Killing me softly: New regulatory reform proposal doesn’t kill retail

Erica Barnett unloads on the proposal offered at a press conference yesterday to change requirements for mixed use development to include retail space. In her post, “Don’t Kill Retail Permanently Over a Temporary Recession,” Erica, in her smart and adorable Crank persona, says

As much as I generally agree with the idea—espoused by Mayor Mike McGinn and city council president Richard Conlin at a joint press conference this morning—that cities should loosen restrictions on urban development, particularly in tough economic times, there’s one aspect of this morning’s regulation-lifting announcement I just can’t get behind: The notion that, because there aren’t a lot of retail businesses opening up right now, we should permanently turn over ground-floor spaces to residential development.

But the thing is that the changes proposed in the announcement today don’t do anything permanent. The Crank assumes that the spaces we’re talking about get locked into residential. That’s not what will happen. It’s the opposite.

The proposal is set up to allow some flexibility for developers to sell or rent space on the ground floor to either residents or businesses. The developer gets to decide. And what will influence her decision? What sells best.

Today’s code requires retail on the ground floor in areas outside designated areas of concentrated growth and development. I signed the letter. I am aligned with the Crank on many of these things. I wouldn’t have jumped on board if this was a street level activity killer.

I’ve got a lot of thoughts about this, but simply put, the issue here is the natural limits of land use. Right now, we’re requiring retail on the ground floor when, in some places, nobody wants it. Why not open those spaces to residential use? If that situation changes, then it go back to commercial again. That’s what this proposal is all about: flexibility. We’re pushing to allow the use that best facilitates dense, walkable, and livable neighborhoods.

The Crank says

The problem with that argument is that recessions aren’t permanent, but land use often is. If we allow developers to build ground-floor housing instead of retail space now, those apartments won’t magically be converted to coffee shops, hair salons, and restaurants once the economy turns around. They will be, for all intents and purposes, permanent residential spaces.

Well, exactly. Sort of. The proposal allows just what the Crank describes as “magic.” If the recession goes away, at those apartments on the ground floor would yield more rent as retail spaces, this legislation makes that possible. That’s why I am in favor of it.

So while the Crank is pushing for the right outcome, she’s missing the basic point. Passing this package means that we allow better flexibility when this recession ends, God willing.

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