money because of the credit crunch", financial crises, etc etc...

Recessions are only defined by the length of time during which the economy is contracting, so yes, I think that this one already is or will be over. But that only means that we're at the lowest point. It isn't enough that the recession is over; what matters is that that we have recovered to the extent that rental rates and vacancy rates are once again adequate to justify the relatively high cost of new construction. Also, whether or not there will be another separate 'double-dip' recession in the near term is up for debate, and I think that it's possible if not likely. So that'd be the first problem is that the fundamentals are weak.

The second problem is that the terms available for debt financing are not nearly as friendly and show few signs of getting better for as long as the commercial foreclosure situation remains bleak. ...and believe me, the worst is yet to come on that front. If there's any one thing that could trigger a second financial crisis leading us into a 'double-dip' recession, it's the projected rate of commercial real estate foreclosures. Even if we avoid a financial crisis, commercial real estate transaction values are going to be suppressed by foreclosures for years to come.

And that, combined with poor fundamentals, still-high hard costs, and expensive debt...well, it makes for a bleak outlook. And that sucks for me, because I used to be the guy that worked through all of these issues and got big projects to pencil out as profitable. Short of switching over to appraisal (which is kind of a dead end), my career is over.

Just sayin'.

And I'm just sayin' that the term "skyscraper" is used in McAllen to describe a pathetic and lonely 17-story building. And according to your dictionary post, that'd be correct.

For downtown Houston, though, maybe 40 stories isn't enough to be considered "relatively tall".

On the serious side, clean up the freeways. Especially 45 and 59 north coming in from Intercontinental. First impressions for people coming to our city are not good and probably a little scary.  Take down the billboards, build walls or some type of screens for dilapidated areas and add more trees.  Don't know what, if anything,  can be done for people coming into Hobby short of nuking the whole southeast side of town.  

Deport all our resident neat freaks to Dallas.

For this thread, lets say 40+ stories, and lets say in downtown proper.

I think four years is a good minimum number, but that's being optimistic.

Absolutely. Just do the paperwork, etc. and there's another chunk o' Houston. Not quite that simple, but if the CoH wants to annex, there's not much that can be done. I think the best thing Houston can do in general is maintain the right to veto incorporations within Harris County to preserve teh ability to annex in the future. Houston has to avoid ending up like Dallas, where the city can't grow because of the inforporated communities that surround it.

Aside from The Woodlands, I don't think that there's too much concern about new municipalities being formed in the ETJ. They'd have to amalgamate many different MUDs under one umbrella, but the burden of MUD bonds would be absorbed unevenly by a new municipality. And that'd create a lot of tension.

What is more likely is that even now we are witnessing the rise of the Management District as a replacement for municipal annexations of residential areas. Management Districts have the authority to tax and can be tasked with essentially any of the services typically provided for by a municipality. They can be responsible for utilities, services, or both. They can even overlap with MUDs or municipalities.