Breaking Barriers

to Affordable

and Abundant

Housing

A German–US Comparison of Publicly Led

Development Projects

By Yonah Freemark

Table of Contents

Methodological Approach

5

Comparing US and German Approaches to Urban Development Policy 8

Land-Use Regulatory Policy

9

Integrated Development Planning

11

Public Sector Support for Housing Development is Generated at Multiple Governmental Levels 12

The Role of Community Engagement

15

Case-Study Cities and Their Publicly Led Developments 16

Demographic and Economic Context

18

The “Living Lab” Publicly Led Development Sites

28

Barriers to Publicly Led Development

43

Zoning and Building Constraints in the Context of Inadequate Comprehensive Planning 45

Difficulties in Attracting Investment to Neighborhoods with Little Demand—and Gentrification in Other Areas

46

Challenges Timing Projects to Meet Public Goals

47

Resident Opposition to New Construction

49

Short-Term Political Horizons and Devolved Public Administration 50

Challenges at the Intersection of Local and Federal Policy 51

Breaking Barriers to Building Housing through Publicly Led Development Projects 54

Strategic Use of Publicly Owned Land Combined with New Financing Sources and Affordability Guarantees

55

True Integration of Transportation and Housing Investments in the Face of Challenging Project Timelines

59

Multi-Stage Planning Process, Integrating Resident Engagement 62

Developing Appropriate Land-Use Regulatory Codes 63

Conclusions 65

Appendix 66

Endnotes 72

References 76

Breaking Barriers to Affordable and Abundant Housing 1

As construction has slowed, urbanization rates have increased, income inequality has expanded, and government investment has declined, cities around the world have increasingly struggled with housing affordability (Ball and Wood 1999; Birch and Wachter 2011; Freemark and Steil 2022; Scanlon, Whitehead, and Fernández Arrigoitia 2014). In this challenging environment, local governments in the United States and abroad are promoting publicly led development projects that integrate housing and transportation investments, with the goal of creating mixed-use and mixed-income neighborhoods. Yet policymakers promoting such projects face systemic barriers. They must overcome restrictive zoning policies, attract investment to low-demand neighborhoods, align project timelines across multiple public objectives, encourage resident support, maintain political commitment in the face of continuous electoral pressure, and work across governmental levels. In this paper, I show that cities can use strategies including expanded use of public land, integrated transportation and housing investment planning, multistage public engagement processes, and reform of land use regulation to overcome obstacles to increasing housing availability. Approaches like these, implemented in the context of publicly led projects, can assist localities in responding to inevitable patterns of growth in a way that promotes social equity and increases environmental sustainability.

Breaking Barriers to Affordable and Abundant Housing 3

Policymakers at many governmental levels broadly agree city building. The pace of privately financed construc-about the need to increase housing availability and afford-tion reflects whether there is private-sector demand for ability; private-market investors cannot accommodate new investment in the first place. Many communities enough new housing for all those who need it. One funda-throughout the United States have failed to increase their mental problem is that local governments have enforced housing stock at all over the past two decades (Freemark strict local regulations that make it difficult to build new 2022). One explanation for that is the predominance of homes, such as rules that prevent anything larger than exclusionary zoning. But another explanation is that poor single-family homes from being built or that ban a mix of jurisdictions simply cannot attract investors for new uses in largely commercial neighborhoods. Building and projects. Even relatively well-off municipalities with ac-fire codes, instituted at the municipal and state levels to commodating zoning codes have been unable to attract promote safety, can also slow or discourage construction enough housing construction to ensure affordability for by raising costs (Listokin and Hattis 2005; McFarlane, Li, all residents. 2 And federal support for housing affordable and Hollar 2021). These rules often constrain develop-to households with low incomes has declined in recent ment in the most sought-after areas and impede con-decades (Vale and Freemark 2012).

struction (Monkkonen, Lens, and Manville 2020; Quigley and Raphael 2005). Competition for a limited number Some cities, therefore, have promoted an alternative of units increases over time, raising rents and purchase to relying on private investors alone. They have led the prices (Kendall and Tulip 2018; Zabel and Dalton 2011). This conception and implementation of integrated develop-problem—which occurs in both the United States and ment projects, or comprehensively planned projects, Europe—is particularly acute in some of the wealthiest which involve local governments selecting sites, creating cities and towns, which sometimes use exclusionary tac-development plans, and contributing to project financing.

tics to prevent new people from moving in (Freemark and These projects hold particular promise to add to the local Steil 2022; Freemark, Lo, and Bronin 2023). Although such housing stock and reduce housing costs, while encour-rules rarely ban publicly subsidized or other affordable aging social integration, reducing carbon emissions, and housing explicitly, they often have the de facto effect of improving quality of life by concentrating investments in preventing its construction.

focus neighborhoods. In this paper, I investigate how six cities in the United States and Germany are undertaking Though many face resident or policymaker opposition these publicly led projects with the goal of identifying to rezoning to encourage substantial new building, some best practices in their approaches. I find that publicly led local and state policymakers are working to review and housing projects have been enabled by:

revise their zoning laws with the goal of accommodating new construction (Pendall). Some US state governments,

• The strategic use of publicly owned land to reduce too, have begun instituting minimum requirements for the cost of providing affordable housing and to plan density in local zoning codes, with the goal of maximizing for a mix of uses from the start of project develop-construction for cities (Manji et al. 2023). And evidence ment. Atlanta is redeveloping city-owned land through suggests that over the long term, more accommodat-its new Urban Development Corporation to create

ing zoning could result in an increase in construction high-density mixed-income housing. In Berlin, the (Freemark 2023a; Freemark et al. 2023) as well as a city government has acquired land at the city edge to reduction in housing prices (Wassmer and Williams 2021).

create master development plans that support city Higher-density zoning is particularly useful for encour-growth.

aging private-sector investment and making room for publicly subsidized affordable housing. 1

• The integration of housing and transportation investments from the start of project planning. Seattle But the regulatory policies put into play by local govern-planning staff are working with the regional transit ments are only one part of the complicated equation of provider to fund new affordable housing in areas 4

around a light rail line. Frankfurt is planning to extend

• Regulations that provide cities the tools to advance a light rail line to provide service to its new housing projects in the interest of housing development. The development.

German cities leveraged federally authorized policy that allowed them to freeze land prices once an area

• The creation of multi-stage resident engagement was identified for development. In Munich, the city processes that enable plans to meet local expecta-took advantage of a policy that allowed it to cap rent tions. In St. Louis, community leaders and other resi-increases in a target area to prevent gentrification dents have played an essential role in identifying priori-and displacement even as it invested in neighborhood ties for the development project. Berlin undertook a improvements.

three-stage design competition with urban designers in dialogue with a jury of experts and residents to final-Other cities considering how to expand housing construc-ize plans for its new development district.

tion through publicly led projects could consider implementing a mix of these approaches in the coming years.

Methodological Approach

I evaluate two questions about publicly led projects. First, are challenged to provide access to affordable housing, what are the major impediments for public entities to have a strong commitment by city leadership to address add housing supply, particularly units that are affordable this, and have interest in participating in an international for people with low and moderate incomes, in large new research project. Five US cities were considered, and GMF

city developments? Second, what can cities learn from selected three after consulting with federal partners and one another to break those barriers? To answer these with an eye to geographical balance around each country.

questions, I compare US and German urban development GMF also assembled a team from each city to represent policy, then leverage an analysis of case-study projects multiple stakeholder sectors, including the person leading in cities in the United States and Germany. To understand affordable housing, another person working in the city these projects and the issues faced by local stakeholders, government, and a cross-sector partner not working for I conducted interviews, visited sites, collected project the city government.

data, attended convenings, and amassed third-party documentation.

These cities reflect a cross-section of each country’s urban environments, and each is facing considerable Data and evaluation

housing cost and availability challenges similar to those present throughout the metropolitan areas in their re-Staff at the German Marshall Fund (GMF) and its partners spective nations. Each city has a number of development in Germany, including the Federal Ministry for Housing, projects underway; for discussion here, I selected proj-Urban Development and Building and the GIZ (Deutsche ects that prioritize housing investment, integrate housing Gesellschaft für Internationale Zusammenarbeit) iden-development into broader community programing (such tified the six case-study cities (Berlin, Frankfurt, and as access to transit and parks), and are being led by local Munich in Germany, and Atlanta, St. Louis, and Seattle governments, rather than private investors.

in the United States) and worked with those cities to select integrated development sites for evaluation (the With the assistance of an intern at GMF, Sarah Phalen, I GMF refers to those sites as “living lab” sites). These cities conducted a series of interviews with city staff members Breaking Barriers to Affordable and Abundant Housing 5

from the team of each of the three US cities and with rep-and noted the special conditions of the integrated devel-resentatives of nonprofit organizations and the US federal opment sites.

government. The staff members represented mayor’s offices, planning departments, housing departments, and My work was coordinated with research led by a separate transportation departments. I conducted interviews on but collaborative German research team led by planning several different themes, including general development consulting group TSPA and involving Stefan Heinig and goals, the relationship between federal and local govern-Bauhaus-Universität Weimar. Throughout the project rements on housing policy, and the potential for integrated search period, this group led the development of a series housing development. These interviews were open-end-of materials designed to provide insight into conditions ed, designed to suss out the major barriers and potential in the German cities. They conducted interviews with opportunities for more housing development. I conducted German local stakeholders, collected data, and produced interviews with 14 individuals, ultimately conducting a a series of reports reflecting their findings. I pull from total of 23 interviews as I spoke to several people multiple those reports to describe conditions in the German cities times. In the findings that follow, I sometimes refer to and about the German case study projects.

comments made during interviews, but I keep the names of respondents anonymous to ensure the confidentiality I used an iterative approach to develop this report’s find-of the points of view they expressed.

ings. By bringing together the variety of data sources, reviewing scholarship, and coding interviews and learnings With the broader “Breaking Barriers” team (consisting from the convenings, I was able to identify some primary of GMF staff and representatives of each of the cities), I barriers to successfully developing publicly led projects—

conducted site visits of integrated development projects while specifying potential approaches to surmount them.

in Atlanta, Berlin, and Frankfurt. These visits aligned with all-day convenings in each city organized by GMF and Limitations

GIZ, which provided formal and informal opportunities for me to learn about the approach that officials are taking to The projects and cities I profile in this report should publicly led urban development. Again, I mention some not be construed as necessarily representative of their of the comments made during these convenings in the respective countries as a whole. First, project leadership findings below, though I keep comments anonymous.

had to be willing to engage in the transatlantic learning process; it is possible that cities facing different sorts of Again with the assistance of Sarah Phalen, I reviewed challenges chose not to participate (or were not selected scholarship and site plan information about each of the for inclusion by German Marshall Fund staff). Second, cities and sites. I also collected data from a variety of city-level stakeholders selected the projects for consider-datasets, including those provided by the US Census ation themselves; there may be other projects in each city Bureau, the real estate brokerage giant Zillow, and the that encounter different barriers to housing investment or National Housing Preservation Database, among others that may provide other potentially useful approaches to (all relevant data sources are noted below tables and break those barriers.

figures). For the most part, I provide data at the metropolitan scale (meaning the US Census-defined “core-based It is also worth emphasizing that the case-study cities statistical area” or the German federally defined metro-vary significantly in terms of their demographics and politan area3); at the municipal scale; and, for US cities, at economics (some suffer from decades of systematic the neighborhood scale (generally meaning census tracts, disinvestment, while others are high wealth localities), and which are not associated with any political or elected they are located in two different countries. Germany and body, but which nonetheless are often used by research-the United States have vastly different histories and cur-ers to describe neighborhood-level demographic and rently have different economies and politics, which inform economic conditions). Using these datasets, I assessed how development projects in the two countries may be the general conditions in each of the case-study cities implemented. These different economic, historical, and 6

political contexts means that observations in one location may be only partly meaningful with respect to another, and comparing outcomes among them may be difficult.

By focusing on the approaches local governments are taking to promote new housing development, this research offers new insight into the challenges and potential of new publicly led projects. However, most new housing in the United States and Germany is developed by private developers. These private entities likely face many other difficulties, and opportunities, than the public sector does. For example, they are more likely to face challenges related to zoning regulations. Further research is necessary to explore the differences between the two countries in how private developers undertake projects.

Moreover, because of the constraints in the study timeline and the parties involved in the project group, I do not undertake much examination of the importance of state (or Länder) governments in making policy related to land use. This is a gap in the work, since the jurisdictional power of local governments in both countries is determined by states. Moreover, states can play an important role in supporting investments, such as in affordable housing.

Despite these limitations, this research offers new insight about how urban development works in the United States and Germany. Stakeholders from each of the cities—like many of their peers globally—share the goal of providing more housing and ensuring that housing is affordable. This comparison can help provide new examples for stakeholders in cities across both countries to consider as they are undertaking projects.

Breaking Barriers to Affordable and Abundant Housing 7

Comparing US and German

Approaches to Urban

Development Policy

8

In this section, I provide a broad overview of how urban development policy is conducted in the United States and Germany. The two countries have considerable differences in planning approaches that impact how they undertake publicly led projects.

Land-Use Regulatory Policy

In the United States, local governments are “creatures”

As in the United States, local governments in Germany of their respective state governments; their existence is make most choices related to land-use policy. They do so predicated on the choice of state legislatures to accord them various arrays of jurisdictional power over various through a required land-use plan (known as an FNP), simi-aspects of urban life (Frug 2008). There is no constitu-lar to a comprehensive plan in the United States; the FNP

tional provision for any state to guarantee independent establishes the zones intended for development. FNPs decision-making by cities and towns—and state leg-are designed to last between 10 and 15 years. These must islatures sometimes preempt housing-related choices follow rules established in the federal Spatial Planning made by localities, such as enabling inclusionary zoning Act, which is intended to coordinate planning and de-or rent control (Fowler and Witt 2019). Nevertheless, most velopment policy across the country (Enssle, Martens-states (in part inspired by federal recommendations in the Neumann, and Heinig 2023). These local plans are nested 1920s (Freemark et al. 2022)) have determined that most within regional, state, and national plans, which set aside elements of land-use and housing policy—including zon-guiding principles (Enssle et al. 2023). Comprehensive ing, building codes, building permitting, and affordable plans are associated with more specific designations housing requirements—are choices to be made by local over districts (B-Plan)—similar to US form-based zoning legislatures, like city councils and county boards.

but focusing more on urban design aspects—that must follow the rules established by the federal government Zoning is the set of rules that defines the scale of building in the Land Use Ordinance (BauNVO) (Hirt 2012). Local and type of uses allowed in communities. It is typically governments must also follow the national building code implemented through a set of policies described in a (BauGB) (Enssle et al. 2023).

zoning code, which describes allowed development jurisdiction-wide and by district; the code is then associated Cities in the United States and Germany can leverage with parcels of land throughout a community on a zoning different regulatory tools to assist with the comple-map. In some states, zoning policies must reflect compre-tion of publicly led development projects. Although US

hensive plans, which lay out more generalized principles federal law does not articulate much in terms of specific about development goals by neighborhood, and which policies local governments can use to undertake such also must be approved by local legislatures. There are no projects (largely leaving policy development to states or federal requirements related to either zoning or compre-home-rule localities), the German building code explicitly hensive plans, and states vary in terms of the degree to provides local governments a set of policies that they can which they enforce regularity among local jurisdictions’

use to advance projects. The BauNVO includes specific land-use regulations (in many states, adjacent jurisdic-provisions for localities to designate mixed areas (MI) and tions use completely different rules and standards, often urban areas (MU), for example, in local B-Plans for partic-even to describe the same requirements).

ular districts. The US federal government, on the other Breaking Barriers to Affordable and Abundant Housing 9

hand, has no standard zoning principles, and the fact that a specific area for protection. In these communities, Germany does may improve the ability of developers to cities can deny the issuance of new building permits invest in new housing projects, though that is outside the and take advantage of the right of first refusal for any scope of this research.

building or land sales (meaning they can buy buildings or land put up for sale as long as they match the pri-Key policy areas and relevant policies include the follow-vate market offer). Landlords in the area are prohibited ing (this list is not meant to be comprehensive; I devel-from charging rents higher than in comparable parts oped it based on discussion with policymakers as part of of the city. United States: In some states, cities are this project):

authorized to leverage a right of first refusal, as well, as with Massachusetts’ allowance for cities to purchase

• Urban development planning. Germany: The Urban housing to preserve affordable housing (Damrosch Development Measure (§ 165-171 BauGB) allows cities 2020). Moreover, some US cities are authorized by to define specific districts, whether currently con-state law to implement rent control or rent stabiliza-structed or not, for development. This measure, which tion policies, which limit rent increases, though those German city staff describe as the “sharpest sword” in policies are relatively rare (Rajasekaran, Treskon, and their toolkit, immediately freezes land prices at their Greene 2019).

assessed level once cities define the district, with the goal of enabling city governments to eventually pur-

• Environmental review. Germany: The Land Use Plan chase the land through eminent domain. This action for Internal Development (§ 13a BauGB) tool allows prevents private investors from taking advantage of cities to advance quick action on small-site devel-planned zoning changes or land purchasing plans by opments. Cities can exempt environmental review

increasing how much they will charge to sell their land; assessments and public participation for infill sites less the city can then expropriate the land at a reasonable than 20,000 square meters. United States: In some cost and expand the footprint of publicly owned land.

states, environmental review policies are limited; in Cities or city-chartered agencies then generally act others, there have recently been efforts to reduce the as master developer, with long-term ground leases.

burden of review. In California, for example, recent leg-Profits can then be leveraged for infrastructure invest-islation has limited environmental review requirements ments (which can be conducted by both public and for publicly subsidized housing projects. 4

private entities), as well as costs for social elements like daycares, schools, and green spaces. The Sectoral

• Protecting environmentally sensitive areas.

Development Plan (§ 9 para 2b BauGB) is a new land-Germany: The 2010 Federal Nature Conservation Act use tool implemented by the federal government only (Bundesnaturschutzgesetz) requires that development in 2021 and thus not yet extensively used. This regula-projects that involve the destruction or impairment of tion is designed to speed the construction of addi-natural areas must compensate for that destruction or tional housing, particularly social housing, and can be restore ecosystems equivalent to the area demolished.

combined with rent control regulations. United States: This must be financed by the developer as a means of Many cities have housing or urban development au-offsetting the negative impact (Baganz and Baganz thorities with the power to expropriate land for public 2023). United States: There is no state or federal stan-use using eminent domain, but they cannot freeze dard for natural area compensation or restoration due land prices in the context of zoning changes or public to development projects, though federal and some investment plans that may increase land value.

state laws can prevent projects from being undertaken if they threaten endangered species.

• Preventing gentrification and displacement.

Germany: The Social Preservation/Milieu Protection

• Project-by-project contracts with private develop-Statute is designed to combat gentrification and ers. Germany: The Urban Development Contract (§ 11

displacement. The cities using this tool can specify BauGB) tool allows cities to enforce a binding contract 10

on private landowners through a site-by-site negotia-projects in exchange for providing a pre-defined public tion over project elements and funding. Landowners benefit (Spauster, Lo, and Freemark 2021).

in some cases sign agreements that two-thirds of increased land values produced by changes to zoning

• Investing in underused land. Germany: The Building requirements are redirected to infrastructure. United Requirement (§ 176 BauGB) allows municipalities to States: Many cities undertake planned development define certain areas of the city for which they oblige processes with private developers that involve nego-property owners to invest in new construction if the tiation over project elements, allowing cities to ask city can demonstrate that doing so would be eco-for specific public benefits to be included in projects, nomically reasonable for the owner. Though this tool such as affordable housing units (Kim 2020). In some is rarely used, it could support housing investment on cases, these processes are negotiated through a com-sites where landlords have been hesitant to invest be-munity benefits agreement. This can also be facilitated cause of their sense that they could make more money through zoning bonuses, which enable developers to by waiting a longer period of time before construction.

receive a boost in the allowed density of their planned I found no similar regulation in effect in US cities.

Integrated Development Planning

The dominant transportation mode for the past centu-formerly agricultural and natural land with new develop-ry has been the car, whose omnipresence and popular ment (Glaeser and Kahn 2004).

appeal has encouraged policymakers to realign transportation networks and land uses around its needs through In the United States, the New Urbanism movement

the construction of highways and mandates or allowances has since the late 1980s proposed an alternative ap-for cul-de-sacs, strip malls, and office parks (Mattioli et al.

proach generally founded on the goal of creating walk-2020). In both Germany and the United States, more than able communities with a mix of uses (Congress for the 80 percent of trips are taken by passenger car, though New Urbanism 2000). New Urbanist communities have travel varies significantly depending on the density of the popped up throughout the United States as a form of local environment (Fountas et al. 2020). In line with the integrated development, combining investment in new needs of the automobile, land uses such as residential, homes with retail, parks, and other social amenities. New commercial, and industrial spaces are often separated Urbanism’s frequent counterpart is transit-oriented devel-from one another, unlike the mix of uses that character-opment (TOD), which is premised on the idea that those ized previous development patterns. Automobiles are as-walkable communities should be oriented around public sociated with a wide array of harms. They perpetuate so-transportation access (Dittmar and Ohland 2004). Major cial inequality by requiring those who use them to spend new public transportation projects are now almost always more on transportation than those who do not—and they conducted in association with development plans around cut off access to opportunity for those who cannot afford future stations, to maximize the benefit of the additional a car‘s high purchase and operations costs. 5 Automobiles accessibility made possible by rail or bus service.

produce vastly more pollution than urban bus and rail networks, contributing to the climate crisis rather than TOD has come to dominate as a mechanism to plan for assisting in the broad goal of abating it. 6 And automo-future development in both German and US cities, and biles encourage urban sprawl, pulling people further from simultaneously, cities have expanded interest in transit one another, reducing the economic potency of historic investment. Atlanta and Seattle, for example, each have city centers, and requiring the massive replacement of large transit expansion plans funded and currently under Breaking Barriers to Affordable and Abundant Housing 11

construction, while St. Louis has preliminary plans for a view that cities built around these goals are more equita-new light rail corridor that would traverse the center of ble and sustainable.

the city from north to south. 7 Frankfurt has approved an expansion of its light rail network, and Berlin’s government Integrated development concepts have been leveraged plans new subway lines in the coming decades. 8 These successfully to produce appealing, often mixed-income investments offer an opportunity for integrated plan-and mixed-use neighborhoods (Ibraeva et al. 2020). But ning linking transportation access with new housing-rich there are systemic obstacles to attracting investment in neighborhoods (Pojani and Stead 2018).

lower-income areas where developers are less likely to make a profit (Hess and Lombardi 2004). Moreover, transit TOD offers several co-benefits. In combination with new access—while essential for people with low incomes—

infrastructure investment, governments gain the oppor-increases housing costs nearby. This can result in people tunity to amass land near stations and lead projects on with low incomes either facing housing cost burdens, or this land (Paulsson 2020). Publicly owned land can reduce such people being displaced to other parts of the metro-housing construction costs and allow for integrating politan area with less accessible transportation services housing with other land uses—from retail to schools, available (Kramer 2018; Padeiro, Louro, and Marques da parks, social service centers, and employment centers Costa 2019). Either way, these outcomes are unappealing (Théry et al. 2016). Even so, assembling and using publicly in the context of a locality searching for mechanisms to owned land may be difficult because of limited public increase access to housing for all.

resources and competition with private market investors.

Cities evaluating mechanisms to expand housing con-TOD goals are embedded in the New Leipzig Charter struction through publicly led projects face a challenge, (Eurocities 2020), a document created by a consortium then, in pushing for integrated development that simulta-of European cities to reflect sustainable development neously improves access to public transportation services goals. The Charter recommends that, in the pursuit of while also guaranteeing that the neighborhoods with the common good, cities should lead in the creation of access are affordable enough for a wide spectrum of the

“compact, socially and economically mixed cities with local population. But achieving such outcomes means well-developed infrastructure and a healthy environment”

that engaged localities must plan for a wide variety of po-

(2). This can be achieved by prioritizing justice, environ-tential interventions beyond just transportation projects mental protection, and productivity, with an integrated and a land-use plan. One potential opportunity is investing approach that combines investment in transportation in expanded affordable housing, to which we now turn.

with housing and other land uses, at multiple scales, meaning both at the neighborhood and city levels. The Charter’s development concepts reflect a widely shared Public Sector Support for Housing Development is Generated at Multiple Governmental Levels

Both the United States and Germany face challenges help fill the gap, though approaches differ. But neither has with affordable housing, with a large share of residents made public subsidies a priority in the housing market.

facing cost burdens that make it difficult for them to pay England, France, and the Netherlands, for example, each for adequate housing. In both countries, public subsidies subsidize more than 15 percent of their housing stock 12

directly through public programs, a far higher level than equity for apartments that generally guarantee rents either of the case-study countries (Scanlon, Whitehead, affordable to households whose incomes are equivalent and Fernández Arrigoitia 2014).

to 60 percent of their respective metropolitan area’s median incomes. These projects include acquisitions of In the United States, the federal government plays a role existing properties, renovations, and new construction; in subsidizing access to affordable housing for people in 2021, state housing finance agencies financed about with low incomes. Federal support is often combined with 150,000 units, of which about a third were new construc-state and local housing assistance, and many housing tion (Freemark and Scally 2023). LIHTC has supported the units affordable to families with relatively low incomes are construction or renovation of about three million units available on the private market, though the supply of such since the program was introduced in 1986. Many LIHTC

units has declined in recent years. 9 Overall, about five projects incorporate additional subsidies, such as HOME

percent of US households live in a unit covered by federal funding, to make projects more affordable to households subsidy (Vale and Freemark 2012). The US federal gov-with lower incomes (Kneebone and Reid 2021).

ernment currently distributes housing assistance through two primary means. First, the US Department of Housing Much of the recent housing policy debate in the United and Urban Development (HUD) provides funds to local-States has revolved around whether subsidized housing ities, states, and housing authorities. HUD’s major pro-funds should be leveraged to support giving households grams include Section 8 housing vouchers, which support with low and moderate incomes “access to opportuni-about 2.4 million households and 5.2 million individuals ty”—meaning the ability to live in neighborhoods with who receive rental assistance, mostly in private-market well-funded public services and employment options.

apartments; the public housing program, which sup-Public housing and other sorts of publicly supported ports about 800,000 units nationwide; and the Section 8

investments have been located in neighborhoods with project-based program, which subsidizes about 1.2 million limited amenities and poor access to transportation (Talen private-market units (US Department of Housing and and Koschinsky 2014). The Section 8 voucher program has Urban Development 2023a). Only about one in four eligi-enabled many people to move from high-poverty neigh-ble households actually receives federal public assistance borhoods to other locales (Ellen 2020). But those moves for housing, suggesting persistent underfunding for HUD

have sometimes been associated with higher transporta-programs (Ellen 2020). The public housing and Section 8

tion spending for households, which adds a cost burden project-based programs—which were key to many post-for many (Hamidi, Ewing, and Renne 2016).

war US urban development projects—largely stopped funding new housing construction in the 1980s, so funds Others have emphasized bringing opportunity to subsi-mostly go to maintaining units and subsidizing resident dized housing neighborhoods. Beginning in the 1990s, rents. Each of these programs restricts rental costs to HUD began investing in mixed-income, mixed-use reno-30 percent of household incomes, and units are typically vations or replacements of public housing neighborhoods reserved for families with low incomes (families whose under the HOPE VI program (Goetz 2012). Public hous-incomes are at or below 30 percent of the median in their ing projects have suffered from underinvestment, high respective metropolitan areas). In addition, HUD subsidiz-rates of crime, and concentrations of poverty that made es housing construction through the much smaller HOME

them challenging communities in which to live (Vale and and Housing Trust Fund programs ($1.5 billion and $382

Freemark 2012). These HOPE VI projects—which may be million in 2023, respectively).

seen in some ways as the conceptual predecessors of the publicly led investments on which I focus this paper—of-Second, the Internal Revenue Service distributes Low-ten integrated multiple subsidy streams and sometimes Income Housing Tax Credits (LIHTC) to state housing private investments. HOPE VI projects emphasized New finance authorities (as well as a few city authorities), Urbanist designs, meaning moderate-scale buildings, which then allocate them to investors who can use them walkable streets, and, where possible, access to commu-to limit their tax liabilities. These investors, in turn, provide nity needs like businesses and schools (Hanlon 2010). In Breaking Barriers to Affordable and Abundant Housing 13

this fashion, these redevelopments departed significantly Despite the overall decline in federal support for social from the large towers that were characteristic of many housing, there has been a recent effort by local public postwar public housing projects. HUD’s more recent housing developers to build new social housing projects Choice Neighborhoods program, which replaced HOPE

or maintain affordability in older ones. One estimate VI, has continued in this approach (US Department of suggests that about a million units originally built under Housing and Urban Development 2023b).

federal contract are now owned by public or non-profit landlords that maintain low rents (Scanlon, Whitehead, Local and state governments play a supporting role in af-and Fernández Arrigoitia 2014).

fordable housing investments in the United States. A large share of cities and states operate housing trust funds, Germany also has a system for ensuring affordable hous-which they can use to supplement federal sources or sim-ing for tenants. The federal government’s housing ben-ply fund new projects directly (Spauster, Lo, and Freemark efits—Wohngeld—are guaranteed subsidies for house-2021). Others use inclusionary zoning—requirements that holds with low incomes, assuming they meet residence new market-rate projects integrate affordable units—to requirements (Enssle, Martens-Neumann, and Heinig expand access to affordable housing. Nonetheless, these 2023). These benefits support about 550,000 house-approaches have been limited in terms of their ability to holds across Germany, which is similar in scale to the US

address the housing need (Freeman and Schuetz 2017).

Section 8 housing voucher program; that said, many more households receive housing assistance as an unem-The German government currently subsidizes about five ployment benefit—this totaled €15 billion in 2009 alone percent of its housing units through project-based social (Schmidt 2021). Unlike in the United States, landlords are housing; about three-fifths of that is publicly owned generally unaware that families are using housing bene-

(McCarthy 2019). In the postwar period, both the East and fit, but some households do not apply for them because West German governments built millions of social hous-of the bureaucratic difficulty doing so entails (Scanlon, ing units, but many have either been demolished in the Whitehead, and Fernández Arrigoitia 2014).

years since or lost their social housing status, entering the private market. In recent decades, an average of 100,000

In addition to support for affordable housing, both the units were lost each year, with only about 25,000 units United States and German federal governments provide added (Scanlon, Whitehead, and Fernández Arrigoitia localities subsidies for urban projects. HUD’s Community 2014). The federal government’s recent support for the Development Block Grant program, or CDBG, funded housing has been limited, with funding declining by a third about $3.3 billion in allocations in 2023. 10 These dollars to €1 billion annually between 2020 and 2024 for social can be used for a variety of local infrastructure improve-housing construction (Schmidt 2021).

ments, though they cannot be used for housing construction. The German federal government supports city In most cases, social housing construction is financed projects through Urban Development Support grants via through contracts with private, public, or non-profit hous-the states; its funding (€790 million annually) is almost ing cooperative developers, which received subsidies in identical on a per-capita basis to CDBG funding in the exchange for maximum rent levels and maximum income United States. 11 Cities can receive funding by specifying levels, generally over 30 years (Scanlon, Whitehead, and specific redevelopment or preservation areas in which Fernández Arrigoitia 2014). These contracts shifted from they plan to invest (Enssle et al. 2023).

grants to loans over time. The social housing program has developed housing for different income bands, ranging from affordable to families with low to middle incomes, over the years. But on average, social housing rents are somewhat lower than those offered in the private market (Schmidt 2021).

14

The Role of Community Engagement The postwar period of urban development in the United planning encouraged advocates to promote resident States and Germany emphasized the use of large-scale engagement—efforts to involve those directly affected renewal projects that leveraged public powers to lead by potential changes in the process of making decisions major modernist developments (Klemek 2011). In German, (Arnstein 1969).

these projects were often built where buildings had been demolished by bombing and fires during World War II. In In the decades since, urban planning professionals have the United States, urban renewal required localities to use adopted participation as a key element of almost every eminent domain to take over and tear down large sections decisionmaking process related to the built environment, of existing neighborhoods. This approach to redevelop-and engagement is mandated as part of many environment was enabled by the 1949 US Housing Act, which mental reviews in the United States (Slotterback and funded localities and states to declare certain communi-Lauria 2019). In Germany, the B-Plans developed by local ties “blighted” (whether or not that was actually the case), governments must incorporate public participation, with demolish the old structures, and then reconstruct new the processes determined by federal law. In some cases, buildings on the emptied sites (Zipp and Carriere 2012).

development proposals incite significant resident protest, Many of the new buildings were publicly subsidized public occasionally resulting in project cancellation (Enssle et housing, but others were private investments; the dif-al. 2023). In recent years, projects in German cities have ferentiation between which investment occurred where begun to engage residents more concretely through was typically a reflection of the local real-estate market co-creation of development plans, as I describe in the (Pritchett 2003). The passage of the 1956 US Federal case study section that follows.

Highway Act, which provided enormous funding for the completion of the Interstate highway system, reinforced The use of public engagement has, in some cases, been this approach through the federally sanctioned erasure of formalized through semi-official bodies of neighborhood city blocks, replaced by rights-of-way for fast automobile residents and community boards that often review pro-traffic (Rose and Mohl 1979). The result was massive de-posed development projects before being considered by struction of urban quality of life meted out disproportion-elected councils. And, in general, the prioritization of pub-ately on communities where people of color and families lic engagement has meant that it has become increasing-with low incomes predominated (Brinkman and Lin 2022; ly difficult to build major projects without “discretionary Karas 2015).

review” by officials, often leaving housing investments open to political pressure to delay timelines, reduce the German cities demolished far fewer pre-existing neigh-scale of new construction, and sometimes kill projects borhoods for urban renewal or highway projects. But in entirely (Manville et al. 2022).

both countries, this postwar approach to redevelopment was largely conducted with limited public engagement. In the United States, local bureaucrats and elected officials, in concert with state and federal officials, announced plans for neighborhood demolition without much opportunity for people in impacted areas to object.

Residents nevertheless began to protest—and they did so in cities throughout the United States and much of western Europe (Klemek 2011). Much of the dissent revolved around the harms done by freeways specifically (Mohl 2004; Mohl 2008). This resistance to “top-down”

Breaking Barriers to Affordable and Abundant Housing 15

Case-Study Cities and Their

Publicly Led Developments

16

Each of the case-study cities included in this project is In this section, I first review major similarities and dif-the core jurisdiction of a large metropolitan area, with a ferences between these cities that inform the real-es-long history of urban development. Nevertheless, these tate market and access to affordable housing, and then cities diverge dramatically in terms of their economic describe the publicly led development plans each mu-and demographic conditions. St. Louis, for example, has nicipality has put forward. In table 1, I summarize key struggled due to the pressures of deindustrialization and characteristics of each of the case-study cities and their racial segregation; Munich, on the other hand, has flour-development sites. I detail both elements in the sections ished due to its centrality to the luxury automobile market that follow.

and high-tech industry. Moreover, each city has a very different plan for its integrated development site. But they share enough characteristics to allow me to compare their varying approaches to urban development planning.

TABLE 1

Overview of City and Publicly Led Development Sites for Each Case Study City Conditions

“Living Lab” Publicly Led Development Site

Atlanta

Growing city in a rapidly growing

Thomasville Heights neighborhood, including former metropolitan area with a diverse

public housing site (which has become reforested) and population. Faces gentrification in the

former site of subsidized Forest Cove apartments. At city context of low housing affordability and

edge and adjacent to federal penitentiary. Surrounded by high municipal income inequality.

neighborhoods of predominately single-family homes, near gentrifying areas. Transit options currently limited to an infrequent bus line, though city is considering implementing improved service.

St. Louis

City has been losing population for

Near North neighborhood, encompassing Carr Square and decades. Population is about 55 percent

Old North St. Louis, includes previous site of closed Pruitt-of color, compared to the rest of the

Igoe public housing complex (which has been reforested) metropolitan area, which is 74 percent

and will host future National Geospatial-Intelligence Agency non-Hispanic white. High poverty rates,

complex. Large HUD Choice Neighborhoods grant assisting about twice as high as metropolitan

funding for 695 units of new housing, public services, and area. Limited market demand for new

corridor placemaking in community with high vacancy rates.

construction.

The project may be connected with the urban core with a future, but currently unfunded, north–south light rail line.

Seattle

Rapidly growing, relatively high-density

Areas surrounding two light rail stations—International city with high housing costs fed by

District–Chinatown and Delridge—along future West Seattle expanding tech sector. Currently

and Ballard Link extensions, with initial phase planned for constructing large regional transit

opening in 2032 and project expected to be completed by expansion project.

2040. Area around both is partly industrial, but near districts with significant development demand.

Breaking Barriers to Affordable and Abundant Housing 17

City Conditions

“Living Lab” Publicly Led Development Site

Berlin

Growing city with high rates of poverty

Buch am Sandhaus is the former site of a secret service and relatively high housing costs.

hospital and the surrounding area; it is located at the History of underinvestment in some

northern edge of the city, in the Pankow district. Site is now neighborhoods.

mostly forested. Plan for up to 3,000 apartments, some on previously unbuilt land, linked to city with regional rail line.

Frankfurt

Diverse city with low-for-Germany

Frankfurt Nordwest is a development scheme for a population densities and an active

550-hectare tract of land that is currently largely agricultural economy dominated by financial

or unused by human residence northwest of the city. Plan for services.

6,800 housing units (30 percent subsidized) and 7,000 jobs connected to city via regional rail and extension of city’s light rail network.

Munich

Rapidly growing, high-density city with

Werksviertel-Mitte is a 39-hectare district in central Munich some of Germany’s highest incomes and

that was previously industrial and which is to be transformed lowest poverty levels.

with 1,150 housing units, about 28 percent of which are to be social. Adjacent to major regional rail station. Part of citywide redevelopment plan to add housing.

Source: The author, based on a review of research material and interviews.

Demographic and Economic Context

In table 2, I compare demographic and economic charac-welfare rolls (in Germany). St. Louis’s adult residents are teristics in each of the case-study cities. Berlin is largest also far less likely to hold bachelor’s degrees than those of the cities by surface area and by population (Berlin, living in the other US cities; Munich’s residents have higher in addition to being a city, is officially a German state).

college education rates than those of the other German Munich has the highest population density, more than cities. Comparing quality of life indicators through the three times as high overall as Atlanta. Atlanta and Berlin human development index, the German regions score have almost identical metropolitan populations of more slightly higher than Seattle, and significantly more than than 6 million, with Munich, Frankfurt, Seattle, and St.

Atlanta or St. Louis. Residents of the German cities are far Louis following, in that order.

less likely to travel to work by car (less than 40 percent of commutes by car in all three cities) than in Atlanta and St.

Compared to the other cities, Berlin and St. Louis are the Louis, and somewhat less likely than Seattle, which has a least well off, with the lowest incomes and highest share low rate of car commuting for a US city.

of people living below poverty (in the United States) or on 18

TABLE 2

Demographic Characteristics of the Case–Study Cities Seattle is the most densely populated of the three US cities Atlanta

St. Louis

Seattle

Berlin

Frankfurt

Munich

Land area (square miles)

135.3

61.7

84.0

344.1

95.9

120.0

Municipal population (2021)

496,480

293,310

733,904

3,677,472

759,224

1,487,708

Population density per square mile

3,669

4,754

8,737

10,690

7,920

12,400

(2021)

Population change from 2000

+19.2% **

–15.8%

+30.3%

+8.7%

+18.2%

+22.9%

Population change from 1950

+49.9% **

–65.8%

+57.0%

+10.2%

+43.6%

+80.6%

Metropolitan population (2021)

6,144,970

2,806,615

4,011,553

6,144,600

5,604,523

5,991,144

Municipal population share of

8.1%

10.5%

18.3%

59.8%

13.5%

24.8%

metropolitan area (2021)

Share of journeys to work by car (2016

58.7%

70.2%

41.8%

37.7%

39.3%

35.4%

for Germany; 2022 for United States)

***

Share population non-Hispanic white

39.2%

44.7%

60.1%

NA

NA

NA

(2021)

Share population non-German (2011)

NA

NA

NA

14.1%

25.1%

22.9%

Per-capita income (US, 2021) or

$55,051

$33,810

$74,733

€38,016

€45,276

€45,360

average gross salary (Germany, 2022)

Persons below poverty line (2021)

18.0%

20.4%

11.0%

NA

NA

NA

Persons on welfare rolls, by state (2015) NA

NA

NA

15.2%

6.5%

3.9%

Gini index of income inequality (city,

0.55

0.50

0.50

NA

NA

NA

2021)

Breaking Barriers to Affordable and Abundant Housing 19

Atlanta

St. Louis

Seattle

Berlin

Frankfurt

Munich

Gini index of income inequality

0.47

0.47

0.47

NA

NA

NA

(metropolitan area, 2021)

Subnational HDI* (2021)

0.90

0.91

0.94

0.96

0.97

0.95

Share adults with BA or more (US,

59.8%

38.9%

68.3%

43%

42%

54%

2021), or share of population 25–64

qualified at levels 5–8 ISCED (Germany,

2020)

Source: US Census 2021 1–year American Community Survey; HUD Building Permits Survey; Federal Statistical Office of Germany; German Central Registry of Foreigners; Global Data Lab; gehaltsvergleich.com; World Inequality Database; Eurostat.

Notes: * Human development index for state where city is located. ** The city of Atlanta has expanded by 99.5 square miles since 1950

and 3.7 square miles since 2000 through annexation. *** US figures are post-pandemic, which encouraged many people to work from home. NA = not applicable.

For the US cities, I conducted a series of mapping exer-residents in the city; it has also attracted a diversity of cises to evaluate how the publicly led development sites residents representing many ethnicities.

selected by the cities fit within the overall demographic contexts of their respective cities. These maps, which The greater incomes of Seattle’s residents reflected in ta-note the location of the living lab sites, plus existing and ble 2 translate into higher local revenues and expenditures planned public transit corridors, are presented in the than the two other US cities, and likely more than the appendix. None of the US cities follows a uniform distri-German cities, though incomplete information is available bution in terms of any of the demographic characteristics for those municipalities (table 3). Seattle local govern-that I identified in table 2. In figure A.1, I illustrate the ments (including the city, county, and independent public share of residents living under the federal poverty line, by agencies) expended a total of 12.5 percent more than neighborhood, which shows that both the Atlanta and St.

those in Atlanta per capita in 2017, and 52 percent more Louis living lab sites are located in neighborhoods with than those in St. Louis. Though the cities received similar higher levels of poverty. These are south and north of the amounts of assistance from the federal government per downtowns of each city, respectively. These areas are also capita, Seattle received considerably more assistance disproportionately populated by people who are non-His-from its state government and was able to raise more panic white (figure A.2). Seattle’s Chinatown International funds locally. That said, Atlanta spent the most of the District—one of the living lab sites—has historically three US cities on housing and community development been one of the neighborhoods with the lowest-income expenses.

20

TABLE 3

Fiscal Characteristics of the Case–Study Cities Per–capita revenues and expenditures, 2017 (US cities), 2014 (German cities) Atlanta

St. Louis

Seattle

Berlin

Frankfurt

Munich

Own source revenue

$5,535

$3,926

$6,302

NA

NA

NA

Intergovernmental aid from federal

$590

$417

$483

NA

NA

NA

government

Intergovernmental aid from state

$656

$782

$1,184

NA

NA

NA

government

Total expenditures

$8,471

$6,281

$9,533

NA

€4,243

€3,943

Housing and community development $483

$317

$422

NA

NA

NA

expenditure

Source: Lincoln Institute of Land Policy, Fiscally Standardized Cities Database; Federal and State Statistical Offices, Germany, 2023.

Notes: Uses fiscally standardized city data, not municipal data.

The varying demographic and fiscal characteristics of peers—though a large share of those units is vacant. The the case-study cities intersect with those cities’ housing German cities have more housing availability than Atlanta markets to influence housing availability and affordability or Seattle, but very low vacancy rates.

(table 4). In some ways, the three US cities share conditions: They have a similar share of housing units owned St. Louis also has a larger share of housing units than by their residents (45–49 percent) and share of their units Seattle subsidized with federal support for affordable that are single-family homes (44–47 percent). These housing, such as through the public housing program and conditions are quite different from those in the German LIHTC credits. That said, Atlanta has the largest share of cities, where three-quarters or more of homes are rented its units with a federal affordable housing subsidy and by their residents, and less than 10 percent of homes are the largest share of residents living in units subsidized single-family.

through federal tenant-based housing choice vouchers.

Though more limited data are available on housing costs In other ways, the US cities diverge dramatically: Seattle’s in the three German cities, sale and rental prices per median home values are almost five times as high as square meter for apartments in the three cities diverge those in St. Louis, and both Atlanta and Seattle have dramatically; costs in Munich, for example, are almost higher rent levels than St. Louis. St. Louis also has more twice as high as they are in Berlin and Frankfurt.

housing availability, with more units per capita than its Breaking Barriers to Affordable and Abundant Housing 21

TABLE 4

Key Housing Characteristics of the Case–Study Cities The six cities have contrasting housing markets Atlanta

St. Louis

Seattle

Berlin

Frankfurt

Munich

Housing units*

253,355

173,493

384,799

1,869,436

365,437

753,150

Housing units per capita*

0.51

0.59

0.52

0.54

0.54

0.55

Share of metropolitan area’s housing

10.3%

13.7%

22.9%

NA

NA

NA

units*

Share units vacant*

8.1%

19.5%

8.6%

3.5%

2.7%

2.3%

Share units owned*

48.6%

45.6%

46.0%

14.8%

19.2%

23.8%

Share units single-family*

44.1%

47.3%

45.6%

8.4%

8.0%

8.8%

Median housing value*

$375,500

$170,800

$848,100

NA

NA

NA

Price per square meter**

NA

NA

NA

€5,615

€4,375

€8,333

Median gross rent*

$1,446

$843

$1,787

NA

NA

NA

Average net rent per square meter ***

$15.3

$11.2

$19.2

€11.4

€13.1

€17.9

Share of renters paying >30% of

50.9%

45.5%

46.6%

NA

NA

NA

income*

Share of renters paying >50% of

28.2%

25.1%

24.7%

NA

NA

NA

income*

Share of housing units with federal

13.2%

11.0%

7.5%

NA

NA

NA

affordable subsidies

Share of metropolitan area’s affordable 36.5%

40.3%

37.6%

NA

NA

NA

units

Share of residents in families using

6.9%

3.4%

2.6%

NA

NA

NA

Housing Choice Vouchers

22

Housing permits 2012–21

45,866

6,425

89,624

168,804

41,219

87,237

Permits per 1,000 residents in 2010

109.2

20.1

146.3

48.8

60.6

64.5

Share housing permits single-family

15.4%

16.0%

6.7%

9.0%

4.8%

8.2%

Share of metropolitan area’s permits

14.8%

9.0%

36.3%

NA

NA

NA

Source: US Census 2021 1–year American Community Survey; HUD Building Permits Survey; National Housing Preservation Database; Federal and State Statistical Offices, Germany, 2023; Global Property Guide, May 16, 2023, https://www.globalpropertyguide.com/

Europe/germany/Price-History; ImmoScout, accessed June 20, 2023, https://www.immobilienscout24.de/Suche/de/berlin/berlin/

wohnung-mieten?enteredFrom=result_list&viewMode=PRICE_INSIGHTS; Apartment List, accessed June 20, 2023, https://www.

apartmentlist.com/rent-report/wa/seattle

Notes: * in 2021 for US cities; 2011 for German cities. ** 2022. *** 2023. Assumes 100 square meter, 2-bedroom apartments for US cities.

These characteristics might imply that housing is more housing stock. Seattle has permitted considerably more affordable in St. Louis than the other cities. But a sim-housing in recent years than its US peers, adding 89,624

ilar share of renters in the Missouri city pay at least 30

units over the past decade, compared to 45,866 in Atlanta percent of their incomes in rent (meaning they are cost and 6,425 in St. Louis. Berlin permitted more units—but burdened) as in the Washington State city, due to lower its population is much larger. When adjusted for popu-incomes and higher poverty rates. That said, residents of lation, Seattle’s performance over the past decade has Atlanta are the most cost burdened, with a majority of been quite strong, with Atlanta only failing to keep up in its renters spending more than 30 percent of incomes on the years since 2018 (figure 1). The three German cities rent. More than 28 percent of Atlanta residents also spend have maintained relatively stable permitting rates over more than 50 percent of incomes on rent, more than in St.

the study period, though Munich permitted more than Louis or Seattle (about 25 percent).

the other two cities in the later portion of the decade and Berlin’s permitting rate was as low as St. Louis’s at the Trends in recent housing construction paint a nuanced beginning of the decade.

picture about the future of each of the case-study cities’

Breaking Barriers to Affordable and Abundant Housing 23

FIGURE 1

Seattle Leads the Pack in Terms of Housing Permitting Housing units permitted, 2012–21, per 1,000 residents in 2010

Seattle

Berlin

Frankfurt

Munich

Atlanta

St. Louis

20

15

10

5

0

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

Source: HUD Building Permits Survey; National Housing Preservation Database; Federal and State Statistical Offices, Germany, 2023.

Seattle is also adding units at a faster rate than the met-site is forested; this is not the case in Munich, where the ropolitan area overall; this is also true of Atlanta, though project is in the city center. The distribution of population to a lesser degree. These differences in pace indicate densities closely matches the distribution of housing units that the housing stock in those two regions is, to some that are single-family homes, which predominate at the degree, centralizing through infill development. In St.

city edges, including portions of Atlanta’s living lab site Louis, on the other hand, only 9 percent of the metropoli-

(figure A.4).

tan area’s housing permits in recent years were in the city, compared to 13.7 percent of existing units, meaning the The distribution of federally subsidized affordable housing region’s growth is sprawling out. That said, in none of the units follows similar but not identical trends in the US cit-cities do single-family homes account for more than 16

ies (figure A.5). In all three US cities, such units are most percent of permitted new units, meaning that recent de-likely to be located in the downtown or near-downtown velopment has concentrated on multi-family apartment zones, with a concentration in the living lab development construction, particularly in Seattle and the German cities areas in both Atlanta and St. Louis. These areas—as well in general.

as those in Seattle—also have lower housing values compared to the rest of their respective cities (figure As with the distribution of population by demographics, A.6). The areas with the lowest housing values generally housing conditions vary dramatically within each of the have the highest share of residents who are severely cost US case-study cities, for which I mapped outcomes in burdened—spending more than 50 percent of incomes the appendix. In each municipality, housing densities are on rent (figure A.7). This map illustrates trends similar to highest downtown and fall in outer neighborhoods, in-those of the location of residents in poverty (figure A.1).

cluding in each of the living lab development areas (figure A.3). Densities in the publicly led development sites in These trends collectively paint a picture of the differenc-Berlin and Frankfurt are also quite low, as much of each es between each of the US case-study cities and their 24

respective metropolitan areas (figure 2). Each of these new construction, Atlanta and Seattle stand out com-cities stands out from their surrounding regions because pared to St. Louis, which is not absorbing a proportionate they have a higher-than-region share of persons below the share of the housing permitting of its region.

poverty line and a much higher-than-region share of subsidized affordable housing units, when compared to their respective populations. But in terms of growth through FIGURE 2

Atlanta, St. Louis, and Seattle Diverge from Their Respective Regions in Varying Ways Share of metropolitan area totals

Atlanta

St. Louis

Seattle

40

30

20

10

0

Population

Non-Hispanic

Persons below

Subsidized

Housing permits

white population

poverty line

affordable housing

units

Source: US Census 2021 1–year American Community Survey; HUD Building Permits Survey; National Housing Preservation Database.

Notes: Data for population and resident demographics from 2021. Data for subsidized affordable housing units from 2022. Data for housing permits from 2012–21.

Changes Over Time

midpoint, with St. Louis peaking at more than 800,000

inhabitants that year (figure 3; Berlin is not shown because We can place these trends into historical perspective.

it is an outlier). These cities grew as both countries’ econo-Cities throughout the United States and Germany expe-mies expanded and as they became centers of economic rienced tremendous growth in the first half of the 20th production. All of the case-study cities became manufac-century; each of the case-study cities gained hundreds of turing or industrial centers during World War II.

thousands of residents between 1900 and the century’s Breaking Barriers to Affordable and Abundant Housing 25

FIGURE 3

Population Change Over Time for the Case-Study Cities Population in incorporated municipality, 1900–2020

Seattle

Frankfurt

Munich

Atlanta

St. Louis

1,500,000

1,000,000

500,000

-

1900

1920

1940

1960

1980

2000

2020

Source: US Census, 1900–2020; German Statistics.

Notes: Note that incorporated municipalities changed in size over time due to annexation. The city of Atlanta, for example, has expanded by 99.5 square miles since 1950 and 3.7 square miles since 2000 through annexation. Berlin not shown because it is significantly larger in population than the other cities. Its population increased from about 1.9 million in 1900 to 4.3 million in 1939; 3 million in 1980; and 3.8

million in 2022.

But in the second half of the 20th century, trends di-case-study cities losing economic dynamism. Indeed, be-verged. Germany’s defeat in World War II and the tween 1950 and 1980, all three cities lost population, with country’s separation into East and West Germany was St. Louis in particular losing 47 percent of its residents. In associated with population declines in each of the three the years since, St. Louis has continued that trend (albeit case-study cities, with Berlin being particularly hard-hit.

at a less extreme pace), though Seattle and Atlanta have In the 1950s, Frankfurt and Munich grew quickly, with turned around. Seattle’s population has grown by 49 per-each then slowing down between 1970s and 2000, before cent since 1980; Atlanta’s has grown by 17 percent.

returning to significant growth. Berlin struggled to regain population until the 1990s; its current population remains One key explanation for the diverging trends experienced significantly below the city’s peak in the years running up by the US three cities is the difference in economic to World War II.

activity over time, which is the product of both public and private sector interventions in the economy. These As the American economy entered a post-industrial differences are particularly notable over the past two phase, manufacturing plants closed or relocated to subur-decades when comparing local economic output in each ban locales, often in the southeast and western regions of region (figure 4). Per-capita economic output barely the country. White flight into suburban areas of each met-budged in the Atlanta and St. Louis regions between 2001

ropolitan region, combined with movement of businesses and 2017, while it increased by 25 percent in the Seattle away from center-city cores, resulted in each of the US

region over the same period (among metropolitan areas 26

in the US, per-capita economic output increased by about strength of Seattle’s economy over the last few decades, 17 percent over this time). This reflects the comparative built on the tech and aviation sectors.

FIGURE 4

Economic Activity in the US Case–Study Regions Total Per Capita Real Gross Domestic Product, Chained 2009 US dollars, 2001–2017

Seattle-Tacoma-Bellevue MSA

Atlanta-Sandy Springs-Roswell MSA

St. Louis MSA

90,000

80,000

70,000

60,000

50,000

40,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Source: US Bureau of Economic Analysis, via St. Louis Fed, 2017.

These demographic and economic trends had differen-number of housing units by neighborhood in each of the tiated impacts on the housing markets in each of the US

US cities between 1950 and 1990, a period during which case-study cities and their respective regions. Even as each of the cities experienced economic challenges.

St. Louis lost about 65 percent of its population between The trends in each are similar: A decline in housing stock 1950 and 2020, the counties now encompassing the available near the center of each city and an increase at St. Louis region more than tripled in population. While the city edge. That said, both St. Louis and Seattle expe-Atlanta’s population increased by about 50 percent over rienced an increase in housing availability in their respec-that period, its metropolitan area multiplied in population tive downtowns during this period. And between 1990

by more than five times. Seattle and its metropolitan area, and 2019, these trends evolved substantially (figure A.10).

on the other hand, grew at similar rates over the period.

In St. Louis, almost all neighborhoods except downtown lost housing units, due in part to increasing levels of land Finally, again in the appendix, I map how housing values and housing vacancy and a lack of new construction. In have changed over time in each of the US case-study Atlanta, neighborhoods in various parts of the city had cities (figure A.8). Seattle saw large increases in housing fewer housing units, though some areas, including much costs, adjusted for inflation, between 2001 and 2022, vir-of the city core, had an increase. And Seattle experienced tually everywhere in the city. Atlanta experienced increas-high levels of increased housing throughout most of the es in most of the city, though it had some declines in the city.

center. And in St. Louis, much of the city experienced declining housing values. Figure A.9 maps the change in the Breaking Barriers to Affordable and Abundant Housing 27

ABOUT THE URBAN INSTITUTE

The nonprofit Urban Institute is a leading research organization dedicated to developing evidence-based insights that improve people’s lives and strengthen communities. For 50 years, Urban has been the trusted source for rigorous analysis of complex social and economic issues; strategic advice to policymakers, philanthropists, and practitioners; and new, promising ideas that expand opportunities for all. Our work inspires effective decisions that advance fairness and enhance the well-being of people and places.

Copyright © April 2024. Urban Institute. Permission is granted for reproduction of this file, with attribution to the Urban Institute.

The “Living Lab” Publicly Led Development Sites Each of the case-study cities identified a key area for Atlanta’s Thomasville Heights

evaluation and co-learning as part of the Breaking Barriers The Thomasville Heights neighborhood is located south-project. Certain of these projects involve redevelopment east of the city center and is adjacent to the city limits of disused, forested sites at the urban periphery (Atlanta (figure 5). The community has suffered from decades of and Berlin), others involve redevelopment of previously disinvestment; its population is currently majority Black, industrial sites in the urban core (Munich and Seattle), with a large share of residents living in poverty. A large one involves development on agricultural land (Frankfurt), US penitentiary completed in 1902 is just northwest of and the last involves redevelopment of a largely resi-the heart of the neighborhood. The “central park” of the dential neighborhood into a mixed-use community (St.

neighborhood is a forest, known as Thomasville Park, Louis). Again, any comparison between these cities must attached to a recreation center. Southeast of that is a acknowledge the fundamental economic, policy, and largely single-family neighborhood built in the 1950s.

governmental differences between the United States and The neighborhood extends primarily along McDonough Germany.

Boulevard Southeast, which is served by the MARTA 49

bus; this route runs downtown and takes approximate-Despite these differences, all of the projects share some ly 30 minutes to get there from Thomasville. Buses run key characteristics: They prioritize housing development, every 15 to 30 minutes during the day. 12 The development particularly of affordable housing, as a key goal; their is close to the Beltline, a major circumferential park that is development is being led by city agencies and involves a currently about half completed, and there has been sig-considerable share of publicly owned land; and they are nificant private investment in housing redevelopment on attempting to integrate the new housing into broader ur-properties between Thomasville Heights and downtown.

ban development plans. In this section, I review the major characteristics of each project.

28

ABOUT THE URBAN INSTITUTE

The nonprofit Urban Institute is a leading research organization dedicated to developing evidence-based insights that improve people’s lives and strengthen communities. For 50 years, Urban has been the trusted source for rigorous analysis of complex social and economic issues; strategic advice to policymakers, philanthropists, and practitioners; and new, promising ideas that expand opportunities for all. Our work inspires effective decisions that advance fairness and enhance the well-being of people and places.

Copyright © April 2024. Urban Institute. Permission is granted for reproduction of this file, with attribution to the Urban Institute.

FIGURE 5

Thomasville Heights in the Atlanta Context

Atlanta’s Thomasville Heights

The Thomasville Heights neighborhood is located southeast of the city center and is adjacent to the city limits (figure 5). The community has suffered from decades of disinvestment; its population is currently majority Black, with a large share of residents living in poverty. A large US penitentiary completed in 1902 is just northwest of the heart of the neighborhood. The “central park” of the neighborhood is a forest, known as Thomasville Park, attached to a recreation center. Southeast of that is a largely single-family neighborhood built in the 1950s.

The neighborhood extends primarily along McDonough Boulevard Southeast, which is served by the MARTA 49

bus; this route runs downtown and takes approximately 30 minutes to get there from Thomasville. Buses run every 15 to 30 minutes during the day. 12 The development is close to the Beltline, a major circumferential park that is currently about half completed, and there has been significant private investment in housing redevelopment on properties between Thomasville Heights and downtown.

Source: The author, based on public data sourced from the city of Atlanta.

Breaking Barriers to Affordable and Abundant Housing 29

The neighborhood was the site of a 350-unit, 36-acre complexes in part because it was committed to a private public housing development, called Thomasville Heights, sector-led, mixed-income redevelopment model that did that was completed in 1967 and demolished in 2010. The not quickly replace demolished units (Vale 2013), leaving neighborhood was also home to the 404-unit Forest Cove the Thomasville Heights site to reforest in the years since Apartments, subsidized by federal project-based Section it was demolished. The Authority has since turned around, 8 support for low-income residents, which was com-hoping to invest in 10,000 new homes over the next pleted in 1971. These apartments are in two groupings, few years through a combination of public and private separated by a currently forested area scheduled for rede-resources in connection with the city’s broader housing velopment. Forest Cove faced years of poor maintenance, strategic plan (Atlanta Housing 2023).

had high vacancy rates, and was condemned in December 2021 after several fires.

These conditions have encouraged interest in redevelopment in Thomasville Heights (figure 6). Mayor Dickens The poor state of Forest Cove encouraged Atlanta Mayor identified the community as a priority action area and has Andre Dickens to commit to rehousing the development’s instructed staff to plan for up to 2,800 housing units in more than 200 households in other parts of the metropol-the neighborhood, including on both public and privately itan area. This relocation was completed in late 2022. 13 The owned land, with a combination of multi-family buildings, city school system recently decided to close the school small apartments, and single-family units, to be completin the community due to falling enrollment. Though the ed over the next few decades. The city’s hope is to use owner of Forest Cove, Millennia Housing Management, public funds (a combination of federal support and local has contested the property’s demolition, HUD has re-affordable housing funding) to ensure that at least 850 of voked its housing assistance payments for the property, these units will be affordable at 80 percent of the region’s and the city has plans to demolish it.

area median income (AMI), with a priority for investment in units at 60 percent of AMI. The project is also expected Local officials are aware of the problems faced by pre-to include more than 100,000 square feet of commercial vious developments on the site—but also see it as an space. As of May 2023, the Atlanta Housing Authority opportunity to help provide additional housing for city released a request for qualifications for the redevelop-residents into the future. One city staff member told me, ment of the Thomasville Heights Projects site, which the

“The housing we that we have currently does not reflect agency plans to follow with an invitation-only request for the current residents that we have. . . . We don’t have proposals. 14 In fall 2023, there was yet another fire in a enough housing to meet the needs of the people who live condemned building on the site—and the city announced here.” The Atlanta Housing Authority spent years blocking a class action lawsuit against Millennia Housing. 15

the reconstruction of many of its older public housing 30

FIGURE 6

Redevelopment Plans for Atlanta’s Thomasville Heights About 2,800 housing units are planned on land held by a variety of owners Source: City of Atlanta, Office of the Chief Policy Advisor, labeled by the author.

The completion of the full project will require action by $29 million will be distributed for gap financing for private multiple stakeholders simultaneously. A major private developers investing in affordable projects; $15 million will landlord, Dwell Communities, owns the land located be-be spent on infrastructure on public land; and $15 million tween the groups of Forest Cove apartments. And Habitat will go to address problems with existing affordable hous-for Humanity and Focused Community Strategies also ing. The city’s fund will be complemented by $200 million control some land in the surrounding area. With the city, in philanthropic money for housing in Atlanta managed by they are hoping to completely redevelop the community the Community Foundation of Greater Atlanta, which has into a mixed-use neighborhood. Noted one interview-prioritized investments in Thomasville Heights. 16

ee from the city government, “We’re pushing to start over, [by building] a street grid from the ground up, with There remain a number of hurdles to development, even mixed-income, grocery stores, and the like.”

beyond the development itself. Atlanta is revising its zoning code as of this writing, but current regulations prohibit The city’s actions in Thomasville Heights will be further the construction of anything other than single-family enabled because of the city council’s decision in June homes on the site of the Forest Cove apartments (which 2023 to fund a $100 million affordable housing bond mea-is zoned R–4). That said, as I describe below, city staff are sure. Of these funds, $38 million is to be dedicated for use relatively unworried about the difficulty of rezoning to as a revolving loan fund to finance affordable units (at 80

accommodate future housing. (The Dwell Communities percent of AMI) on publicly owned land through a new and former public housing sites are zoned for higher entity called the Atlanta Urban Development Corporation, densities. 17) Moreover, the city’s broader planning princi-which is a subsidiary of the Atlanta Housing Authority; ples have yet to prioritize the project. The city’s Housing Breaking Barriers to Affordable and Abundant Housing 31

Affordability Action Plan does not mention the district, It now suffers from very high levels of vacant buildings for example, though this may simply reflect a time lag and undeveloped land; most blocks have one or more between assuring the investment and planning.

parcels of land previously occupied by housing but since demolished. At the center of the neighborhood is a major St. Louis’s Near North

landmark of sorts. The Pruitt-Igoe apartment project was a federally supported public housing development that The Near North neighborhood is located just north of held 2,870 apartments in 33 high-rise buildings when downtown and includes both the Carr Square and Old it was completed in 1955. After considerable difficulty North St. Louis communities (figure 7). The community ensuring safety for residents, the apartment projects has faced decades of disinvestment, some of which fol-were demolished between 1972 and 1976, and the site has lowed the use of federal urban renewal and highway funds reforested in the years since.

in the postwar period to demolish preexisting structures.

FIGURE 7

St. Louis’s Near North Neighborhood

Source: The author, based on public data sourced from the city of St. Louis.

32

Over the following few decades, the Near North neigh-Perhaps more important from the perspective of access borhood faced considerable challenges attracting devel-to housing are the grants the city won to support neigh-opment. Part of the problem is the city’s general eco-borhood redevelopment (figure 8). In 2016, HUD awarded nomic circumstances, as laid out in the previous section.

a $29.5 million Choice Neighborhoods grant, designed to Noted a city staff member, “when compared to the lack be combined with other sources of investment to fund of investment, we don’t have the tax base to support our the redevelopment of the Preservation Square public infrastructure, and we have extreme levels of inequality.”

housing project, the construction of almost 700 units The Near North community is now a low-demand area, of housing for households with diverse incomes, and in-with only limited private-market interest in redevelop-creased loans and support for small businesses. 22 Housing ment and high rates of poverty (City of St. Louis 2022).

units will include both single-family and multi-family buildings, reflecting the current physical characteristics But the neighborhood’s future now looks more promis-of the neighborhood. This neighborhood investment ining. One interviewee told me that the city’s priority is to cludes the construction of a newly connected street grid.

“interrupt these cycles, and heal the scars of segregation, Projects are already underway; 131 affordable units have redlining, and more.” 18 There are several key explanations been completed and 222 units are currently under con-for this momentum. The US Congress awarded the neigh-struction. Completion has been slowed by the Covid–19

borhood the future campus of the National Geospatial-pandemic and other local contracting issues. Elements of Intelligence Agency, a federal compound that will open the Choice Neighborhoods grant also include the creation by 2026. Though the project, which is being built on land of an economic empowerment center and placemaking the city acquired from individual property owners through along 14th Street, which runs through the area, com-eminent domain, 19 will be cut off from the surrounding pleted in collaboration with the St. Louis Development neighborhood by secure fencing, it may be useful in en-Corporation. The city has also provided support for couraging investment in the area, in part because of the small businesses through the allocation of $37 million in 3,150 staff members expected to work there, and because American Rescue Plan Act funds. In connection with the of the learning spaces on campus designed for the use of Choice Neighborhoods investment, the city has devel-area students. 20 The city hopes to leverage the project to oped a neighborhood-wide transformation plan. 23

promote new investment in the neighborhood. 21

Breaking Barriers to Affordable and Abundant Housing 33

FIGURE 8

Redevelopment Plans for Near North St. Louis

Source: Urban Strategies, McCormack Baron Salazar, City of St. Louis, and St. Louis Housing Authority. 2016. Near North Side Master Plan.

March. Available at https://cdn.nextstl.com/wp-content/uploads/20220627114022/Near-North-Side-Choice-Master-Plan-Presentation-March-2016.pdf

Note: Plans for the area have advanced since 2016, and the streetcar loop plan has been replaced by a proposed light rail line on a somewhat different alignment.

Finally, St. Louis is making plans for an expansion of its as part of its 2022 Affordable Housing Study. That report Metrolink light rail network with a new north-south line.

acknowledges the difficulties of investing in the area; The light rail line would run every 10 to 20 minutes along the neighborhood is what the report defines as a low-de-a 5.6-mile route, and it could be completed in the next mand submarket, meaning having a significant number several years. The line would run adjacent to the National of households with low incomes, decades of population Geospatial-Intelligence Agency, providing access to job decline, and high vacancy rates. The neighborhood is holders there, and near the housing investments the city predominately composed of single-family homes and has has planned. 24 The line could improve resident connectivi-seen little new construction over the past few decades. It ty to the rest of the region.

is thus to be determined whether the city’s investments will catalyze broader economic development in the area in The city has framed its investment in the Near North Side the coming years.

34

Plans for Seattle’s Chinatown and Delridge, to begin detailed station-area planning in 2024. The city’s along its Light Rail Expansions

focus is on two station areas that I explore as the integrated development case studies: Chinatown-International In November 2016, Seattle region voters passed the District (CID) and Delridge, each located south of down-Sound Transit 3 referendum, which funded $54 billion town. The Delridge station is expected to open as part of in public transportation improvements throughout the the first phase of the project in 2032; the CID station as Puget Sound metropolitan area. Among the funded

part of the second phase in 2039 (figure 9). These station projects are two interconnected light rail routes, re-areas are among the few neighborhoods in the city whose ferred to collectively as the West Seattle and Ballard Link neighboring residents are majority people of color—and, extensions (these would be funded and built by Sound as described in the previous section, many of the resi-Transit, the regional operator). These lines, expected to be dents have low incomes. The CID station is near the con-completed in 2032 and 2039, respectively, will cost $12

fluence of a number of major transportation infrastructure billion and add 13 new stations to neighborhoods in the projects that have previously undermined the community city of Seattle. Construction is expected to begin in 2026

due to demolition and the negative impacts of construc-after environmental review is completed. 25 The project tion, and a decade or more of additional transportation responds to conditions in the rapidly growing region, infrastructure construction has raised concern that the which faces a housing crunch and high housing costs.

area may become difficult to live in. Moreover, some New zoning policies to encourage additional housing near residents are concerned that the projects may encourage transit could reduce costs over the long term (Freemark gentrification and displacement. There has been debate in et al. 2023).

the city about the exact location of the CID station, in part due to Sound Transit’s goal to cut expenses in the face of The construction of new light rail stations offers the increased construction costs over the past few years. 26

city of Seattle the opportunity to plan dense, mixed-use neighborhoods around new stations. The city is expected Breaking Barriers to Affordable and Abundant Housing 35

FIGURE 9

Station Area Planning in Seattle

Source: The author, based on public data sourced from the city of Seattle.

Though the city has yet to develop specific plans for interviewee noted to me that this area is “a pedestrian development in the station areas, we have some clues hellscape right now,” indicating that integrating the com-about how the areas will evolve over time. In the Delridge munity with the future rail station may be difficult. The station area, the city is using its North Delridge Action areas around the planned CID station form the cultural plan to guide future planning, though it has not yet firmed hub of Seattle’s Asian American community but are also up investment plans. The areas immediately adjacent to occupied by large swaths of industrial uses. The area is the planned station are currently about half occupied by also near the city’s main train station, large stadiums, and housing and the rest by a steel plant and a strip com-industrial uses whose future depends on city decisions mercial center; these areas, according to city staff, could about zoning and changes in the real estate market that theoretically be redeveloped to provide for community may follow from investment in the new light rail line.

needs, such as groceries and affordable housing. One 36

Planning in station areas in the Puget Sound follows is to align new construction to areas around rail lines.

decades of transit-oriented community planning that the city and regional planning agencies have led (see, The city has 16 major new publicly led development e.g., Growing Transit Communities Partnership 2013; zones, mostly scattered around the edge of the city Nikolic et al. 2009). These, in turn, have been formalized in at least partly undeveloped areas. The living lab in the urban village element of Seattle’s Comprehensive development zone is the Buch am Sandhaus, located Plan, which encourages the creation of dense, mixed-in the Pankow borough on the north side of the city.

use, and mixed-income neighborhoods in the areas near The 57-hectare site encompasses an abandoned state stations. 27 The city’s comprehensive plan is, as of this security (secret service) hospital and forested areas, all writing, in the process of being rewritten to encompass proximate to a regional rail station. The city’s develop-plans for the new light rail stations. Station area planning ment plan proposes the construction of up to 3,000 new must also reflect the Washington state statute RCW

housing units (including the conversion of the hospital 81.112.350, which requires Sound Transit—the agen-into homes), daycare centers, and schools, surround-cy building the light rail lines—to offer 80 percent of ed by maintained forested areas (figure 10). The city’s surplus property suitable for housing (meaning leftover planners propose that buildings be arrayed along a major land from project construction) to qualified entities that new street oriented toward public transport, bikers, and develop housing, of which at least 80 percent of units is walkers. 29 The development site was identified for hous-to be affordable to families with incomes at 80 percent ing development by a private entity several decades ago, of the area median or less. Sound Transit adopted an eq-but that project was never realized.

uitable transit-oriented development policy in 2018 that promotes partnerships with other public agencies for The current project’s plan was developed through a development near stations. Sound Transit has also com-multi-month public engagement process in which the mitted $20 million to a revolving loan fund for affordable city paid three teams of urban designers to offer ideas housing. 28

for the site. These designers presented their proposals to a city-hired jury of urban planning experts, as well as Berlin’s Buch am Sandhaus

one representative of the community. The jury provided feedback to each team, which then refined plans Berlin is Germany’s unified capital city and state, the two more times before the final plan was selected for largest city in the country and third-smallest state by implementation by the city. The city plans to develop the land area, after Bremen and Hamburg. After decades of project through long-term leases on lots in the devel-a challenging economic environment, the city is now on opment after it has constructed basic infrastructure, the upswing, with a growing population and increasing such as the east-west street at the center of the project.

job numbers, as described in the previous section. The Developers will have to follow city-determined develop-city’s growth has raised concerns about housing afford-ment principles (such as affordable housing and design ability, and the city has committed to adding 200,000

requirements); they are expected to include both private new housing units by 2030. The local government’s goal developers and the city public housing agency.

FIGURE 10

Berlin’s Buch am Sandhaus Development, to the North of the City Center Source: Berlin Senatsverwaltung für Stadtentwicklung, Bauen und Wohnen. Rahmenplan und städtebaulicher Masterplan. Accessed July 27, 2023. https://www.berlin.de/sen/stadtentwicklung/neue-stadtquartiere/buch-am-sandhaus/rahmenplan-und-staedtebaulicher-masterplan/

Notes: The former state security hospital is the inverted “T” shaped building on the north side of the site; the pink buildings are the sites of the planned major new housing developments. The S-Bahn regional rail station is located in the middle right of the plan, at the end of the new road planned to serve as the primary “spine” of the project.

Berlin’s project has met some resistance. A group of compensation plan for the project (which will require new residents of the surrounding area has contested the plan, land to be reserved for natural uses in exchange for this arguing that it would eliminate access to green space land being developed) is inadequate.

for the neighborhood and will require destroying large sections of forested areas in which endangered species now live. They argue that the federally required land 38

Frankfurt Nordwest—Stadtteil der Quartiere The project is being planned for the area between the A5

motorway and existing portions of the city of Frankfurt, Frankfurt is Germany’s economic capital and a driver of mostly developed in the postwar period, notably

much of the country’s financial services industry. The Nordweststadt. These neighborhoods have a high share pressures of global capital have encouraged the influx of of immigrant households and have generally lacked ac-higher-income residents and competition for land that has cess to effective public services in the past, according to displaced older enterprises in the city. The municipality’s local planners. The new project is being associated with goal is to identify new approaches to adding affordable an extension of the city’s U7 light rail line as well as the housing while also renovating older units. Noted one S-Bahn regional rail service. Project planners have had attendee at a German Marshall Fund event, “In Frankfurt, to work closely with the national government in project we have a highly speculative market. . . . We want to have development, as it has involved plans to move a major more housing possibilities and options.” Though the city electric power line and negotiations about the future of has generally low population densities in its neighbor-the motorway to ensure the development project and the hoods, it has focused most of its development efforts road can coexist.

on peripheral land currently occupied by agricultural or natural land but still within the city’s limits.

The project is being developed under the German Urban Development Measure described above. This enables the As part of this initiative, the city’s living lab site is city to use eminent domain for land assembly at reason-Frankfurt Nordwest, a development proposed for mostly able costs, and then allows the city to sell or lease land agricultural land northwest of the city center and located to private entities once plans have been finalized and on the city’s border with suburban jurisdictions. 30 The infrastructure improvements have been made; these sales project will involve the creation of two sub-development provide the funds to support investment in the social zones (figure 11). The remainder of the surrounding site infrastructure that accompanies the project, including will remain primarily agricultural. The development zones schools and daycare facilities. As in Berlin, the project has are large enough to accommodate up to 6,800 housing been developed using a three-stage resident engage-units, of which at least 30 percent would be affordable ment process and an eight-member appointed jury (a under German social housing rules, and up to 7,000 jobs.

“Consilium”) that provides technical feedback about the The project would also include parks, schools, shops, and project’s elements. 31

leisure uses.

Breaking Barriers to Affordable and Abundant Housing 39

FIGURE 11

Schematic Urban Design for Frankfurt Nordwest Source: Stadt Planungs Amt, Frankfurt Am Main. 2023, “Frankfurt Nordwest.” April. https://www.stadtplanungsamt-frankfurt.de/show.

php?ID=23150.

Notes: The image shows the full boundary of the project, with the highway corridor cutting through on a diagonal from the northeast to the southwest. The new development areas are shown in red, purple, and brown colors, with the planned parks in green, and the extension of the U7 light rail line and the S-Bahn regional rail lines shown with dotted lines. Preserved agricultural areas are shown in yellow colors.

40

Frankfurt’s development project has generated some Munich’s 39-acre living lab site, Werksviertel-Mitte, is disagreement. A plan for development on the west side of near Munich’s city center and includes the former site the site encountered opposition from residents and politi-of a Pfanni food production factory. It is within several cal officials from the suburban city of Steinbach, resulting blocks of the Ostbahnhof rail station, which is served by in that portion of the project being scuttled. In addition, hundreds of regional rail trains a day, as well as frequent residents of the areas to the east have protested elements subway and light rail service. The district sat underused of the project, such as the fact that its development will and its former industrial buildings partly abandoned for involve the replacement of agricultural land with build-several years, leading to the area becoming known for ings. They worry this will diminish their quality of life. City its dance clubs and other nightlife uses. Though the site planners have attempted to address this concern through remains largely privately owned, the city has led planning the inclusion of major park spaces throughout the project, for and investment in redevelopment in the community.

but opposition to the project remains present.

The project is expected to incorporate 1,150 housing units (of which about 30 percent will be social housing) and up Munich’s Werksviertel-Mitte

to 7,000 jobs, plus a mix of lofts, art studios, restaurants, and green spaces (figure 12). 32

Munich has little land on its edges to convert from undeveloped to developed uses. (This results from historical The city government has conceptualized the neighbor-differences in municipal annexation policy in the three hood to become an active, vibrant area, not simply a res-regions.) The city has high housing costs, as shown idential community. This approach matches the project’s in table 4. Though it is one of the wealthiest cities in location, which is near the center of the city and sur-Germany, housing price increases have outpaced increas-rounded by fairly high-density areas. Munich’s is at a more es in resident salaries, making living in the community advanced stage of development than the other living lab more expensive for more of its residents. As such, it has projects profiled here. Much of the project planning was significant development demand, and the city has plans completed about a decade ago.

for major new housing investments through infill reconstruction of formerly industrial zones.

Breaking Barriers to Affordable and Abundant Housing 41

FIGURE 12

Plans for Munich’s Werksviertel District, Showing New Buildings Near Ostbahnhof Station and Pedestrian-Only Streets

Source: Werksviertel München. Accessed July 27, 2023. https://werksviertel.de/

42

Barriers to Publicly Led

Development

Breaking Barriers to Affordable and Abundant Housing 43

Together, the demographic conditions I described above so because of diverging financing and implementation paint a picture of communities in flux. On the one hand, calendars.

cities like Atlanta, Munich, and especially Seattle are permitting relatively large numbers of new homes, making

• Some highly vocal and sometimes politically influential room for thousands of new residents as those cities grow residents oppose change in their communities—often quickly. But that new housing may be inadequate to ad-because of worries about disrupting the status quo, dress continued high housing costs (particularly in Munich but also because of concerns about hurting the local and Seattle) or high housing cost burdens (particularly in environment. This can delay project implementation Atlanta). On the other hand, cities like Berlin and especially because of long review periods and changes in project St. Louis may have relatively lower housing costs—but design that sometimes reduce density.

their residents are more likely to have low incomes or live in poverty. In each of these groups of cities, housing

• Frequent elections in the United States encourage remains a major cause for concern. More housing—par-local elected officials to act fast with the goal of ticularly affordable housing—is necessary to account for short- to medium-term results. This approach makes local needs. The publicly led developments I profile here it difficult to commit to a major development project could help make room for those units.

that will not be completed for years. The fact that local public administration is devolved into multiple depart-My interviews with officials and other stakeholders in the ments worsens this problem.

case-study cities, combined with collection of information about local conditions, suggest ways in which it

• In both countries, federal government regulations and is challenging to generate new housing via publicly led bureaucratic systems sometimes stand in the way of investment. Several of these challenges are unique to ei-adding housing by creating obstacles that prevent the ther the United States or Germany, but others are shared use of public funds in the most effective way possible.

across the Atlantic. In this section, I review several key findings from this research:

Below, I detail each of these findings, using examples from the case-study cities to illustrate conclusions.

• In the United States, in particular, local zoning con-Conditions in the various cities differ, but the conclusions straints—such as regulations allowing for the conI describe apply to all of them, unless noted specifically.

struction only of single-family homes—sometimes

make it difficult for private-market actors to add new homes even in neighborhoods where there is real-estate demand to do so. Even so, these zoning con-

straints are not a primary impediment to the publicly led plans the cities are focused on.

• Though attracting investment to high-income neighborhoods is reasonably straightforward, assembling adequate financing for new housing development in communities that are currently largely inhabited by families with low incomes is challenging, delaying project completion. When successful, on the other hand, such investments could generate gentrification.

• Though cities hope to integrate multiple project objectives simultaneously—such as housing and public

transportation investments—they find it difficult to do 44

Zoning and Building Constraints in the Context of Inadequate Comprehensive Planning

As noted, German cities regulate construction using entitlement is already there or relatively simple.” In St.

a nationally uniform building and land-use code, the Louis, one interviewee said, “We hate the mandatory BauGB. 33 Though the code enables each local government parking minimums [imposed by the zoning code], and to make independent choices about future development want those changed.” But they went on to emphasize that within neighborhoods, the specific regulations that cities

“for the most part, [projects] don’t need rezoning.” Even must follow are defined nationally. This includes not when they do, “rezoning is relatively straightforward. The only the zoning districts that can be implemented (e.g., Planning Commission will rarely deny a rezoning, and the what sorts of buildings are allowed in a defined district), only way to do that is if the project is in conflict with the but also the tools a local government can leverage to comprehensive plan.”

undertake urban development, some of which I profiled above. Representatives of the German cities with whom I There are several possible explanations for the lack of discussed development plans spoke positively about their local concern about the constraints posed by existing ability to leverage zoning policies to implement their living zoning regulations on development strategies in the lab projects. From their perspective, the nationally authoUS cities. First, because the projects I investigated are rized regulations offer them broad latitude to complete led by city governments, they may have an easier time their investments.

implementing changes in land-use rules than a private developer planning a similar project. Second, it is possi-The US cities each have bespoke zoning rules typically ble that the locations of the projects in the US cities—in defined at the local level but with input from state gov-largely low-income neighborhoods in all three cities—has ernments. The federal government has virtually no rule in resulted in less public resistance to zoning change than defining those zoning policies. These conditions make it might have been experienced had the projects been somewhat difficult to compare policies in one city with developed in higher-income areas. Third, since localities another. As I discussed in the introduction to this report, are both planning the projects and regulating them, it is there is considerable evidence that land-use regulations possible that the designs of the projects already reflect are one key explanation for inadequate private housing what officials know can be reasonably implemented construction in US cities. Rules are often made too strict under the land-use code or potential modifications of it. In to enable the construction of a diverse type of housing to any case, understanding the differences in the constraints meet community needs.

(or non-constraints) imposed by land-use regulations between public and private developers is worthy of further Nevertheless, my interviews with officials in the case-study.

study cities indicated that, broadly, they face few real land use regulation–related obstacles in implementing their Indeed, when asked about recent private projects, publicly led living lab projects. Staff in Atlanta noted that interviewees emphasized that the zoning process could their work in Thomasville Heights was not constrained be more complicated. Seattle enforced a challenging by zoning policy—they could pursue the project they development environment for private developers involved wanted and then move to easily alter the land-use rules in building around other rail stations (not yet the living lab from there. “City-owned land is typically formerly in-sites, which are years away from being subject to devel-dustrial or city service land,” one mayor’s office staffer opment). Describing conditions for private investment said. “It’s usually fairly easy to rezone to multi-family or around the Northgate light rail station on the north side of mixed use. . . . So, on 90 percent of our sites, [zoning]

Seattle, a staff member said, “It was so prescriptive, down Breaking Barriers to Affordable and Abundant Housing 45

to the [size of] the balconies on those units . . . it was this intersections where the locality wanted to focus invest-crazy level of specificity.” They argued that these condi-ments and growth. In theory, this structure was supposed tions inhibited the easy construction of projects led by to produce neighborhoods with a reasonable mix of private entities, even if the planning itself had been led by housing, employment, retail, and services. But officials the public sector.

complained this was rarely the case. “Holistic planning in a neighborhood is the edge, exception case,” one said.

Moreover, there is evidence that the case-study cities do Another noted, “I notice that, with dismay . . . some of the struggle to undertake comprehensive, integrated planning development would happen anyway without a plan.” The in advance of new project development, whether led by case-study publicly planned projects I investigate here, public or private entities. In Seattle, the city has for years then, may be somewhat of an exception to the rule.

pursued an urban village strategy that designated major Difficulties in Attracting Investment to

Neighborhoods with Little Demand—and

Gentrification in Other Areas

Interviewees emphasized that the US cities have strug-likely to be people of color. These communities have gled for years to attract development in some of their suffered years of limited private-sector investment in new least well-off neighborhoods. Low resident incomes make housing. At the same time, at least in Atlanta’s case, the it difficult for private investors to make a profit on new

“neighborhood had largely been ignored by public part-construction, since they cannot rely on wealthier families ners for too long,” according to a housing staff member.

being willing to move into the community. This makes While city agencies had developed plans for the redevel-building new housing other than publicly subsidized units opment of the area, “too often, you’ll have a small-area challenging to finance. This is true even on the publicly plan, and then 10 years later, nothing will be done,” they led development sites, which incorporate a mix of public continued, because of the inability to attract private-mar-and private financing and rely on private investment (such ket development to the areas.

as in the form of market-rate housing development) to help support the cost of providing affordable housing and In some cases, the lack of public support for investments social investments. At the same time, when they have in such communities is the product of the intentional been able to bring in new real-estate investment, US city choice not to invest in such areas by public entities. “What planners have faced concerns that new projects generate we don’t want to do is only build affordable housing in gentrification and displacement. Even though additional the communities that have been historically disinvested,”

housing is likely to play an important role in moderating a St. Louis interviewee said. Municipal staff considering increases in housing costs by adding new supply, it is how to spend limited affordable housing funding want to often only financeable in neighborhoods where housing preserve some of those funds for “communities that are prices are already increasing.

better off,” to use the language of a St. Louis official, to ensure that people with low and moderate incomes can The living lab project sites in all three of the US cities are have access to housing in different parts of the city as a in neighborhoods with a disproportionate population of whole.

residents with high levels of poverty and who are more 46

When investments do go into communities with high raised fewer concerns about the difficulty of attracting rates of resident poverty, city staff worry about the investment in the lowest-income portions of their respec-potentially gentrificative effects. “We have to consider tive communities. There are several potential explanations

. . . anti-displacement, community ownership, cultural for this difference with the United States. One may be displacement, [and] affordable commercial space,” said that Germany has less economic inequality or social/racial a city staffer in Seattle. They worry that the investments segregation and thus suffers from less of the spatial dif-in new housing projects in certain areas could be associ-ferentiation in real-estate markets that is common in US

ated with dramatic changes to the neighborhood—and cities. Another is that the German cities’ projects were not thus outcomes that fail to meet the needs of existing located in existing low-income neighborhoods, but rather residents.

on greenfield land outside the city (in Berlin and Frankfurt) or near the city center (in Munich); these areas may be The German planners with whom I discussed these issues easier to attract investment to than those in the US cities.

Challenges Timing Projects to Meet Public Goals The three German cities have established comprehensive the agency’s decisions about land acquisition are in-planning efforts that link investments in new housing with formed by making sure there is space for the future rail other sorts of projects, such as public transportation lines, right of way, stations, and construction staging area—not parks, and schools. They are capable of undertaking these ensuring that there is adequate space left over for consorts of joint investments thanks in part to a series of reg-nected housing development. (The fact that the agency ulatory tools that enable comprehensive action, particu-has limited funds even to implement the transit project larly the Urban Development Measure described above.

means it does not have leftover funding available for extra But the US cities I studied experience difficulties linking land acquisition.) And while the city could theoretically a variety of investment types into a single, unified living contribute to housing investment around stations, an lab project. Much of the challenge has to do with timing, interviewee pointed out that they did not “know if I have among the correlated projects and with the availability of any [financing] sources that can hold out [on construc-funding, and with the constraints of zoning policy.

tion] for 15 years,” when the light rail line is completed.

So transportation investments go in now and housing Consider first the intersection between efforts to expand construction must wait for a hypothetical future.

housing availability and new access to transportation—an essential link when the goal of all of the case-study cities These problems have shown up in the past. “The last is to encourage TOD. In Seattle, an interviewee noted that time we had a light rail expansion project,” in the Rainier housing and transportation investments were “operat-Valley, “there are still many parcels that are underde-ing on different time horizons.” Sound Transit, which is veloped,” said one local planner. “The city is often very building the light rail system that will serve the publicly late in planning for station-area development,” another led development sites, is planning lines that will not open noted, suggesting that the energy for station planning for service for more than a decade. They are “hyperfo-for surrounding housing often fails to accelerate until cused on the schedule and budget of the [rail] system,”

just before a station is to open. And the transit agency’s said a city department head, and “they are loath to take on choice not to purchase additional land for TOD surround-additional responsibility outside of delivering the system.”

ing stations meant that in “the first round of Sound Transit The result is that, according to a federal transit employee, projects, we ended up with squirrely, triangular sites” that Breaking Barriers to Affordable and Abundant Housing 47

were difficult to use for construction, according to a city least acquire land at elevated prices to do so in the future.

employee. That said, as I describe below, there is hope While it is possible, or even likely, that much of what will that the agency is taking a different approach this time, eventually be built privately will be new housing, it is and both Berlin and Frankfurt have demonstrated effec-unlikely to be affordable or fulfill the city’s general desires tive mechanisms to integrate transit directly into project for the area.

planning.

The living lab sites in Seattle again provide a useful examIn the other two US cities, the order of decision-making ple of this phenomenon. To handle the discrepancies in is reversed. While St. Louis is planning a major light-rail timelines between the housing and transportation proj-project that would serve the Near North neighborhood, ects, one option, according to a city staff member, would city staff emphasized that “there’s uncertainty” about be to simply proceed now (or when the route is precisely when that project will be constructed, because planners selected, likely in 2024) with a city-led housing project.

are far from completing the planning process or even tak-This would have the advantage of taking advantage of low ing the steps necessary to assemble its needed financing existing land prices surrounding the future stations and sources. “We have the NGA coming in” soon, they noted, little competition from private developers to acquire the but “we have light rail that won’t open until 2032,” at best.

land. “What hurts us,” said a city employee, “is the specu-This means that the housing is likely to be completed far lation and the land values; it’s really hard to compete.” But in advance of the transportation improvements.

a project underway now would be complete many years before the light rail line, leaving initial residents without Similarly, while Atlanta has developed a comprehensive connectivity and with years’ worth of disruptive, noisy local transit investment plan funded by a 2016 referen-construction.

dum, that plan included only increased frequency and longer spans of service on the bus route serving Thomasville A second option would be for the city to simply acquire Heights (with service increasing to every 20 minutes from land and to hold on to it for several years. But this ap-every 25 at midday on weekdays). 34 While local staff noted proach has its own problems. It would mean the city that they would like to see a new bus rapid transit corridor spending large sums of money on vacant land on which with dedicated bus lanes and faster travel times serving it would be able to build little for years. Not only would the area (on the major street through the neighbor-this reduce city property tax revenue, but it would raise hood, McDonough Boulevard Southeast), the city has no political concerns about wasteful spending and no action, funding to build such a project at this time. If Thomasville according to an interviewee.

Heights is a priority for the mayor in terms of neighborhood investment, that prioritization primarily seems to A final option, perhaps the easiest one, would be to ad-apply in terms of housing investment, not associated vance with the planning process before the city engages transportation projects.

in direct public action. This would have the advantage of allowing the city to rezone to allow for the future develop-Several of the US cities are trying to use zoning as a ment types that local stakeholders and political officials mechanism to plan for future housing in the context want to see. Upzoning around stations, for example, of new transit lines. But, perhaps surprisingly, some of could enable more housing in highly accessible places.

those I interviewed expressed concern about rezoning in But upzoning, an interviewee argued, would raise land advance of the completion of their city’s development prices by enabling future development; “I don’t want the project. At issue for them is the difference in time be-underlying zoning to change, because I don’t want the tween when a project is planned and when it can actually value to increase. . . . Anytime there’s an upzoning, that be built. If a rezoning occurs too far in advance of when a then increases the value that the government would have city or its staff wants to—or can—act, private developers to pay.” Private investors would be able to build more may leverage new construction rights to build more, or at and thus would purchase land for future projects. In the 48

meantime, the city would lose out on opportunities to buy A last major barrier faced by the case-study cities is the land for its own use (such as for a more diverse array of difficulty of proceeding with a large development project housing choices), and affordable housing would be more when the market demand is not present for residents to expensive to construct.

occupy all of the proposed housing units at one time. In Atlanta, for example, city officials expect that Thomasville All three options, then, are problematic in terms of a city’s Heights will be constructed over a 15-year timeline, with ability to accomplish its aims for a housing project. This fewer than half the units completed in the first seven poses a fundamental barrier in the way of the city’s action.

years. As an interviewee from the office of the mayor The city is stuck between a rock and a hard place in terms noted, “there’s an absorption risk. You’re going to have too of whether to proceed with development, whether to much housing at one time” without some delays. In some buy land, or whether to rezone. This misalignment has ways, this delay in construction could be beneficial—it hit Seattle in the past. One interviewee noted that there will ensure that units do not sit empty and help relieve the remain significant undeveloped or underdeveloped plots financing load on city and private financing sources. At of land adjacent to the first phase of the city’s light rail the same time, it will mean a neighborhood that is only system, in part due to the strangely shaped parcels left partly developed for more than a decade to come, which over from light rail construction, as noted.

could be detrimental to quality of life for residents.

Resident Opposition to New Construction

In the United States, one often-cited obstacle to new The results of the current approach to engagement are housing construction—publicly led or private—is com-three-fold: First, reduced overall housing construction; munity engagement. While theoretically designed to second, increased housing prices in appealing neigh-ensure democratic engagement in the planning process, borhoods where housing is not being built but people this involvement often means hearing more from people still want to move in; finally, reinforced social and ra-who are white, people who are older, and people who are cial segregation produced by wealthier people moving homeowners (Einstein, Glick, and Palmer 2019). They may to exclusive neighborhoods where locals protest new be more likely to oppose projects because of concerns construction and others being forced to live elsewhere.

that new projects, particularly those that contain afford-Some argue that the way to deal with this problem is to able housing, will reduce property values or degrade expand engagement further, especially among historically quality of life in impacted neighborhoods (Been, Madar, underrepresented communities (Hyra 2015; Karner and and McDonnell 2014; Fischel 2005)—despite the fact Marcantonio 2018). Others, particularly members of the that such projects do nothing of the sort (Stacy and Davis YIMBY (“yes in my backyard”) movement, suggest that 2022). Such opinions are shared by homeowners across more housing should be allowed “by right,” meaning with-the political spectrum (Marble and Nall 2021). Projects in out special review or public engagement. They argue that neighborhoods with a larger share of residents who are this sort of streamlining will result in more housing being white homeowners are more likely to attract opposition at built and achieve more equitable outcomes. 35 Pro-housing public hearings—and elected officials are more likely to groups, often under the YIMBY banner, have been popping pay attention when more people are opposed to projects up in cities across the United States in recent years. 36

(Lo and Freemark 2022). Meanwhile, people who are not directly affected by projects rarely engage—meaning German cities, too, have seen some contestation about those who might move into future buildings, for example, the importance of new development. Cities in both coun-would almost never testify in favor of an investment.

tries have struggled to identify the best ways to engage Breaking Barriers to Affordable and Abundant Housing 49

the community while supporting that goal. Resident op-These opponents have focused their energy on attempt-position is sometimes widespread. A Frankfurt city official ing to shut down projects because of the perception said in a project convening, “We have a classic NIMBY [not that they will negatively alter the status quo in a certain in my backyard] phenomenon—people directly next to neighborhood. Others point to environmental concerns. In this neighborhood who own in this neighborhood don’t Berlin, for example, residents have argued against the liv-want it.” Despite their effort to develop a local community ing lab project because of a concern that it would destroy engagement process, St. Louis staff similarly argued that part of a forest and the ecosystem there (I was unable opposition was common, particularly in “areas of the city to find evidence of similar concerns about the Atlanta that are highly concentrated with single-family homes.”

example). A community group has argued forcefully to There, “when you talk about wanting to come in with new local elected officials that the project should be cancelled affordable housing, you will hear a lot of opposition.”

or replaced with one that would require fewer trees to be knocked down.

One issue is who states strong positions about projects.

In St. Louis, a local housing official said, “the people with Despite these conditions, some interviewees noted that, higher educations just are louder.” And in Frankfurt, most because residents typically organize early against plans, of the people who came out to public meetings, a staffer if a project makes it through an initial stage of consider-noted, were “elderly people, people who own housing, ation by political stakeholders, it is more likely to make people who are white, people who grew up in Frankfurt; it to the construction phase. Noted an interviewee in St.

they are the people who get out and say what they want.”

Louis, “Theoretically, [you could] have residents mobilizing This disproportionate engagement of certain types of against a project, but when residents mobilize against a people in planning means others get left out. Noted the project, it is typically killed early on.” And there are some Frankfurt official, “people who are renting, who are often examples where development projects are simply sup-immigrants who can’t vote, [who] need the housing and ported by the locals. In Atlanta, a city staff member said want to support the project,” rarely have their opinions

“no one disagrees on this idea for” Thomasville Heights. As heard. In St. Louis, an interviewee said, people with low in-such, the city leaders promoting the development project comes “feel that whether they come to a meeting or not, have not had to contest resident points of view as they they have no power.” This could mean that new housing push for adding more housing supply.

projects are not reflecting the opinions or needs of the people who need new housing the most.

Short-Term Political Horizons and Devolved Public Administration

Among the current barriers to achieving more housing informed by short-term “wins.” Second, they struggle with through publicly led development, perhaps the most disaggregated funding and planning processes managed challenging to address are the political and institutional by different local agencies or departments, which may barriers within each of the cities that are attempting to not see eye to eye on the importance of getting new undertake their projects. These problems, according to projects done.

the interviewees, are particularly acute in US cities, which face two major challenges. First, they are dependent on Consider first the realities of short-term political leader-action by political officials whose primary perspective is ship in each of the case-study cities. Since 2010, Seattle 50

has had six different mayors, none of whom was elected odds with one another—on the same investment. An to a second term. Atlanta’s previous mayor, Keisha Lance Atlanta official gave an example of a parcel of land owned Bottoms, was elected in 2017 but did not even run for by another local department. “The head of sanitation or reelection in 2021; a similar circumstance occurred in St.

public works doesn’t really care about windfall returns to Louis with its previous mayor, Lyda Krewson. A depart-the city’s general fund” in the context of a new housing ment head in Seattle said, “we’ve had a lot of shorter-term project. As a result, it is difficult to make the case for con-mayors,” so it has been difficult to maintain a singular city verting the land they manage into other uses, like housing.

vision for the future over time. The consequence of the short-term nature of these elected officials’ time in office Similarly, different governmental units have different is that, according to an interviewee, when “I’m talking skills. “My experience is that part of the challenge is that about something 15 to 17 years in advance . . . no one transit agencies aren’t really real-estate agencies,” one wants to think about something that far out.” An Atlanta federal official told me. “So they don’t always take on”

housing official said, “preparing for administrative change TOD projects. Each of the public agencies also manages is going to be difficult. . . . As soon as we have a new its own contacts with relevant federal funders (e.g., HUD

mayor, they may change” the policies related to housing or the Federal Transit Administration, FTA), an Atlanta investment.

interviewee added. A Seattle official said, “there’s at least three governments involved” in the living lab project Furthering the challenge of engaging in the development planning. “Trying to get those three together to have a of a major project that integrates housing into a broad-conversation with varying timelines of success and dif-er neighborhood is the reality of many different public ferent measures, that’s extremely challenging because no agencies working simultaneously—and sometimes at one entity holds that.”

Challenges at the Intersection of Local and

Federal Policy

In both the United States and Germany, the federal redevelopment, their use is defined precisely by the government’s role overseeing issues related to land-national government in the context of integrated de-use planning policy is limited. In both cases, the federal velopment plans developed by localities in association government sets some guidelines and provide substantial with state governments. Each of the city stakeholders funds, but state and local governments exert most control described the Urban Development Support program, de-over what types of investments, such as housing, can scribed above, as relatively easy to use and said it usually be allowed where. Even so, federal policies can at times allowed them to undertake projects of their choice.

serve as a potential barrier to new housing construction.

Localities identify mechanisms to operate within these In some ways, US cities benefit from similar freedom in constraints, but ultimately are subject to oversight from the use of the federal funds they receive through CDBG.

higher-level governments.

Noted a federal official, “We give them a menu, but they really decide how they want to use the funds. As long Staff from the German cities recounted a generally less as most of the funds go to low- and moderate-income direct relationship with federal stakeholders than the US

people, they can do virtually anything they want,” except cities (though they do have to follow the federal build-invest directly in new housing construction. CDBG thus ing code). While they receive federal grants for urban can cover expenses related to building, like acquiring land, Breaking Barriers to Affordable and Abundant Housing 51

clearing buildings, laying streets, and installing utilities.

multiple sources. . . . It can kind of grind the funds to a halt Localities can extend CDBG funds through HUD’s Section because of the bureaucracy of having so many differ-108 program, which provides a loan guarantee equivalent ent sources of funds involved.” And HUD requirements, to of up to five years of CDBG allocations to localities, for in general, are expensive. A Seattle representative said bigger projects. HUD’s HOME and Housing Trust Fund that “the unintended consequence of bringing in federal grants provide important assistance to localities looking dollars is that it could cost us an additional $10 million on to invest in new or renovated affordable housing. All HUD

a project. . . . If there’s a penny of federal money, suddenly fund recipients must describe their planned expenditures we have to abide by Davis-Bacon [labor cost rules].” As a in consolidated plan processes and annual action plan result, cities try to concentrate federal dollars into just a updates.

few projects to avoid the expense, time, and confusion of trying to manage many projects with federal government The relationships between national and local govern-funding.

ments, however, are imperfect. Frankfurt’s experience with its Nordwest project suggests that the German HUD’s ability to provide assistance to municipalities federal government’s control of national infrastructure—

to navigate these circumstances is limited because of including energy provision, highways, and railways—caus-staffing shortfalls. The US Department of Transportation es challenges. There, the federal government wanted to (DOT), for example, provides more assistance to govern-invest in changes to a highway near the development ments to conduct environmental review than does HUD, project, and this prevented the local government from according to one paper reviewer from HUD. One agency moving forward with its housing development until a representative told me, “It’s important to understand decision was made about how to move forward with the where we stand at HUD when it comes to manpower.

highway. Noted one German planner, “it becomes a power From 1991 to 2018, we lost half our staff.” As a result, play: who is stronger, highway planning or local planning?”

said a local government interviewee in Atlanta, “I would Until the national government makes its choices about in-describe us as the engine that moves things, and HUD is frastructure plans, the locality is stuck—and must adjust more reactive.” Atlanta staff emphasized that the terrible its plans in the meantime, delaying the completion of new conditions in the Forest Cove apartment complex were homes.

unknown to—or at least went unaddressed by—HUD for years. Making matters worse is that decisionmaking about The US officials I interviewed, too, raised major concerns HUD policy is sometimes divided between federal staff about their ability to leverage federal funding support for in the national headquarters and those in regional offices.

their communities’ benefit—and for the goal of quick-A St. Louis staff member said, “I’m not sure how aligned ly advancing housing construction. Federal grants are local HUD offices are with DC HUD.” A Seattle depart-useful, but using federal money as part of a project adds a ment director said the two parts of HUD were “pretty well

“whole pile of laws and requirements,” such as the need to distanced. There’s actually a point of tension between the purchase materials from US-based sources (through the two of them… they are such a huge bureaucracy, and so Buy America requirement), said a federal official. “It’s one we get lost in that conversation.” 37

more thing that jurisdictions have to learn and absorb.” A St. Louis interviewee backed up this contention, telling me The US DOT, on the other hand, has received considerable that the different funds they had received had varying re-increases in funding in recent years thanks to the passage quirements when it came to issues like what types of or-of the 2021 Infrastructure Investment and Jobs Act. That ganizations could receive funding as grant subrecipients.

law substantially expanded support for transit projects.

Said a Seattle interviewee, “politically, there’s a lot more Using multiple federal programs on the same project can support for big infrastructure. . . . From a values perspec-double or triple requirements in terms of issues such as tive, the federal government will put billions of dollars inspections and environmental review. An Atlanta hous-into helping lower income people move around—but ing official noted that “it’s messy to line up funds from not to get them housed.” As a result, local transportation 52

officials go out of their way to “federalize” their projects (integrating federal funds); it is just worth it, given how much money is coming in. That value, however, has its limits: Though the FTA is officially supportive of joint development projects (meaning real-estate investments directly linked to transit) and TOD, transportation funds cannot be used for housing investments directly (there are promising new changes to federal requirements that may expand these opportunities; I describe these in the next section).

These conditions collectively paint a concerning picture of how local governments in both countries interact with national government officials and leverage federal funds.

In Germany, large housing projects can be delayed or forced to change due to federal control over infrastructure projects that get in the way. In the United States, available funding for housing and related investments are constrained by complicated federal rules about how the money is spent, making using federal support challenging in the context of adding new housing units.

Breaking Barriers to Affordable and Abundant Housing 53

Breaking Barriers to Building Housing through Publicly Led

Development Projects

54

Local governments in the United States and Germany review processes, cities can call upon a well-defined, face a number of challenges in implementing their pub-competitive planning process that, from the start, licly led development projects. These difficulties may identifies public priorities related to not just housing stand in the way of the case-study cities—and others but fully integrated projects and leverages those prior-like them—being able to achieve the abundant access to ities throughout the development timeline.

housing their residents desire. Even so, my investigation also points to promising ways that the case-study cities in

• The zoning and building codes that localities use to both countries have demonstrated to advance significant regulate new construction do not have to serve as a new housing construction in their living lab development major constraint on new housing availability, but rather areas. Several that stand out include:

can support it. Cities can adjust their local guidelines to facilitate more housing development.

• Publicly owned land offers a resource to reduce housing costs and provide government stakeholders Each city may need to apply these approaches in its own the ability to act in the public’s interest. Cities can way. Integrating publicly led projects with new transit maximize public land ownership while still encouraging lines may be a more fruitful approach to generating space new housing development, combined with permanent for new housing in some cities, while altering zoning to affordability guarantees.

support more privately funded projects may be more effective elsewhere. Whatever the case, cities have to

• Cities can integrate financing and development plan-find new ways to add housing in the coming years. As an ning for housing, transit, and other public investments interviewee noted, “Seattle used to think of itself as a me-simultaneously. Rather than approaching integrated dium-sized town, but we are now a metropolis. . . . We are projects from only one perspective, cities can co-plan in a city that is land-locked and water-locked, and there to create more vibrant, connected communities.

is nowhere else to grow but up.” Publicly led planning for vibrant and mixed-use new developments with plenty of

• Rather than subject new development plans to years new housing offers one path to achieve that goal.

of attempts to garner public buy-in through endless Strategic Use of Publicly Owned Land Combined with New Financing Sources and Affordability

Guarantees

The publicly led development approaches each of the development plans, create equity to support future proj-case-study cities is pursuing with its respective living lab ects, and increase opportunities for housing affordability.

project is, in some ways, a departure from the assumption They noted that, if structured appropriately, a project with that land is a private good which the government has only publicly owned land could counter gentrification, extract a limited right to manage through planning. At the core housing from the uncertainty of the private market, and of the approach now being taken by the cities is the use be integrated with other sources of funding and financing of publicly owned land. Interviewees in each community to promote better outcomes. Moreover, public land can emphasized that they see public land as an opportunity be easier to redevelop than privately held land because of not to be sold off, but rather to generate leverage over the less strenuous entitlement process, as noted.

Breaking Barriers to Affordable and Abundant Housing 55

One fundamental benefit of municipal land ownership is construction, the city might consider it. But now, the local that it enables cities to plan for high levels of affordability government is taking a proactive lead on using the land to without requiring as significant a subsidy as with LIHTC

advance city priorities. This requires partnerships within or other similar funding sources. “It’s imperative that we agencies to assemble land parcels and use them. Noted keep ownership of the land and mandate affordability,” an a city employee, “We say, ‘hey, fire department, we’re not Atlanta official told me. The approach to do that is new.

getting rid of your station, we’re either working with a According to staff, city land previously was conceived as developer to pick an alternative site [for the fire station],’

something that, in the context of housing developments, which allows the department to avoid the procurement could be sold off—in some cases to nonprofit afford-process, ‘or we’ll rebuild it on the site’” as part of a larger able housing developers; this was often used as a low- or development project.

no-cost contribution to LIHTC financing deals. But now,

“we’re moving toward a value-generating approach,” said Atlanta is undertaking this approach directly at an interviewee. “We’ve come to the conclusion that the Thomasville Heights, where the city and sister agencies best way to generate a sizable return on our public land already own a majority of the land to be redeveloped portfolio is to start thinking of our land contribution as an (figure 13). Municipal staff believe that the city can do a equity contribution on deals that are income-producing better job encouraging transformation in this relatively and that include affordable housing. So it’s to think like low-income community than the private sector can. “Our private investors that want to create more income for the horizon is a bit longer than the typical investor,” said an city.”

interviewee. “Ultimately, you have to create some kind of market desire to move in the area.” And by using its own This approach places the city in the forefront of the de-land, the city can think about the long term, integrate velopment process. In the past, if they did not sell it, cities housing affordability from the beginning, introduce a like Atlanta would often sit on their land—even in the large share of affordable housing into the portfolio, and most hot-market neighborhoods—unconcerned about

ensure that the housing is being built in association with a the degree to which it was contributing to the city’s hous-mix of uses to create a vibrant community.

ing supply. If developers advanced a proposal for new 56

FIGURE 13

A Variety of Public Agencies Own a Large Share of Land in Atlanta’s Thomasville Heights Of 120 acres of undeveloped land in the neighborhood, 89 are publicly owned Source: City of Atlanta, Office of the Chief Policy Officer.

Atlanta is not the only city focusing on the potential use dollars generated by the Atlanta Community Foundation of its publicly owned land. In Seattle, a planning staff and Woodruff Foundation. The Housing Production Fund member told me that “we’re looking at government will provide low-cost, mezzanine construction financ-agency owned property in general. We don’t want to just ing for mixed-income housing projects, with the goal have this with Sound Transit, we also want to look at King of providing additional sources for affordable housing County [which encompasses the city] and the school dis-financing beyond what is already available through federal trict: What are all the government parcels that might be programs.

good candidates for development?” Another emphasized,

“It’s our intention that we want all the land that’s available.

Some of the cities have created new public entities de-

. . . I view the land that Sound Transit is taking [for the light signed to ease the process of developing major projects rail project] as just the start.” In theory, many of these like the living lab sites. Atlanta’s Mayor Andre Dickens properties can be converted from some other use to moved the city’s Housing Innovation Lab into the mayor’s focus on the goal of expanding housing supply.

office with the goal of promoting his administration’s goal of adding 20,000 affordable housing units. And he led Several of the cities are associating publicly owned land the Atlanta Housing Authority to create a new subsidi-with new financing sources. In Seattle, a housing levy that ary housing developer, a governmental nonprofit called was renewed and expanded in 2023 generates funding to Atlanta Urban Development Corporation (AUDC) that be used for the production and preservation of affordable is tasked with financing and developing mixed-income housing. In Atlanta, a $100 million housing bond funded housing, sometimes referred to as social housing. 38 AUDC

by city taxpayers will be complemented by philanthropic has the added advantage of enabling the city to develop Breaking Barriers to Affordable and Abundant Housing 57

a long-lived institution tasked with housing construction.

In Germany, the case-study cities leverage public land City staff want it to “exist insulated from the mayor” in the continuously as the preferred approach to undertake new context of frequent political shifts.

housing development projects. Using regulatory tools that the national government has provided, especially the AUDC is still building out its capacity, but it will be de-Urban Development Measure, the cities identify key land signed to co-develop and own projects through a joint that they plan to develop and then expropriate it at prices venture model. Housing units developed by the agency that have not been inflated by speculation, before leasing could be made a key component of the Thomasville it out to private entities. The profits from those leases go Heights development. This new authority has the advan-on to fund services such as schools and daycare. In Berlin, tage of enabling the city to “think beyond” LIHTC, as one the city has focused on “not only housing and social interviewee put it. This new approach will expand the housing, but a mixed social situation,” according to an public capacity for development, bringing in real estate attendee at a project convening. This is made possible by expertise as a core municipal function.

integrating the city’s social housing developer into plans and ensuring that they develop some of the project sites.

Seattle is on the way to implementing such a social City staff work to ensure that projects include a full mix housing agency, thanks to the 2023 voter approval of of neighborhood amenities, such as groceries and green the Seattle Social Housing Developer. That independent, space, within an easily walkable distance.

city entity will be designed to produce new housing units designed for residents with low, moderate, and middle In Munich, the city’s Sozial orientierter Bodennutzung incomes, and these could theoretically be integrated into (SoBoN) policy requires developers constructing on the living lab project sites. That said, it remains to be seen city-owned land to provide a minimum share of new units how this body will be managed and funded. 39

as affordable. 40 Developers respond to city invitations to present project ideas, and then are judged based on St. Louis, too, has created an independent public agency the quality of their proposals before they are chosen to tasked with engaging in land assembly and project ad-engage in a long-term ground lease (projects that better vancement, the St. Louis Development Corporation. This meet public goals through the planned provision of agency has focused on what to do with the city’s mass of public amenities are more likely to win). Private develop-25,000 vacant properties, many of which are in the Near ers involved in projects on public land also contribute to North Area. The Corporation, like AUDC, is somewhat the costs of infrastructure in the neighborhood, further insulated from day-to-day political engagement, enabling enabling new construction.

it to act more quickly.

58

True Integration of Transportation and Housing Investments in the Face of Challenging Project Timelines

Staff in each of the case-study cities is committed to project will be fully accessible by public transportation concentrating housing in areas accessible to transit ser-from the start.

vices. Access to transit has several advantages: It encourages residents to use environmentally friendly modes In Frankfurt, the city government is planning the creation of transportation, it can reduce project development of the Nordwest neighborhood and funding the extension costs (by eliminating the need to build as much parking), of transit to serve the site. The city government is ensur-and it lowers overall living costs by allowing residents to ing that the thousands of residents at the development avoid the costs of traveling by car. But building housing will get access to both regional rail and light rail service.

in a way that capitalizes on transit can be difficult, in part These joint investments will guarantee that the neigh-because of the differing timelines between the two types borhood meets the city’s goal of adding housing density of investments, as described. Conducting this sort of joint without adding street traffic.

planning requires intentional planning across municipal agencies that are building a common front. An interAs described above, in the United States, local govern-viewee from Atlanta emphasized, “we have to be really ments often struggle to integrate planning processes intentional because we’re retrofitting an auto-centric across multiple city departments involved in multiple policity. If you don’t do it right, you’ll end up with a lot of car cy areas. This is despite the fact that, as in Germany, there dependency.”

is real demand for planning around transit. First, staff in US cities acknowledge the environmental and cost-sav-The focus on linking housing construction with transpor-ings benefits of concentrating development in ways that tation investments is particularly a factor in Germany.

leverage integration with public transportation. Second, Noted one convening attendee from Berlin, “We are the reality is that many of the neighborhoods surrounding considering that if we’re planning new areas, and housing the living lab sites are already filled with residents who use areas, there is definitely no need to have a car—it’s always transit. “There are really staggering rates of carelessness,”

a possibility to use public transportation.” A Frankfurt noted an official from St. Louis. “Over 50 percent of the representative agreed that “getting away from individual, households in those areas don’t have cars.”

car-centered new development—that will be a big chance for rethinking the issue of providing space for amenities.”

This is a change from the past; noted an interviewee, “If you’re building housing, it’s easy to get myopic.” From In Berlin and Munich, officials intentionally chose a site for this perspective, both Atlanta and Seattle have led the redevelopment adjacent to existing, high-quality tran-way by “quarterbacking” TOD. In the first city, the mayor’s sit services. Residents of each living lab site will be able office has concentrated decisionmaking by bringing in to travel throughout the region quickly thanks to these staff involved with a full breadth of issues related to the connections. In Berlin, in addition, the city is planning Thomasville Heights project, including transit, financ-a frequent, dedicated bus rapid transit line linking the ing, parks, and schools. “We start with . . . the assets or regional rail line to the full breadth of the new district. This resources that the different partners have,” said an Atlanta project is being implemented along the major east-west official. “Almost all of them are receptive to the idea that corridor that will cross the neighborhood at the same time if we work together, we can accomplish something that’s as the new housing is being built. Profits from the new really meaningful.” In Seattle, a planning agency staff development will help finance the bus line; as such, the member told me, “We are a team of city departments that Breaking Barriers to Affordable and Abundant Housing 59

are contributing to this. For the most part, we try to work its train station and the Capitol Hill district. At the same really collaboratively. We are one Seattle voice.”

time, the low-slung, 561-unit public housing development at Yesler Terrace—on a 30-acre site—was identified by As in Germany, US planners are focusing on ensuring that the Seattle Housing Authority (2023) for redevelopment TOD means more than just housing located near transit. In due to aging infrastructure, and the agency began plans Seattle, a planner asked, “What are the other modes that for its redevelopment.

need to be plugged in, and understanding what amenities are needed? There’s a catalytic opportunity for the kinds Given the importance of the redevelopment project, of things we’re looking at, so economic development, planners at Sound Transit altered the proposed align-commercial space, and more.” City staff pledged to take ment of the First Hill line, with the goal of better serving a major role in station-area planning as soon as Sound Yesler Terrace (Sound Transit 2010). 41 That line opened Transit finalizes station sites for the light rail project. And for service in 2016. And in 2013, the public housing they will do so in concert with available public land.

project redevelopment was underway, made possible by a combination of LIHTC, HUD grants, state housing One opportunity that Seattle is piloting is the use of grants, and private investment. The area is planned for an excess transit agency-owned land around future stations almost nine-fold increase in housing density, and 3,900

for housing development. Once no longer needed for the units are already completed or underway, including a full transit project itself (such as for construction staging), set of replacement units designed for families with very that land will be targeted for affordable housing use.

low incomes, plus 1,000 more for families with low and Because the land is publicly owned, it will become more moderate incomes (Seattle Housing Authority 2022).

feasible to construct housing at lower costs. This will The project also includes new public parks, a community become even more possible thanks to Sound Transit’s center, and medical facilities (figure 14). This deliberate creation of a revolving loan fund designed to help support concentration of units around a new transit line demon-TOD.

strates the intentional increase in density made possible through better access to public transportation and a com-Interviewees in Seattle mentioned an example of hous-bination of public subsidies and private real-estate. Noted ing–transportation planning integration in their city. The a Seattle interviewee, Yesler Terrace “proves it can be Yesler Terrace neighborhood, while not a living lab site, done—what’s emerging is a very desirable, mixed-income was redeveloped in concert with the construction of a community that’s close to jobs, downtown, and public streetcar route, the First Hill line. In the late 2000s, the transportation.”

city began planning for this route, which would connect 60

FIGURE 14

Seattle’s Yesler Terrace Integrates Thousands of New Housing Units Adjacent to Streetcar Line Source: Seattle Housing Authority (2022).

Note: Housing projects noted with red boxes; neighborhood amenities noted with blue boxes; medical and hotel uses noted with purple boxes; and future project noted with yellow box.

The US federal government could be a key partner in directly); CDBG funds can also be used for those uses, as enabling the joint housing and transportation planning noted.

that the case-study cities want to pursue at their living lab sites. The FTA encourages new transit lines to be coordi-Recent changes to federal laws and regulations have nated with zoning changes that allow more housing con-provided new opportunities. The 2022 National Defense struction through its grantmaking processes. That agency Authorization Act (NDAA) updated rules related to also enables transit agencies to leverage station-area land the disposition of land purchased with federal funds for joint development, meaning projects that are directly (Freemark 2023b). The FTA’s guidance allows transit agen-linked to stations. Meanwhile, federal transportation grant cies to give land purchased using federal funds to public dollars can be used for both TOD planning and joint de-or nonprofit agencies for the purposes of affordable hous-velopment site infrastructure, such as roads and utilities ing without having to pay the federal government back.

(though they cannot be used for housing construction This disposition can be undertaken without additional Breaking Barriers to Affordable and Abundant Housing 61

public review, greatly simplifying the ability of agencies programs. TIFIA and RRIF loans—which originally were fo-like Sound Transit to develop housing on land used for cused on financing transportation projects with low-inter-light rail construction.

est loans—can now be used for TOD. The programs offer both construction and permanent loans at much lower The federal government has also adapted regulations rates than commercially available. Though the programs related to use of loans provided by the Transportation have not yet financed any actual TOD projects, according Infrastructure Finance and Innovation Act (TIFIA) and to a federal interviewee, the goal is to begin providing Railroad Rehabilitation & Improvement Financing (RRIF) loans to real estate projects in 2024.

Multi-Stage Planning Process, Integrating

Resident Engagement

As described, the current public planning process has the do a whole bunch of stuff without engaging the residents.

tendency to prioritize the points of view of only a certain it was essential that we develop alongside the residents.”

subset of residents. People with higher incomes, people who are white, and people who are homeowners typically As described, staff argued that neither the project in engage more directly in planning for new housing than Atlanta nor that in St. Louis has been seriously threatened others. And this has the ill effect of sometimes inhibiting by resident opposition. One explanation is surely the com-housing construction. Interviewees from all cities agreed prehensiveness of the resident engagement program.

that the solution to this problem is not to eliminate resi-Another may be the fact that, in Atlanta, the renova-dent engagement, but rather to create engagement pro-tion and replacement of the Forest Cove complex was cesses that are more inclusive but also more definitively association with a promise of a right to return for former aimed toward ensuring that they result in more housing as residents. “We said, no matter what happens there, we’re an end product.

going to create a high-quality neighborhood and give you all a chance to get there,” said a city employee.

The US case-study cities developed comprehensive approaches to engage residents as part of their publicly led The German cities offer some useful examples for how projects. In St. Louis, the local government hired a plan-resident engagement can be leveraged to produce better ning consultant to conduct resident training sessions to projects. In Berlin and Frankfurt, as briefly mentioned increase comfort with the process, as well as sharing in-above, the local governments conducted an urban design formation via town hall meetings, door-to-door flyers, and process meant to collect information from residents, pit other sorts of engagement. In Seattle, officials affirmed ideas against one another, and end up with the best possi-that “we owe it to the residents of the city that the proj-ble urban development. This process works as follows: ects that Sound Transit builds integrate into communities and provide the most rich transit-oriented experience 1. The city government identifies a development site for for those communities.” In Atlanta, officials undertook a construction of new housing and other needs (in this similar series of public engagement programs designed case, the living lab sites).

to compile feedback from neighbors, with the goal of

“build[ing] coalitions of the residents,” according to a local 2. The city hires and pays a number of urban design and housing staffer. “We’re really sensitive to not drop in and planning teams to develop planning ideas for the site, 62

based on the city’s general goal of increasing housing which becomes the city’s final design to be imple-availability there (three teams in the case of Berlin, mented in the city’s planning code.

seven in the case of Frankfurt).

This process is new to German cities, but it offers an 3. The public reviews these ideas in a series of open intriguing example to follow for other cities considering meetings and provides feedback to the design teams.

how to advance major new development projects with the public’s input. It has the benefit of structuring input 4. These teams (still paid) refine their plans, twice, in part over a series of sessions and doing so in a way that also to reflect the public’s views about how to design to prioritizes the points of view of experts. Hiring several development.

urban design firms to create planning concepts from the beginning allows for a variety of options to be presented 5. A jury primarily comprised of experts in urban design while maintaining the general purpose of the project, and planning, but typically incorporating a resident increasing housing supply.

member, then votes on the preferred alternative, Developing Appropriate Land-Use Regulatory

Codes

Interviewees from the case-study cities repeatedly update will ensure coherence between different sorts of argued that their ability to complete their respective investment across city agencies and the general goal of publicly led development project was not limited by local making the neighborhood one with a high quality of life.

zoning and building codes, as described. Because the city is leading project development in each case, city But zoning policy is also meaningful for the implementa-staff feel empowered to pursue the project that they tion of major projects in the context of their extended im-believe is a best fit for the site, and, if necessary, to seek plementation process. Here, Seattle is taking an interest-changes to local zoning afterwards. They do not think ing approach to dealing with the city’s concerns, as noted, that making those changes is particularly burdensome, that upzoning too quickly could make the neighborhood perhaps because they are public agencies. Even so, there unaffordable and inhibit public land purchase. The city is are some key lessons to be learned from the development thus planning to implement what it refers to as “interim processes of the living lab sites, first, in terms of ensuring controls” that are designed, according to a city staffer, not that zoning aligns with long-term plans and the timing

“just to limit the bad development—it’s also a tool to not issues inherent in development, and second, in terms of rezone too early.” These policies could, for example, limit increasing the city’s authority to regulate development in the construction of new drive-through restaurants, pre-key areas.

vent new storage facilities, and ensure that setbacks for new buildings respect adequate sidewalk rights-of-way, to Consider first the alignment between development plan-ensure that the areas around stations appropriately reflect ning and comprehensive plans. In St. Louis, local officials the goal of creating a walkable neighborhood; “It’s really have emphasized the importance of updating the city’s a way to set the development environment in advance so strategic land-use plan to reflect the priorities it has set we don’t hamstring ourselves,” another interviewee said.

out as part of the Near North planning process. This plan Breaking Barriers to Affordable and Abundant Housing 63

In the longer term, these interim regulations will be replaced. City staff expect the creation of TOD-oriented rules that support higher density uses, while incorporating inclusionary zoning requirements to ensure that new projects include an affordable housing element. This may include a series of anti-displacement measures that could, for example, protect from demolition apartment complexes with a high number of residents with low incomes. But the details of these policies have yet to be concretized.

Germany’s Urban Development Measure was used by

both Berlin and Frankfurt to ensure that they could assemble a large land parcel at property prices that did not inflate due to investor speculation. This tool was essential in enabling the city government to affordably buy land, thanks to its provisions that allow property values to be frozen. It will also be key to ensuring that the city can later fund social services by leveraging revenues from leasing parcels to private developers. This tool does not exist in a similar way in the US cities.

64

Conclusions

Through an investigation of the approaches six case-effective public transportation, and ensures a higher qual-study cities in the United States and Germany are taking ity of life for residents. If successful, these development to conducting publicly led development, I have identi-projects could represent a new model for developing fied not only several of the key barriers to new housing integrated, high-density urban neighborhoods.

investment, but also several potential mechanisms to break those barriers. There remain substantial obstacles to Both US and German cities can learn from each oth-building enough housing to meet the need in both coun-er’s experience. The US cities have demonstrated key tries—and this study does not provide much information approaches to engage a wide swath of their residents, about how to encourage privately developed housing.

including some of the most historically disenfranchised, But the case-study cities clearly demonstrate effective to the benefit of project advancement. The German cities approaches on the path toward providing more housing.

have been able to leverage federal regulatory structures Some of these strategies could be beneficial for cities to speed project delivery. Both sets of cities have shown across both countries to emulate.

the value of using publicly owned land. As the living labs move toward completion, the transatlantic exchange of Most remarkable, perhaps, is the systematically coura-ideas about city planning can only improve results.

geous point of view that staff in each of the cities are taking in planning for their cities’ respective future. In each city, political leaders have chosen to take pride in the future of their community and bring a cohort of people and institutions together to support the difficult endeavor of assembling and leading the planning and development of new housing projects. Each of the cities is demonstrating its resilience in the face of mounting affordability pressures by trying something new.

From that perspective, the choice by each city I study here to emphasize the role of the public sector in housing creation stands out. In both countries, city leaders acknowledge that they cannot just rely on the private real estate market to act independently to construct adequate housing for their respective populations. Rather, major publicly controlled development sites and development plans can be used as a mechanism to add thousands of new housing units. And those units can be added in a way that increases housing affordability, offers access to Breaking Barriers to Affordable and Abundant Housing 65

Appendix

In the maps that follow, I illustrate differences in the demographics of neighborhoods throughout each of the US case-study cities. Each map identifies where the living lab publicly led development site is located, as well as the location of existing and planned rail and bus rapid transit.

FIGURE A.1

Share of Population Living Under the Federal Poverty Line Source: US Census 2017–21 5–year American Community Survey, showing Census tract level data.

66

FIGURE A.2

Share of Population that is Non-Hispanic White Source: US Census 2017–21 5–year American Community Survey, showing Census tract level data.

FIGURE A.3

Housing Density per Square Mile

Source: Historical Housing Unit and Urbanization Database 2010 (2019 data).

Breaking Barriers to Affordable and Abundant Housing 67

FIGURE A.4

Share of Housing Units that are Single-Family Homes Source: US Census 2017–21 5–year American Community Survey.

FIGURE A.5

Distribution of Federally Subsidized Affordable Housing Units Source: National Housing Preservation Database (2022).

Notes: Affordable units included on these maps include all project-based, federally subsidized units, including public housing, project-based Section 8, and Low-Income Housing Tax Credit units.

68

FIGURE A.6

Median Housing Value

Source: US Census 2017–21 5–year American Community Survey.

FIGURE A.7

Share of Households Spending More than 50 Percent of Income on Rent Source: US Census 2017–21 5–year American Community Survey.

Breaking Barriers to Affordable and Abundant Housing 69

FIGURE A.8

Change in Median Housing Values, 2001–22

Source: Zillow Home Value Index, all homes, by Zip code (2022).

Notes: Areas without data are shown in white.

FIGURE A.9

Change in Housing Units by Neighborhood, Case-Study Cities Percent change from 1950 to 1990

Source: Historical Housing Unit and Urbanization Database 2010 (1950 and 1990 data).

70

FIGURE A.10

Change in Housing Units by Neighborhood, Case-Study Cities Percent change from 1990 to 2015–19

Source: Historical Housing Unit and Urbanization Database 2010 (1950 and 1990 data).

Breaking Barriers to Affordable and Abundant Housing 71

Endnotes

1 Yonah Freemark, “Exclusionary Zoning Limits

urban-wire/what-rising-gas-and-rent-prices-mean-

Opportunity by Concentrating Subsidized Housing in a families-low-incomes

Small Part of the Puget Sound Region”, Urban Institute Urban Wire, June 22, 2023. https://www.urban.org/ur-6 Yonah Freemark, “What the Inflation Reduction Act ban-wire/exclusionary-zoning-limits-opportunity-con-Did, and Didn’t Do, for Sustainable Transportation,”

centrating-subsidized-housing-small-part-puget

Urban Institute Urban Wire, September 15, 2022, https://www.urban.org/urban-wire/what-inflation-re-2 Houston notoriously does not use zoning, but Harris duction-act-did-and-didnt-do-sustainable-transporta-County (which includes Houston) had only 27 housing tion

units for every 100 extremely low income households, according to a recent analysis. Erika Poethig, Liza 7 See MARTA, “MARTA 2040 Project Overview”. https://

Getsinger, Josh Leopold, Graham MacDonald, Lily

www.itsmarta.com/current-projects.aspx; Sound

Posey, Pamela Blumenthal, Reed Jorgan, and Katya Transit, System expansion. https://www.soundtransit.

Abazajian, Mapping America’s Rental Housing Crisis, org/system-expansion; East-West Gateway, Corridor Urban Institute, 2017. https://apps.urban.org/features/

Planning/Metrolink. https://www.ewgateway.org/

rental-housing-crisis-map/

transportation-planning/corridor-planning-metrolink/

3 This geography has no political meaning as it is not 8 Kevin Smith, “Frankfurt U-Bahn Extension Approved”, associated with any form of elected or appointed gov-International Railway Journal, May 29, 2020. https://

ernment in any of the cities. Each of the case-study www.railjournal.com/passenger/light-rail/frank-cities is located in a metropolitan area with a federally furt-u-bahn-extension-approved/; Olivia Logan,

designated metropolitan planning organization (MPO)

“Berlin Government Underlines Plans to Expand

whose areas of influence parallel those of (but are not U-Bahn Network”, I Am Expat, September 7, 2023.

exactly the same as) the Census-defined core-based https://www.iamexpat.de/expat-info/german-ex-statistical area. MPOs in these three regions have pat-news/berlin-government-underlines-plans-ex-appointed members who make choices about how

pand-u-bahn-network

federal transportation spending should be allocated to projects, but their influence is generally less significant 9 Joint Center for Housing Studies of Harvard

than that of elected officials in local or state govern-University The Supply of Low-Cost Rentals Continues ment. The MPOs for the three regions are the Atlanta to Decline , 2023. https: //www.jchs.harvard.edu/

Regional Commission, the East-West Gateway Council son-2023-low-cost-rentals

of Governments (for St. Louis), and the Puget Sound Regional Council (for Seattle).

10 U.S. Department of Housing and Urban Development, Community Planning And Development Formula

4 Kenneth Schrupp, “California Legislature Unanimously Program Allocations For FY 2023, May 3, 2023. https://

Passes New Exemption to Environmental Review”,

www.hud.gov/program_offices/comm_planning/

The Center Square, August 18, 2023. https://

budget/fy23

www.thecentersquare.com/california/article_3e-

1bac1c-3e14-11ee-a901-2f4da5f5a094.html

11 Federal Ministry for Housing, Urban Development and Building, Supporting Urban Development in Germany.

5 Yonah Freemark, “What Rising Gas and Rent Prices https://www.staedtebaufoerderung.info/EN/home/

Mean for Families with Low Incomes”, Urban Institute home_node.html

Urban Wire, March 17, 2022. https://www.urban.org/

72

12 For details about Thomasville Heights, see Jewel Burks, 18 For details about Near North St. Louis, see City of St.

“Thomasville Heights is Atlanta”, Medium, May 19, Louis, North City Commercial Corridors. https://www.

2022. https://medium.com/@jewelmelanie/thomas-

stlouis-mo.gov/government/recovery/covid-19/arpa/

ville-heights-is-atlanta-ccc790b157f8; Martha Dalton, projects/project.cfm?id=282; Jacob Barker, “Over two

“Atlanta school board moves ahead with plan to close years after big HUD grant, Preservation Square project Thomasville Heights Elementary”, WABE, June 7, 2022.

finally nears groundbreaking”, St. Louis Post-Dispatch, https://www.wabe.org/atlanta-school-board-moves-April 27, 2019. https://www.stltoday.com/business/

ahead-with-plan-to-close-thomasville-heights-elelocal/over-two-years-after-big-hud-grant-preserva-mentary/; Stephannie Stokes, “City of Atlanta propos-tion-square-project-finally-nears-groundbreaking/ar-es $9 million to relocate Forest Cove residents”, WABE, ticle_ea43dfa3-f795-5188-b45d-88d466373a7c.html; May 3, 2022. https://www.wabe.org/city-of-atlan-Michael R. Allen, “Before and After Pruitt Igoe,” Pruitt ta-proposes-9-million-to-relocate-forest-cove-resi-Igoe Now. http://pruittigoenow.org/before-and-after/; dents/

National Geospatial-Intelligence Agency, “NGA breaks ground on new facility in north St. Louis”, November 13 City of Atlanta, Mayor’s Office, Last Families Move 21, 2019. https://www.nga.mil/news/NGA_breaks_

from Forest Cove Under Mayor Dickens’ $9.1M

ground_on_new_facility_in_north_St._Lou.html; Evie Relocation Plan, October 3, 2022. https://www.atlanta-Hemphill, “St. Louis eyes MetroLink expansion even ga.gov/Home/Components/News/News/14374/672

as bus service contracts”, St. Louis Public Radio, December 1, 2021. https://news.stlpublicradio.org/

14 Atlanta Housing Authority, “Redevelopment Of Vacant show/st-louis-on-the-air/2021-12-01/st-louis-eyes-Land. Request for Qualifications For Real Estate metrolink-expansion-even-as-bus-service-contracts; Developers”, May 5, 2023. https://www.atlantahousing.

Rosemann and Associates, “Revitalization Milestone org/wp-content/uploads/2023/05/RFP-2023-0076_

for Historic Near North Side Neighborhood”. https://

AHA-Tier_2_Sites_RFQL_Spreads-Final_5.5.23.pdf

rosemann.com/revitalization-milestone-of-histor-

ic-near-north-side-neighborhood/; Vincent Bennett, 15 Joyce Lupiani, “City of Atlanta announces class action

“Urban residential renaissance: Development under-lawsuit against management company of troubled

way to revitalize north St. Louis”, St. Louis Business Forest Cove Apartments”, Fox 5, October 6, 2023.

Journal, September 28, 2022. https://www.bizjournals.

https://www.fox5atlanta.com/news/city-of-atlantacom/stlouis/news/2022/09/28/development-un-

announces-class-action-lawsuit-against-manage-

derway-to-revitalize-north-st-louis.html; Alex Ihnen, ment-company-of-forest-cove-apartments; Akilah

“Near North St. Louis Chosen for $29.5M HUD Choice Winters, “Fire at Forest Cove apartments extinguished, Neighborhood Grant”, NextSTL, December 12, 2016.

damages building”, 11 Alive, November 30, 2023.

https://nextstl.com/2016/12/near-north-st-louis-cho-https://www.11alive.com/article/news/local/forest-sen-29-5m-hud-choice-neighborhood-grant/

cove-apartments-fire/85-43bf0a5b-d9ad-43c5-a671-

b3956bebd414

19 Kimberly Adams, “Can a spy agency fight ur-

ban blight in St. Louis?” Marketplace, January 13, 16 Sean Keenan, “As ‘Cop City’ Vote Steals Show, Atlanta 2017. https://www.marketplace.org/2017/01/13/

City Council OKs Battery of Affordable Housing

can-spy-agency-fight-urban-blight-st-louis/.

Legislation,” A tlanta Civic Circle, June 9, 2023, https://

atlantaciviccircle.org/2023/06/09/atlanta-city-coun-20 National Geospatial-Intelligence Agency, About Next cil-approves-100-million-housing-bonds/

NGA West. https://www.nga.mil/about/About_N2W.

html

17 City of Atlanta, Department of City Planning, Planning Viewer. https://gis.atlantaga.gov/planview/

21 Staph Kukuljan, “With NGA construction underway, attention turns to development around the

Breaking Barriers to Affordable and Abundant Housing 73

$1.7B campus”, St. Louis Post-Dispatch, October 21, Village Element, 2005. https://www.seattle.gov/docu-2021. https://www.stltoday.com/business/local/

ments/departments/opcd/ongoinginitiatives/seattles-with-nga-construction-underway-attention-turns-

comprehensiveplan/urbanvillageelement.pdf

to-development-around-the-1-7b-campus/arti-

cle_5f363256-205a-5949-822a-64eb11d55c3a.html

28 Sound Transit, Transit-Oriented Development,

2023. https://www.soundtransit.org/sys-

22 City of St. Louis, “City of St. Louis Wins $29.5M Choice tem-expansion/creating-vibrant-stations/

Neighborhoods Grant”, December 12, 2016. https://

transit-oriented-development

www.stlouis-mo.gov/government/departments/may-

or/news/city-of-st-louis-wins-choice-neighborhoods-29 See Entwicklungsstadt Berlin, Rahmenplan Für 2.700

grant.cfm

Neue Wohnungen in Pankow festgelegt, June 15,

2023. https://entwicklungsstadt.de/rahmenplan-

23 NextSTL, Near North Side Choice Transformation fuer-2-700-neue-wohnungen-in-pankow-festgelegt/; Plan, 2022. https://cdn.nextstl.com/wp-content/

Senatsverwaltung für Stadtentwicklung, Bauen und uploads/20220627114023/DRAFT-Near-North-Side-Wohnen, Buch – Am Sandhaus. https://www.ber-

Transformation-Plan.pdf

lin.de/sen/stadtentwicklung/neue-stadtquartiere/

buch-am-sandhaus/

24 Growing Metrolink, Modified City of St. Louis Alignment, 2023. https://growingmetrolink.com/city-30 Note that the city also has a major development proj-of-st-louis/

ect underway in the city center involving the construction of four interconnected towers, but we did not 25 For details about the West Seattle and Ballard focus on this project as part of this research initiative.

Link Extensions, see City of Seattle, Draft City Stadt Planungsamt Frankfurt Am Main, Frankfurt

Recommendations, June 7, 2022. https://www.

Nordwest – Neuer Stadtteil der Quartiere, 2023.

seattle.gov/documents/Departments/OPCD/

https://www.stadtplanungsamt-frankfurt.de/frank-

OngoingInitiatives/LightrailOPCD/2022.06.07_CoS_

furt_nordwest_neuer_stadtteil_der_quartiere_18798.

Council_WSBLEReccomendations_Presentation_Draft.

html

pdf; City of Seattle Office of Planning & Community Development, Planning for West Seattle and Ballard 31 Ibid.

Link Extensions. https://www.seattle.gov/opcd/

ongoing-initiatives/lightrail-expansion-in-se-

32 Werksviertel-Mitte, 2023. https://werksviertel-mitte.

attle/wsble#rseoutcomes; Sound Transit, West

de/

Seattle Link Extension and Ballard Link Extension.

https://www.soundtransit.org/system-expansion/

33 Bundesministerium der Justiz, Bundesamt für Justiz, west-seattle-ballard-link-extensions

Baugesetzbuch, 2023. https://www.gesetze-im-inter-net.de/bbaug/

26 Christina Shimizu, Bettie Luke, and Binko Chiong-Bisbee, “Two light-rail station options would better 34 MARTA, More MARTA Atlanta Bus Service

serve, protect Chinatown International District”, Enhancements, August 28, 2023. https://services.

The Seattle Times, March 17, 2023. https://www.

itsmarta.com/uploadedfiles/More%20MARTA%20

seattletimes.com/opinion/two-light-rail-station-op-Atlanta%20Route%20Book%20V1.pdf

tions-would-better-serve-protect-chinatown-international-district/

35 YIMBY Action, Our Solutions. https://yimbyaction.

org/2021/solutions/

27 City of Seattle, Office of Planning and Community Development, Seattle’s Comprehensive Plan: Urban 36 Cassidy Pearson and Jenny Schuetz,

74

Where pro-housing groups are emerg-public housing redevelopment into its choices about ing, Brookings, March 31, 2022. https://www.

transit plans.

brookings.edu/blog/the-avenue/2022/03/31/

where-pro-housing-groups-are-emerging/

37 In reviewing this paper, HUD officials provided additional information related to HUD’s funding challenges.

They noted that the majority of reductions to HUD’s workforce occurred in the years before 1995 thanks to computerization of work processes. They also pointed out that HUD’s limitations in engaging on the CDBG

and HOME programs “reflects in part the statutory design intended to enable locally determined program activities supported by administrative funding”. And they emphasized that the challenges in maintenance of affordable housing structures reflect years of inadequate Congressional appropriations and mounting capital needs.

38 Wilborn P. Nobles III and Caitlin Thompson,

“Atlanta Housing OK’s creation of nonprof-

it to build social housing”, The Atlanta Journal-Constitution, July 27, 2023. https://www.ajc.com/

news/atlanta-news/atlanta-housing-oks-cre-

ation-of-nonprofit-to-create-social-housing/

NVZYBSNJ5BADFMLIEGGC4DLE7M/#

39 Melissa Santos, “What’s next for Seattle’s social housing initiative, I-135”, Axios, February 21, 2023. https://

www.axios.com/local/seattle/2023/02/21/seattle-social-housing-initiative-passes-next-steps; Seattle City Council Blog, Meet the 13 people appointed to bring social housing to Seattle, April 28, 2023. https://council.seattle.gov/2023/04/28/meet-the-13-people-appointed-to-bring-social-housing-to-seattle/

40 #Housing 2030, Sozialgerechte Bodennutzung,

‘Socially Just Land Use’ in the City of Munich,

Germany, 2023. https://www.housing2030.org/proj-

ect/sozialgerechte-bodennutzung-socially-just-land-use-in-the-city-of-munich-germany/

41 One paper reviewer from Seattle questioned whether Sound Transit’s routing choices resulted from the Yesler project, but the evidence from planning documents suggests that the agency incorporated the Breaking Barriers to Affordable and Abundant Housing 75

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80

About the Author

Yonah Freemark is the lead of the practice area on Fair Housing, Land Use, and Transportation at the Urban Institute. He conducts research at the intersection of housing, transportation, and land use.

Acknowledgments

About The Urban Institute

This brief was funded by a grant from the German The nonprofit Urban Institute is a leading research organi-Marshall Fund. I am grateful to them and to all our funders, zation dedicated to developing evidence-based insights who make it possible for Urban to advance its mission.

that improve people’s lives and strengthen communi-I want to thank several anonymous reviewers from the ties. For 50 years, Urban has been the trusted source US Department of Housing and Urban Development for for rigorous analysis of complex social and economic providing considerable feedback that improved the paper.

issues; strategic advice to policymakers, philanthropists, Reviewers from each of the case-study cities provid-and practitioners; and new, promising ideas that expand ed thoughts on drafts of this paper and other research opportunities for all. Our work inspires effective decisions products. Nancy Mandel provided fantastic edits to the that advance fairness and enhance the well-being of manuscript. Sarah Phalen offered useful research assis-people and places.

tance. Isabell Enssle and Thomas Stellmach contributed essential information about the German development environment. And Tarsi Dunlop provided constant advice and support throughout the research process.

The views expressed are those of the author and should not be attributed to the Urban Institute, its trustees, or its funders. Funders do not determine research findings or the insights and recommendations of Urban experts.

Further information on the Urban Institute’s funding principles is available at urban.org/fundingprinciples.

The work that provided the basis for this publication was supported by funding under an award with the U.S. Department of Housing and Urban Development. The substance and findings of the work are dedicated to the public. The author and publisher are solely responsible for the accuracy of the statements and interpretations contained in this publication.

Such interpretations do not necessarily reflect the views of the Government