Redevelopment Continues in Urban Neighborhoods

Washington, DC (March 25, 2010)- Smart growth strategies emphasize the reuse of land. An updated U.S. Environmental Protection Agency report shows a continuing shift in development toward urban neighborhoods in the United States, despite a slow a real estate market.


This trend, described in EPA’s 2010 report, “Residential Construction Trends in America’s Metropolitan Regions,” shows that redevelopment continues in many urban neighborhoods. Taking advantage of opportunities to reuse land and to redevelop underused sites is a key smart growth strategy. It helps communities protect natural lands from being developed, strengthens the local economy, and puts new homes, stores, and jobs within easy reach of surrounding neighborhoods.
The data show that, compared to the early 1990s, the share of construction in urban neighborhoods was up 28 percent in mid-sized metropolitan regions that have promoted redevelopment of underused sites and development around transit, such as Portland, Ore; Denver, Colo.; and Sacramento, Calif. For example, in 2008 Portland issued 38 percent of all the building permits within its region, compared to an average of 9 percent in the early 1990s; Denver accounted for 32 percent, up from 5 percent; and Sacramento accounted for 27 percent, up from 9 percent.
The latest report shows that an even stronger trend toward urban redevelopment in the largest metropolitan regions continued in 2008. New York City accounted for 63 percent of the building permits issued within its region. By comparison, the city averaged about 15 percent of regional building permits during the early 1990s. Similarly, Chicago now accounts for 45 percent of the building permits within its region, up from just 7 percent in the early 1990s.
Across the country, many urban neighborhoods are experiencing dramatic transformations. Parking lots, underused commercial properties, and former industrial sites are being replaced by condos, apartments, and townhouses. In spite of the many impressive projects, a central question remains: Do such examples add up to a fundamental shift in the geography of residential construction?
To answer this question, EPA examined residential building permits in the 50 largest metropolitan regions in 2009. The original report, issued in Feb. 2009, examined building trends in the 50 largest metropolitan areas from 1990 to 2007. The results of this analysis can be found in the report Residential Construction Trends in America’s Metropolitan Regions 2009. In 2010, EPA expanded the data set to include 2008 data. The results of this analysis can be found in the report Residential Construction Trends in America’s Metropolitan Regions 2010.
The main goal of the analysis was to clarify: 1) if there has been a shift toward redevelopment; and 2) in which regions the shift has been most significant.
The trends in both reports indicate that the distribution of residential construction has significantly changed over time in many regions. In more than half of the largest metropolitan areas, urban neighborhoods had dramatically increased their share of new residential building permits.
* The urban neighborhoods had more than doubled its share in 15 regions.
* The increase had been particularly dramatic over the past 5 years.
* Data from 2008 showed the trend continuing in the wake of the real estate market downturn.
However, in many regions, a large share of new residential construction was still taking place on previously undeveloped land on the urban fringe. The 2010 report showed the following average share of new residential construction in urban neighborhoods: Redevelopment in urban neighborhoods added up to more than half of new residential construction in only one region: New York. In 8 regions, redevelopment in urban neighborhoods accounted for between 1/4 and 1/2 of new construction: Chicago; Dallas; Los Angeles; Miami; Norfolk/Virginia Beach, Virginia; Portland, Oregon; San Diego; and San Francisco. In 18 regions, redevelopment in urban neighborhoods significantly increased but accounted for less than 1/4 of new residential units. In 6 regions, there was very little change in the distribution.
The original report, issued in Feb. 2009, examined building trends in the 50 largest metropolitan areas from 1990 to 2007. The update incorporates data for 2008, which included several months of national economic downturn.
For questions about this study, please contact John Thomas (202-566-1285, thomas.john@epa.gov).
Related Resources:
Residential Construction Trends in America’s Metropolitan Regions 2009
Residential Construction Trends in America’s Metropolitan Regions 2010