Atlanta Housing completing demolition and redevelopment

Last week the NYT noted that the Atlanta Housing Authority was nearly done demolishing its 32 largest communities totaling nearly 15,000 units.

The article presents a quick summary of pro and con positions and mentions a series of articles from Creative Loafing Atlanta, an alternative weekly that has provided more detail on Atlanta’s particular efforts.

Writes the Times:

The elimination of housing projects does not mean the abandonment of public housing. The Atlanta Housing Authority pays for more residents’ housing these days than it did in the 1990s. But they are scattered throughout the city in mixed-income communities and private housing financed with vouchers through the government’s Section 8 program.

Still, critics of the demolitions worry about the toll on residents, who must qualify for vouchers, struggle to find affordable housing and often move to only slightly less impoverished neighborhoods. Especially in a troubled economy, civil rights groups say, uprooting can lead to homelessness if more low-income housing is not made available. Lawsuits have been filed in many other cities, generally without success, that claim that similar relocations violate residents’ civil rights and resegregate the poor.

As always, David Smith, in “End of an Error, Pt. 1″ has both the background on Atlanta and places the demolition in context. In his introductory entry (David’s thoughts ran to 3 parts) he divides housing assistance between place-based (build it and they’ll come) and people-based (pay them and they’ll go).

Atlanta has clearly made the choice to reduce the concentration of poverty by largely eliminating the ownership of housing by the AHA and providing residents with vouchers to assist them in acquiring the housing on their own.

Mentioned in the article is research conducted by Thomas Boston, professor of economics at Georgia Tech. Boston is the author of a case study of mixed-income revitalization in Atlanta. The study (link above to the working paper), was peer reviewed for the Journal of the American Planning Association and studied 2,700 families (1,200 that relocated and 1,400 that did not) from Atlanta public housing communities during a 7 year period and found:

Families who moved from public housing projects to vouchers were 1.5 times more likely to be employed in the long term than were those who remained in projects. Families who moved to mixed-income communities were about 2.1 times more likely to be employed in the long-run than those who remained in projects.

Creative Loafing collected a few of the articles written about the AHA and troubles with the Atlanta affordable housing market. I submitted a few comments in the collector piece, to the extent that well run PHAs were essential to working well with private sector owners. The benefit to an owner of taking voucher holders is that a substantial portion of the rent can be relied upon each month, that lease violations (behavior problems, non-applicant residents, housekeeping standards, etc.) can be enforced by both property management and the voucher-issuing entity. Cooperation, however, requires a PHA that is responsive to residents and owners, provides clear guidelines for enforcement and inspections, and delivers the types of follow-up assistance and counseling needed to bring greater financial stability to voucher holders.

I’ve got some additional thoughts on funding sources in a future post.

Economy: How do you measure stress?

With that multi-layered question, the AP unveils its March 2009 Economic Stress Index, essentially stagflation with a new methodology. The components are highlighted in the related video from University of Pennsylvania Professor Tony Smith, “How do you measure stress? You can talk about experiencing bankruptcy, home foreclosures, and unemployment.”

Operating like a wayback machine, the AP collates statistics from October 2007 and March 2009 measuring unemployment (via BLS), residential and commercial foreclosures (via RealtyTrac), and bankruptcies (via court filings) and presents them unweighted. Foreclosures are likely undercounted, because RealtyTrac does not compile information from counties with under 25,000 residents; without publicly available foreclosure information for these counties, the AP gives these counties zero-weight. These areas are typically central Texas, and non-urban areas of Kansas, Nebraska, North and South Dakota, Wyoming, New Mexico, and Kentucky.

The usual suspects (Las Vegas, Florida, Phoenix, Inland Empire, Rust Belt) are all here, but remember that the graphics show rate of change, not absolute numbers. Thus it was surprising to be reminded that Las Vegas/Clark County had a March 2009 foreclosure rate of 7.81% and an October 2007 foreclosure rate of 3.53%.

Highlights from the AP:

The current recession spread like an epidemic from isolation to ubiquity, marching from sequestered pockets of foreclosure to a nationwide explosion of misery as unemployment overtook foreclosures as the dominant misfortune of this recession.

Places with technology-based economies were recession-proof for a while but aren’t now.

Places with large numbers of government jobs — state capitals, university towns, communities with concentrations of hospitals — remain fairly recession-proof. These are places like Columbia, Mo.; Madison, Wis.; the Raleigh, N.C., area; and Athens, Ga.

State government is not hurting that much — at least, not yet.

The regions we look to for our traditional sources of energy, for our coal and oil — Wyoming, West Virginia and the like — have generally not been hit as hard.

While bankruptcy declarations are happening everywhere, they tend to be higher in the South because of such things as low wages, state laws that give power to creditors and a culture that’s more familiar with the bankruptcy option.

Among counties with 25,000-plus residents, no place has been hit harder than Elkhart County, Ind., and that 15 of the 20 American counties hit hardest by the recession in the past year are in six states — Indiana, Ohio, Michigan, North Carolina, South Carolina and Tennessee.

Although the note for editors says “much of the Great Plains region remains relatively unscathed by the nation’s financial meltdown,” I would recommend they overlay this map with one showing population loss to update their definition of ‘unscathed’.

Review and make appropriate plans. I strongly recommend looking closely at the data and using a comparative approach to benchmark your particular area against neighboring jurisdictions.

Three points toward a trend

Galley Eco Capital fleshes out a recent NYT article on pension fund investments in sustainable buildings. Noting that the article said little about groups such as CERES or Business for Social Responsibility, GEC recommends that general partners have some information about their portfolio’s sustainability at the ready.

Without providing a timeframe, GEC says simply ’soon’. Given the hellacious market conditions, most GPs or LPs are probably just trying to keep above water (or no more than 3″ below the surface). Certainly I’ve become much more skeptical of GP claims about pending payments and improved performance. Until we finish triaging portfolios, I’m not sure we will see an increase in portfolio reporting requirements. Once that process is complete, probably by 2Q 2009, we’ll need to start working on financial stabilization or exit strategies for properties. At that point, I think there is a tremendous role for sustainable analysis to play.

In that vein, here are a couple of articles inspired by recent postings at Globest.com. Globe Street is terrible about their paywall, so I’ll link directly to the source material where possible. CalPERs announced on November 30th that its real estate partners reduced energy consumption in 2007 by 13%, partway toward their goal of a 20% reduction in energy use by 2009. The primary vehicle is the Hines Green Development fund, which currently has $725mm for promotion of sustainable real estate holdings. The methods identified by CalPERs are standard steps any responsible owner should be taking such as low-flow and sensor-operated fixtures, recycling programs, and preemptive, onsite water treatment.

The more important (and actually reported) article discusses a new CA law mandating utilities to maintain an Energy Star Portfolio Management Database for all non-residential properties in CA. Contained in Assembly Bill 1103:
1) Requires electric utilities, beginning January 1, 2009 and upon the written request of the owner or operator of a nonresidential building, to provide the owner or operator monthly energy consumption data for the building in a format that is compatible for uploading to the US Environmental Protection Agency’s (EPA) Energy Star Portfolio Manager.
2) Requires electric utilities, beginning January 1, 2009 and upon the written authorization of a nonresidential building owner or operator, to upload monthly energy consumption data for the building to ESPM.
3) Requires an owner or operator of a nonresidential building, on and after January 1, 2010, to disclose to a prospective buyer, lessee, or lender the ESPM benchmarking data and scores for the building.

Writes Globest’s Brian K. Miller:

One year from January, anyone looking to buy, finance or lease an entire building will be entitled to obtain the building’s Energy Star Portfolio Manager benchmarking data and ratings. The Energy Star program rates buildings on a scale from 1 to 100 against other buildings within its class. Buildings within the top quartile will be eligible to be recognized as an EPA Energy Star Building and can use the “Energy Star Label” to communicate its energy efficiency to tenants, lenders, and other stakeholders.

Obviously buyers and owners do this kind of comparison already, but with the addition of the Energy Star scoring, all parties will be in a position to both analyze and act upon energy efficiency opportunities rather than passively accept the consumption rates.

My East Coast bias won’t allow me to say that most initiatives begin in California, but by sheer market size, these requirements or requests for information are likely to start moving east in the next 18-36 months.

Writing a Green Lease (BOMA Guide)

For non-residential readers, a new lease guide with language specific to green building incentives was released by BOMA (Building Owners and Managers Association), an international organization of landlords and commercial property managers BOMA’s Lease Guide, including green lease language. Much like leases from an apartment association, BOMA leases are the boilerplate upon which many landlords rely. When language likes this makes the industry boilerplate, the concepts have gone mainstream.

I no longer do enough commercial leasing to justify the $70 for this guide, but I found it interesting that the guide specifically identifies the contradictory incentives inherent in most sustainable efforts. Per BOMA:

“The BOMA Green Lease Guide offers an alternative to the typical triple net lease, where the landlord pays for capital improvements but the tenants, who pay the utility bills, reap the benefits of energy savings. The language included in this document gives owners the right as standard procedure to pass through to tenants any capital costs that result in lower total operating costs. The new green language ensures that maintaining, managing, reporting, commissioning and re-commissioning the building to conform to a green certification or rating program is included in the pass through costs.”

(Via FacilitiesNet.com.)

Flex your power: Hotel Energy Efficiency

Good sustainability resources for multifamily were once so hard to find that I spent much of my time immersed in the hotel world. I still wander through it periodically to see what new developments might be co-opted for longer-term residents.

Flex your power, a project created by the California Public Utilities Commission, has a multi-page summary of efficiency and conservation practices. The ideas aren’t all new and they’re not particularly detailed, but as something to give your site and service managers, it works very well.

In the DC area, many of our best service managers came from the hotel world and were already familiar with these ideas when we started to introduce them to multifamily projects.

Software to measure carbon footprints

Apparently this is shout out to Greener Buildings day at MFG. A few weeks ago they carried an article about TREES, a new program from Tririga, which helps owners analyze the environmental impact of their buildings.

I’m not entirely sure how easy this is integrated into residential buildings, but I found this comment from George Ahn, CEO of Tririga, to be very telling:

“There is regulation coming — whether its in the form of a carrot-and-stick as to tax credits and penalties or something else — and at the end of the day (businesses) are going to need to prove where you are and what you’re doing.”

TRIRIGA Markets System to Measure, Reduce Carbon Footprint of Buildings | GreenerBuildings: “”

(Via Greener Buildings.)

Non-RE: Trucks and the Coase Theorem

Per the post below about future directions of green building policies and the disconnect between costs and benefits, the well researched and written Environmental and Urban Economics posted a timely item about trucks in Long Beach and the question of who pays for what benefit?

Los Angeles Dirty Trucks and the Coase Theorem: “We know that particulate matter in the air is deadly stuff. It increases death rates in the U.S and around the world. We know that it lowers home prices nearby. We know that older trucks produce high levels of this stuff. So, should older smoke belching trucks be allowed to drive on the roads? Clearly, this pollution externality story is a nice example of the Coase Theorem at work. Who should pay for the cleaning up of the trucks? The trucking industry (and thus the consumers of the goods being shipped) or the ‘victims’ who are exposed to the pollution under the status quo?

My UCLA colleague Arthur Winer has written an excellent background paper on the pollution issues;

http://www.scag.ca.gov/publications/pdf/2004/SOTR04_WinerEssay.pdf

The issue below appears to be whether dirty trucks operated by independent firms will be allowed to keep operating.

Los Angeles port, truckers group head for court

Rick Loomis / Los Angeles Times

Transport trucks head into and out of the Port of Long Beach. Truckers are suing over the clean trucks program, which is intended to reduce air pollution.
National association is seeking an injunction to block the clean truck program on grounds it imposes intrusive regulatory systems’ on motor carrier rates and services.

By Louis Sahagun and Ronald D. White, Los Angeles Times Staff Writers
September 8, 2008

The nation’s busiest port complex and the largest trucking association are expected to face off in federal court today to resolve a vexing question:

Who would suffer more from the landmark clean trucks program set to begin Oct. 1: the trucking industry or residents affected by toxic diesel emissions?

The answer could determine whether the program will launch on time — and whether massive expansion projects will proceed at the Los Angeles-Long Beach port complex, already the gateway for 40% of the nation’s imported goods.

The $1.6-billion program aims to improve air quality by replacing a fleet of 16,800 old, exhaust-spewing trucks with newer, cleaner models.

Beginning Oct. 1, pre-1989 trucks will be banned from the adjacent ports of Los Angeles and Long Beach. By 2012, only trucks that meet or exceed 2007 standards will be allowed entry.

The goal is to rid local skies of tons of carcinogenic pollution and particulates linked to thousands of premature deaths and respiratory ailments. Port officials hope the program’s launch will persuade environmentalists to stop raising legal objections to expansion projects designed to meet future growth at the ports.

The 2007 clean trucks program was crafted by environmentalists, drivers, shippers, city officials, community leaders and the ports after years of often contentious debate.

But now the American Trucking Assn. says it has discovered serious flaws with the proposal.

In an interview, Curtis Whalen, head of the association that represents 37,000 trucking companies nationwide, said his group was seeking an injunction to block the program on grounds it imposes ‘intrusive regulatory systems’ on motor carrier rates and services. He also argued that the program would ‘result in far fewer trucking companies being able to serve’ the ports.

Of particular concern to truckers is a Port of Los Angeles plan that would require formation of concessions, companies that would employ some of the thousands of drivers who currently operate as independent owner-operators.

Concession requirements are designed to give the ports — as landlords — enforcement powers over big rigs entering the harbor area. This, in turn, would give the ports influence over hiring decisions, truck maintenance and driver health insurance, among other issues.

‘Let’s be clear: We are not against clean trucks,’ Whalen said. ‘We are objecting to concession plans that are going to squeeze out a lot of existing motor carriers and thousands of independent owner-operators.’

A ruling from U.S. District Judge Christina Snyder, which could come as early as today, would have a direct effect on the communities of San Pedro and Wilmington, where residents have coped for years with thousands of big rigs rumbling through neighborhood streets and local freeways.

‘The trucking industry believes the status quo works fine,’ said Los Angeles Councilwoman Janice Hahn, whose district includes the Port of Los Angeles. ‘But for us, this is all about making sure that the dirtiest trucks calling at the ports are forever banned, and the creation of a stable workforce of drivers with health benefits and decent wages and well-maintained trucks.’

Janet Schaaf-Gunter, a member of the executive board of the San Pedro and Peninsula Homeowners Coalition, agreed.

‘This much is guaranteed,’ she said. ‘Each day we move forward without a change in the number of clean trucks on the road, we are killing additional people.’

However, the National Retail Federation, which supports the trucking group, worries that the concessions requirement and new fees will add more than $1 billion per year to cargo container costs for goods moved through the complex. These costs would come at a time, the federation says, that the retailing industry is ill-equipped to bear them.

For example, motor vehicle and parts dealer sales are down 5.8%, according to the federation’s monthly figures comparing this July to July 2007. Home furniture stores’ sales are down 4.7%, and department stores have seen their sales fall 2.6% during the same period.

The trucking association ‘raises very important questions about the port plans’ lack of consistency with U.S. statutes that also deal with the regulation of the pricing routes and services of trucking companies,’ said Erik Autor, vice president and international counsel for the federation. ‘These are important issues for many of our members who are concerned about both [clean truck] plans and, of course, about the rates they will have to pay.’

Environmental and health advocates contend that financial losses should not supersede efforts to battle the ongoing health crisis fueled by diesel pollution. State air quality authorities have linked 3,700 premature deaths each year in California to pollution from the transportation of goods — more than the number of people who die from homicide.

Martha Cota, 45, who lives less than two miles from the Port of Long Beach and who, along with two of her four children, suffers from asthma, hopes the association’s legal challenge is swiftly defeated.

‘Environmental rules should be very well designed,’ she said, ‘and they must be delivered on time so that we really do improve our air.’

louis.sahagun@latimes.com

ron.white@latimes.com”

(Via Environmental and Urban Economics.)

Energy modeling (BOMA article)

The Building Owners and Managers Association (BOMA), which focuses on non-residential properties, places an article at FacilitiesNet that nicely summarizes CBRE’s work in sustainability during 2007.

“Energy efficiency makes the difference” highlights CB’s use of energy modeling and BIM, which is becoming a useful addition to CAD.

“A key part of the company’s plan to improve energy efficiency in its space involves using the ENERGY STAR benchmarking tool. To begin, all office buildings larger than 100,000 square feet will be benchmarked; a second round for smaller buildings will follow.”

At a recent internal sustainability committee meeting I made the argument that the industry is headed this way: it’s time to crack the books and then get our hands dirty with the details.

http://www.buildingoperatingmanagement.com/article.asp?id=7363

There’s a much longer discussion of energy modeling in the April 2008 issue of GreenSource. I haven’t waded through it yet, but their continuing ed articles for the AIA usually provide a few new tidbits to those who aren’t otherwise paying attention.

As an owner/former developer, I’m very much of the ‘make it work’ school of thought. Nevertheless, I will concede that whole building integration of HVAC, lighting, LEED, and other requirements is still tricky business. Trying to find someone who understood my desires in the Memphis project took forever.

Here are two DOE-backed modeling efforts:

Oak Ridge Benchmarking Building Energy Performance (http://eber.ed.ornl.gov/benchmark). This website allows you to quickly benchmark energy performance on 16 different building types and approximate energy use and cost savings from energy upgrades.

Energy IQ (http://energybenchmarking.lbl.gov). Currently under way, the pilot version of this tool is being called the next generation of nonresidential energy benchmarking. This “action-oriented” tool provides opportunity assessments based on benchmarking results. The tool supports comparison of the user’s building to peers and the tracking of an individual building or portfolio over time.