Hamtramck: Scale and Institutional Frameworks

22 thoughts on “Hamtramck: Scale and Institutional Frameworks”

    1. The thing about all the redevelopment initiatives is that they need to be really big to pencil out for all the agencies and corporations that get involved. Anything small is crushed early in the game.

  1. Kind of unrelated to this post but I only recently discovered your blog, so…

    I’ve noticed you write about New Jersey a lot and I’m wondering if you’ve visited Red Bank lately? 15 years ago they were calling the town “Dead Bank” and now it’s not unusual to see a Lamborghini parked on a downtown street. You can’t get a table at a restaurant there on a Saturday night.

    A couple of years ago they put up one of those giant, mixed use apartment buildings you’ve talked about, right across from the train station, replete with giant pictures of pretty single women on the outside.

    1. I spent considerable time in Red Bank when I lived in Jersey. I had friends in The Highlands just above Sandy Hook. As a much younger person I imagined myself living in one of the grand apartments above the shops on Broad Street. Those old brick buildings with the classical touches were so solid and beautiful. And yes, Red Bank’s downtown was in fact dead back then. This would have been the late 80s and early 90s. All the money was in the leafy suburbs around Rumson and Tinton Falls.

      The towns that most agressively embraced “urban removal” when suburbia was in full blossom (and turned their historic downtowns into a collection of parking lots) are the hardest to repair now. The ones that quietly let things slide from benign neglect and the ones that have a good chance to come back strong.

  2. I’ve been howling about big local government for years, but it occurs to me that if “decentralized” tyrants in local governments and even small business are all making the SAME sort of rules, then there might be broader more “centralized” cultural, political, or Wall Street pressures on them to do so.

  3. Always great observations. You’re both right. Everywhere in the US has the same set of ridiculous social & regulatory rules that essentially mean if you’re just a typical private citizen, don’t even think about changing the form or function of building. The BIG difference in Rust Belt is just that there’s so much under-utilized property that regular middle class folks can get into a pretty much any property-type serving their intended purpose today at a reasonable price point. Plus, the region has the nation’s largest concentration of walkable urbanism – which has been more or less outlawed since WWII. So, if your dream is to have a neighborhood tavern or a main street store, there’s no place in the US with lower barriers to entry. However, that cool riverfront machine shop that’s been boarded up since 1929 won’t be bootstrapped into the average person’s law office with an auxiliary apartment in the back. However, if we beg hard enough megacorp might turn it into a “catalytic” mixed use development with just a few million in historic preservation & affordable housing grants, and then rent it as a law office with an apartment in the back. It just is what it is.

  4. So in a nutshell, if I read you correctly, the disease that is rotting the US is that it has become corporatized to death: it’s not “We the people” anymore but “We the incorporated”.

    1. I have a less conspiratorial interpretation than the straight up “crony capitalism” folks. Our situation is more subtle than that.

      As the US economy grew and our influence around the world increased everything got bigger decade after decade including our corporations and government agencies. We needed these larger institutions to manage the ever expanding complexity and scale.

      Our national quandary now is that growth is essentially over and we need to scale back down. The hangover is huge and no one wants to give up whatever position they currently enjoy and rely upon. We’re going to struggle with too many middlemen and administrators hovering over too little productive activity. So everyone is going to get squeezed really hard.

      Everyone insists that growth is strong, but it’s all just paper and electrons pretending to be real economic activity. The trajectory of the US for the next few decades will involve unwinding a mountain of bad debt (both public and private) and learning to live with a lot less of everything. The end of the dollar as the global reserve currency will be the definitive moment when we realize the true condition of our domestic affairs.

      This won’t be the end of the world. We’ll all still be able to live relatively comfortable lives. But the political and social stress of contraction might make it feel like the Apocalypse.

      1. I think your take on growth is wrong. The economy can grow without things getting bigger. For example, someone could get out and sweep the streets in America.

      2. I wonder if the decline of prior empires (especially British) could provide a preview. But there doesn’t seem to be another superpower to step in afterwards. Maybe a less conflicted world due to reduced military adventuring?

        Corporate decline evidenced by asset stripping management. Too much innovation is incremental, or for trivial instead of important problems; partly why I see tech deflating to some extent.

        Japan has suffered overhang over two decades, although they seem to have handled the social aspect much better. China looks precariously close to falling into similar trap. While Russia fell far in and can’t get out.

  5. The Housing Elements to some communities’ General Plans put great emphasis on meeting their future housing needs through granny units. I tend to be cynical enough to think that the planners who draft this nonsense are sophisticated enough to know that few will ever be built and that that is really the intent. In addition to the cost of building them, how many homeowners really want to be a landlord with their tenants right next to them? Mortgage costs and the potential income may make some consider this (as evidenced by the number of people who take in AirBnB visitors), but it’s still a minority who would even consider this, and most of them will be put off by the costs of actually building such a unit.

    As for Hamtramck, I find it doubtful that in a locale with low housing costs a developer would find it financially viable to build a 200 unit lifestyle condo project. Most people, especially if they have young families, would probably rather have a house. A lot would depend on Detroit’s recovery, job growth, population increases, and whether that eventually results in even more restrictive building codes that push people into condos. That might be a generation away at least.

    1. Personally I prefer living as close to my tenants as possible. We tend to have good relations. And for many people with granny flats or duplexes the folks they house are relatives. Hence the term… granny.

      It’s true that people who love cities often obsess over walkable mixed use neighborhoods and downplay the larger trend toward fully detached single family homes in suburbia. Then again, people with an obsession for single family homes on cul-de-sacs suitable for children are often oblivious to the pent up demand for urban living even in otherwise funky places like Detroit.

      A significant number of large condo and apartment complexes are currently being built in downtown Detroit. I’ll be blogging about that situation soon. I’ve got photos. There’s a profitable market for such places in the urban core for young professionals and empty nesters even in metro areas with a glut of cheap housing. People aren’t necessarily interested in living in all parts of Detroit, but the particular neighborhoods that are doing well are thriving.

      Developers have figured out that in select locations there’s pent up demand for in-town living. Building new units in a cluster that includes some refurbished historic properties with urban amenities (restaurants, cafes, sports, theater, etc.) pencils out economically. And don’t forget the endless subsidies and tax breaks that sweeten the deal. That process could easily occur in a place like Hamtramck. Or not…

      1. You make some fair points, but bear in mind that many of the millennials are now passed 30, marrying and having families. So, while there is still a flow of youthful millennials about to finish high school and become young adults, many of whom will love city living (I did when young) for a while, there is also a baby bust going on that is especially acute in the northern states. You’re right about the incentives. You can certainly force Bay Area builders to build a lot of apartments – they’re sprouting like mushrooms after a rain on the peninsula, but I have a hard time seeing it in a place like Detroit.

        By the way. Good web site. Having played a bit in the real estate game, you hit upon a number of subjects I find interesting. Semi-retired now, though, and still recovering from the wounds.

        1. Many of the infill projects I see around the country cater to aging Boomers as much as Millennials. I’ll be blogging about this soon. Small low maintenance apartments in amenity rich neighborhoods appeal to the bar bell demographics at both ends of the chart.

          A significant number of older suburban NIMBYs will eventually be living in some of the same quasi urban infill complexes in their own neighborhoods that they fought against. They just don’t know it yet. Most of it will be “density without urbanism” with apartments on the side on a bland eight lane arterial in what was a dead mall. But it will be “good enough.”

  6. I was tempted to comment, “Perhaps if you opened a small business in the store front and lived in the back…..” OR ” …or two…”. But I’ve read many of your previous posts, only starting recently. I practiced your under the radar methods for many years successfully and aliken it to the Supreme Court guy who said to “arranging your affairs in such a way to pay the least tax possible” is AOK.
    As a property manager in a small downtown district in the E. Bay Area for the last 20 years, you put a foundation under my disparate thoughts regarding govt and progress and community. Thanks.

    On a separate note, perhaps you might see a chink in the armor with the new granny unit decree by Gov Brown to localities. While we are obsessed with vacation rentals here in San Diego currently, the layout of the city with its alleys and multiunit housing culture appears to be ripe for helping the city solve its housing crisis. Hah!

    1. Personally, I’m no longer interested in attempting to do much of anything that isn’t plain vanilla legal as-of-right. If you have to go begging for permission… I’m out.

      Alissa at Bank Suey is smart enough to keep out of debt and take things one step at a time without rocking the boat. I admire her. But I stand by my initial assertion. Hamtramck is going to scrape by at its current low level until large scale developers come in and do the heavy lifting with special government incentives. Nothing else is legal. After a dozen 200 unit condo complexes go up in Hamtramck Alissa will be well positioned to leverage her property. If the big stuff never happens she won’t lose anything and can carry on at a moderate pace in a town that’s not bad as it is. It actually reminds me of the Mission here in San Francisco when I first arrived a long time ago.

      As for Governor Brown’s granny flat decree – Meh. The cost of building anything in coastal California is off the charts. Have you priced lumber and such lately? Have you tried to find a competent contractor in recent years? It’s tight out there. Regardless of the regulatory patches only fairly expensive projects will be built and only relatively high rents will be sufficient to service the associated construction loans. $400 a square foot is the absolute minimum price these days for a nothing special stucco box. So a 500 square foot granny cottage would be $200,000 even before associated permits and the blah, blah, blah. Is that really an affordable housing option for the people who need it the most?

      The people best positioned to take advantage of the new granny flat option are institutional investors who partner with established construction firms to buy and build out dozens or hundreds of properties with an economy of scale. That’s probably not the mom and pop situation the law was attempting to foster. Again, Meh.

      1. Basic construction doesn’t cost $400 per square foot, even in California. In outlying areas where land isn’t so expensive you can find new homes at less than $150 per square foot. It’s not going to cost much more to plop down a small one-story cottage in some capacious back yard in your typical California suburb.

        The first movers will be landlords renting out houses and there are a lot of those. There’s going to be at least one more round of state legislation first though, because the municipalities will figure out some underhanded way to block the granny flats and the state will have to forbid whatever it is.

        1. I’m not going to argue numbers here. I’m sure there are new homes being offered at $150 per square foot in fresh subdivisions in the Antelope Valley, Riverside, Modesto, or wherever. I know people who work for the companies that build them. But the cost of extruding 200 stucco boxes on a greenfield site on the edge of the metroplex is an entirely different animal than building a one off backyard cottage.

          A neighbor directly across the street in Sonoma is in the process of putting a 1,000 square foot plain old addition on to his modest existing home and it’s supposed to cost $400,000. Have you ever known such a project to come in on budget?

          1. Agreed. It is very expensive to dig up streets or alleys or driveways to make new water/sewer connections (and in most places it’s illegal to piggyback from one “primary” structure” to a “secondary” (granny flat) unless they are fully attached.

            Mobilizing a (name your trade) contractor costs the same whether they are wiring 10 2500 sf stucco boxes or one 500 sf apartment-over-garage (often referred to as carriage houses in older Eastern/Midwestern cities). A furnace and AC system doesn’t cost 1/5 for the 500sf apartment. A 100-amp electrical panel costs the same. Having the (electric, gas, water) utility drop service and install a meter costs the same.

            It is not at all surprising that in a place where greenfield construction costs $150/sf that a granny flat would cost 2-3x that.

            1. It really doesn’t matter if it is $150 a sq ft or upwards of that, the point is there are limited numbers of people who own lots where such a building could be built, who want to, and then who have the money to do so. It’s not really even a partial housing solution for any city in the US. The numbers of them that will be built per year per city are almost completely inconsequential.

              1. Look… a hundred years ago the absolutely normal thing that occurred everywhere as-of-right without anyone thinking twice about it was for a small cottage to be build on a scrap of land in a growing town. Some years later when the family had a bit more money the house was added on to. Then it was added on to again. And again. And all along the way the house was being used not just as a single family residence, but a home business, a place that rented out spare rooms, a small productive garden with chickens and such… This is what every Main Street town was like.

                And when the family had enough money or property values rose high enough the whole thing was pulled down and replaced by something new and bigger – typically with ground floor shops with apartments above and a smaller building in the back if there was room.

                Our current culture will not tolerate any of this. It’s not how we do things anymore. It’s not what most people want to see happen next door. And our existing spread out development pattern doesn’t readily support it. So we have insoluble problems that we can’t and won’t fix. Instead we’ll continue to struggle with the consequences.

                When those consequences only affected poor people that society never cared about anyway it didn’t matter. But as the former middle class contracts more and more people are finding themselves living with reduced circumstances in a landscape they can no longer afford. They’re angry about their lost status. But we collectively won’t embrace the older traditional living arrangements because it’s considered low class and beneath our dignity. Shrug.

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