On the Wrong Side of I-695

On the Wrong Side of I-695

In a study for the Brookings Institution, Jenny Schuetz found that while Washington, DC has modestly increased its housing stock, the growth has not been uniform across the District.

Over at Greater Greater Washington, Payton Chung provides an interesting case study on how two neighborhoods in the same ZIP code, Capitol Hill and Capitol Riverfront, separated by I-695 (a major artery in DC), have had two radically different experiences in their housing development.

Capitol Hill, writes Chung,

North of I-695 is Capitol Hill, where one of the country’s largest, oldest, and most fiercely-guarded historic districts has steadfastly maintained the neighborhood’s physical character. The streets of colorful, low-rise rowhouses look much the same as they did 25, or even 125, years ago.

Proposals to build new buildings — even for something as uncontroversial as a supermarket and mid-rise, mixed-income apartments adjacent to Metro — must undergo a gauntlet of reviews, lawsuits, and counter-lawsuits that can drag out for several years and cost millions of dollars. The process is so daunting that hardly anyone even bothers trying, and so few new housing units have been built in recent years.

Capitol Riverfront (also called “Navy Yard” or “Waterfront”), on the other hand, is a very different story:

South of I-695 is Capitol Riverfront, or “Nats Flats” as City Paper once called it, where seemingly everything is shiny, new, expensive, and filled with yuppies having fun. In just the past five years, the Capitol Riverfront’s streets have been rendered nearly unrecognizable by a startling metamorphosis: this boomtown has seen a dozen luxury residential towers open their doors, almost half of all new homes built in DC.

The neighborhood has more than doubled in in size, going from 3,000 to 6,200 housing units, and services have also blossomed, with the local restaurant count going from 20 to 52. The dozen tower cranes looming overhead herald even greater change to come.

The contrast between these two neighborhoods has produced predictable effects: rents in Riverfront have declined, despite its “yuppier” vibe, while Capitol Hill rents have increased.

The lessons? First, even when developing in high-rent areas that are experiencing “gentrification,” greater housing supply brings down rents. Chung reminds us that while rents won’t decline dramatically, newer housing and lower rents are two great tastes that taste great together.

Second, greater supply and lower rents helps to slow the process of displacement for lower-income residents.

If you build more housing in a neighborhood, you can accommodate more people, and demographic change is likely to be slower. If you don’t build housing, you make neighborhood change a zero-sum game, and likely accelerate displacement,” writes Joe Cortright about how Fruitvale, a multiethnic neighborhood in Oakland, may have mitigated displacement by expanding onto adjacent industrial land.

The waterfront neighborhood is a land-use and zoning deregulation success story. The rest of DC should take note and follow its example.

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By |2018-07-20T07:30:23-07:00July 19th, 2018|Blog, Land Use Regulation|