Here are some links that are worth your time to explore and then to come back to later because there was something that applies to a problem you will be trying to solve in 6 months:

I started a blog because I got frustrated repeating myself on topics I figured any builder or developer already knows. I found that if I just copied the five paragraph explanation I had just written to someone and pasted it into the blog template, all I needed to do was find an appropriate image to go at the top of the post and a catchy headline and it would become a blog post . Something that other people might find useful. Posting the information in a blog would reduce the time I would need to spend repeating myself, since I could just point people to the blog post where they could get all kinds of useful information. I have not been very active on the blog for some time, but there is still a lot of good content there.

Some background; In 2008 I was working on a team developing a wonderful 200 acre master planned regional infill project next to a middle school and an elementary school with a greenway running through it, when the financial crisis hit. We had just completed all of the California Environmental Quality Act requirements and were ready to start engineering the roads and utilities when the real estate crash in Northern California hit.. We had about 30% of the project in local bank debt. The rest was all equity when the bank called our loan. That meant that the loan had to be repaid in 30 days and the only way to do that was to put in more equity, more cash from the partners. Because I could not come up with any additional cash, I lost an my stake in the project when I could not fund my share of the cash call. I was "diluted out".

That experience taught me a brutal lesson about putting all my eggs in one basket. Economies of scale will not save you from a huge disruption of the real estate economy. Big projects require big capital investment and carry big risks. My partner David Kim and I were both laid off from the development company. We hung out a design and development consulting shingle and started looking at what kind of small projects could still find financing through the 1 to 4 unit typical VA, FHA, Fannie Mae, Freddie Mac 30 year mortgage if we could find partners to fund the construction with cash. We found that if you could build with cash from your partner or private lender and then pay off the cost of buying the property and building the four-plex with a government insured 30 year residential 1-4 unit mortgage. At the time FHA and VA loans had the strictest limitations on non-residential space in a 1-4 unit qualifying building at 20% of the building SF.

Shifting Scale out of Necessity The result was the Form Follows Finance Four-plex (or 4-F) We designed it to fit with its narrow end to the street on a 50' wide typical lot, or with its wide side to the street on a 100' wide lot with parking behind the building. We sent this prototype design around to everyone in our network urging them to take the open source resource and adapt it to their local market.
The first iteration of the 4F and its accompanying pro forma are shown below.

I spent 2009-20215 trying to teach basic real estate math to my friends and colleagues in the Congress for the New Urbanism (CNU). I was trying hard to convince them that as policy wonks, planners, urban designers, architects, developers, and builders dedicated to making places worth caring about attempting, they would be smart to bet on the places where they were working professionally and construct and own some buildings that would provide some passive income. With some passive income they might be better prepared for the next Great Recession. Maybe next time they wouldn't have to lay off their entire crew and watch them struggle and scatter to the four winds.. I can only imagine how annoying I must have been to some of those folks I have known for 20 + years…. https://www.cnu.org/

Here is an early lecture video from 2011 at the University of Miami's Masters of Real Estate Development + Urbanism program: http://www.andersonkim.com/news/lecture-at-the-university-of-miami.html

We had very limited success in our attempts to turn Urbanists into small developers…. Again, I was probably pretty annoying in my approach.

In the summer of 2015 we started a nonprofit with several colleagues called the Incremental Development Alliance (IncDev). For the last 5 years we have been running around the country teaching workshops and bootcamps folks how to develop small projects in their neighborhood. This effort also includes working with local municipalities to help them clear the zoning and procedural underbrush that can have a disproportionate impact upon small operators. I figure the content we delivered through the lectures and hands-on exercises delivered about 60% of the benefit for the local small developers and people looking to get into the business. The other 40% was the opportunity to meet their people and finding support from like-minded folks in their area, and maybe their neighborhood.

IncDev's work during the pandemic has been limited to on-line workshops and bootcamps. https://www.incrementaldevelopment.org/

Lots of IncDev videos here:https://vimeo.com/incdevalliance

There are links in this blog post to Professor Arthur C. Nelson's book Reshaping Metropolitan America. The blog also has a link to his downloadable data set.
Here is a video of his lecture given around the same time as the book was published: https://www.youtube.com/watch?v=mKH_yMfqeo8

Check out the We Do Incremental Development Facebook Group. The group has a good culture, focused upon pragmatic solutions with a tendency for the Architects in the group to drift into thought exercises and theoretical design firm time to time. Lots of helpful people in the group. Worth scrolling back in the timeline there and poking around in the FILES or VIDEOS sections of the group page.

https://www.facebook.com/groups/smalldevelopersandbuilders

An early version of the 4-F

The first built example of the Form Follows Finance Four-plex (the 4-F) in the Hampstead Neighborhood of Montgomery, Alabama.

People keep asking me "When are we going to get a real grocery store in Downtown East Point?" That's a legitimate question, but the answer requires learning a bit about how the folks who operate grocery stores decide to put a store in one community over another community.

Here is a very straightforward set of location criteria for LIDL grocery stores. The LIDL folks break it down based upon the local context. Is the site in a Suburban setting, a neighborhood center, or a downtown urban setting? Each has a population requirement within the service area and a median income for the service area. The more spread out the development pattern, the more money each household needs to make.

This is pretty much how a retailer looks at a potential location. Where will the customers come from and how much money do most of the potential customers make.

A secondary set of metrics have to do with the other retailers in the same area, competitors and complimentary anchor institutions or retailers. They want to know who else is operating in the same local market area.

We have a 17,000 SF building on Washington Road which would be suitable for LIDL, but our city's median household income is less that the threshold needed to recruit LIDL to East Point.

Our population is 34,875 and our Median Household Income is $40,882. In order to have our site considered by LIDL we need more folks living in East Point and we need folks in East Point to be making more money.

Until the number of people living in East Point increases and until our residents make more money, retailers like LIDL , ALDI, Trader Joes and the rest will continue to locate their stores in places that hit their numbers.

If you google the name of the store you would like to see in your neighborhood with the words "site selection criteria" you can find out pretty quickly what it will take to get their attention.

Last night the 3rd Police Precent building in Minneapolis burned. Social media is going to be full of folks trying to make sense of recent events in Minnesota.

After listing to the news this morning and walking the dog around the neighborhood, here are my thoughts:

We are hearing the term Systemic Racism a lot. So let's unpack that term. It is really horrible to face the reality that we have a cultural system in place that ends up getting black and brown folks killed at the hands of local police. That same system produces other effects and impacts; lousy housing, physical and mental health, economic inequity hit black and brown folks harder than most white folks. Roll all that heartache into a glacier of needless suffering and most white folks can't face it. We have a hard time recognizing that we could ever be personally culpable in something that evil. If we come to terms with being part of that monstrous system, then what?

Systemic Racism is a big and formidable monster. I think the enormity of the problem is why people with even a little bit of privilege feel a need to deny that they have a part to play in building a new system. It is hard to know where to start, what to do differently, or if you can even trust your own mind, knowing that racism has a grip on some dark corner of your mental real estate.

Let's face it. White folks can be really embarrassing sometimes. We can also be really dangerous to black and brown folks and extremely clueless at the same time. These are the same privileged people that need to find the resolve to face the monster and resist the temptation to rationalize the evil they have seen.

A culture and system that has the evil of racism baked into it is not going to somehow evolve into something better with the fullness of time. We cannot not be satisfied by doing work that results in a slightly less shitty system.

For something that runs this deep we need to build a radically different alternative on purpose. It will require a lot of work to push the needle from shitty, well past neutral, to something excellent and equitable. Can that be done in a generation? It is hard to commit to a task that will not be completed in your lifetime, but that does not mean we shouldn’t do it.

The pandemic and the Covid 19 Recession are presenting us with the opportunity to make a dramatic shift in building trust and equity in our local communities. It would be great if we could look to our political leadership for inspiration and meaningful guidance in this time, but that is unlikely. The work that needs doing is going to be at the scale of individuals, households, neighborhoods, and local communities.

I don't know what that work needs to be, but I am convinced that the scale and location of where that work needs to be done is extremely local. We will probably have to figure this out as we go, but change is only going to happen at the speed of building trust. Trust is built between individuals long before it is built between individuals and institutions.

Boarded up duplex in New Orleans

MAY 29, 2020