Excape The Bland...Designing Micro Centers

excerpt from Retail Trends

Main Street USA

For horizontal mixed-use projects, architects say the most frequent failing is creating a development that feels bland to the customer. Mixed-use projects are expected to recreate the town square setting found in downtowns of the past, but many architects don't look closely enough at what made those settings work, according to John R. Clifford, principal of GreenbergFarrow, a national firm offering architecture, engineering and development services.

“They are trying to recreate the Main Street of Disneyland, this artificial idea of what a Main Street looks like,” says Jack Illes, managing partner of Urban Labs, a Del Mar, Calif.-based urban design and architecture firm specializing in mixed-use retail and residential projects. “You can show up anywhere in the country and you'll find the same kind of place, with the same tenants and after a while, it's going to feel as tired as the mall because it's not unique.”

This is a costly mistake, because horizontal mixed-use projects, where buildings are spread out over many small buildings, bring some added expenses to the mix. Four-sided construction tends to cost 10 percent to 15 percent more than the three-sided approach commonly used with single-use retail properties, says Jack O'Brien, president of Dallas, Texas-based architecture firm O'Brien & Associates.

To break monotony, allowing retailers to pursue their own design visions can help make the place unique, according to Illes. He brings up the example of General Growth Properties' Otay Ranch Town Center, a recently opened lifestyle property in Chula Vista, Calif.
General Growth let each retailer design its own storefront, resulting in details as varied as limestone pillars and striped awnings to stonework and a sunset yellow color scheme for the local Barnes & Noble.

The quality of the materials, however, has to be consistent throughout the development, says Stan Laegreid, principal of Seattle, Wash-based Callison Architecture. A community for the mid-market consumer should not have elements of luxury to avoid confusing customers.

A common mistake architects have made with some of the first horizontal mixed-use projects has been to bury the retail deep inside the project's residential components. The retail and residential should play off each other, but retail also needs to pull from a wider trade area, says Greg Lyon, partner with KTGY Group, Inc., an Irvine, Calif.-based planning and architecture firm. “They need traffic that extends beyond that community,” he says.

When adding entertainment to the mix, designers also need to think about the hours of operation for theaters and restaurants. “A live theater isn't necessarily used 365 days a year and even if it is, it's typically only from 8 p.m. to 10 p.m.,” says Illes. “What happens the rest of the day? You've got a bunch of doors leading to an empty, dark place and that can kill traffic.” And location is important as well. Otherwise, residents may have to deal with noise every night.

To make the projects interesting to explore, architects and planners should vary the width and length of streets within the development, the style and height of various buildings, the size of public area spaces and the distribution of architectural features such as fountains and clock towers.

“Real cities were built over time by different architects and different landlords,” says Clifford. “They have modern structures on the side of Neoclassical ones, with Victorian architecture nearby.”

Spacing is also an important consideration, says Alex Espinoza, design principal in the retail/commercial studio of Dorsky Hodgson Parrish Yue, a Cleveland, Ohio-based architecture firm. When buildings are too close together, people feel uneasy, but putting them too far apart disorients visitors, Espinoza says.

The configuration and placement of parking lots is one of the greatest challenges in mixed-use development. Most experts say that parking in horizontal projects should be segregated by use, with separate lots set aside for residents, retail customers and office workers. These lots have to be connected to their respective uses by convenient pedestrian links and should be within close walking distance for the center's customers, says Michael Alston, of Development Design Group, a Baltimore, Md.-based planning, architecture and design firm. In vertical projects, which tend to use structured parking, segregation is even more critical — the condominium owners don't want to come home a week before Christmas and find that their spaces have been taken by shoppers, says Lyon. He recommends creating separate entrances for residents and office workers from the retail portion of the project.

Vertically challenged

In vertical mixed-use projects national retail tenants with good credit are vital for securing financing, but they have set store prototypes and prefer wide, open spaces with great ceiling height. That is difficult to achieve when there are all kinds of mechanical and plumbing systems coming down from the apartments above, says Simon Sykes, vice president with Development Design Group. One solution is to position these systems horizontally, along the ceiling, instead of vertically, when they come to the first floor. O'Brien recommends creating a 2- to 4-foot tall interstitial space between the retail level and the apartments above for sewer pipes as a way to avoid multiple penetrations of the podium slab above retail.

In vertical mixed-use, structured parking can account for up to 15 percent of the entire project cost, while not producing any revenue, says Laegreid.

Another issue to tackle is how the retailers can load and unload merchandise without disturbing residents. A loading dock can be installed in the back of the building or on the ground floor or basement level, with an elevator delivering the goods to the retailer's main floor. This requires a delicate balancing act — elevators and servicing areas often translate into inefficient space and lost revenue, resulting in up to 15 percent of additional expense, says Laegreid.

Getting the message out

The architect also has to make sure that the retail component is the most eye-catching of all in a mixed-use property, says Jeff Green, owner of Jeff Green Partners, a Mill Valley, Calif.-based retail consulting firm. In such a dense environment, visitors' eyes tend to wander and if the storefronts don't jump out at them, the retailers are likely to suffer. O'Brien recommends using different construction materials to set retail apartfrom residential and office.

Considering what kind of tenants go well with a mixed-use building is also an important decision. Restaurants, for example, are a risk for vertical mixed-use projects because in addition to the smell and noise that might bother residents, they can draw rats and mice that could eventually scurry up and infest residential units.

“That's new information to many people in the suburban hinterland; it isn't necessarily self-evident,” says Illes. To prevent a disaster, developers need to make sure that the market in which their mixed-use property is going to be located can support each use on its own. They have to educate themselves on what makes mixed-use work and adequately explain their vision to the architect, says Illes.

“If you hire different architecture firms for each use, you've got one team trying to solve all of their problems and another team concentrating on what they need,” says Brian Church, of Urban Labs.

“We've tried that in some cases, but it's really difficult,” Church says.

Return of the Occidental Tourist

excerpts from Seattlest

Yesterday Seattlest broke out of the office at noon, grabbed a Tats'trami and headed to Occidental Square. There's nothing like passing a short hour with a book and a gut bomb in a square... Actually, had a book along, but it was only cover for our real mission which was to watch all the little people go about their little lives and they happily obliged by showing up and staring back at us. What? Just eating a sandwich and reading over here. Nosy freak.

Earlier this week Seattlest got an email from the Project for Public Spaces who'd recently found a post of ours from last fall about the newly renovated Occidental Square, a renovation they had a hand in. They wondered if we had any updates to our first reactions. A bunch of trees were removed during the park's renovation--seventeen of them, exactly--which, in light of the P-I's article on Monday about the declining fortunes of the tree in Seattle, is pretty tragic.

Generally we're not in favor of the removal of urban trees, but it did help the square. Yesterday the sun came out just as we were arriving and it was leafy and bright at the same time. We had our book and the Tats'trami and when the couple at the table next to us started speaking Polish we thought for just a second that we might be back in the greatest square on the face of the Earth. But no.

It's not really the square's fault, though. You can mess with the leafy to sunny ratio for ever, but you're not going to change the fact that the businesses that surround the square are designed to be used once a month. If there were a few boutiques that opened directly into Occidental Square and maybe another cafe or four there would be a reason for people to meander around on a lunch hour. As things stand, it still seems like a really nice square that most people haul ass through en route to catching the first pitch. We're going head back for some more lunches, though, and maybe we'll grab a few coworkers on the way next time. It should be the best spot in or near Downtown for people watching and we're going to start doing our part by showing up.

Can new architecture create successful places?

by Kathy Madden

People often ask me if a building has to be old or look historic to create a sense of place. I always answer with a definite "No!" While it may be easier to find older buildings where public activity flourishes, their success is not due to age or a particular architectural style. The main factor is actually how the base of the building is treated. A building with a well-designed (and well-managed!) ground floor can be a great place regardless of the style in which it is constructed. Let's look at two places which I think illustrate this point quite effectively: Country Club Plaza in Kansas City, and Rockefeller Center in New York.

Country Club Plaza, which debuted in the 1920s, is one of the nation's oldest shopping centers. Built in a style that mimics the architecture of Seville, Spain, it succeeds as a pedestrian district even though it was developed to accommodate cars. A few years ago PPS interviewed the managers of the complex, and we found that they attributed their success to four things. One, they offered a mix of attractions that appeal to a broad array of people – for example, by varying the price ranges of retail and restaurants. Second, they located necessities (e.g. bank branches, or doctors' and dentists' offices) in places that would lead people to pass by retail stores en route. Third, everything in the development allowed people to interact with it in some way. Children could touch sculptures; people could sit by pools and fountains; window displays were designed to maximize intrigue; outdoor cafes hosted jazz performers and other entertainment. And last, but certainly not least, blank walls were not allowed anywhere. Where management identified sterile areas around the exterior of the complex, they added plantings or artwork to liven the space up for passersby. What's remarkable is that, even though the Plaza is widely known for its historicist aesthetic, the people who run it cite very different reasons for its enduring popularity.

Rockefeller Center, though it was constructed just a short time after Country Club Plaza, couldn't look more different--but it is an even better public space. Its soaring forms are modernist icons, and the closer you get, the more these buildings come alive. Art deco sculptures grace the entrances. Ground floor windows protrude slightly from facades, enticing people to slow down and take a look at the goods inside. Changing exhibits and events in the center of the complex keep it humming in every season, while artfully placed wooden benches enable people to pause, rest, reflect, and take it all in. Here, a modern aesthetic gracefully accommodates a great public space.

Contrast the original Rockefeller Center with the more recently developed Rockefeller Center West (built in the 1970s on the west side of Sixth Avenue), however, and you'll see a very different way of building which has no sense of place. The buildings here do not have human-scaled bases: Store windows and entrances are set back from the sidewalk by nearly 50 feet, and the space between the building and the curb is basically empty. The retail is hidden so few people go window shopping. There is no reason for people to linger or make a return visit.

Rockefeller Center and Country Club Plaza make it clear that success as a public space is independent from architectural style. But as Rockefeller Center West illustrates, newer buildings often fall short of the mark. This is also true regardless of style. In fact, many of the worst new buildings are those designed to look old or historic, which don't work because they hide their ground floor uses behind a "charming" facade.

So although great new buildings may be few and far between, I stand behind my emphatic "No" -- there is NO reason new architecture can't contribute to an enhanced sense of place in the public realm. I would love to hear from readers of this blog about new buildings that succeed at their base--that engage the sidewalk with transparent ground floors and a mix of retail and other uses. What new architecture is striving to create better places?

Sustainable Bags: "Freitag"

what: the Freitag bag, a Swiss-made carryall manufactured entirely from recycled materials. Invented by Swiss brothers Daniel and Markus Freitag, who wanted bags just like the ones used by New York bike couriers (bags that were practical, weatherproof, quick and easy to use), the Freitag bag is an urban tool, a saddlebag for the city, durable enough to be carried all over the world. Very attractive to a visually-trained eye, it’s a pleasant surprise in a world of standardised, mass-produced everyday objects.

who: Markus and Daniel Freitag — also known as the Freitag brothers — were heavily influenced by the motorway. Living in an apartment near a highway in Switzerland, they had easy access to watching the trucks rolling by, covered in thick tarpaulin. In 1993, the DoItYourself duo began to create one-of-a-kind bags made of recycled waterproof tarps, bicycle inner tubes and seatbelts. Before long they were trucking; the company outgrew the brothers’ apartment and moved to its own space in Zurich. Freitag opened flagship stores in Davos, Switzerland, and in Hamburg, Germany. Perhaps more importantly, it established an international presence online. The website allows online hipsters around the world to shop, create custom bags, learn more about the company, play branded games, and even apply for jobs.

sustainability features: the Freitag bag is tailor-made on a small-scale, of recycled materials. Made entirely by hand, the unpretentious Freitag bag has distanced itself from trendy, brand-driven products as a durable and radical ‘anti-brand’ alternative for youthful urbanites who have made it their choice for toting personal necessities. In addition to covering the history of the bag and its particular ecological, economic, and socio-cultural contexts, Freitag.com contains portraits of 3,000 Freitag bags and their owners, most of whom are members of a generation that is as vain as it is critical of consumerism -a generation for whom the Freitag bag is the ideal brand-name product.

Great Urban Streets Design Principles

Principle 1:
Manage CongestionCongestion is a fact of life in successful urban places. By definition, a place that supports a great concentration of economic and social activities within a pedestrian-scaled environment is going to be congested.

Principle 2:
Balanced/Active StreetsDowntown streets must balance the needs of pedestrians, bicycles, transit and the automobile in creating an attractive and viable urban core. Downtown streets are for people first, commercial second, parking third and through traffic fourth.

Principle 3:
Streets as PlacesThe Great Streets Program envisions downtown as a vital focus of city life, and as a primary destination. Our downtown streets are our most important and pervasive public space and common ground.

Principle 4:
Interactive Streets Urban Streets are the stages on which the public life of the community is acted out.

Principle 5:
Pride of PlaceVisible, caring and upkeep are critical to the vitality of urban street life.

Principle 6:
Public ArtArt in the public environment can help to establish a stronger sense of place and a continuity between the past, present and future.

Pitiousa- Human Scale Development

The design for the town of Pitiousa recognises that every context is a self-regulating, living system; that the basic elements of urbanism are the urban block, the street and the square; that buildings should never be as large as the commission; and that they should use well-tried constructional techniques and materials. Pitiousa also recognises that " Classicism is not a Style ", but a tradition that has evolved from and coexisted with the vernacular. It is a living tradition open to adaptation and interpretation, and responsive to region, climate and nature. "

-Demetri Porphyrios

" Unlike the currently marketed conception of tradition as the "peddling of antiques", the classical project does not aim at upholstering a spurious restoration. Instead, its aim has been to ferret out in existing society those traditional elements that could foster the new. The story of cities has been the story of endless innovation. But the new has never been a mere novelty. The new has always been the result of a process of knowledge and merit. the various phases of history are additive and the storing of new experience has been the law of mankind. The exclusive characteristic of civilised man has been his ability to record and to retrieve from memory. In that sense, Classicism and the Traditional City are less absorbed in the dialectic between an imagined future and a nostalgic past ( as many critics have claimed ), than in the search for realistic projects. The ultimate criterion in the design of cities ought to be the public well-being of their inhabitants. "

-Demetri Porphyrios

Sustainable co-op supermarket?

from cool town studios

Good neighborhood supermarkets are hard to come by. Trader Joe's and Whole Foods are the de facto choices by the downtown crowd, though the former has a limited selection and the latter caters to an upper class income. The most progressive neighborhoods in forward-thinking cities like Madison WI, Burlington VT, Cambridge MA and Ann Arbor MI have it figured out - co-op supermarkets.

As you can see (above), co-ops have evolved - they're organized via grassroots efforts, but don't look like grassroots efforts. In fact, they're sharp-looking, well-managed, and price competitive because they follow the mass customization/crowdsourcing/beta community model of future patrons organizing to design and develop the grocery they want. In fact, as a result, most of them have built-in cafes (right) and community bulletin boards.

The question then becomes, how does one start a co-op supermarket? The answer is with the Food Co-op 500 (perhaps a play on the Fortune 500), cooperative effort to help establish a total of 500 co-op supermarkets in 10 years (there are 300 today).

The outline of the development guide can be found here, based on:

1. Four organizing principles:The 'Four Cornerstones' of Vision, Talent, Capital and Systems.
2. Three stages of development:Organizing, Feasibility and Planning, and Implementation.
3. Two sources of funding:- $10,000 matching Seed Fund grant for the first stage of development.- $25,000 matching Sprout Fund loan for the second and third stages of development.

Finally, you can 'find a co-op supermarket near you' with the Cooperative Grocer Directory... and if there isn't one, you now have an idea of how to solve that!

In Praise of Smaller Developments

by Trisha Riggs E-mail: priggs@uli.org

ULI’s Place Making Conference Explores Fundamentals of Designing and Building for Change

Conference panelists discussed the benefits of building smaller developments. The smaller the town center development, the more necessary it is to link with the surrounding neighborhoods, resulting in ample points of connection. Conversely, while larger developments have more capability to be self-sustaining, this can lead to isolation, participants noted. “Going small forces you to connect to what is around you, because you are not big enough to do things on your own,” said Richard E. Heapes, principal of Street-Works in White Plains, N.Y.

According to John E. Felton, principal and director of community design at Cline Design Associates in Raleigh, N.C., there are several steps that can be taken upfront to help smoothen the process of developing small, mixed-use projects, including conducting a full analysis of the entire site’s potential and the timing of the development of each use; developing a clear strategy for integrating each use; using a simple, efficient design; understanding that parking for each use is critical; and planning for the creation of an engaging place that draws people back for repeat visits.

Felton advised conference attendees to “go to where the people are” to find promising sites for smaller projects—including downtown infill locations, sites near transit, places close to universities or cultural centers, and old shopping centers. Many of these sites represent lucrative opportunities for adaptive reuse, he said.

Katherine Kelley, president of Green Street Properties in Atlanta, shared four key lessons learned in developing small-scale projects: 1) Be externally focused—build to the perimeter of the project so it connects to the external infrastructure. “This is beneficial to the surrounding community as well—each can enjoy the benefits of the other.” 2) Anchor the project with great restaurants. “They (restaurants) are a primary channel for the public, and they draw people to the adjacent retail.” 3) To the extent possible, arrange the project’s components horizontally. “If you have to layer vertically, make each building easily walkable to the next.” 4) Realize that something has to give to make the numbers work. “If you don’t have high density (which is sometimes a challenge to achieve in smaller projects) you have to look elsewhere for a sufficient revenue stream.”

The place making trend, said Terry Shook, president of Shook Kelley in Charlotte, N.C., has resulted in a “new breed” of community developers who are catering to rising consumer demand for convenient living environments that save time by offering a variety of development uses close together. Town center development provides an opportunity to reclaim areas with no sense of community—particularly in suburban settings—by “turning the ordinary into the special, until we reach a point at which the special becomes the ordinary,” he said.

Shop in a Box

The latest in the world of pop-up retail? From Singapore comes the Venue VBOX, a portable store in a shipping container, which can be set-up temporarily. Any place. Any time.

The VBOX enables a brand or company to follow an event they wish to align their brand with, or pop up where consumers least expect it. Tag along with a photography exhibition or set up shop temporarily at a large sporting event. Brands can even showcase items that consumers may not otherwise be able to purchase elsewhere: just fill the VBOX with one-offs or special editions and you'll pull in consumers with the prospect that they'll able to purchase something unique.

The VBOX comes self-contained and equipped with an iMac and iPod HiFi. It's entirely ready to go; all that needs to be done is fill it with enticing products. To date the VBOX has housed collections by some of the fashion world’s most prestigious names: RAF SIMONS (Prada Group) and limited PUMA designer co-labs by Alexander McQueen, Christy Turlington, Mihara Yasuhiro as well as CDs, magazines/books and Motorola phones.

Whether the VBOX is placed in a remote village in Spain, on a beach in California or on the ski slopes of Canada, it's a refreshing way to inject fun and excitement into a brand and win over a swag full of new consumers. Japanese clothing brand UNIQLO used container stores for its recent launch in the United States. More about that here. And for much more on pop-up retail, check out trendwatching.com's overview.

People=Power!

By SAM COOPER

Fred Kent believes in people power.
You can have the most attractively built community in the world, he says, but if people don’t come together to mix in public spaces, it’s just dead space.

Kent recently spoke to the West Vancouver Chamber of Commerce and Mayor Pamela Goldsmith-Jones, in relation to the plans to renew Ambleside.
The world-renowned urban planning expert has worked with over 2,000 communities through his New York-based Project for Public Spaces consultancy, started in 1975.

His theory is that attractive, non-automobile dominated public spaces layered with multi-use functions will pump vitality back into communities that have become too isolated.

Educated at Columbia University, Kent brings studies of geography, economics, transportation, planning and anthropology, into his “place-making” philosophy. He’s taken about a million photos in communities around the world, using time lapse technology to understand the underlying motivation of people’s attraction, or repulsion, to certain public spaces.

“Foot movements are like a sort of language,” he explained of his photographic methodology, to a table of listeners including Goldsmith-Jones and Park Royal vice-president Rick Amantea, over a lunch of grilled salmon at Saltaire in Ambleside.
The group had earlier toured Ambleside and found traffic overpowered their conversations.
“Your main street is only functioning at 40 per cent of what it could be,” Kent said.
“When you look at your city, there are a lot of opportunities and a lot of things not happening.”

Kent’s group holds that great cities have a formula of ten great destinations. And each location should also be enriched by ten different activities, he says.
But a location doesn’t have to be an attraction like the Eiffel Tower to draw people.

For example, a city hall, library, laundry, coffee shop, and bank could be layered together.
“If you triangulate those things with other activities you’d have one of the busiest places in Canada.”

Busy is a positive concept for Kent, meaning regular people interacting.
“The important business of the city is in the social functions, not what happens in city hall,” he said.

Hearing this, Goldsmith-Jones nodded enthusiastically.
“I try to go to a different coffee shop every day and I find what I’m running into is so interesting, I have to move back my (municipal hall) meetings,” she told Kent.
Kent suggested West Vancouver citizens should be engaged in a process to imagine what new public spaces in Ambleside should encompass.

Investment Funding for New Urbanists

Exerpts From New Urban News

Since the late 1990s, a number of people have tried to form investment pools that would provide money for new urbanist developments. It has not been easy going.

The Traditional Neighborhood Development Fund, started in 1997 by new urbanist developers Robert Chapman, Rob Dickson, and Lloyd Zuckerberg, obtained backing from the multi-billion-dollar Hillman Company and from a major shareholder in Goldman Sachs, but was never able to place any significant capital.

The Fund for New Urbanism, started in 2002 with Andres Duany, Sam Young, and businessman Wayne Huizenga as partners, hoped to finance several projects but is now limiting itself to just one — a 930-acre development near Edenton, North Carolina. Another pool, the Green Living Fund, which Kacey Fitzpatrick in the San Francisco Bay Area expected to have in operation by late 2006, has delayed its startup by at least several months.

Yet while some investment pools are being postponed or pared down, others are springing into existence. In January, the Denver-based Revival Fund Management of Dennis Fleming and Charlie Randall started its Urban Green Fund, which will invest in walkable, mixed-use developments within a half-mile of mass transit. Also importantly, philanthropies are coming forward. The New York-based FB Heron Foundation, for example, is investing in New Urbanism through funds such as the Bay Area Smart Growth Fund and the California Smart Growth Fund.

What seems to be under way is a sorting out of investment concepts and participants. In some instances, new urbanists tried to start funds before conditions were ripe. “We were way premature nine or 10 years ago,” says Chapman, who leads an established new urbanist development company, the North Carolina-based Traditional Neighborhood Development Partners. “I think the time is absolutely right now. We’ll make an announcement in midsummer about a new fund that will have a sustainability and green building aspect.”

Some funds have run into difficulty because they employed methods that diverged too much from the real estate field’s usual ways of doing business. DPZ’s Fund for New Urbanism, whose research and organizing were carried out primarily by Young and Demetri Baches, had what seemed an ingenious idea: The Fund would identify eight sites “ideally located for smart growth,” design plans and codes for them, secure entitlements so that construction could occur as-of-right, and transfer the approved plans to developers prepared to follow the plans.

There turned out to be at least two flaws in the Fund’s premise, according to sources consulted by New Urban News. First, developers resisted paying to obtain planned, entitled projects. “A developer doesn’t want to pay retail,” Chapman says. “He wants to pay wholesale.” Second, the Fund suffered from being seen as more a planning operation than a development organization. Baches acknowledges that DPZ did not want to devote time and energy to becoming a full-fledged developer itself. With a busy international planning practice, DPZ would have had a hard time managing several development projects. Thus the Fund settled upon carrying out the one project it had pushed the furthest — Sandy Point.


THE NEED FOR PATIENT CAPITAL
Analysts agree that there is clearly a need for pools of “patient capital.” Mainstream real estate financiers mostly have “a time horizon that is so compressed that you have to make [undesirable] compromises,” Chapman observes. A new urbanist development will surpass a conventional subdivision in value in the long run, he says, but first a great deal of money and time must be invested. It’s not uncommon for 15 years to be needed.

“We need to understand real estate as a 40-year asset class again,” says Fleming. Fleming expects to put money into a project for eight to nine years and to have a provision allowing the investment to be renewed twice. By comparison, conventional real estate funds usually “have a time horizon of five [years] plus two [extensions] or seven [years] plus two [extensions].”

Revival Fund Management expects its Urban Green Fund to amass $250 million and will invest it in approximately 20 to 30 projects in “progressive real estate markets” such as Denver, Seattle, Dallas-Fort Worth, Boston, Washington, and the Bay Area (except the purportedly overpriced city of San Francisco). Each project will get $7 million to $12 million from the Fund, says Fleming, the managing director. Properties will typically be “within a half-mile radius of frequent transit service” and will feature energy-efficient technologies, a fund statement says.

Once the first Urban Green Fund is established, a second fund would be started, and so on. Eventually Revival would like to establish a real estate investment trust (REIT) for properties that are new urbanist and “green.”

Criteria similar to Revival’s are already being used by the $100 million Rose Smart Growth Fund, which developer Jonathan Rose established about a year ago. After buying two buildings in downtown Seattle for $23 million last April, the Rose fund announced its second investment in November: half of the $38 million needed to convert the historic Clipper Mill buildings in northern Baltimore to 51,000 sq. ft. of arts and crafts studios, 62,000 sq. ft. of offices, 36 loft apartments, and other uses. The Rose Fund became a 50-50 partner with Struever Bros. Eccles & Rouse, which is developing the project, with Cho Benn Holback + Associates as architects. The property adjoins a light-rail stop in Jones Falls Valley.

A new urbanist investment of more limited duration is “mezzanine capital,” which Philip Blumberg’s American Ventures Realty in Coral Gables, Florida, supplied to projects such as market-based, moderate-income housing in the Little Havana section of Miami and the luxury-class Gold Avenue Lofts in downtown Albuquerque. Mezzanine financing — so called because it occupies a level between loans and long-term equity— generally is paid off after about 18 months. Blumberg says the investments made through his company’s South Florida Urban Initiatives Fund and New Mexico Urban Initiatives Fund, both of which are near being closed out, have performed well, delivering operating returns of 15 percent or better.

Blumberg says plans for a third urban initiatives fund, in New Jersey, fell through when Governor Jim McGreevey, with whom the fund organizers were working, unexpectedly resigned in November 2004 (after the governor admitted having an extramarital affair with a male state employee). “Given the current down cycle in residential real estate, we’re evaluating what would be the next form for a fund,” Blumberg says, noting that he remains “bullish” on this kind of investment.Chapman views better financial structures as a key to improving the quality of community development in America. When he rolls out a new fund later this year, many of his investors are expected to be “foundations, endowments, and other socially conscious organizations” comfortable with a long timeline.

A growing number of foundations are putting money from their endowments into environmentally and socially responsible real estate development. The Heron Foundation has placed $11 million (3.5 percent of its endowment) into the Bay Area and California Smart Growth Funds and the Canyon-Johnson Urban Fund, Genesis Workforce Housing Fund, and UrbanAmerica funds.

California has become a hotbed for smart growth funds, which often favor energy-efficient buildings along with urban locations near mass transit. The California Public Employees’ Retirement System (CalPERS) has invested in funds such as the Green Development Fund — which was begun with the Houston-based real estate firm Hines, for construction of LEED pre-certified office buildings — and the $676 million CIM Urban Real Estate Fund. Two of the fund management companies most active in California are Pacific Coast Capital Partners and Pacific Realty Group. Among the sponsors of such funds is the Bay Area Council, which in 2002 started the $66 million Bay Area Smart Growth Fund I for projects in or near neighborhoods of below-median income and which has since launched a second fund.

Baches is now managing partner of DPZ Pacific, a firm licensed by DPZ to produce plans, designs, and codes in Australia, New Zealand, China, and other parts of East Asia. “ He expects to start funds in that part of the world, where he thinks the prospects for New Urbanism are bright.

Sustainable Fresh Local Markets

Excerpt from New York Times

PORTLAND, Me. — Until last summer, the 136-year-old building at 28 Monument Square had been one of the most visible eyesores at the center of this energetic Atlantic Coast city. You would never know it now.

Most days, a steady stream of customers follow their noses, thirst and appetites into the building, home of the new Public Market House, where in a narrow corridor flanked by vendors they can buy fresh-cut flowers, cheese from Maine farms, a sandwich on fresh-baked bread and beer from state microbreweries.

The seven-month-old market occupies the basement and first floor of the partly renovated four-story building at the heart of downtown, which was last home to a failing surplus store.
Kris Horton, whose K. Horton Specialty Foods has become a local landmark, led an active public campaign last year to establish the new market after the Libra Foundation, a philanthropic organization in Maine, sold the last of its real estate holdings in Portland, including the larger indoor Portland Public Market, two blocks away. Ms. Horton and other food and farm-product vendors had worked in that market since 1998.

The new Public Market House, situated in a square that has supported a large outdoor seasonal farmers market for decades, has become the latest example of how fresh local food and downtown markets can stimulate activity in American cities, big and small.

Although the Public Market House is and will continue to be significantly smaller in size and sales than the old market it replaced, it will not be subsidized. Moreover, the Public Market House’s proximity to the existing outdoor Wednesday farmers’ market prompted the authors of a new economic study to propose promoting the indoor market as the centerpiece of a “market district.”

“Markets bring life to a city,” said Nelle Hanig, a business development specialist in Portland’s Economic Development Division, who helped accelerate the permit process to have the market built. “This one is already a destination. The location of the Public Market House is important to its success. It’s right in the middle of town. It’s becoming a focus of activity, and that’s always good in a city.”

The study, completed last month for the Portland Downtown District, an economic development agency, said that the Public Market House is already attracting enough shoppers to generate $1.2 million annually in sales. The building’s owner is planning to renovate the second floor to provide space for four or five more vendors, who could generate a further $1.2 million in sales.
The market district, the study said, might also include a covered outdoor market with 25 vendors on nearby Lancaster Lane, as well as producers selling goods on “day tables” in Monument Square.

The old market’s sale last August and the steady departure of vendors until its formal closing in January stirred passions throughout the city. Downtown workers and weekend shoppers from the suburbs loved the old market’s homegrown vendors and special events.

But vendors paid less than $20 a square foot to rent space in a market that cost the foundation as much as $75 a square foot, said Morris Fischer, president of CB Richard Ellis-the Boulos Company, which represented Guggenheim Real Estate, the New York investment firm that bought the market last August.

“I believe in the spirit of a public market being a community,” said Ms. Horton, while attending to early afternoon customers. “We found out that a lot of other people in Portland feel the same way.”

Inner City Retail

post from Marvin a.k.a. eMarv

I was just reading the "Welcome to Metropolis" article in Retail Traffic magazine. The article states that "MacFarlane already has 2.2 billion to invest. Meanwhile, DLC Management Corp. Has joined with G.L. Blackstone & Associates to form DLC UrbanCore LLC and is sitting on $100 million in capital." Imagine that! (I wish I had $100M to sit on!) I actually know of a couple of potential infill sites in Baltimore that could be ideal for redevelopment.

BTW, for those that are not convinced about inner city retail, here's an impressive stat from the retail traffic article: "In 2002, ...inner city shoppers went outside their neighborhoods to buy $42 billion in goods, or 25 percent of the total $122 billion retail demand of those consumers, according to a study for the Boston-based Initiative for Competitive Inner City by Boston Consulting Group Analytics with Claritas Inc."

Another benefit (according to executives in the know) is the good returns. G. Lamont Blackstone of UrbanCore states that they are exceeding 13 percent returns and Victor MacFarlane says "the return rate for an initial $50 million (of a total $3 billion) invested by the California Public Employees' Retirement System was 30 percent in 1996."

Still not convinced, here's another extract from the article:
Baldwin Hills-and other inner city successes like Harlem USA, and Gulfgate Center in Houston-are convincing a widening pool of players that investment in minority communities is a good bet. "It will increasingly become mainstream as retailers recognize that there are few other commercial real estate opportunities in this country of the magnitude these present," says Capri CEO and Chairman Quinton Primo, III.

So where are the big inner city players looking next? (I thought you'd never ask... :)
According to Retail Traffic, they are looking in Seattle, Phoenix, Tucson, Dallas, Denver, Fort Worth, Austin, Fort Lauderdale, Tampa, Miami and Jacksonville. While Pittsburgh, Philadelphia and Detroit are flat.

AIA Top 10 Green Winner

The Z6 House

Location: Santa Monica, Ca
Building type: Single-family residential
New construction
2,480 sq. feet (230 sq. meters)
Project scope: a single building
Urban setting
Completed August 2006
Rating: LEED for Homes v1 --Level: Platinum


The Z6 House is a single family residence that was added to a multi-family zoned lot with an existing duplex. The residence has 4 bedrooms and 2 1/2 baths., although the bedrooms open up to the rest of the house for added space when needed.

The house is constructed of factory built modules that were delivered to the site and erected on the site-built foundation over a period of 13 hours; the structural slab on grade serves as the finish floor for the first level. A roof deck takes advantage of views and a green roof with vegetation native to southern California.

This project was chosen as an AIA Committee on the Environment Top Ten Green Project for 2007. It was submitted by LivingHomes, in Santa Monica, California with Ray Kappe Architects, in Pacific Palisades, California. Additional project team members are listed on the "Process" screen.

Environmental Aspects
A commitment to minimizing the ecological footprint informed all aspects of the homes' design. The project team used the phrase "Six Zeroes" to describe the goals of the project: zero waste, zero energy, zero water, zero carbon, zero emissions, and zero ignorance.

The design maximizes the opportunities of the mild, marine climate with a passive cooling strategy using cross-ventilation and a thermal chimney. A 2.4-kilowatt photovoltaic array and a solar hot water collector take advantage of the sunny location, as does the daylighting strategy for the interior.

To create flexible interior spaces, all bedrooms have moveable wall partitions that can be opened to common areas for more space. Large exterior doors and large expanses of glass connect inside to outside and allow living space to expand to the outdoors.

New Urban Home by David Baker + Partners

by Jetson Green

I wanted to talk about David Baker + Partners' (DBP) new design for a development called Blue Star Corner. The design is called the New Urban Home. The New Urban Home philosophy blends loft and condominium attitudes, with a modern feel that tends to build up--not out. This philosophy was brought to the Blue Star Corner development to create a sustainable (LEED for Homes), modern, urban design for the historic Park Avenue District in the Bay Area. All the appliances will be Energy Star, all the plumbing will be water efficient, and the site is located near mass transit. Blue Star Corner is planned for completion in mid-2007.

Green Features:
The developer, Holliday Development, and DBP hope to achieve LEED for Homes certification on this project. Here's some of what they're going to do: will use recycled and non-toxic building materials, non-endangered woods, galvanized metal, bamboo flooring, and environmentally-fabricated CaesarStone quartz countertops; will try to source materials locally as much as possible (keeps money in local economy + eliminates the transportation/gas premium); open spaces will feature sustainable landscaping by Conger Moss Guillard Landscape; appliances will be energy-efficient with Duravit, Kohler, and Bosch brands; and much more.

Other Amenities:
Units will include also Ann Sacks bathtubs, Sub-zero + Jenn-Air refrigerators, Bisazza tiles, Benjamin Moore paint, in-unit iPod docking stations, and personal garages with fold-up work stations. This is all going in with the general setup with a master bedroom, living room, kitchen, and flex room. To add to that, homes will be unique--they won't all have identical features, colors, or design. It's important to cater to individuality.

Extra Links:New Urban Home at Blue Star Corner [Generalized Case Study]David Baker + Partners Provide Design for "Green" Amsterdam-Inspired Townhouses [MHN]

Bike Racks as Art

A new take on Public art? Found this interesting site today called Cycloops. They make very fun and whimsical ways to lock your bike up in the urban or suburban enviornments. You can even submit your own creative design for them to fabricate. Now that is Boho.

The Ren Building

by Tylene

Architecture in China never ceases to amaze me—case in point—the REN Building. Copenhagen’s Bjarke Ingels Group (BIG) proposed this eye-catching design over a year ago to coincide with Shanghai’s “Better City, Better Life” 2010 World Expo . The building takes its form from the Chinese character for person 人 (”ren”) and combines two buildings (one symbolic of mind and the other symbolic of body). We love the poetic inspiration that reflects both site and cultural sensitivity.

“The first building, emerging from the water, is devoted to the activities of the body, and houses the sports and water culture center. The second building emerging from land, is devoted to the spirit and enlightenment, and houses the conference center and meeting facilities. The two buildings meet in a 1000 room hotel, a building for living.”
It’ll be exciting to see if the plans for the project are approved. Check out more views and an animated fly-through of the project below.

The Sears "Modern" Home

Ecerpt from Sears Archives.com

From 1908–1940, Sears, Roebuck and Company sold more than 100,000 homes through their mail-order Modern Homes program. Over that time Sears designed 447 different housing styles, from the elaborate multistory Ivanhoe, with its elegant French doors and art glass windows, to the simpler Goldenrod, which served as a quaint, three-room and no-bath cottage for summer vacationers. (An outhouse could be purchased separately for Goldenrod and similar cottage dwellers.) Customers could choose a house to suit their individual tastes and budgets.

Designing a Sears Home
The process of designing your Sears house began as soon as the Modern Homes catalog arrived at your doorstep. Over time, Modern Homes catalogs came to advertise three lines of homes, aimed for customers’ differing financial means: Honor Bilt, Standard Built, and Simplex Sectional.

Honor Bilt homes were the most expensive and finest quality sold by Sears. Joists, studs, and rafters were to be spaced 14 3/8 inches apart. Attractive cypress siding and cedar shingles adorned most Honor Bilt exteriors. And, depending on the room, interiors featured clear-grade (i.e., knot-free) flooring and inside trim made from yellow pine, oak, or maple wood. Sears’s catalogs also reported that Standard Built homes were best for warmer climates, meaning they did not retain heat very well. The Simplex Sectional line, as the name implies, contained simple designs. Simplex houses were frequently only a couple of rooms and were ideal for summer cottages.

Retail or Gallery??

Excerpts from Superfuture

Amsterdam...
Do you ever get that ' why-haven't-i-discovered-this-place-before' feeling? it just happened to me when visiting this interesting streetsmart store [hilariously, brian jensen of copenhagen's wood wood knew ALL about it and first informed me of this spot]. see an unexpectedly varied and hot range of streetwear, sneakers, watches, cosmetics of dr. hauschka [yo!] and in the near future an increased selection of magazines, books and CDs too. sneakers can be customized to the max, rendering them one of a kind trophies. as with all the other items, goods are carefully selected in order to offer exclusivity and quality. an added value element here are the regular art exhibitions of both emerging and established street artists plus other product related events.

Clientele:
International to say the least but also a wide local following. even some sort of cult status in japan since appearing in brutus magazine in 2002. they're all metric groupies...

Service:
Friendly and personal: leave that to bright-eyed, soft-spoken and globetrotting owner ido who's laid-back and knowledgeable ways add personality to this store.

Interior:
With a name like this it ain't hard to figure out the size but it also gives you a clue about its sobre look which in turn proves to be the proper context for 90 sqm.'s funky merchandise and art display.

Building the New Urbanism

by Erica Ryberg

Urban planners take a cue from pre-WWII cities and towns.

It takes Kiki Wallace one minute to get to work. It’s no accident. He built his neighborhood, Prospect New Town, to be walkable, with wide sidewalks, narrow streets and parks scattered throughout. Most notably, its town center is within five walking minutes of every home.

To create Prospect, the Longmont, Colorado, developer worked with star planners Andrés Duany and Elizabeth Plater-Zyberk. Since its construction, the town has attracted a great deal of interest in the planning community. “We have people from all over the state of Colorado and from other parts of the United States and internationally coming to look at it,” said Wallace. “They’re all wanting to emulate this type of development.”

Post-World War II-style suburban planning assumes that everyone has a car and wants to use it. This model, some urban planners believe, is what accounts for the growing epidemic f obesity, heart disease and diabetes. Now, a growing number of environmentalists, architects and urban planners, including Duany and Plater-Zyberk, are putting their minds together to create human-scale neighborhoods, where parks, shops and schools are all close enough to walk or bike to. They are part of the New Urbanist movement, the most coordinated effort in this country to create these kinds of neighborhoods. “New Urbanism is basically a set of principles to get to that holy grail of a mixed-use, mixed-income, fully socially integrated, non-automobile-dependent kind of place,” said Emily Talen, a professor of urban planning and author of New Urbanism and American Planning: The Conflict of Cultures.

Planned down to the size of the numbers on the houses, New Urbanist communities have a striking regularity about them; the first town Duany and Plater-Zyberk created served as the picket-fenced, pastel-tinted backdrop of the dystopian film The Truman Show.

If, conversely, New Urbanism isn’t edgy enough, head to Arcosanti, architect Paolo Soleri's experimental town rising from the desert north of Phoenix, Arizona. To capitalize on space, Soleri took advantage of the city’s cliff-side location to minimize the use of streets and build in three dimensions. The result is an ultra-compact and contiguous sculptural mélange of tilt-up concrete slabs, high-density housing and work space, sidewalks and...bells. Lots of bells. The manufacture of bronze bells, tourism and workshops support the design interns who are the main workers and occupants of the still-nascent city. Despite Arcosanti’s acclaim as a visionary means of creating urban space (Soleri was honored in July at the White House for his work), it hasn’t yet caught on commercially.

New Urbanism emulates many of the qualities of pre-World War II developments, in part by tacking front porches onto its houses, detaching the garages and shrinking the lawns down to the size of postage stamps. For this reason the movement sometimes goes by the moniker neotraditionalism. That means the features New Urbanists lovingly include in their designs are also available in many older towns and cities across the country. Take, for instance, a city neighborhood such as Uptown, in Minneapolis, or small towns like Portland, Maine, Flagstaff, Arizona, or Madison Wisconsin. All have sidewalks, public transport and discernible centers - central characteristics of New Urbanism. “If it’s walkable and compact and diverse and so forth,” said Duany. “Insofar as it is that, then it’s New Urbanist.”

Base-Miami

For better or worse, the Lincoln Road Mall on South Miami Beach is quite reminiscent of New York's 7th Avenue in the West Village. One shop however, Base, stands out from the rest by offering an exceptionally curated suite of both products and services.

Owner Steven Giles says "we're less about labels and more about the ongoing (and less easily defined) culture of the store, but amongst the labels we’re most proud to be associated with would definitely include Isabella Capetto, Nice Collective, Lemar and Dauley, Maharishi, Martin Margiela and Comme Des Garcons."

"Base is not a specific need-based store, like Sears. Your reasons are less clearly defined. One of my little secret ambitions is to redefine the concept of a department store. By and large, the concept hasn’t changed in the past 100 years. I like to find the unseen links between things. Base has its finger on the pulse of modern cultural living: it’s part of a tribe.

I say to my buying team, ‘Don’t think competitively; think creatively.’ We are selling the mix as DJs sell theirs. I recently read the book, Pattern Recognition, in which the central character seeks cool. That is the job I would love to have. She’s label-phobic, I love that! Over a period of time, my assistant and I have developed a scanning process: this is from laid-down patterns over time that are recognized by your brain. "

But it's not just about clothing and accessories, there's a service slant at Base. An in-house salon, Snip, and a CD Bar offer visitors style and satisfaction on a more soulful level. And the folks at Base have also been known to publish music, design resort uniforms and produce events.

Information about the store and several items for sale can be found on their site, baseworld.com.

The "Branding" of Your Neighborhood

by Frank A. Mills

For the most part traditional urban planning has failed our urban neighborhoods. Rather than being driven by practical considerations and a real understanding of urban decline, much of what passes for urban planning is driven more by wishful thinking than anything else. Ultimately such planning is destined for failure.

If traditional urban planning is not working, let's get rid of it. It's time for a new approach.I hesitate to mention this word, its full of capitalistic connotations at best, greed, at worse, and in between, blind spin-doctoring.

The word is branding.There, I've said it. Before you shut down the blog let me at least tell you what I am talking about.

Think about what made made our urban neighborhoods a place that people wanted to live in, in the first place. I know that when I was a kid, my parents moved to Baltimore's Windsor Hills neighborhood because it had the reputation of being a nice place to live and raise a family. Now, isn't that a form of branding?

Here in Cleveland, many of the older, and not so old, residents of Glenville remember when that neighborhood was known as Cleveland's "Gold Coast" because of its many upscale boutiques, and before that, "Cleveland's Garden Basket" from its many truck farms. Branding, again.But what makes this particular branding significant, is that most of the current residents who mention this, didn't live in Glenville when it was the Gold Coast, and certainly not when it was "Cleveland's Garden Basket."

Although Glenville is in serious decline, the Brand remains.So much so, that some of Glenville's residents want to revive the "garden" part and have Glenville become known as the "Western Entrance" to the International Gardens and Rockefeller Park.

Okay, so where am I going with this?

Do we not buy a particular brand of car because of what it offers in quality and safety, price, and amenities? Do we not buy into the brand – its quality of life and affordability – of a neighborhood when we make decisions about where we are going to live?When we think about revitalizing urban neighborhoods this is where we need to begin, with the neighborhood's brand, with its negative and positive connotations. I suggest that before any plans are made that we articulate the spirit, the qualitative essence, of place. This is the unarticulated brand.

Just as we take cars for test drives before we purchase, we need to walk the neighborhood, to talk to the people, to eat in the restaurants, and to drink in the pubs. We need to learn to feel what made, and makes, the neighborhood a neighborhood — before we create plans.

We need to think of neighborhoods as a "her" – an ever-evolving living organism – not an "it" devoid of life.

We need to understand why she is in decline (if she is), not from the perspective of urban experts, but by hearing, seeing, and feeling her story. We need to see her through the lenses of the camera. We need to see her inside out, through the windows of her homes, stores, places of work, and cafás and the lives of her residents.We need to become part of her life, just as we must make her part of our life. We need to feel her embedded poetry. And when we do, we will discover her essence, and be able to articulate it, to "brand" it.

The brand is not the neighborhood's essence; rather the brand proclaims her essence. When we realize her essence, we have something we can latch hold of, something that we can "sell"— an urban neighborhood where people that want to visit and to live in. Done correctly, an amazing phenomena will take place: residents will begin to demand all that the brand promises (just like they expect and demand certain qualities from commercial brands): good schools,livable homes, retail amenities; everything that makes a neighborhood home. The seeds to stop decline are sown, and the neighborhood begin to experience, once again, the realization of her vital essence through development that truly builds upon who she really is.

Let's throw away the master plans. Let's start spending our energy in discovering, and experiencing, the embed poetry, the essence, of our urbanneighborhoods. Then, and only then, do we have that hitherto elusive essential quantity necessary for the revitalize our urban neighborhoods

Analyzing Real Estate

by Clifford A. Hockley

Investing in real estate is a tricky business, and like the stock market, every investment will not be a great one. As a matter of fact, what makes a great real estate investment is keyed as much to timing and interest rates as it is to the true operating costs of a property.


I will grant you that every marketplace is different, and market conditions may force you into overpaying for a property you really want, but if return on investment is what you want, you cannot afford to overpay for real estate investments if you expect to retire on the income. Sure, there is a lot to be said for leverage and appreciation, but at the end of the day the cash flow is what counts.

So how does an investor assure himself that s/he is making the right decision and assembling an income and expense statement that is accurate?

1. Examine many similar properties at the same time.
It is helpful to examine similar pro formas at the same time. You will see what one owner or broker may include, and what another may leave out. Look at the market to see how long it is taking to find a new tenant. Talk to other real estate brokers, lenders and property managers in the market to establish a baseline.

2. Review operating numbers for the past three years.
Most financial analysis reports will exclude capital expenses. Bear in mind that you must reserve for capital expenses. The roof will leak, the HVAC will fail, and the main water line will break. I guarantee things will happen that you do not expect. Prepare financially for potential problems. Remember that real estate is an asset that wears out: doors need to be painted, carpets replaced, new faucets installed, etc. By reviewing three years of income and expenses, you will have a much better idea of vacancy rates as well as real expenses.

3. Obtain comparable rent income numbers.
Drive around the neighborhoods where your potential property is located. Call the brokers and the managers to find out what the rents are. Are there any concessions being given to rental units or lease space? Use this information to verify the figures you received for the property you wish to buy.

4. Examine the vacancy rate in the market place.
Each market and specific type of real estate investment has a vacancy rate. Some locations are better than others, and will perpetually have a higher occupancy rate. Look for concessions that have been offered. How will they affect your cash flow when you own the property? Why is your property full? Did the seller hastily rent to tenants from emergency aid shelters (yes, this has happened in weak markets). Banks will not loan on buildings with more than a 5% vacancy rate. They will, however, offer construction loans if you are renovating the building. This may give you some time to find tenants to fill a building, otherwise you will be forced to guarantee the rents, which means your hard-earned cash will not be at work making more money for you.

5. Talk to an appraiser regarding common incomes and expenses in the marketplace.
This seems like common sense, but no one seems to do it. The agent representing you is motivated to close a transaction. They may not be experienced, or may not provide all of the information you need. You need accurate information to make an informed decision.

6. Review the BOMA and IREM expense analysis books for the marketplace.
These books are updated every year and can give you an in depth look at how properties are operating.

7. Ask for schedule "E" tax return information for the property.
Many sellers will refuse to supply the schedule, but in my mind, the proof is in the pudding.
In my conservative opinion, cash flow is what the investor seeks. If your property has an 8% -10% positive cash flow after all of the adjustments discussed above, it should make sense. Many buyers also use CAP rates as an indicator of value; I find it to be a lagging indicator if you compare your property to others in the marketplace. Just because other investors are buying a 4% CAP property, does not mean you should. Maybe the market is overheated, perhaps there is more demand than supply, maybe you should look in a market with 8% - 11% CAP rates, or perhaps low interest rates give you the opportunity to buy something with a low CAP rate and still make money.

You should look at comparison indicators as you pursue your investment strategy:
CAP rate, cash-on-cash return, debt coverage ratios, price per unit (or price per square foot for comparable properties in the same marketplace), percentage of expenses (are they inline or understated). Don't forget to look at the financing and due diligence costs as part of your transaction.

All this analysis may mean that you will make lower offers than another investor. It may mean that you will not be willing to pay as much as a seller wants.
On the other hand, do you want to buy a property that will not appraise, or worse yet, not have a positive cash flow? I do not think so.

Park Forest: the new community model

Exerpt from Metropolitan Planning Council

South Chicago suburban Park Forest has been a model community from its inception. A town built in the late 1940s as one of the nation's first-large scale planned unit developments, Park Forest 's success gave rise to a format that shaped thousands of communities across the country for decades. It had one of the first regional shopping malls, the village's main economic engine for years, which only fell on hard times when shoppers took their pocketbooks to newer indoor malls in the 1990s. The village recognized the futility of a Park Forest Mall with no major anchors and converted its failed mall to a town center—DownTown Park Forest—cutting streets through parking lots, taking down outmoded buildings and reinventing itself. Now, once again, the village is leading the way, modernizing suburban homeownership opportunities, breathing new life into the downtown and attracting new investment, proving that Park Forest is building its legacy and creating a great place to call home.

The groundwork for this transformation was laid in 2003, when village leaders invited the Urban Land Institute-Chicago and Campaign for Sensible Growth to convene a Technical Assistance Panel (TAP) to assist with increasing the viability of the newly created DownTown. The industry experts who comprised the panel offered several workable strategies as reported in Building on the Legacy: Creating a New DownTown. In the few short years since the TAP took place, many of the recommendations have been implemented, creating a new legacy in historic Park Forest .

Project "Row Houses"

Exerpt from New Your Times.

ON a strangely balmy late autumn afternoon, while the art world busied itself in Miami with beachfront reservations and limo drivers, Rick Lowe was, as he generally is, on Holman Street in southeast Houston’s predominantly black Third Ward, greeting another out-of-towner.

In the gloaming, decrepit houses and weedy lots dotted some surrounding blocks, on the edges of which were new double-garage brick homes — signs of encroaching gentrification, an unwanted side effect of Mr. Lowe’s work.

Although it’s hard to tell at a glance, this stretch of Holman may be the most impressive and visionary public art project in the country — a project that is miles away, geographically and philosophically, from Chelsea and Art Basel and the whole money-besotted paper-thin art scene.

Mr. Lowe, a lanky, amiable, remarkably youthful-looking 45-year-old artist from Alabama, moved to Houston 21 years ago and lives here in the Third Ward, where he founded Project Row Houses. In 1990, “a group of high school students came over to my studio,” he recalled. “I was doing big, billboard-size paintings and cutout sculptures dealing with social issues, and one of the students told me that, sure, the work reflected what was going on in his community, but it wasn’t what the community needed. If I was an artist, he said, why didn’t I come up with some kind of creative solution to issues instead of just telling people like him what they already knew. That was the defining moment that pushed me out of the studio.”

He tried to think afresh what it meant to be a truly political artist, beyond devising the familiar agitprop, gallery decoration and plop-art-style public sculpture. He considered what the German artist Joseph Beuys once described as “the enlarged conception of Art,” which includes, as Beuys put it, “every human action.” Life itself might be a work of art, Mr. Lowe realized: art can be the way people live.

And the Third Ward could be his canvas. He was inspired by John Biggers, the late African-American muralist who painted black neighborhoods of shotgun houses like the ones on Holman Street and showed them to be places of pride and community, not poverty and crime. “It hit me,” Mr. Lowe recalled, “that we should find an area like the one that Biggers painted that was historically significant and bring it to life.”

Behind him as he spoke, a phalanx of 22 gleaming shotgun houses stretched across two blocks. Built in 1930 as tenant shacks, derelict by the early ’90s, they were bought by Mr. Lowe and a coalition of artists and others. To Mr. Lowe they were like “found objects.”

Seed money came from the National Endowment for the Arts and from the Elizabeth Firestone Graham Foundation. The director of the Menil Collection gave his staff Mondays off to help renovate. Chevron redid the outside of a dozen buildings. Hundreds of volunteers pitched in to clear trash and sweep up used needles, hang wallboard and fortify porches. A local church adopted a house, and so did people and families from the neighborhood.

Top 10 RE Investor Financing Mistakes

Excerpt from: lassitermarketing

1. Quitting the Day Job Too Soon
Repeat after me: “Equity does not pay the bills.” I see it happen all the time. An investor gets a few rentals and decides to quit the day job to pursue investing full time. Big mistake. Don't quit the job until you have 12 months of living expenses saved up and/or monthly cash flow equal to what you were making at your day job.

2. Being Broke and Greedy
My mentor used to say, “You can't be broke AND greedy." In RE investor world it means that if you have no money to put into a deal you better be prepared to pay high rates or give up some equity to a partner.

3. Underestimating Holding Costs
If you're a flipper, in most areas today, your properties are taking a lot longer to move. Factor in ALL of your holding costs to the budget - loan payments, utilities, etc - so you don't lose all your profit.

4. Not Properly Setting Up Your Entity
If you list your occupation as real estate investor on a mortgage loan application, you are in for a tough road ahead with the underwriter. You may as well say you are a drug dealer. Same goes for naming your LLC. Try not to reference anything having to do with flipping or foreclosure help or anything like that. Stick to an easy name to deal with like Acme, LLC.

5. Paying Cash for a Property
Paying cash for a property is fine as long as you don't need the money back anytime soon. If you do, then you're trying to get an unseasoned cash out refinance and if you're lucky enough to find a lender to do the loan, you will pay through the nose for it.

6. Buying a Rental That Won't Cash Flow
WHY would you do that? Remember, equity does not pay the bills. This is the main reason why investors go broke.

7. Deeding the Property to an LLC Before It Is In Permanent Financing
Let's say you buy a property with private money and take title in your LLC. When you go to refinance it, the lender will either require you to deed it out of your LLC before closing or they will deny the loan outright. Risk mitigators are telling lenders that the loans that have the highest rate of default are usually in names of LLC's so many lenders won't touch them if they've EVER been titled in your LLC. Just take title in your name, get your financing set and THEN put it into your LLC for asset protection.

8. Using hard money That Doesn't Include Repairs
This is just dumb. Just use a 100% conventional loan at half the rate and ¼ the fees and have the seller pay closing costs since you're funding the repairs out of pocket anyway. Same goes for companies that will cross-collateralize equity in another property to fund repairs. Just get a HELOC yourself and pay ½ the interest rate.

9. Listing for Sale While In Short Term Financing
I have guys come to me all the time to try to refinance their short term hard money loan because the property they are flipping has not sold. Good luck. Why? Well, you have a vacant, unseasoned, rental property that has been listed on the MLS within the last 6 months. Even if we can get a lender to do the refinance you will have a prepay penalty that will make you cry.

10. Not Having Adequate Cash Reserves
You should not own a property and have no money in the bank or available credit on a line of credit. Something will come up and then you will be forced to make a bad decision. This is a business and every business needs cash reserves.