Every weekend we dig into the archives. This post by Kent was originally published in May 2014.
Our open, innovative economy increasingly craves proximity and extols integration, which allows knowledge to be transferred easily between, within, and across clusters, firms, workers and supporting institutions, thereby enabling the creation of new ideas that fuel even greater economic activity and growth. – Bruce Katz, The Metropolitan Revolution.
A while back I took a look at CBD land value and discovered how extreme it is compared to cbd-adjacent property. Taking a cross section look those land values also reveals some interesting anomalies on the western side where land values seems to be compromised. Elevation and historical land use activity were suggested as an explanation, but it is more likely influenced by the motorway-scaled one way systems of Hobson and Nelson Streets which create a barrier to movement and accessibility.
The fundamental function of a city is to facilitate exchange- social, economic and cultural. Urban land value is created by accessibility and centrality; simply, how many people can access the site, or inversely what can people access within close proximity from the site. While useful for shaving a few minutes off a commute, streets designed to prioritise vehicular access such as the one-way couplets of Hobson and Nelson Streets destroy urban land value. Here are couple of images from a dystopic tour of the CBD.
The prioritisation of automobiles repels human activity. So while it may be easy to access offices and places in the CBD from the motorways, this access comes at a cost. In urban settings automobility limits personal mobility (walking) both by creating repulsive environments (see photos above) and by the spatial requirements of moving and storing cars, resulting for example in having to wait for two minutes to walk across a street. Here is an illustration of the spatial requirements of moving a car through an urban area.
To put it another way, the prioritisation of the long distance car trip with motorway-style infrastructure may save time on one trip, these designs severely obstruct other short trips or more spatially efficient PT trips.
This returns us to the value of a city- its ability to facilitate exchange (or as some spatial economists obliquely say ‘to minimise transport costs’). Today we continue plan our transportation systems based upon the objective of minimising motor vehicle delay, but this is seriously flawed, especially in urban contexts.
The most valuable trips in urban areas are not the motor vehicle trip, but the ones buried in the ecosystem of city life which go unmeasured. Critically these “trips” are enabled by highly efficient transport modes.
These trips enable the phenomenon of cityness – the messy, complex, dense convergence of the physical environment at multiple scales. Increasingly these spatial properties of cities are being recognised for their value in fostering innovation and productivity. In the recent book Metropolitan Revolution, Bruce Katz documents how cities are radically adapting to the new realities of proximity that are required for businesses and cities to compete on the global scale.
The hunger for knowledge and the imperative to collaborate has spatial implications. Partners want to be near partners for the simple reason that proximity enables constant interaction and knowledge sharing.
…The proximity effect can be staggering: Gerry Carlino has found that the number of patents per capita increase, on average, by 20 to 30 percent for every doubling of employment density, with the greatest increases expected within the most densely populated portions of a metropolitan area. Stuart Rosenthal and William Strange find that intellectual spillovers that drive innovation and employment drop off dramatically as firms and people move more than a mile apart.” At a distance of just over a mile, the power of intellectual ferment to create another new firm or another new job drops to one-tenth or less of what is in closer in.
Here is a map of the Auckland CBD showing this mile metric. Coincidentally it fits nicely within the motorway collar.
On a finer scale Katz refers to the often cited work of Arzaghi and Henderson who found that the value of clustering for advertising industries is highly dependent on proximity to other agencies and thus being “close to the center of action.” The value gained from proximity for this industry outweighed the rent premiums. In fact they found that these spatial advantages (information spillovers and frequent contact) to be so narrowly focused geographically that they dissipate over a short distance if walking to a meeting place becomes difficult… “and are gone by 750 meters.”
Katz’s bigger point here is that it is not just media companies that require this spatial fix now, but a broader range of knowledge-intensive sectors such as science and technology heavy fields.
Lets consider that 750m metric for a moment. This distance generally represents a 10-minute walk. Add a hill, throw in an intersection or two (or just Fanshawe St) and very quickly that employment-dense catchment that firms would pay a premium for is now marginalised. Here is an illustration of 750 meter (radius) catchments across the CBD. Consider if these circles having the depth that is required to support a job dense environment in this economy. Now chip away at these circles with a motorway, a one-way couplet, a two-minute wait at a traffic signal, some hills, and even the water’s edge. What’s left?
Here is a more sophisticated version of the first image. I have extended the study area across the motorways. The blocks represent capital value (land value + improvement value) by area. This value has then been extruded using the building footprint in a relative proportion of height (ie. a tower tower 30m is 3X more valuable than a tower of 10m).
Some things jump out from this image. Like from my original post, the premium for city centre land is impressive. Also, the motorway system seems to radically constrain the cbd like a noose. This also has the effect of concentrating capital values excessively in the very centre (near Queen Street) since this is where the abundant proximity remains. Firms locating on the edge, or cbd-adjacent (outside the motorways) have limited access to the concentration of people in the city centre.
As a single fix the CRL has the potential to span the motorways and create “centre of action”-like proximity to places like K Rd, Newmarket and Eden Terrace. In addition to the massive mobility efficiency of underground rail, it will also critically bring a degree of scale to our CBD which is currently chopped into an archipelago by the motorways. The CRL however, will not address the street-level barriers that repel movement and proximity. This will require a major shift in the way people see the value of the city and recognition that there are real trade offs associated with applying outdated transportation objectives in urban areas.