Ely recognized that organizing a discipline of land economics and engaging in a definition of principles was a “staggering job worthy of our best efforts for solution.” Over 80 years later, our Society and the educational institutions that have endorsed Ely’s energy and commitment have now produced a substantial body of work of applied land economics theory and practice. We take pride in our various disciplines that contribute to the application of these theories and principles: architecture; law; planning; engineering; administration; appraisal; transportation and conveyancing industries. But is the job done? Have we advanced sufficiently since the 1930’s that there is no longer a need for an honourary society for the advancement of land economics principles? To answer that, recall the words that Ely also went on to say in his autobiography:

"When we turn to the cities we find many land owners in distress. Roughly speaking, we may say that real estate in some of our great cities has become bankrupt. Foreclosures, rent assignments, and other indexes of distress in New York and Chicago tell the sad story of inadequate and short sighted land utilization. Individual buildings may be beautifully planned as individual buildings, but if they do not fit properly under some general scheme, they may become bankrupt or operate at a heavy loss. We hear a great deal about city planning; we have a profession of city planners. Just as planners, some of them are excellent. Two or three of them can get together and re-plan the whole of New York City. Nevertheless, if their plans do not rest upon a solid economic foundation, and generally they do not, the result is loss and keen distress. The poverty that results from bad utilization of the land and that passes on from generation to generation is evident to every careful observer of what is taking place in city and country. Countless needless tragedies exist."

Is today's society demonstrably different from the description he provided in his time? Probably not. Our individual professions and our Society continue to adapt and continue to contribute. The changes that he foresaw would be coming, continue to come.

The motivating idea for Lambda Alpha International has been and continues to be to gather together existing knowledge, interpret it cautiously and to continue to conduct research on a go forward basis for new and better generalizations, for use and application.

To borrow again from Ely’s words the job of our Society and its contribution to society in general remains all the more relevant and pressing:

"Even if we reach perfection in generalization on the basis of facts at a given moment, and this is, in the nature of things impossible, we should need to continue our researches, because evolution, like life, never ceases and the situation that exists at one particular time is something that the world has never seen before and never will see again. We have never advocated panaceas. We stand ready to revise conclusions as we get new light. But first of all we must gather the essential facts; then we must look at these facts dispassionately and interpret them collectively. This is the spirit . . . " (page 239).

Indeed, this is the spirit of LAI and the reasons why our local Chapters and the use of new technology permit LAI to expand its reach in recording, accessing and in advancing local and global contributions.

The new five year Strategic Plans of both LAI and its Land Economics Foundation reflect and are designed to advance these continuing and relevant causes. The local Chapters, LAI and LEF remain true to the founding principles of the Society; much is yet to be accomplished as the future unfolds.

Ian Lord, LAI President

Lou Slade KeyNotes Editor

Happy New Year! In this first KeyNotes issue in 2012, I'm asking the following question to stimulate a conversation in these pages over the next few months:

How do changes in the use of transportation rights-of-way impact land economics?

We are going to explore that question this year through KeyNotes and with the help of our readers. I am inviting members to address this question from their professional perspective, particularly if they have first-hand familiarity with a project in their metropolitan area that involved the reuse of a right-of-way for a new use with direct or indirect economic development objectives.

I've listed several projects in four different categories and noted questions that I have about those projects.

The High Line, NYC

1. Total Removal or Below Grade Relocation of a Transportation Facility. California removed both the Embarcadero Freeway and CA Route 101 in San Francisco and replaced these limited access highways with surface boulevards. Boston relocated I-93 through the city into a tunnel. The general objective of these projects was to remove the blight that the freeway structures imposed on the impacted neighborhoods and to create sites for redevelopment. In the cases where freeways were totally removed, there was also a traffic objective inherent in the project. The economic questions include: what has been the net effect of these kinds of projects on the creation of new development opportunities, land values, and tax base/revenues?
   
   
2. Replacement with New Transportation Mode or Other Use. Many cities have replaced obsolete rail facilities with trails in the Rails-to-Trails program. Several years ago, in the close-in Washington D.C. suburbs, the State of Maryland purchased a spur rail right-of-way and replaced the freight rail line with a popular bicycle/walking trail. Now, the State is moving forward with a plan to integrate light rail commuter service into the right-of-way adjacent to the trail. What economic impacts are anticipated to result from this innovative project?
   
   Also, New York City has developed the High Line on the elevated structure that was the right-of-way for a freight rail spur. The New York Times has reported that over a billion dollars of new investment has occured along this right of way. Is this development that would have occurred in NYC regardless of the High Line, or did the project truly stimulate a significant portion of this value?
   
   

Olympic Sculpture Park, Seattle

3. Real Estate Development on Structural Platform Over Right-of-Way. Many of our cities have buildings or small campuses built in this kind of configuration. How do the economics work on these projects? Is it simply that the cost of land is so high that an expensive structure is justified to create a site?
   
   
4. Esthetic Cover on Platform Over Right-of-Way. Seattle has two excellent examples of this: the Freeway Park designed by the office of Lawrence Halprin and built in the 1980’s, and the recently completed Olympic Sculpture Park designed by Weiss and Manfredi. How have these parks affected the development in their immediate neighborhood? Is the public benefit-to-cost ratio attributable to the park greater than 1.0?
   

Over the next few months your KeyNotes editor will endeavor to stimulate chapters and members to help develop Featured Articles that address these and other questions in this theme. If you have good knowledge of a project in this category and would like to contribute a short article to KeyNotes this year, please contact me. I look forward to this conversation with you.

Lou Slade, International LAI Editor

Navy Broadway Complex

In 1991, a Federal judge and the California Coastal Commission gave approval for a new high-rise complex on the San Diego waterfront directly across from what is now the U.S.S. Midway Museum and Navy Pier.

The Navy wanted to demolish their 1920's obsolete administrative headquarters. Douglas Manchester, developer of the two largest waterfront hotels (the Marriott and the Hyatt -- each 1,500 rooms), agreed to build the Navy a new building in exchange for a 99-year lease on the 12-acre site.

Manchester's plan was to build a $1.0 billion complex that included 1,500 hotel rooms, 350,000 square feet of office space, 155,000 square feet of retail space, the Navy building and a large park. San Diego Lambda Alpha member Perry Dealy led the Manchester team.

Now, the Coastal Commission has said the Manchester plan no longer conforms with state law and unanimously voted down the project. The environmental coalition that is fighting the project wants the land to be turned into a clone of Millennium Park in Chicago.

The 20+ year approval process conforms to standard operating procedure in San Diego County.

Alan N. Nevin, San Diego Chapter Scribe

2012 Ely - Chicago Chapter Board of Directors Slate Approved at December 2011 Annual Meeting

The Ely - Chicago Chapter approved the slate of the 2012 Chapter Board of Directors at its Annual Meeting/Holiday Party on December 14, 2011.

The 2012 Board of Directors will kick off the 2012 Programming season with a view into the Chicago Union Station master plan study.  Jeffrey Sriver with the Chicago Department of Transportation will describe the proposed project which intends to enhance and transform this great Chicago asset boasting over 16.2 million passengers a year utilizing one of the oldest and largest transit stations in the country. Chicago has an unprecedented chance to capitalize on this significant redevelopment opportunity. To that end, Ely Chapter members will be provided with an early look at the study so they can have an impact on what gets built. This forum is in line with the City’s high level of transparency on this project whereby they are providing opportunities to the public to weigh in on the plan.

Terri T. Haymaker, Ely Chapter Scribe

The Economics of Urban In-Migration, Housing Costs and Transportation Costs

Here is a frequently cited statistic about the District of Columbia: 37% of households own no car. The statistic is probably out of date. In December, the Bureau of the Census estimated that District population has grown by 2.7% in the past year, a rate outstripping even that of Texas. Why the population increase of 10,000? The best guess is that area residents are tired of fighting traffic-- the DC area has the highest congestion ranking in the nation-- and find the lively and transit-rich center city a viable option for living. Now it is likely that more than 37% of households own no car.

My reading of recent reports is that it is young people moving in who are looking for a hip urban lifestyle in a place with jobs ( in addition to some older people moving here or suburbanites moving into town). I think the Richard Florida “Creative Class” issues are highly relevant. (EDavison)

The LAIGW chapter closed out its 2012 luncheon series with a presentation by Art Rodgers of the City’s Office of Planning that focused on the results of in-migration and on the tradeoffs between housing and transportation costs, decisions that clearly are at play in the Nation’s Capital.

Rodgers highlighted research by the Center for Neighborhood Technology that isolated housing and transportation costs for subareas of Metropolitan Washington. Combined costs ranged from less than 45% of Area Median Income ($106,100) in certain portions of the District and close-in Maryland and Virginia to over 45% of AMI in suburbs largely beyond the Washington Beltway.*

In its Region Forward plan, the Metropolitan Washington Council of Governments has a target of combined housing and transportation costs of less than 45% of AMI by 2020 in Regional Activity Centers.

How does this apply to the District, which is such a center? The District has adopted an ambitious streetcar plan to serve underserved parts of the city and to link those areas to the Metro system. However, the Office of Planning is concerned that up to one-third of areas along streetcar corridors could see strong upward pressure on housing prices. For example, when the Anacostia streetcar line becomes operational, OP expects transit use to increase 36% and autos/household to decline even further-- by 61%, actually-- while over 2,100 new households move to the area. Hence, the anticipated upward pressure on housing prices. OP is therefore considering proposing measures to keep the cost of housing from rising dramatically or to mitigate these effects.

The City has had several neighborhoods that were riot corridors of the late 1960’s undergo gentrification, pushing out lower income people. One way to mitigate gentrification is to use public land or housing funding to put in long term affordable housing in those neighborhoods before the gentrification precludes it. This research provides an “early warning system” of where to target those funds or use public private partnerships for publically owned land development. (EDavison)

Of course transportation is not the only reason for making a lifestyle choice. However, there has clearly been a payoff for the District's focus on providing transportation alternatives through enhanced pedestrian safety, bike and car sharing, dedicated bike lanes and improving transit connections among heavy rail stations through bus and trolley lines.

*This work built on earlier research for the Washington region by the Urban Land Institute in Beltway Burden and Priced Out (2009)

View a PDF of the presentation here.

Rosalyn Doggett, George Washington Chapter Scribe (with commentary from Elizabeth Davison, LAIGW President)

Maryland District 3 Congressman John Sarbanes - Keynotes Baltimore’s Annual Meeting

Outgoing Chapter President and LEF Member, Rachel Edds welcomed 50 members and guests to Baltimore LAI’s annual meeting at the 19th century Maryland Club in downtown Baltimore. Recapping highlights of her two-year term, she thanked Dr. Michael Anikeeff, Director of the Edward St. John Real Estate Program for facilitating monthly program meetings at the Johns Hopkins Carey School of Business. She also expressed appreciation to outgoing Board Secretary Herbert Davis and his assistant Judy Bushong, along with Membership Chair Robert Lefenfeld and acknowledged the insightful program presentations by members. She circulated a write-up of the fall 2011 LEW in Sacramento, summarized the research projects funded by LEF and encouraged participation in the upcoming two LEW week-ends in 2012.

New members for 2011 and 2012 were identified, including the new inductee Brenda Desjardins, Owner and President, New Home Marketing Services / New Home Development Strategies; Michael Cordes, Managing Director, Columbia National Real Estate Finance, LLC; and Owen J. Rouse, Senior VP, Manekin, LLC.

The roster of officers and Board of Directors was presented and unanimously elected. They are: President James “Jim” Leanos, SIOR; Secretary Kenneth Rice; Treasurer Michael Lester; Membership Chair Stephen Rudow; Scribe Tara Clifford and Historian Josef Nathanson. Joining them on the Board are Rachel Edds, Immediate Past President; Joseph Cronyn; John Murphy, Michael Anikeeff; Joanie Millane; Geoffrey Washington; Melvin Freeman; Herbert Davis; and Joseph "Jody" Landers.

Elected in 2006, Congressman John Sarbanes represents Baltimore City and Anne Arundel, Baltimore and Howard Counties. Serving on the Science, Space &Technology and the National Resources Committees, the Maryland Congressional Representative is known for stewarding the Chesapeake Bay, championing higher education and authoring the legislation ‘No Child Left Inside’.

In his remarks about the need to rebuild the country to make America strong again, he lamented that the notion of investment and paying for infrastructure was lost in the deliberation about deficit and debt reduction by the failed Congressional Super Committee. Sarbanes advocates rebuilding the infrastructure through four components: 1) physical (water and sewer systems, bridges, roads); 2) human capital (education and jobs training especially in the health care field); 3) civic (volunteer and community service through AmeriCorps and the Veteran Corps); and 4) environment (preserve natural resources for sustainability). Claiming all four will create jobs, he believes everyone has to be asked to step up and contribute. According to Sarbanes, there is a $2.2 trillion worth of investment to be made with attendant green jobs. Congressman Sarbanes has co-sponsored the Property Assessed Clean Energy Tax Benefits Act that still is pending. The proposed legislation provides tax incentives for Property Assessed Clean Energy (PACE) bonds issued by state and local governments that help homeowners and businesses install energy efficiency upgrades.

In spite of the pervasive attitude of cynicism in today in the US where only 9% approve of Congress, Sarbanes implored LAI members to not hack away at the foundation of the country and join him in his hopeful vision about revitalizing the American dream.

It is with extreme sadness that we report that Kurt Shelger passed peacefully at home on January 11th. His wife Shirley was at his bedside. Kurt was a true professional in every sense, as well as an outstanding gentleman, mentor, partner and friend. Kurt turned 96 last November and enjoyed a quality of life to be envied. He will be greatly missed.

LEF is a not-for-profit charitable foundation organized to administer an investment fund which provides grants for research projects related to land economics. Over the past three years LEF has committed capital (5% of assets) to a number of significant and worthwhile endeavors across the country on a matching basis with other non-profit entities. The following are projects LEF has funded to-date.

Steven R. Gragg MAI, FRICS, LEF President

Lambda Alpha International (LAI) has recently created a group on Linkedin.com. Linkedin is an online professional network of more than 60 million professionals in over 150 industries. Linkedin is a great place to exchange information, ideas and opportunities. Linkedin allows you to:

• Stay informed about your contacts and industry,
• Find the people & knowledge you need to achieve your goals, and
• Control your professional identity online.

Our LAI Linkedin group will provide a means to further promote communication and networking among LAI members. Please join us at LAI’s newest place to network: www.linkedin.com.

Moving? Changing Jobs? Name Changed?

Please visit the Members Only section of the LAI Website and under the Member Services section you can update your profile.

Forgot how to login? No problem.

Please visit the LAI Website at www.LAI.org. On the left hand side click on the Members Only Tab. Here you will need to use your email and the password is lai.