The present mode of developing land for human use is destructive and, in the end, economically self-defeating. It is also a process that is wired into a bevy of special interest groups from government to banking to energy. Change the real-estate development process and you have changed virtually everything about modern society. Change will require a systematic METHOD.

Is it possible? Yes.

Will it be easy? No. Attempt it and do it poorly is an invitation to bankruptcy. Do it correctly and there is no way to fail.

Over time, real estate will always accrue value. Properly developed real estate will accrue at a much greater rate. It makes it’s own value. The rarest thing in the world is a beautiful landscape that supports human activities in an economically and ecologically sustainable way. People will pay for it and it is unlikely that any one fund could possibly overbuild the demand.

It is said that the Earth is becoming over developed. This is true and not true. It is over developed given the Pattern Language and architectural design strategies now in place. Humanities’ present approach to infrastructure development will be catastrophic if scaled much beyond present levels. Work and lifestyle patterns are intrinsically “integrated” to this infrastructure calamity as are building codes, mortgage (death-gage) practices and so called safety and work standards.

The building “industry” (in name only) does not employ ValueWeb structures but is composed of many small, poorly financed businesses that work mostly in a passive-aggressive set of contractual arrangements. This imposes massive (up to 50% cost and 75% time) penalties on the design/build process. There is no comprehensive SYSTEMS INTEGRATOR in this mix - merely different players seeking dominance and advantage.

Managing a fund that will establish long term financial viability, social, architectural and ecological integration, and put into practice a new WAY of developing earth assets will require going completely across the grain of “conventional wisdom.” We have come to the point, however, where there is little choice but to do this. There are isolated, partial examples of projects that have done so, over the last 50 years, with great success. Enough to point to a direction that can be pursued with confidence.

It is time for the new Cathedral Builders. It is time to arrest destructive development practices. Time to create a new model. This can be done only if an integrated approach is taken. This development process must be comprehensive and bring together all of the components (research, design, engineering, manufacturing, building, financing, property management, real estate law and codes, craft “unions” and so on) into one eloquent facilitated system of work.

At one time or another, in the last 48 years, I have worked in each of these now isolated domains. I have found that they can be integrated and that this brings powerful results. It is also to be noted that the resistance and ignorance - and lack of vision - in this arena is legend. There are entrenched special interest groups that will even employ violence - and unethical practices that border on the illegal as a common practice that have been long banned in other, more scrutinized areas of our economy - to maintain their position. For change to be accomplished, a critical mass has to be brought to bear on a single point and a systematic process employed over a multi-year period to PRACTICE a new way into being.

This is worth doing. People need new environments based on 21st Century patterns and opportunities. Environments that are affordable and sustainable. Environments that demonstrate how human economy and natural ecology are one.

If leveraged in the traditional way, a 500 million dollar fund can be used to create an enormous amount of building. If leveraged, the system-in-place will co-op the process. Maybe, with great effort and extra cost, something better will be accomplished but nothing significant. If approached on a cash basis for long term equity build, a much smaller project is possible. However, one of enough scale to become self generating. Enough scale to build a community. Enough scale to create a new way. Something affordable and something that will build great value for the investors.

Developments have to be mixed-use. Zoning that separates functional uses forces unnecessary commuting, wastes energy and destroys community. See Organic City zoning concept.

A Master Planning PROCESS is necessary that works on global, regional, community scales. These levels of recursion have to cluster. See Master Plan.

Cohousing and other community-shared resource design strategies have to be employed to bring community and amenity to families and small businesses at an affordable price. See Domicile and Affordable Housing projects.

Buildings have to be designed that they sit more gracefully on the earth and so they can be moved easily from site to site. This way real estate can be developed over time following a natural value cycle. Land is too often underdeveloped in the beginning (due to low value) then, when prices raise, causing disruptive demolition for future development. See EcoSphere Project.

Far greater density has to be accomplished at the same time far less crowding must be the result. This is possible by building three dimensional spaces in true Mega Structure designs. See 1970s Concepts.

Eatable landscaping has to be part of every project no matter the type or scale. Food, energy, landscape, economy are intrinsically linked. See Permaculture. Change one and you effect the others. This linkage has been broken and covered up by slight-of-hand. This is a massive system of transfer payments. A “system” affordable because of subsidized oil prices. Add to the real cost of oil a good portion of US military spending and you will see what I mean. Individuals think they are exercising choices - usually, they are merely selecting between multiple competing options of the same kind. Options (packaged goods) that are made up mostly marketing and advertising costs.

Landscape Commons with Clustered Development and plant and animal migration corridors must be employed.

The entire concept of land ownership and how it is practiced has to be challenged. Stewardship of large chunks of land managed for long term use through natural development cycles has to become the norm. Chartered Organizations can be established to do this. Land speculation (and exploitation) is the enemy of affordable living and work habitats, community and ecology.

Communities (and there should be nothing else) must be Replacement Economies (Jane Jacobs) otherwise there is not long term intrinsic economic viability. Lack of a true economy (common with overspecialized fragmented developments) inevitably leads to the boom and bust cycles of real estate which is unnecessary, leads to exploitation and unnecessary ecological costs. See Balitmore Development.

A new Economic Paradigm has to be practiced. The model/practice has to to be based on a new set of assumptions. See UpSideDown Economics - 12 Aspects. These new assumptions have to be operationalized with new mechanisms. See Rutgers University Presentation. In general, the entire economic paradigm is an engine that leads to the negative results we are getting - a massive abuse of the the idea of a free enterprise system. See Time For Right Livelihood and UpSideDown Economics.

Real estate developments have to become Net Energy Producers - not consumers. Small scale distributed energy systems make the best strategy for taking the load off our aging global grid. Buildings make up a huge portion of US energy consumption - about 60%. They can be much more energy efficient than they are now. This does not require sacrifice nor the adaptation of minimum living standards. It requiring engineering the projects from the start to employ intelligent energy strategies. Natural systems are complex and work for you. Artificial systems require that you keep putting energy in - forever. If true costs were accounted, few of us would be living in a typical suburban subdivision - nor would manufacturing, transportation or cities be designed the way they are.

New Ownership Options have to be found. There are many that have been tested. No ONE will work for every situation. We need a suite of options each with a reliable specification of appropriate use.

A Multidisciplinary Design Team has to be created that has world-class design competency. This level of integration requires eloquent solutions. These multiple elements cannot be “added on” one another. This kills the concept and accelerates costs.

Projects must employ Alexander’s Pattern Language principles else the results will not be livable.

If it seems that the approach indicated above is too complex or risky, the following should be considered. First, the course we are on is ultimately risky and we are out of time. We are the first generation that will inherent the mess we have created. Second, big changes are easier to make than small ones. Big changes attract great people. It is the compromises between a new way and an the old way that leads to a field of mines. Third, money talks. It is possible to use the leverage of a significantly large fund to put in place - and keep in place - new rules of engagement. This requires investors with patience and staying power.

Last, this is the kind of project that we built the MG Taylor System and Method for. If this process is employed from the beginning, the risks can be greatly mitigated. This was demonstrated by the 777 and F-15 projects. The method is in place for facilitating systemic changes that otherwise have no possibility of coming about due to social lock-in.

A personal note: I have spent 44 years training to do this kind of project. Up to this date (May 2001) neither my talents nor skills have ever been comprehensively employed. It has all been “good” practice for the real work yet to come [link].

In the system of real estate development, there are several arenas that require serious restructuring:

A - Land Ownership • Codes • Financing

Our present practices related to land ownership produce massive negative consequences. Chopping land up into millions of small parcels to be individually owned is an automatic tragedy of the commons. It is impossible to practice stewardship under these circumstances. In practical terms, there is little real value in land ownership other than those related to exploitative economics. The system encourages speculation - not use. It certainly does not encourage the use and development of the land over centuries through well understood cycles of use. This does not argue totally against individual ownership of land. It argues that ownership has to be defined and fit into an overall schema of land use and stewardship. The is a SCALE issue here - physical scale and time scale. Most ownership strategies in place are totally out of scale.

Building and zoning codes designed to protect actually promote mediocrity and constrain innovation and competition. Developers and builders - and architects - can hide behind these minimum standards which become THE standards by default. The cost and risk of innovation is made too high and the industry grinds out the same thing over and over.

Because buildings cost far too much, long term financing becomes necessary - which in turn - becomes one of the largest costs of ownership. Few ever really own their property. Few ever pay off a mortgage. Money is “made” by high leveraged financing and selling based on an increase in value (generally created by scarcity and inflation). The need for this “value” increase, in the short term, drives the entire real estate proposition.

Add these social constructs together and the result is a FRAMEWORK in which innovation is risky and difficult. The result is an entire industry that runs at the lowest common denominator. Competition constrained to a narrow bandwidth with few real degrees of freedom. Almost every good idea is illegal or not financable. This acts as a positive feedback loop artificially keeping the status quo in place.

A method that spends 75% of the time and half of the financial resources on itself “gives up” too much from the beginning. There remains no marginal utility to build well, design with care and perform systematic research on alternative methods. Those that do good work in such a system “finance” it by their willingness to take extraordinary risks and to work for far less income than those who “play the game” as it is.

Superior design-build methods have to employed to get the cost down to where it is possible to invest in new designs and technologies. However, if these financial gains are merely sucked out of the project as short term profits nothing systemically is gained. Systematic investment in both method and product is required if the future is to be different.

Real estate development does not pay for it’s own costs. It transfers most of them to other systems and to the future. It is a massive generator of unintended consequences. Life-Cycle costing methods are necessary to understand the true design tradeoffs required for sustainable development.

Today, a development has to include in it’s Business Model the costs to the larger system: water cycles, energy generation, transportation, animal habitat and so on. These systems costs have to be made part of the project costs and long term amortization schedules.

The now popular crammed together 10,000 square foot house on a single lot - a million or two (or more) of pretentious design is the perfect icon of an idea gone crazy. Add to that the ego-monuments of business and the massive infrastructure necessary to make the present model of “peanut butter spread” development work and you have a prescription for failure. A system that progressively gets too expensive to maintain furthering the ongoing rise and decline cycles of real estate value and use.

Architecture and ecology are now one subject. Architecture and economics are now one subject. Architecture and health are now one subject. In designing a building, a design team is, in fact, designing a way of living. They are creating a MODEL of how to see the world and approach life. A city is a room in the house we call our planet. These must be better integration between these multiple levels of recursion.

The notion of what is necessary, what is adequate and what is abundant has to be challenged. Our society is fragmented and detracted - the new form of Roman Circus. Life is a headlong rush to the next task. Everything a commodity to be bought and sold and reported on like a sports event. Our architecture, naturally, reflects this and encourages it. Architecture is the PLACE in which this frantic “living” is going on. Change one, you change the other.

The real estate industry has no systematic and comprehensive R&D method. It is, therefore, impossible to change the system that is in place as a system. Change is ad-hoc, incremental, risky and rarely at a scale where all of the major pieces of the design, build, use method can be understood, challenged and altered as a system. There is rarely continuity of effort making it nearly impossible to build mutual trust and common METHOD.

It does not require great scale to do this. It requires an environment of steady production over an extended period of time. It requires a wide scope: all of the building types; all of the social/economic conditions. It requires equal and creative participation of the entire ValueWeb that makes up what today we call a city. As a deliberate experiment in the entire process of living, new rules-of-engagement have to be put in place - a covenant - that reduces catastrophic risk (downside) and yet rewards performance (upside) only, however, to a reasonable scale.

There are several ways that such a venture can be funded. In the first place, even highly experimental development can be accomplished so that it’s market value over the medium term (10 to 15 years) can equal the cost and return capital. Secondly, IP that has market value can be created, protected, package and Licensed as a business. Third, certain venues can be employed; today what R&D is done is often done in entertainment and recreational building, or by personal patronage expressed in individual homes or institutional buildings. By building a careful portfolio, the project can draw on many sources of capital and pay back though a variety of methods. In fact, it can be highly profitable. The only caveat is that the demand for short term return has to to attenuated and that a steady capital flow over an extended period is essential. Also, that real experiment has to be financed.

An R&D effort such as this would require a sponsor that can represent the industry and who is willing not to interfere in the day-to-day operations of the project. A large track of land will be required in a region where the building authorities are willing to suspend conventional codes. Likewise, cooperation from unions, insurance companies and the many other producer/protector entities. And, the end users will have to be carefully selected. The metaphor is like sending a colony to Mars to start serious development. This can only be approached as a serious experiment in building a serious 21st Century habitat for Earth. ALL aspects of this have to start with a blank slate. A small number but critical rules-of-engagement have to be put into place and a governance process that can evolve with the reality that is being created. Growth will have to be paced. Too fast or too slow can be a problem. The scale of the project has to be such that every buding type can be explored. The scope such that maximum self sufficiency can be achieved in food production, energy and economy. Green space and accommodation for a wide variety of non-human life forms has to be integral to the effort.

If some effort of this kind is not launched, it is impossible for me to see how we humans will be able to design, develop and test alternatives to our present course.

Is there anyone who can claim, with credibility, that our present course will work over the next 25 years?

SolutionBox voice of this document:
INSIGHT • POLICY • PROGRAM