You Can't Build Old Buildings

by Sandy Ikeda
Thu, 17 Jan 2008 at 1:30 AM

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(This is a follow-up to my earlier post on Willets Point.)

Where do new entrepreneurial ideas come from? One source is successful, well-established businesses like Apple Computer Inc. Another, perhaps even more important one, from the viewpoint of novelty and the long-term vitality of an economy, is people, typically young ones, who are rich in ideas but poor in capital. Think of Steve Jobs and Steve Wozniak in their garage before they founded Apple.

Most new proposals for urban redevelopment try to accommodate the trendy idea that you can construct an environment that will somehow promote this kind of creativity. How do they propose to do this? By building new spaces in a "mixed-use" context designed to enable frequent face-to-face contact among the various users. I hear something like this is being planned for the old riverfront warehouses in the proposed Brooklyn Bridge Park.

But such spaces, precisely because they're new, tend to be very pricey. Unless there are substantial and long-term subsidies that accompany a significant portion of the units in these developments few if any of the second sources of innovation will be able to afford to use them, stifling innovation.

And this approach itself raises a host of other problems. Choosing who gets these subsidized spaces becomes a tricky political issue and, once established, moving occupants out who no longer qualify becomes a legal headache. If they are economically successful they should no longer get a subsidy, but they may argue that they are being punished for their success; and if they're unsuccessful they can argue that ipso facto they should continue getting the subsidy.

Old, worn-out buildings (or garages) are often good places to incubate ideas, but you can't build old buildings. Places like Willets Point (and Dharavi in India) offer cheap space for poor entrepreneurs who tend in turn, at least initially, to serve poor patrons. Willets Point is a good, though perhaps not perfect, example of an "unslumming" commercial slum, that is, a slum that is bootstrapping its way to economic development. Okay, it doesn't appear on the surface to be all that innovative. But in among the mostly grungy auto shops are a few shinier and larger establishments. So, the most successful either leave for less-toxic pastures or, if they stay, help to unslum the slum.

(Most auto shops are grungy no matter where they're located, but the thickness of Willets Point seems to ramp up the grunge factor, so that the whole is greater than the slum of the auto-parts. Couldn't resist!)

I'm not arguing that Willets Point should remain a commercial slum forever, although there will always be a need for commercial slums, as well as residential slums, as long as there are poor people. Instead of a grand 30-year plan, however, the city government could just upgrade the practically non-existent infrastructure of the place, and with the new Mets stadium adjacent to it, this will raise real-estate demand and prices over time. The current owners could then choose to sell when they themselves judge the time is right. Large or small investors would bargain with current owners to determine appropriate land-use over time. It may be a convention center, a school, office space, or condominiums. Or something no one has thought of yet. While there may be problems caused by those who hold out in order to leverage their position against a large-scale development, which is one of the economic justifications for eminent domain, these can be dealt with if and when they arise.

But Mayor Bloomberg wants to build everything at once in one giant agglomeration. I admit it's hard to imagine that Willets Point could look worse than it does now, and his plan may generate more revenues (and costs) in the short run. I'm sure it would smell better. But I fear that it would make Willets Point a drearier place than it could evolve into (maybe even drearier than what's there today): A thriving neighborhood with its own, perhaps grungy, character — not unlike the meat-packing district before it became so chi-chi. Such a neighborhood, a real neighborhood, would be a more vital and organic part of the living city.

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