Wednesday, March 2, 2011

A Question on the Question to the Editor

Long-time reader Gabe states/asks:
1) 50 years is a long time to maintain the necessary political will-power to tear out the freeways.

2) We barely have the money or political will now to go in this direction.

3) Dallas just spent a tremendous amount of resources (in the last two decades) getting 75 and Woodrall Rogers to place most people were/are happy with. They just added a very pricey deck park. I think it's a tough sell to ask them to tear it down (though I agree that would be optimal).

In light of all this, are there shorter term, less costly (both in $ and in will) solutions with a higher perceived cost-benefit ratio?

One suggestion (and I think it's yours) would be the removal of the overpass of 75 south of Woodrall Rogers to 30. This would reconnect downtown and Deep Ellum/ East Dallas/Baylor.

Are you aware of any traffic/economic impact study that's been done on this idea? It seems to be that property owners in both downtown and Deep Ellum would be gaga for it.

Perhaps he is right that it is too long-term. Seoul did it in less than 5. But rather than scaling down (which is what I was suggesting with just dipping our toes in the water removing cloverleafs to incrementally urbanize the highway section/interface), we rapidize. I worry that if you go too small with the initial phases that you don't "deliver on the promise" and that there isn't enough tangible, visible proof to show that it is worth it.

The plan to make I-30 like I-75 and the theory that it will create new real estate value adjacent is hooey. It is still highway frontage, which to this day is VASTLY overvalued by the local real estate market. Just look at it. The most valuable areas are those away from freeways. So make freeway land valuable by taking out the freeway! Instead, let's ramp up the process and vision and figure out new financial/planning engineering that turns it into a bullet train of neighborhood building!

Here's an idea:

The thing is, the idea pays for itself in the way we thought roads once did, when roads (or more accurately) streetcars were built from downtown to adjacent areas to unlock the real estate potential of areas immediately outside of downtown.

Tearing out a freeway can cost a few hundred million. But the amount of value in the land underneath, when properly arranged for maximum synergy and spatial interconnectivity vastly exceeds that number. It is public R.O.W. Assemble this land along with all the vacant and highly eroded/underdeveloped land along the freeway, which can be done on the cheap. Because it is vacant, that should tell you the land value is virtually nil today. What is the value when there is no longer a highway between the two neighborhoods it severed like a planarian only that the planarian/neighborhood didn't regrow its head/tail? Much more than nil. And I mean exponentially more.

You don't even need city/state coffers to do it. You can raise the money all privately and structure it in a way to handle investment big and small (and bundle them together into shares), so that it all doesn't end up belonging to only big banks. The shares end up paying for the deconstruction of the highway and become shares of the developable property.

Contribute (small or large) to pay for the deconstruction, become a shareholder. Crowdsource the financing. Then the new infrastructure is financed via a TIF which is paid back by the increase in Tax Base which is a no-brainer because a highway is a net mega-negative. Either sell off the readied land to developers at a profit or go with fee-based development to maintain some control.

The numbers would have to be run, but considering the ROI on Seoul's highway tearout is 5x in 5 years? Could an individual or family get a condo for 1/2 (or less) of what it would normally cost? Could the profits of the entire hypothetical development entity be rolled into new amenities that can't be financed today, such as parks or streetcar linkages to downtown?

This is what pensions should be investing in, not scams like the Museum Tower. Of course, the idea doesn't yet exist beyond a figment of my imagination so how would any pension know this is an opportunity or that this is a no-brainer because of the long-term value and returns inherent in something like this?