Tag: Houston

The Next Boom Towns In The U.S.

What cities are best positioned to grow and prosper in the coming decade?

To determine the next boom towns in the U.S., with the help of Mark Schill at the Praxis Strategy Group, we took the 52 largest metro areas in the country (those with populations exceeding 1 million) and ranked them based on various data indicating past, present and future vitality.

We started with job growth, not only looking at performance over the past decade but also focusing on growth in the past two years, to account for the possible long-term effects of the Great Recession. That accounted for roughly one-third of the score. The other two-thirds were made up of a a broad range of demographic factors, all weighted equally. These included rates of family formation (percentage growth in children 5-17), growth in educated migration, population growth and, finally, a broad measurement of attractiveness to immigrants — as places to settle, make money and start businesses.

We focused on these demographic factors because college-educated migrants (who also tend to be under 30), new families and immigrants will be critical in shaping the future. Areas that are rapidly losing young families and low rates of migration among educated migrants are the American equivalents of rapidly aging countries like Japan; those with more sprightly demographics are akin to up and coming countries such as Vietnam.

Many of our top performers are not surprising. No. 1 Austin, Texas, and No. 2 Raleigh, N.C., have it all demographically: high rates of immigration and migration of educated workers and healthy increases in population and number of children. They are also economic superstars, with job-creation records among the best in the nation.

Perhaps less expected is the No. 3 ranking for Nashville, Tenn. The country music capital, with its low housing prices and pro-business environment, has experienced rapid growth in educated migrants, where it ranks an impressive fourth in terms of percentage growth. New ethnic groups, such as Latinos and Asians, have doubled in size over the past decade.

Two advantages Nashville and other rising Southern cities like No. 8 Charlotte, N.C., possess are a mild climate and smaller scale. Even with population growth, they do not suffer the persistent transportation bottlenecks that strangle the older growth hubs. At the same time, these cities are building the infrastructure — roads, cultural institutions and airports — critical to future growth. Charlotte’s bustling airport may never be as big as Atlanta’s Hartsfield, but it serves both major national and international routes.

Of course, Texas metropolitan areas feature prominently on our list of future boom towns, including No. 4 San Antonio, No. 5 Houston and No. 7 Dallas, which over the past years boasted the biggest jump in new jobs, over 83,000. Aided by relatively low housing prices and buoyant economies, these Lone Star cities have become major hubs for jobs and families.

And there’s more growth to come. With its strategically located airport, Dallas is emerging as the ideal place for corporate relocations. And Houston, with its burgeoning port and dominance of the world energy business, seems destined to become ever more influential in the coming decade. Both cities have emerged as major immigrant hubs, attracting on newcomers at a rate far higher than old immigrant hubs like Chicago, Boston and Seattle.

The three other regions in our top 10 represent radically different kinds of places. The Washington, D.C., area (No. 6) sprawls from the District of Columbia through parts of Virginia, Maryland and West Virginia. Its great competitive advantage lies in proximity to the federal government, which has helped it enjoy an almost shockingly ”good recession,” with continuing job growth, including in high-wage science- and technology-related fields, and an improving real estate market.

Our other two top ten, No. 9 Phoenix, Ariz., and No. 10 Orlando, Fla., have not done well in the recession, but both still have more jobs now than in 2000. Their demographics remain surprisingly robust. Despite some anti-immigrant agitation by local politicians, immigrants still seem to be flocking to both of these states. Known better s as retirement havens, their ranks of children and families have surged over the past decade. Warm weather, pro-business environments and, most critically, a large supply of affordable housing should allow these regions to grow, if not in the overheated fashion of the past, at rates both steadier and more sustainable.

Sadly, several of the nation’s premier economic regions sit toward the bottom of the list, notably former boom town Los Angeles (No. 47). Los Angeles’ once huge and vibrant industrial sector has shrunk rapidly, in large part the consequence of ever-tightening regulatory burdens. Its once magnetic appeal to educated migrants faded and families are fleeing from persistently high housing prices, poor educational choices and weak employment opportunities. Los Angeles lost over 180,000 children 5 to 17, the largest such drop in the nation.

Many of L.A.’s traditional rivals — such as Chicago (with which is tied at No. 47), New York City (No. 35) and San Francisco (No. 42) — also did poorly on our prospective list. To be sure, they will continue to reap the benefits of existing resources — financial institutions, universities and the presence of leading companies — but their future prospects will be limited by their generally sluggish job creation and aging demographics.

Of course, even the most exhaustive research cannot fully predict the future. A significant downsizing of the federal government, for example, would slow the D.C. region’s growth. A big fall in energy prices, or tough restrictions of carbon emissions, could hit the Texas cities, particularly Houston, hard. If housing prices stabilize in the Northeast or West Coast, less people will flock to places like Phoenix, Orlando or even Indianapolis (No.11) , Salt Lake City (No. 12) and Columbus (No. 13). One or more of our now lower ranked locales, like Los Angeles, San Francisco and New York, might also decide to reform in order to become more attractive to small businesses and middle class families.

What is clear is that well-established patterns of job creation and vital demographics will drive future regional growth, not only in the next year, but over the coming decade. People create economies and they tend to vote with their feet when they choose to locate their families as well as their businesses. This will prove more decisive in shaping future growth than the hip imagery and big city-oriented PR flackery that dominate media coverage of America’s changing regions.

Cities of the Future Rankings
Rank	Metropolitan Area
1	Austin, TX
2	Raleigh, NC
3	Nashville, TN
4	San Antonio, TX
5	Houston, TX
6	Washington, DC-VA-MD-WV
7	Dallas-Fort Worth, TX
8	Charlotte, NC-SC
8	Phoenix, AZ
10	Orlando, FL
11	Indianapolis, IN
12	Salt Lake City, UT
13	Columbus, OH
14	Jacksonville, FL
15	Atlanta, GA
16	Las Vegas, NV
16	Riverside, CA
18	Portland, OR-WA
19	Denver, CO
20	Oklahoma City, OK
21	Baltimore, MD
22	Louisville, KY-IN
22	Richmond, VA
24	Seattle, WA
25	Kansas City, MO-KS
26	San Diego, CA
27	Miami, FL
28	Tampa, FL
29	Sacramento, CA
30	Birmingham, AL
31	New Orleans, LA
32	Philadelphia, PA-NJ-DE-MD
33	Minneapolis, MN-WI
34	St. Louis, MO-IL
35	Cincinnati, OH-KY-IN
35	New York, NY-NJ-PA
37	Boston, MA-NH
38	Memphis, TN-MS-AR
39	Pittsburgh, PA
40	Virginia Beach, VA-NC
41	Rochester, NY
42	Buffalo, NY
42	San Francisco, CA
44	Hartford, CT
45	Milwaukee, WI
45	San Jose, CA
47	Chicago, IL-IN-WI
47	Los Angeles, CA
49	Providence, RI-MA
50	Detroit, MI
51	Cleveland, OH

This piece originally appeared at Forbes.com.

Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and an adjunct fellow of the Legatum Institute in London. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

Photo by Exothermic Photography

July 6, 2011

The Rise Of The Third Coast: The Gulf Region’s Ascendancy In U.S.

For most of the nation’s history, the Atlantic region — primarily New York City — has dominated the nation’s trade. In the last few decades of the 20th Century, the Pacific, led by Los Angeles and Long Beach, gained prominence. Now we may be about to see the ascendancy of a third coast: the Gulf, led primarily by Houston but including New Orleans and a host of smaller ports across the regions.

The 600,000 square mile Gulf region has long been derided for its humid climate, conservative political traditions and vulnerability to natural disasters. Yet despite these factors, the Gulf is destined to emerge as the most economically vibrant of our three coasts. In our rankings of the fastest-growing job markets in the country, six Gulf cities made the top 50: Houston, Corpus Christi and Brownsville, in Texas; New Orleans; and Gulfport-Biloxi and Pascagoula, in Mississippi. In contrast, just one Pacific port, Anchorage, Alaska, and one small Atlantic port, Portsmouth, N.H., made the cut.

This reflects a long-term shift of money, power and jobs away from both the North Atlantic and the Pacific to the cities of the Gulf. The Port of Houston, for example, enjoyed a 28.1% jump in foreign trade this year, and trade at Louisiana’s main ports also reached records levels.

This growth stems from a host of factors ranging from politics, demographics and energy to emerging trade patterns and new technologies. One potential game-changer is the scheduled 2014 $5.25 billion widening of the Panama Canal, which will allow the passage to accommodate ships carrying twice as much cargo as they are able to carry currently. This will open the Gulf to megaships from Pacific Basin ports such as Singapore, Shanghai, Pusan and Kaohsiung, which have mostly sent their cargos to West Coast ports such as Los Angeles and Long Beach. Some analysts predict that more than 25% of this traffic could shift to Gulf and South Atlantic ports. “More of Asia will be heading to this part of the world,” says Jimmy Lyons, CEO of the Alabama State Port Authority.

The area also is getting a big jolt from ascendant Latin America, the Gulf’s historic leading trade partner. Bill Gilmer, an economist with the Federal Reserve Bank of Dallas, notes that Latin America is home to many of the world’s fastest-growing economies, with overall growth rates last year exceeding 6.1%. Since 2002 about 56 million people in the region have risen out of poverty, according to the World Bank.

Trade with Latin American partners — including Mexico — is ramping up growth in Houston as well as other Gulf ports. Brazil, for instance, has risen to become Mobile, Ala.’s leading trade partner. Latin immigration to virtually all the Gulf cities, including New Orleans, can only strengthen these economic ties.

The energy industry represents another critical force in the Gulf’s resurgence. It employs at least 55,000 workers in the Gulf, which produces roughly one-quarter of the nation’s natural gas and one-eighth of its oil. Although Houston seems assured of its spot as the focal point of the world fossil fuel industry, oil and gas also boosts numerous economies throughout the region, notably in Corpus Christi and various ports across Southern Louisiana.

Though the Obama administration puts its bets on subsidizing “green jobs,” traditional energy jobs may prove, in the short and medium term, far more important. There is even widespread talk about the Gulf emerging as a center for the export of natural gas. Over $ 6 billion in new investments are already being proposed for export facilities, notes David Dismukes, associate director of the Louisiana State University Center for Energy Studies.

The energy-related economy produces high-wage jobs that range from geology and engineering to the muscle work on the oil rigs, which provide well above average wages for blue collar workers. Such growth is particularly critical to regions such as New Orleans, long dependent on generally lower-wage industries like hospitality and personal services. The energy business also will help accelerate the expansion of business services such as law, accounting, architecture and advertising.

The shift to the Gulf includes some rapid industrial expansion, particularly for energy intensive industries. Huge natural gas supplies are creating enormous opportunities for expanding petrochemical industries. The German firm Thyssen Krupp opened a new $5 billion steel mill last year, and Nucor Steel announced a large new facility to be built just outside New Orleans. Like energy production, these facilities tend to pay above-average wages for blue collar workers, which will likely raise living standards for a region that has lagged historically.

At the same time, demographic trends suggest these areas will continue to become more attractive to international commerce. Despite a legacy of hurricanes and floods, Houston, with over 5 million people, has emerged as among the fastest-growing large metropolitan regions in the country. The region’s population is expected to double in the next 20 years. Most of the economies its port serves — Dallas-Fort Worth, San Antonio and Austin — also have experienced rapid growth. Recoveries are in place in many other hurricane-devastated areas, including greater New Orleans.

Overall the Gulf is expected to be home to 61.4 million people by 2025, a nearly 50% increase from its 1995 base. This expanding domestic market — along with the possibilities posed by the canal — have already persuaded two larger retailers, Wal-Mart and Home Depot, to establish modern new distribution centers in Houston.

Finally there is the matter of political will. Both the Northeast and the Pacific regions are increasingly dominated by environmental, labor, urban land and other interests often hostile to wide-ranging industrial expansion. A legacy of labor unrest, most notably a big strike of West Coast ports in 2002,   convinced some shippers to diversify their operations elsewhere.   Growing regulation in California, suggests economist John Husing, a leading expert on port-related issues, makes the prospects for growing warehouse, logistics and manufacturing jobs increasingly “impossible” there.

East Coast ports, subject to some of the same pressures, may be slow to make the “intense capital improvements” required to capture expanding trade. In contrast, the Gulf’s leaders in both parties support   broad based economic growth. New Orleans’ Democratic Mayor Mitch Landrieu is no less friendly to industrial and port expansion than Republican Gov. Bobby Jindal. Houston Democratic mayors like Annise Parker, Bill White and Bob Lanier have been as strongly in favor of critical business and infrastructure investment as their Republican counterparts.

Such differences in attitude have driven power shifts   throughout American economic history. In the 19th century New York through a combination of ruthless ambition and greater vision overcame aristocratic Boston and more established Philadelphia. Icy Chicago performed a similar coup over its then far more established and temperate rival, St. Louis, in the mid- and late 1800s.

In the last century, unfashionable Los Angeles, without a great natural port, overcame the grand Pacific dowager San Francisco, blessed by one of the world’s great natural harbors, as the economic center of the West Coast. Los Angeles built a vast new modern and largely artificial port to make up for what nature failed to provide, and also nurtured a host of   industries from aerospace, oil and entertainment to garments.

Now history is about to repeat itself as Texas, Louisiana and other Gulf Cities seek to reorder the nation’s economic balance of power. Unless California and the Northeast awaken to the challenge, they will be increasingly supplanted by a region that seems more determined to expand their economic dominion.

This piece originally appeared at Forbes.com.

Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and an adjunct fellow of the Legatum Institute in London. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

Photo by NASA Goddard Photo and Video

June 23, 2011
Listing the Best Places Lists: Perception Versus Reality

Often best places lists reflect as much on what’s being measured, and who is being measured as on the inherent advantages of any locale. Some cities that have grown rapidly in jobs, for example, often do not do as well if the indicator has more to do with perceived “quality” of employment.

Take places like Denver and Seattle. Both do well on what may be considered high-tech measurements – bandwidth, educated migration, entrepreneurial start ups – but have trailed other places in terms of creating jobs. Others, such as Oklahoma City and Raleigh, do better in terms of overall job creation and cost competitiveness.

There are effectively few truly objective criteria, and the Area Development list does tend to weigh a bit heavy on the factors that help more expensive – although not necessarily the most costly – cities. If cost of doing business, or regulatory environments were given more weight, some of the high fliers would not do as well.

We prefer to focus less on atmospherics and more on how people, and businesses, are voting for their feet. San Francisco and New York have generally had slower job growth and greater outmigration, but do well on lists that focus on perceived qualitative factors.

But then there is Austin. Here is one region that has it all, the low costs and favorable regulatory climate of Texas along with the amenities associated with a high-tech region. The area creates a large number of jobs of varying types and is still inexpensive enough to attract young, upwardly mobile families. This gives it a critical advantage over places like Silicon Valley, Los Angeles or New York. Unlike those three centers, Austin performs extraordinarily well in quantitative measurements.

The region that most closely matches Austin in these respects is not Seattle and Denver, but Raleigh Durham. Recently a group of leaders from Raleigh made a visit to Denver to learn what makes that city successful. Speaking to the group, we pointed out that by objective measurement – job growth, educated migration, population growth – Raleigh beat Denver by a long shot, yet it was to Denver the group was looking for inspiration. In fact, over the past three years, Americans have moved to Raleigh at a rate more than three times that of Denver. Perception can be a funny thing which makes a winner feel inferior to a clear runner-up.

Another strange result is that New York and Houston had the same number of mentions. Yet looking at numbers — from educated migration, job growth, population increase — Houston slaughters New York. People, from the college educated on down are flocking to Houston while fleeing, in rather large numbers, from New York. One has to wonder where the rankers live and where they are coming from. Houston triumphs on performance, while New York, to a large extent, wins on perception.

Looking simply at job growth over the past ten years for the Leading Locations mentioned on at least five surveys, the 14 regions separate themselves into three groups. The top tier of places – Austin, Raleigh, San Antonio, and Houston – all have seen job growth of more than 12% and seem to be recovering from the recession faster than the others.

Salt Lake City and Charlotte were tracking with the top tier of places until 2007 but have since fallen to the second tier of cities. The remainder of the second tier includes steady growers Dallas and Lincoln, along with Oklahoma City, a region that has seen a boom in jobs since bottoming out in 2003.

The final job growth tier of places includes five regions that have fewer jobs than ten years ago. Seattle drops just below the zero line after being hit particularly hard by the 2001 and 2008 recessions, while New York and Denver finish near the national rate. Pittsburgh and Boston spent most of the decade below their 2000 employment levels, but each seem to be recovering from the recession faster than many of the other Leading Locations cities.

But perhaps the biggest problem with lists has to do with the size of regions. Much of the fastest growth in America, particularly in terms of jobs, has been in small metros, many with fewer than 1 million or 500,000 residents. Smaller dynamic areas such as Anchorage, Alaska; Bismarck, North Dakota; Dubuque, Iowa; or Elizabethtown, Kentucky – all in the top 25 of NewGeography’s Best Cities for Job Growth 2011 Rankings – are too small to show up on some lists yet may be a location of choice for expansion. This reflects not so much their relative desirability but the fact that, unlike larger regions, they simply are not included on many rankings.

Ultimately, a list of lists does tell us much, but perhaps only so much for a specific individual or business. For someone interested in the movie business, for example, Los Angeles – and increasingly places like New Orleans or Albuquerque – are great draws, but perhaps not so much for financial services. The lists of lists are useful to identify hotspots, but for most location decisions, it may be more imperative to drill down to more detailed industry sectors and workforce attributes. And most of all, take the perception factor into account and look instead at the real numbers to tell you where to go.

This piece first appeared at AreaDevelopment.com, as part of its Leading Locations series discussing best cities rankings.

Joel Kotkin is a Distinguished Presidential Fellow in Urban Futures at Chapman University in California, an adjunct fellow with the London-based Legatum Institute, and the author of The Next Hundred Million: America in 2050. Mark Schill is Vice President of Research at Praxis Strategy Group, an economic research and community strategy firm. Both are editors at NewGeography.com, a provider of two surveys for Area Development’s Leading Locations list.

Photo by mclcbooks

June 3, 2011
Rethinking Urban Dynamics: Lessons from the Census

Much has been made of the vaunted “back to the city” movement by “the young and restless,” young professionals, the creative class, empty nesters and others were voting with their feet in favor of cities over suburbs. Although there were bright spots, the Census 2010 results show that the trend was very overblown, affecting mostly downtown and near downtown areas, while outlying ones bled population. One culprit for this discrepancy seems to be that the intra-census estimates supplied by the Census Bureau were inflated – in some cases very inflated.

Looking at selected core cities for major US metropolitan areas, many of them were materially over-estimated:

One particularly egregious case relates to Atlanta. Its huge projected population increase in the 2000s led me to describe it as “one of America’s top urban success stories.” The reality proved to be quite different. Rather than strong population growth in the city, the population growth turned out to be basically flat, quite a different story. Other declines might be more predictable, such as Detroit, or those who had previously challenged estimates like Cincinnati and St. Louis. Still, even urban cores in rapidly growing regions like Dallas and Houston were not immune from this trend.

There were some exceptions. Cities like Indianapolis, Columbus, and Oklahoma City came in slightly ahead of expectations, but the number of cities with misses and the sizes of the positive and negative misses tilted towards the down direction.

It seems clear now that the justification for much of the “back to the city” story reflected bad estimates. People can’t be faulted for relying on the official government numbers – I did. But the reality of the 2010 Census, as demonstrated by Wendell Cox and others, is that the 1990s were actually better for urban population growth in America than the 2000s in many respects.

One legitimate bright spot for cities lay in the growth of downtown and near downtown areas. Though often starting from low bases, these areas often showed impressive increases. For example, St. Louis showed good growth downtown despite a very disappointing decline in total city population:

The poster child for this phenomenon was Chicago, where a fairly expansive area in the greater core showed large population growth. Areas that were formerly almost all commercial, such as the Loop, added significant residential population, while areas that were nearly derelict like the near South Side have blossomed into thriving upscale neighborhoods.

The problem, from places ranging from Chicago to Cleveland, is that the gains in the “core of the core” have been more than offset by losses elsewhere, especially the flight of blacks and other minorities – many of them immigrants – to the increasingly diverse suburbs.

Cities across America have invested enormous sums into downtown redevelopment and major projects in selected districts. The good news: these investments have shown some ability to move the needle in terms of attracting young professionals downtown. The bad news lies with the fact that these developments have been extremely costly, and have not transformed the overall demographic or economic climates of the cities that tried them. This demonstrates the limits of the policies. Those who aren’t in the young professional, empty nester, or creative class demographic have rightly figured out that they are no longer the target market of city leadership. No surprise then that many of them have decided to vote with their feet.

Given the resulting overall negative swings, cities may want to revisit their strategy of putting all their chips in the downtown redevelopment basket in favor of less glamorous improvements in basic neighborhood safety, services, schools and other critical elements. A handful of elite enclaves and talent hubs may be able to thrive on a “favored demographic quarter” strategy, but for most places there just aren’t enough young professionals and artists to go around.

Aaron M. Renn is an independent writer on urban affairs based in the Midwest. His writings appear at The Urbanophile.

* Actual population minus projected population as of 4/1/2010 using a run rate projection based on the 2008-2009 estimated population growth.
** Base is the projected 4/1/2010 population above.

Photo by Ian Freimuth

April 28, 2011
China, Detroit, and Houston: How Ghost Properties Compare

Learning about China’s property boom and its “ghost” cities has given me a whole new perspective on my four decades in the building, land development and consulting fields. During these periods our economy has had various ups and downs. In ‘up’ times, the rise in construction of new housing and growth in commercial developments has been quite obvious. What I have always had a problem understanding is why there seemed to be new housing projects and commercial projects that sprouted up during the bad times.

Unlike this current recession — and I do believe that it is still current, despite the rhetoric that it’s over — past economic downturns were localized. As an example, I lived in Detroit in 1973 during the first gas crunch, when there were long lines to fill up. Unemployment in Detroit was a huge problem, and there was no work for a young ‘planner’ for new suburban developments, nor the prospect of anything turning around soon.

I eventually decided to move to the south, where it was thought to be better. As I crossed into Texas, there weren’t any more gas lines. It seemed the entire State was booming. I drove through to Houston, picked up a phone book, and made a phone call to Paul Lederer Land Surveying and Engineering, which had a display ad that stuck out. Paul answered, and when I explained that I wanted to work as an apprentice to expand my knowledge into his field he hired me over the phone. I settled down, and after a year was ready to buy a home of my own.

Detroit was still in economic hardship, with housing requiring a 20% down payment for a mortgage. At the same time, in Houston, homes were so much in demand that we had only minutes to make an offer once a home we wanted came on the market. Financing required only a 5% down payment.

When a wealthy Detroit businessman heard that I could buy homes with only 5% down in a market that was escalating in sales and pricing I was offered a business proposition. I was asked to buy 50 homes at 5% down, and then resell them to a shell company for at least 10% more than our original purchase price. The homes would then be re-financed elsewhere with 5% down. The shell company would then default on the loans, and we would split the profits.

In other words, if we paid an average of $30,000 each for 50 homes, we would have $1,500,000 in real estate, for which we had put $75,000 down. In theory, if I sold the homes to a shell company for $2,000,0000 with a $100,000 down payment, we would each walk away with $200,000 profit (roughly $790,000 in today’s dollars after inflation) if we defaulted on the loans. I was not interested in something that I considered fraud for a quick dollar, but it would not have been difficult to do this in real estate at that time.

A few years later, Detroit was still in an economic downturn, and another person I knew was building large residential and commercial projects. These were new developments with hundreds of units and high-rise office towers.

I mentioned to someone close to this developer that I was unimpressed with a venture to build at a time when there was not a market for either condominium buyers or office tenants, and curious as to why it was being pursued. A 20 story office tower would impress me if it were leased out; one sitting empty would not be so impressive.

The answer was a lesson in economics. It was explained to me that the office tower was built for $10 million, but financed for $20 million, made possible by some inventive appraisals. Yet the bank needed only $1 million down. In other words, if the developments failed spectacularly there were still millions to be made, even if the properties went back to the banks. Ironically, Detroit in the late 1970’s and early 1980’s recovered somewhat, and the developments in question became financially viable and successful.

I have no doubt that every industry, not just the development of land, has stories of financial shenanigans, but these are two examples of only a few that I have been exposed to during my 43 years in the development business.

So today, whenever I see areas with aggressive construction that exceeds market potential, it makes me wonder…

In light of this history, see what you think about development in China. Check out this 15 minute video from a major Australian broadcaster on China’s ghost cities.

Rick Harrison is President of Rick Harrison Site Design Studio and Neighborhood Innovations, LLC. He is author of Prefurbia: Reinventing The Suburbs From Disdainable To Sustainable and creator of Performance Planning System. His websites are rhsdplanning.com and performanceplanningsystem.com.

Photo: Expensive waterside apartments in Shekou Shenzhen by DC Master.

April 9, 2011
The Best Cities For Minority Entrepreneurs
As the American economy struggles to recover, its greatest advantage lies with its diverse population. The U.S.’ major European competitors — Germany, Scandinavia, France, Italy, the Netherlands and Italy — have admittedly failed at integrating racial outsiders. Its primary Asian rivals, with the exception of Singapore, are almost genetically resistant to permanent migration from those outside the dominant ethnic strain.

In contrast, America’s destiny is tied to minorities, who already constitute a third of the nation’s population and who will account for roughly half of the population by 2050. Younger and more heavily represented in the labor force, minorities are poised to become the primary source of entrepreneurial growth.

The clear advantage with minorities, particularly immigrant minorities, lies in their own self-selection. Risk-takers by the very act of emigration, they are more likely to start small firms than other Americans. In fact, a recent Kauffman Foundation study found that immigrants were unique in boosting their entrepreneurial activities since the onset of the recession. Overall the share of immigrants among new entrepreneurs has expanded from 13.4% in 1996 to nearly 30% this year.

Forbes asked demographer Wendell Cox (www.demographia.com), researcher Erika Ozuna and me to examine the immigrant entrepreneurial phenomena among the nation’s 52 largest metropolitan areas. The results (below) turned out to be in many ways surprising, and almost counter-intuitive.

Usually we think of immigrant entrepreneurs as clustering in crowded city communities or high-tech places like Silicon Valley. But based on rates of self-employment, housing affordability, income growth and migration, immigrant entrepreneurs tend to prefer sprawling, heavily suburbanized regions, many of them clustered in the South and Southwest.

The best U.S. city for minority entrepreneurs on our list, Atlanta, has long been a haven for black entrepreneurs. But, recently, its Latino and Asian populations have exploded, with exceptionally high rates of self-employment. In the past decade, the Atlanta region’s Asian population surged 74%, while its Latino population grew by 101%. The overall foreign-born population rose by roughly 300,000.

Similar surges took place in almost all the top cities on list. They include Baltimore (No. 2), Nashville (No. 3), Houston, Miami, Oklahoma City, Riverside San Bernardino, Calif., the Washington D.C. metro area, Orlando, Fla.. and Phoenix, Ariz.

Latino shopping center developer Jose Legaspi traces much of the entrepreneurial success in these areas to this rise in population. This is particularly true in places like Miami, which has the nation’s highest rate of foreign immigration, and has long boasted of its role as “the capital of the Americas.” Less renowned are cities like Houston, which now enjoys a higher per capita rate of immigration than Boston, Seattle or Chicago. All these cities have engendered dense pockets of diverse and often dispersed ethnic populations; in some locales, ethnic groups share neighborhoods and economic space. It’s increasingly common to see stores owned by ethnic groups serving both their own tribe as well as others.

“The entrepreneurial class will follow the immigrant population,” notes the Montebello, Calif.-based entrepreneur, who has developed retail centers in such diverse locations as Los Angeles, Las Vegas, Atlanta, Phoenix and Fort Worth, Texas. “You get small retailers following their needs as well as a growing professional class.”

Legaspi notes that an increasingly critical factor for the growth of many of these fastest-growing minority areas is cost of living. With the exception of Baltimore and Washington — whose growth is tied to the expansion of the federal government — the cities on our list enjoy relatively low housing costs. Minorities “American dream” generally does not revolve around an apartment in dense, expensive urban areas, Legaspi n says, but want an affordable single-family house.

This also applies to middle- and working-class African-Americans, whose shift away from cities to suburbs has been among the most remarked upon phenomena identified by the Census. In Atlanta, for example, the ratio of median income to median house value is 4.6 for African-Americans, 3.1 for Asians and 5.2 for Hispanics. In 35th-ranked San Francisco it’s 14.3 for African Americans, 7.1 for Asians and 10.6 for Hispanics. No surprise that per-capita minority growth is far more rapid in Atlanta than in the avowedly “multi-cultural” Bay Area.

Land use and other regulations also play a role here, not only for housing prices but for entrepreneur opportunities. Again, with exception of the Washington and Baltimore areas, the fast-growing minority regions, and rapidly growing self-employed populations, are regions with diffuse, multi-polar and heavily suburbanized land patterns.

The strip mall, much detested among urban aesthetes and planners often serves as “the immigrants’ friend,” says Houston architect Tim Cisneros. In places like Houston, Cisneros points out, Columbians, Nigerians, Mexicans , Indian and Vietnamese businesses usually cluster not in downtown centers or fancy high-end malls, but in makeshift auto-oriented strip centers, where prices are low, parking ample and the location within easy driving distance of various ethnic populations. You want a good Indian meal in Houston, you don’t need to head downtown, but to the outer suburbs of Fort Bend County.

In contrast, many of the more expensive, denser regions — many with storied high-tech sectors — did poorly in our survey. Besides San Francisco, Minneapolis ranked No. 49, San Diego No. 48, San Jose No. 46 and Boston No. 45. Chicago clocked in at a dismal No. 50.New York, the legendary home of minority entrepreneurship, ranked a meager No. 39.

Jonathan Bowles, president of the New York-based Center for an Urban Future, traced this poor performance to a myriad of factors, including sky-high business rents, which stymie would-be entrepreneurs in minority communities. “[Entrepreneurs] face incredible burdens here when they start and try to grow a business,” Bowles suggested. “Many go out of business quickly due to the cost of real estate and things like high electricity costs. It’s an expensive city to do business without a lot of cash.”

Yet not every region at the bottom of our list came from the array of high-end “luxury” cities. The bottom of the list also included a host of rustbelt cities, including Detroit (No. 47), Cleveland (No. 51) and Milwaukee (last place at No. 52). Clearly cheap rents and affordable space are not enough when weighed against slow job growth, weak immigration and general economic stagnation.

And often, notes Richard Herman, an immigrant attorney in Cleveland, a cultural pre-disposition against immigrants plays a destructive role in many of these cities. “The rust belt cities don’t tend to welcome newcomers,” Herman says. “The infrastructure, the sentiment is not there. But you can’t get around it. We have to change our culture if want to change our situation.”

Here is the full ranking of the top 52 metros for minority entrepreneurs, compiled by researchers Wendell Cox and Erika Ozuna:
1. Atlanta-Sandy Springs-Marietta, GA
2. Baltimore-Towson, MD
3. Nashville-Davidson-Murfreesboro-Franklin, TN
4. Houston-Sugar Land-Baytown, TX
5. Miami-Fort Lauderdale-Pompano Beach, FL
6. Oklahoma City, OK
7. Riverside-San Bernardino-Ontario, CA
8. Washington-Arlington-Alexandria, DC-VA-MD-WV
9. Orlando-Kissimmee, FL
10. Phoenix-Mesa-Scottsdale, AZ
11. Memphis, TN-MS-AR
12. Dallas-Fort Worth-Arlington, TX
13. San Antonio, TX
14. Tampa-St. Petersburg-Clearwater, FL
15. Austin-Round Rock, TX
16. Charlotte-Gastonia-Concord, NC-SC
17. Indianapolis-Carmel, IN
18. Los Angeles-Long Beach-Santa Ana, CA
19. Richmond, VA
20. New Orleans-Metairie-Kenner, LA
21. Jacksonville, FL
22. Tucson, AZ
23. Portland-Vancouver-Beaverton, OR-WA
24. Raleigh-Cary, NC
25. Louisville-Jefferson County, KY-IN
26. Birmingham-Hoover, AL
27. Seattle-Tacoma-Bellevue, WA
28. Cincinnati-Middletown, OH-KY-IN
29. Sacramento-Arden-Arcade-Roseville, CA
30. Pittsburgh, PA
31. Kansas City, MO-KS
32. Columbus, OH
33. Las Vegas-Paradise, NV
34. Virginia Beach-Norfolk-Newport News, VA-NC
35. San Francisco-Oakland-Fremont, CA
36. Denver-Aurora-Broomfield, CO
37. St. Louis, MO-IL
38. Buffalo-Niagara Falls, NY
39. New York-Northern New Jersey-Long Island, NY-NJ-PA
40. Rochester, NY
41. Hartford-West Hartford-East Hartford, CT
42. Salt Lake City, UT
43. Providence-New Bedford-Fall River, RI-MA
44. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD
45. Boston-Cambridge-Quincy, MA-NH
46. San Jose-Sunnyvale-Santa Clara, CA
47. Detroit-Warren-Livonia, MI
48. San Diego-Carlsbad-San Marcos, CA
49. Minneapolis-St. Paul-Bloomington, MS-WI
50. Chicago-Naperville, Joliet-IL-IN-WI
51. Cleveland-Elyria-Mentor, OH
52. Milwaukee-Waukesha-West Allis, WI
This piece originally appeared in Forbes.com

Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and an adjunct fellow of the Legatum Institute in London. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

Photo by LHOON
March 31, 2011
Census 2010: A Texas Perspective

If you want to get a glimpse of the future of the U.S., check out Fort Worth, TX. Never mind the cowboy boots, but you might want to practice your Spanish.

Texas is growing explosively and much of that growth is among Latinos. The latest Census Bureau figures show the Lone Star State grew by 20%, to over 25 million people, recording about a quarter of the nation’s overall growth. The rate of growth was twice the national average. The implications are huge politically, as Texas stands to gain 4 new Congressional seats from this expansion, and Hispanic leaders want in.

A majority of the Hispanic growth came from births to families already living here. While migration from other states and countries contributed about 45%.

The Texas story stands in contrast to the Rust Belt states and the Northeast, where overall growth is minimal. Texas’s Hispanic-fueled growth spurt out-paced the entire countries, helped brace our housing market and our economy.

A close look at Texas growth reveals much about American’s home-buying habits. Rural areas got smaller – few want to live in the boonies of far west Texas while it appears suburban areas won over the most transplants.

But arguably the biggest winner was Ft. Worth, or Cow Town as we call it. Fort Worth grew by a whopping 38.6%, the largest increase in the state, followed by Laredo’s 33%, Austin at 20.4%, and San Antonio at 16%. In contrast the city of Dallas, my home, grew by a scant .8% – a bit deflating to a city all puffed up about a $354 million arts center, a downtown park and greenway, and the $185 million Perot Museum of Nature & Science underway.

Houston remains the state’s largest metropolitan area but sustained growth of only 7.5%, though Harris County – mostly due to growth in the suburbs – grew by 20%. As in Ft. Worth and elsewhere, Hispanics have been the driver, and now comprise 41% of the Harris County population. The biggest growth took place in formerly rural towns just outside the big cities, one-shop stop farmer’s crossings or granaries.

Curtis Tally shakes his head at how fast little Justin, north of Fort Worth, has grown. Subdivisions sprouted up on what was once farmland around his Justin Feed Co. in southern Denton County. From 1891 residents in 2000, Justin has 3,246 today.

"We were selling seed for pastures; now we’re selling seeds for lawns," Tally, 74, who has been in business in Justin since 1958, told the Fort Worth Star Telegram.

If you think that’s amazing, wait ‘till you get to Fate, Texas, 25 minutes east of Dallas on Interstate 30. Ten years ago you would have missed Fate, a town of 500 so small the utility invoicing was done on postcards if you blinked while driving. Today, Fate is the fastest-growing town in the state, with 6,357 residents – an increase of 1,179%! Residents who live there say it’s far enough away from Dallas to be in the country, but still close to the big city. Fate draws many first time homebuyers who are starting families (home prices range from $50,000 to $300,000) Here’s what Fate resident Tina Nelson told The Dallas Morning News:

“My kids can go ride bikes all day long and I don’t have to worry too much about where they are,” said Tina. “It’s like the 1950s (here) the sun goes down and everyone’s porch light comes on.”

On the western side of Lake Ray Hubbard, a few minutes from Fate and slightly closer to Dallas is Sunnyvale, another fast-growing little hick town where professionals are building $2 million dollar homes on a 124 acre family ranch turned into home sites called St James Park. They send their children to a two-year old, $50 million public school with the highest ratings in the state.

The young man building homes on the 49 two acre estate sites is Jojy Koshy of Atrium Fine Homes. At 31, Jojy holds a masters in business from the University of Texas and tells me, with pride, how his parents immigrated to the Dallas suburb of Plano in 1986 from India.

“My parents instilled a strong work ethic in us,” he says. “I know this market is challenging, but I believe that if I work longer, harder, and keep our clients completely satisfied, we will have a great business.”

It’s the same story across the state. The Interstate 35 corridor between Austin and San Antonio filled in with development as the cities merged closer to becoming one big schizophrenic metropolis. The string of counties along the Rio Grande, anchored by Brownsville and McAllen have been growing, and may be beneficiaries of the crime wave south of the border. A sharp Dallas Realtor took out an ad in the Monterrey newspaper advertising homes for sale in Dallas and snagged several buyers. Even the wife of the Monterrey mayor moved to a Dallas suburb, escaping the cartel and seeking to be closer to her family here.

Aside from escaping death in Mexico, what is driving people to Texas? Start with our rising star, Fort Worth. The city has both a cowboy pizzazz personality and a lower crime rate than Dallas. Fort Worth’s arts district has overshadowed Dallas’s for years, and the neighborhoods offer true community – places where the kids can still walk, not be bussed, to school. Rose Bowl winner Texas Christian University is on the upswing, downtown is charmingly vibrant, and an urban renaissance is taking hold on the city’s western edge called West 7th.

What are people seeking in Texas? I’d call it quality of life with room for upward mobility: affordable homes with mortgage payments that leave some money for recreation, good public schools for their kids and generally less onerous tax regime.

Yet with our many gains, Texas faces great challenges. The state has the third-highest teenage pregnancy rate in the nation, which is actually an improvement from last year, when we were number two. There are a rising number of children are living in poverty in Texas. Many of these children may be anchor babies born to illegal immigrants who cross the border to ensure their children and ultimately, themselves, citizenship. In 2006, 70% of the women who gave birth at Dallas County’s Parkland Memorial Hospital were illegal immigrants.

Increasingly, Latinos, illegal or not, take those babies home to the suburbs. Texas suburbs are no longer lily-white. This is true in working class places like Bedford, Texas, outside Fort Worth, where the black population has almost doubled. In affluent Southlake, the population this decade shifted from 95 percent Anglo down to 88 percent. Looking for a great selection of Asian food? You’ll starve (or go broke) in downtown Dallas. Go north to Carrollton, Texas where you’ll find a 78,000 square foot Super H Mart in what was once a Mervyns department store. Inside you’ll find seven types of gray, fuzzy, Chinese long, acorn, spaghetti, butternut, and kombucha squash eight food stalls said to rival any of those found in Seoul and Singapore, two cities known for their gourmet street food. Manduguk, anyone?

The new Texans are coming here not just to live, but to dig in economically.

In the end, we are seeing the birth of a Texas that is neither the white bread, big hair idyll of the cultural conservatives or the free market dystopia imagined by liberals. It is becoming more diverse, without losing its capitalist energy. With all its blemishes, the emerging Texas may well become the model for how America evolves in the coming decades.

Candy Evans is an independent journalist based in Dallas, Texas, She covers Texas for AOL’s HousingWatch and blogs at secondshelters.com.

Photo by Rick

February 25, 2011

The Still Elusive “Return to the City”

Metropolitan area results are beginning to trickle in from the 2010 census. They reveal that, at least for the major metropolitan areas so far, there is little evidence to support the often repeated claim by think tanks and the media that people are moving from suburbs to the historical core municipalities. This was effectively brought to light in a detailed analysis of Chicago metropolitan area results by New Geography’s Aaron Renn. This article analyzes data available for the eight metropolitan areas with more than 1 million population for which data had been released by February 20.

Summary: Summarized, the results are as follows. A detailed analysis of the individual metropolitan areas follows (Table 1).

In each of the eight metropolitan areas, the preponderance of growth between 2000 and 2010 was in the suburbs, as has been the case for decades. This has occurred even though two events – the energy price spike in mid-decade and the mortgage meltdown – were widely held to have changed this trajectory. On average, 4 percent of the growth was in the historical core municipalities, and 96 percent of the growth was in the suburbs (Figure 1).
In each of the eight metropolitan areas, the suburbs grew at a rate substantially greater than that of the core municipality. The core municipalities had an average growth from 2000 to 2010 of 3.2 percent. Suburban growth was 21.7 percent, nearly 7 times as great. Overall, the number of people added to the suburbs was 14 times that added to the core municipalities.

Table 1:
Metropolitan Area Population: 2000-2010

	2000 Population
	Historical Core Municipality	Suburbs	Metropolitan Area
Austin	656,562	593,201	1,249,763
Baltimore	651,154	1,901,840	2,552,994
Chicago	2,895,671	6,053,068	8,948,739
Dallas-Fort Worth	1,188,580	3,972,964	5,161,544
Houston	1,953,631	2,761,776	4,715,407
Indianapolis	860,454	664,650	1,525,104
San Antonio	1,144,646	567,057	1,711,703
Washington	572,059	4,181,934	4,753,993
Total	9,922,757	20,696,490	30,619,247

	2010 Population
Austin	790,390	925,899	1,716,289
Baltimore	620,961	2,089,528	2,710,489
Chicago	2,695,598	6,599,081	9,294,679
Dallas-Fort Worth	1,197,816	5,173,957	6,371,773
Houston	2,099,451	3,846,449	5,945,900
Indianapolis	903,393	852,848	1,756,241
San Antonio	1,327,407	815,101	2,142,508
Washington	601,723	4,883,034	5,484,757
Total	10,236,739	25,185,897	35,422,636

	Change: 2000-2010
Austin	133,828	332,698	466,526
Baltimore	(30,193)	187,688	157,495
Chicago	(200,073)	546,013	345,940
Dallas-Fort Worth	9,236	1,200,993	1,210,229
Houston	145,820	1,084,673	1,230,493
Indianapolis	42,939	188,198	231,137
San Antonio	182,761	248,044	430,805
Washington	29,664	701,100	730,764
Total	313,982	4,489,407	4,803,389


	Percentage Change: 2000-2010
Austin	20.4%	56.1%	37.3%
Baltimore	-4.6%	9.9%	6.2%
Chicago	-6.9%	9.0%	3.9%
Dallas-Fort Worth	0.8%	30.2%	23.4%
Houston	7.5%	39.3%	26.1%
Indianapolis	5.0%	28.3%	15.2%
San Antonio	16.0%	43.7%	25.2%
Washington	5.2%	16.8%	15.4%
Total	3.2%	21.7%	15.7%

Chicago excludes Kenosha County, WI
Washington excludes Jefferson County, WV
Indianapolis core municipality: Indianapolis & Marion County

Analysis of Individual Metropolitan Areas: The major metropolitan areas for which data is available are described below in order of their population size (Figure 2 and Table 1).

Chicago:The core municipality of Chicago lost 200,000 residents between 2000 and 2010. Suburban growth was 546,000, adding up to total metropolitan area growth of 346,000 people. The suburbs accounted for 158 percent of the metropolitan area growth. The core municipality decline was stunning in the face of the much ballyhooed urban renaissance in that great city. Yet this renaissance was limited enough as to not lead to an expanding population.

The decline in the core municipality population represents a major departure from the 2009 Bureau of the Census estimates, which would have implied a 2010 population at least 170,000 higher (assumes the growth rate of 2008 two 2009).

Instead all of the growth was in the outer suburbs, beyond the inner suburbs of Cook County.

Dallas-Fort Worth: The historical core municipality of Dallas had a modest population increase of 9000, or less than 1 percent between 2000 and 2010. In contrast, the suburbs experienced an increase of 1.2 million, or 30 percent. Thus, approximately 1 percent of the metropolitan area growth was in the core municipality, while 99 percent was in the suburbs, most of it in the outer suburbs. The inner suburbs added 14 percent to their 2000 population, while the outer suburbs added 36 percent.

The population figure for the core municipality of Dallas – consistently among the strong core areas – was surprisingly low, at 9 percent below (117,000) the expected level. The suburban population was 1 percent (71,000) below expectations.

Houston: The historical core municipality of Houston had comparatively strong population growth, adding 146,000 and 8 percent to its 2000 population. However this figure was 8 percent, or 174,000 below the expected figure. By contrast, the suburban growth was 39 percent, more than five times that of the central jurisdiction. The suburban population growth was 1,085,000, more than six times that of the core jurisdiction. The suburban population was 4 percent or 144,000 higher than expected.

The core jurisdiction of Houston accounted for 12 percent of the metropolitan area growth while the suburbs s accounted for 88 percent. This was evenly distributed between the inner suburbs of Harris County and the outer suburbs. The inner suburbs added 38 percent to their population while the outer suburbs added 41 percent.

Washington:Reversing a decade’s long trend, the historical core jurisdiction of Washington (DC) had a small population gain between 2000 and 2010. But the Washington, DC gain of 30,000 pales by comparison to the suburban gain, which was more than 20 times greater, at 700,000. The core jurisdiction accounted for 4 percent of the population gain, while the suburbs accounted for 96 percent.

More than 60 percent of the growth in the metropolitan area was outside the inner suburban jurisdictions that border Washington, DC (Arlington County and Alexandria in Virginia, together with Montgomery County and Prince George’s County in Maryland), while the inner suburbs accounted for 36 percent of the growth. The population increase in the inner suburbs was 9 percent, compared to 37 percent in the outer suburbs.

Jefferson County in West Virginia was not included in the analysis because data is not yet available.

Baltimore: The historical core municipality of Baltimore, the site of another ballyhooed urban comeback, lost 30,000 people, or 5 percent of its 2000 population. Baltimore’s 2010 population was 4 percent or 16,000 below the expected level. The suburbs experienced a 10 percent or 188,000 person increase. The region’s population increase was roughly equal in numbers between the inner suburbs and the outer suburbs, although the exurban percentage increase was nearly twice as large.

San Antonio:The historical core municipality of San Antonio experienced the largest population increase among the eight metropolitan areas, at 183,000, a roughly 16 percent population jump. The city of San Antonio accounted 43 percent of the growth while suburbs in Bexar County and further out accounted for a larger 57 percent. However, the suburban population increase was 248,000 or 44 percent. This is something of a turnaround in trends that favored the city of San Antonio in the past because of its vast sprawl and predominant share of the metropolitan population.

The city of San Antonio population was 5 percent or 65,000 people short of the expected 2010 level. The suburban population was 15 percent more or 104,000 more than the expected level.

Indianapolis:The historical core area of Indianapolis and Marion County (including enclaves within Indianapolis) grew 5 percent and accounted for 19 percent of the metropolitan area growth. In contrast, the surrounding suburbs grew 28 percent, representing r 81 percent of the metropolitan area growth. Overall, the core municipality added 44,000 people, while the suburbs added more than four times as many, at 188,000.

Austin:The historical core municipality of Austin experienced the greatest growth of any core jurisdiction in the eight metropolitan areas, at 20 percent. Even so, growth in the suburban areas was nearly 3 times as high at 56 percent. The city of Austin accounted for 29 percent of the metropolitan area population growth, while the suburbs accounted for 71 percent. Overall, the central municipality grew 134,000, while the suburbs grew 2.5 times as much, at 333,000.

Generally it is fair to say that, so far, suburban areas are growing far faster than urban cores. In addition, most of the fastest growing core municipalities are those areas that are themselves largely suburban, particularly in relatively young cities like San Antonio, Houston and Austin.

Among the eight metropolitan areas analyzed, the older core jurisdictions (with median house construction dates preceding 1960) tended to either lose population or grow modestly. This is illustrated by the city of Chicago, with a median house construction date of 1945, Baltimore with a median house construction date of 1946 and Washington with a median house construction date of 1949 (Table 2). Generally, the central jurisdictions with greater suburbanization (with median house construction dates of 1960 or later) grew more quickly. For example, highly suburban central jurisdictions like Austin with a median house construction date of 1983 and San Antonio, with a median house construction date of 1970, grew fastest. So much for the long forecast, and apparently still elusive, “return to the city”.

Table 2:
Historical Core Municipalities: Growth & Median House Age

	Historical Core Municipality
	Growth: 2000-2010	Share of Metropolitan Growth	Median House Construction Year
Austin	20.4%	28.7%	1983
Baltimore	-4.6%	-19.2%	1946
Chicago	-6.9%	-57.8%	1945
Dallas-Fort Worth	0.8%	0.8%	1974
Houston	7.5%	11.9%	1975
Indianapolis	5.0%	18.6%	1967
San Antonio	16.0%	42.4%	1979
Washington	5.2%	4.1%	1949
Average	3.2%	3.7%

Wendell Cox is a Visiting Professor, Conservatoire National des Arts et Metiers, Paris and the author of “War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life”

February 22, 2011

Giving the “New Houston Metro” Credit Where it’s Due
Tuesday, the Houston Metropolitan Transit Authority (Metro) held a blogger luncheon with senior Metro people (Chairman, CEO, board members, managers) at the Rail Operations Center south of Reliant. It was an informative event with a lot of good two-way Q&A. And it included an impressive tour of the facility, which, btw, is not air conditioned in the main maintenance bay. Let’s just say it was the right time of year for a tour and I’m really glad I don’t work there in the summer. The facility is doing its job though: Metro claims to have the highest operational uptime for rail cars in the country.

Sometimes in my push for increasing commuter bus services and cutting back rail, I fail to give credit to a lot of good work that is going on at the “New Metro”:
a few issues for our collective consideration:
There was a lot of good talk about improving express commuter bus services to TMC, Greenway, and, most importantly, Uptown. I pitched them on expanded HOV/HOT lanes (like the 610 Loop) and laptop trays and wifi on the commuter buses, which are under consideration. They have a very high percentage of downtown commuters – 30-40% – and claim a pretty high number for TMC – 20-30% – but that includes people who park in Smithlands and ride the rail, which I don’t consider a true commuter solution (it’s not doing anything to reduce freeway congestion).

Ultimately, they’re trapped by the voter referendum and the federal money process to keep pursuing a rail plan (and line prioritization) that really doesn’t make a lot of sense given the new fiscal reality since the referendum was passed. It will make even less sense if the Republican House guts rail funding. But at least they’re taking steps to “firewall” the rail plan financially so it doesn’t end up stealing from critical local and commuter bus operations. I may not agree with the overall strategic direction of the agency, but they do have good people doing good work within the constraints of the game they’re forced to play.

This post originally appeared at houstonstrategies.com
February 16, 2011
The Real Answer to Houston’s Traffic Congestion
The Houston Chronicle editorial board recently argued that light rail is key to combating Houston’s traffic congestion problems. But if you look at the three cities with worse traffic congestion than Houston – DC, Chicago, and LA – they have much more transit, including tons of light rail in LA. Transit clearly hasn’t solved the problem in these cities. These people aren’t stuck in that traffic because they like it – it’s because the transit doesn’t go where they need to go or isn’t timely. This is especially true with the rise of dispersed job centers in those cities where the trains don’t go or don’t provide good connectivity to the suburbs where people live. Let’s see, in Houston we have downtown (<7% of jobs), uptown/Galleria, the med center, Greenway, Greenspoint, the Energy Corridor, Ship Channel, and NASA – among others. If that’s not a dispersed set of job centers poorly suited to rail connectivity, then I don’t know what is.

It’s absurd to argue a light rail network focused inside the 610 Loop is going to do anything to relieve congestion or provide relief to commuters from the vast suburbs outside the loop. The solution is not doubling down on our multi-billion dollar LRT network, but instead scaling it back (University line only, IMHO) and instead spending the funds on a radical increase in express bus commuter services connecting all suburbs to all job centers with frequent nonstop 60+ mph transit using high-speed HOV/HOT lanes. Imagine driving to your local suburban transit center (which might just be a mall parking lot) and finding regular, frequent express buses (of all sizes) serving every major job center in Houston. These buses could have amenities like wifi and laptop trays. They might even be run by private operators (with subsidized fares) competing on routes, schedule, reliability, service, and amenities. And after they get to the job center, they can circulate to get you right to your building – no long walks in heat, cold, or rain. Finally, all of this is a single-seat service without annoying and time-consuming transfers from bus-to-rail or rail-to-bus (or even rail-to-rail).

It’s a much more practical solution for a city like Houston, but one that requires innovating ‘outside the box’ as a transit agency rather than parroting the “more rail” mantra that every other transit agency in the country repeats endlessly.

For more details, see these two previous posts:
- The case against rail transit
- A better vision for Metro
This post originally appeared at Houston Strategies.
February 9, 2011