What slowdown?

The new economy may have foundered, but most new urbanists report that they are as busy as ever. Though growth has slowed in the national economy, internet firms have crashed, industrial output has declined, and the stock market has floundered, new urbanist design firms continue to thrive in 2001. Some firms report a mild drop in business requests — but not to the extent that it has cut down on the actual workload. “We are still turning away work, but probably not at the rate that we were,” says John Torti of Torti Gallas & Partners/CHK, a Silver Spring, Maryland, firm with a staff of 120-plus — one of the largest in the New Urbanism. Meanwhile, Torti reports a positive effect of the economic slowdown. “All of a sudden we have high quality architects and urban designers in the market for new jobs,” he says. “This is a big change from the high 90s, when you couldn’t buy a good architect if you offered to pay him more than you made.” Consequently, Torti is hiring staff, and recently leased an additional 5,000 square feet of office space. Toronto-based Michael Morrissey, a new urbanist architect and planner, theorizes as to why he is busier than ever. “I haven’t felt any effect (from the slowing economy) personally, and most new urbanist developers are running around trying to hunt down more work before every developer is doing New Urbanism.” Morrissey knows up to 20 US developers who have experience building new urbanist projects or who have been hanging around new urbanists for a long time and see a brief window of opportunity — perhaps lasting the next four or five years. “They feel the need to become bigger and have several projects going at once,” Morrissey explains. “There is an urgency to do that while they still have the edge and the New Urbanism is still unique.” Thriving amidst turmoil Dan Solomon, whose firm is in San Francisco — the heart of the high-tech crash — might be expected to see some loss in work, although he hasn’t. “An utter collapse of real estate is taking place all around us, and we’re busy as hell,” says Solomon, a Congress for the New Urbanism founder. “I don’t know why, or how long it will last.” Solomon says he is in the process of hiring two additional staff members. He reports that many architecture firms in the Bay area — especially those whose clients included internet firms — have seen a dramatic drop in work. Solomon’s firm had no internet clients, and it mainly focuses on affordable housing and infill architecture and urban design. There is still a tremendous shortage of affordable housing, and housing in general, in the Bay area, he notes. Housing may be the strongest sector in the overall economy nationwide, which probably goes a long way to explain why business is booming for new urbanists. Fueled by dropping interest rates and relatively low unemployment, homes are going up at an almost unprecedented rate. For the first time since the federal government began keeping statistics in 1963, housing starts topped 900,000 (annual basis) for seven months in a row, beginning in December 2000. Housing starts in Canada also are at a very high level. Another factor buoying new urbanists is their relative diversification, compared to typical design firms. New urbanists often split their work between architecture and planning. Even Duany Plater-Zyberk & Company (DPZ) in Miami, which focuses mainly on planning, has considerable work in the public and private sectors, in nearly every part of the country, and in Europe, Asia, and South America. Two years ago, DPZ was “frantic,” and now they are merely busy, says Jeff Speck, director of planning. “Work for cities hasn’t dropped at all — but we haven’t had to take more city work, because there is still plenty of TND (traditional neighborhood development) interest,” Speck says. The firm is not hiring, “because we’re being cautious.” Planning less cyclical Whereas architecture is highly affected by economic cycles, planning is front-end activity. Most developers know that they are facing an approval process that could take anywhere from one to five years, notes Morrissey. “What’s the perfect time to do that? During a recession.” During the early 1990s real estate recession, demand for architecture dried up, but planning work continued, notes Elizabeth Moule of Moule & Polyzoides in Los Angeles, also a CNU founder. She also anticipates that during the next real estate recession “private development will slow down somewhat, but the public work will go on.” New urbanist firms are involved in a niche market that is growing, notes Steve Coyle of Lennertz Coyle & Associates in Portland, Oregon. New urbanist developers generally are looking to create value over the long term, as opposed to reaping quick profits, he adds. Moreover, TNDs, with their mix of housing types and uses, have a built-in market flexibility, Coyle explains. New urbanists generally “do not let short-term cycles affect long-term development goals,” he says.