Great posts by other (GPBO) 01: Introducing a new series

July 7, 2009 | Atlantic Yards, Cities, GPBO, Home asset finance, India, Microfinance, Norman Oder, Speculation

Because information wants to be free, blogs are all about sharing, so from time to time I’ll post these potpourri columns of Great Posts By Others, featuring thought-provoking posts and our reactions thereto.


We seek out new posts and new inspiration

1.1 Atlantic Yards Report

Ever since I first encountered the Atlantic Yard report blog, I’ve considered it essential reading for understanding Atlantic yards, an enormous and seemingly endless current eminent-domain-like redevelopment in Brooklyn.


Single-handedly putting the New York media to shame:

Norman Oder

Single-handedly researched, written, and posted by the indefatigable and Pulitzer-prize-deserving Norman Oder, it is a sole-source reference, using the Web to publish documents obtained via Freedom of Information Act requests, chronicling public hearings, and mercilessly comparing what officials said once with what they say now.


Putting elected officials on the record:

One of the hundreds of documents posted by Norman Oder

I’ve been agog at two things:

* The extraordinary diligence that Mr. Oder has poured into his blog, even quoting people like me.

* The significance of Atlantic Yards on discussions (for or against) of eminent domain for economic development (ED4ED), which often bears on affordable housing.

Over and over, Mr. Oder had exploded public pronouncements with evidence, leaving the developer’s credibility (and that of many of its supporters, such as ACORN) in tatters.


Nonsense, everything’s fine

Most recently, his quest for transparency and truth has led him, to discover that leak-tolerant architect Frank Gehry’s original design was impossible, and that, as shown in the following excerpt, virtually nothing about Atlantic Yards will be what it was sold as:

*May 02 - 00:05*

This got the approval; who knows what will be built?

What we learned

But we did learn some important things:

* The Independent Budget Office (IBO), recalculating its 2005 cost-benefit analysis, concluded the arena would be a money-loser.

* The Metropolitan Transportation Authority (MTA) is willing to compromise with Forest City Ratner on the timetable (and perhaps the total) for the $100 million owed, as well as the quality of the new Vanderbilt Yard.

* Neither the state nor the city have updated their analysis of new revenue–already deeply flawed, because it excludes costs–to acknowledge current conditions

* The New York City Housing Development Corporation is waiting for Forest City Ratner and ACORN (which is in hock to the developer) renegotiate the configuration of the affordable housing.

* The Empire State Development Corporation (ESDC) likely will produce a revision of the Modified General Project Plan (GPP) in the next month or two, which will trigger a new public hearing.


There are many known unknowns, and we don’t know when we won’t know them

What we didn’t learn

Some other important things we didn’t learn:

* How long the project might take

* When construction might begin

* When affordable housing might begin

* Whether there are enough bonds for affordable housing

* How the per-unit cost of affordable housing compares to other projects

* Whether architect Frank Gehry is on the project

* Whether officials realized FCR decided to seek more subsidies well before the economic downturn.

* Why the ESDC lets private companies benefit from naming rights to public buildings.

Though I generally support eminent domain for economic development, Mr. Oder’s investigative reporting – all of it, I might add, from public-domain sources and out of his own pocket – reveals a seamy side to glitzy projections and hollow promises. Long may he prosper.

1.2 India Development Blog

Because we are doing some modest work in India – Slum Dwellers International in Mumbai, and SEWA Bank in Ahmedabad, almost anything to do with Indian affordable housing is interesting to us, and because India is the world’s fastest-growing democracy, and quite probably its fastest growing middle class, anything to do with Indian affordable housing is important for the wider world. Over at the India development blog [Hat tip: Yousuf Marvi], we came across this post is the next challenge scale or flexibility?

Indian MFIs typically offer very general and standardized products.  The 1st loan is often in the range of Rs 6,000-10,000 (USD $120-200), and is paid back weekly over one year.  The 2nd loan is typically about Rs 12,000 (USD $240) and the 3rd loan is about Rs 15,000 (USD $300), and repayment is done the same way with both of these cycles as was done with the 1st loan.

Microfinance remains among the last quarter-century’s greatest financial innovations, yet its very success has led to a tyranny of sameness. The more financial products, the more robust the financial ecosystem, and the greater the consumer choice.

One size does not fit all.


You might want to rethink that …

Even the most successful entrepreneurs would fall under this rigid structure, and would only be able to receive about Rs. 15,000 (USD $300) in their 3rd year of successful repayment.  If they need more capital, they will need to go to a moneylender or another MFI, regardless of their track record.

I think MFIs in India should better tailor their microcredit products to their clients.  Some clients need larger loan amounts, a monthly infusion of cash, or daily loans (e.g., auto-drivers that rent their autos at a daily rate).

Just as birds can fly only if they are smaller than a certain size, classical microfinance has upper-bound limitations.


Nothing bigger can fly: the Andean condor

When the scale reaches above a particular size, new engineering is involved.


For that load, you need new technology: the gossamer condor

In our view, microfinance will never scale to housing; instead we must introduce new products, such as what we at AHI are calling Home Asset Finance.

It could be difficult to train loan officers on how these different loan products work, and which type of client may benefit from these differentiated products, but it’s crucial that Indian microcredit becomes more flexible.  In my mind, more flexibility would benefit clients more than the growth in scale of the microcredit available today.

Yes, and we’re working on it.


Seeking the elements of a new form of housing finance

1.3 Bldg blog

On a lighter note, we [Hat tip: Janaki Blum] found the Bldg blog, which presented a great post on urban X-rays:


See the blog post’s structure?

At one point Beard refers to the “theaters and porticoes” built in ancient Rome using wealth taken during Pompey‘s “eastern campaigns” in Armenia and elsewhere. However, she writes:

The term “theaters and porticoes” hardly does justice to this vast building complex, which stretched from the present day Piazza Campo del Fiori to the Largo Argentina, covering an area of some 45,000 square meters. A daring – and, for Rome, unprecedented – combination of temple, pleasure park, theater, and museum, it wrote Pompey’s name permanently into the Roman cityscape. Even now, though no trace remains visible on the ground, its buried foundations (and particularly the distinct curve of the theater) determine the street plan and housing patterns of the city above; it remains a ghostly template which accounts for the surprising twists and turns of today’s back-streets, alleyways, and mansions.

The not entirely surprising realization that the present-day street grid of Rome is actually an articulation of other, previously buried cities – cities not lost to history, then, but accessible in outline through the indirect archaeology of contemporary urban planning – reminds me of something that came up back at Postopolis! LA.


[Image: Fallen Fruit‘s map of the lost orchards of Silver Lake].

During their presentation, the ingenious duo Fallen Fruit mentioned that, when they were mapping fruit trees in today’s Los Angeles, they stumbled upon the borders of much older, abandoned fruit orchards. In other words, what appeared simply to be a random fig tree growing in someone’s front yard was, when seen on a map together with other such trees, actually the remnant presence of a now-forgotten farm. Those trees, to use Beard’s term, are the “ghostly template” from an earlier phase of land use.

As I’ve written elsewhere, streets and other lines of transportation are a city’s nervous system, so even today main tunnels come into New York at the Battery, because that is where the trains started, because that is where the ferries docked.


A tunnel to connect to railroad lines that have since vanished …

There is a different grid inside the grid, you might say – where each tree becomes something like a legal document, marking the outer boundaries of a lost landholding.

I love this evocation of the past still around us, forgotten. The front yard of our old house on Avon Hill Street, had two bearing pear trees, one a Bosc, the other a seckel. Every fall, Nancy used to gather both kinds, which made good eating.


Who planted the tree whose fruit I ate?

After we bought the house, I learned that our neighborhood had indeed been an orchard, and I allowed myself romantically to think that these trees were in fact survivors of that bygone age.

Perhaps I wasn’t being so romantic after all.




Comment from Matt Healy
Date: July 7, 2009, 10:56 pm

My childhood house had an apple tree in the backyard, which was among the last survivors from the orchard that had once been there. Its apples were small and hard, not suitable for eating raw but excellent for baking — as a child I enjoyed many pies and other baked items my mother made from them.