Cities like New York and San Francisco give massive contributions to the nation’s overall economy, with 380 U.S. metro areas generating 90% of the total GDP in 2012.
But a new study found that these cities can actually be making much more—a hefty $1.6 trillion more, to be exact. So why isn’t this money being generated? The answer is the lack of affordable housing inventory in urban areas.
Economists Chang-Tai Hsieh from the University of Chicago and Enrico Moretti of the University of California at Berkeley have placed a price tag on restrictive urban land use policies, The Atlantic’s CityLab reports.
According to CityLab, Hsieh and Moretti’s research is the first of its kind to develop a “defensible estimate” of the costs constrained development, such as antiquated zoning and building codes, have on the U.S. economy.
The $1.6 trillion figure was extrapolated from an analysis on the economic contribution of 220 metros to the overall U.S. economic growth over more than five decades, supplemented with data on the characteristics of workers from the American Community Survey and the Current Population Survey.
What they found was that “too much of America’s urban economic power is simply being wasted on higher housing bills.”
Related Stories
| Jan 4, 2011
Grubb & Ellis predicts commercial real estate recovery
Grubb & Ellis Company, a leading real estate services and investment firm, released its 2011 Real Estate Forecast, which foresees the start of a slow recovery in the leasing market for all property types in the coming year.
| Dec 17, 2010
Condominium and retail building offers luxury and elegance
The 58-story Austonian in Austin, Texas, is the tallest residential building in the western U.S. Benchmark Development, along with Ziegler Cooper Architects and Balfour Beatty (GC), created the 850,000-sf tower with 178 residences, retail space, a 6,000-sf fitness center, and a 10th-floor outdoor area with a 75-foot saltwater lap pool and spa, private cabanas, outdoor kitchens, and pet exercise and grooming areas.
| Dec 17, 2010
Luxury condos built for privacy
A new luxury condominium tower in Los Angeles, The Carlyle has 24 floors with 78 units. Each of the four units on each floor has a private elevator foyer. The top three floors house six 5,000-sf penthouses that offer residents both indoor and outdoor living space. KMD Architects designed the 310,000-sf structure, and Elad Properties was project developer.
| Dec 17, 2010
Vietnam business center will combine office and residential space
The 300,000-sm VietinBank Business Center in Hanoi, Vietnam, designed by Foster + Partners, will have two commercial towers: the first, a 68-story, 362-meter office tower for the international headquarters of VietinBank; the second, a five-star hotel, spa, and serviced apartments. A seven-story podium with conference facilities, retail space, restaurants, and rooftop garden will connect the two towers. Eco-friendly features include using recycled heat from the center’s power plant to provide hot water, and installing water features and plants to improve indoor air quality. Turner Construction Co. is the general contractor.
| Dec 17, 2010
Toronto church converted for condos and shopping
Reserve Properties is transforming a 20th-century church into Bellefair Kew Beach Residences, a residential/retail complex in The Beach neighborhood of Toronto. Local architecture firm RAWdesign adapted the late Gothic-style church into a five-story condominium with 23 one- and two-bedroom units, including two-story penthouse suites. Six three-story townhouses also will be incorporated. The project will afford residents views of nearby Kew Gardens and Lake Ontario. One façade of the church was updated for retail shops.
| Dec 7, 2010
Prospects for multifamily sector improve greatly
The multifamily sector is showing signs of a real recovery, with nearly 22,000 new apartment units delivered to the market. Net absorption in the third quarter surged by 94,000 units, dropping the national vacancy rate from 7.8% to 7.1%, one of the largest quarterly drops on record, and rents increased for the second quarter in a row.
| Nov 3, 2010
Senior housing will be affordable, sustainable
Horizons at Morgan Hill, a 49-unit affordable senior housing community in Morgan Hill, Calif., was designed by KTGY Group and developed by Urban Housing Communities. The $21.2 million, three-story building will offer 36 one-bed/bath units (773 sf) and 13 two-bed/bath units (1,025 sf) on a 2.6-acre site.
| Nov 3, 2010
Rotating atriums give Riyadh’s first Hilton an unusual twist
Goettsch Partners, in collaboration with Omrania & Associates (architect of record) and David Wrenn Interiors (interior designer), is serving as design architect for the five-star, 900-key Hilton Riyadh.
| Nov 1, 2010
Sustainable, mixed-income housing to revitalize community
The $41 million Arlington Grove mixed-use development in St. Louis is viewed as a major step in revitalizing the community. Developed by McCormack Baron Salazar with KAI Design & Build (architect, MEP, GC), the project will add 112 new and renovated mixed-income rental units (market rate, low-income, and public housing) totaling 162,000 sf, plus 5,000 sf of commercial/retail space.
| Nov 1, 2010
Vancouver’s former Olympic Village shoots for Gold
The first tenants of the Millennium Water development in Vancouver, B.C., were Olympic athletes competing in the 2010 Winter Games. Now the former Olympic Village, located on a 17-acre brownfield site, is being transformed into a residential neighborhood targeting LEED ND Gold. The buildings are expected to consume 30-70% less energy than comparable structures.
