Legal Commentary

New London May Build Townhouses on Site of Kelo Takings

By Ilya Somin

For years, the site of the property condemned in the controversial Kelo v. City of New London case has stood empty. Now however, there are recent reports that the city of New London has found a developer interested in building townhouses on the site (see here and here) [HT: my RA Eva Choi, and Michael O?Malley of the Yale University Press].

Several previous plans to develop on the condemned property have gone under. In November, the Pfizer Corporation, whose lobbying helped instigate the initial takings, announced the planned closing of its headquarters in New London. That step further reduced the likelihood that anything will be built in the area. It remains to be soon whether the townhouse development will work out better than these previous efforts. At present, it is not clear how much the new project will cost taxpayers, and a news report indicates that ?[c]onstruction on the project will not occur any time soon.?

Even if the townhouses are eventually built, it is unlikely that they will generate enough development to offset the value of the numerous homes and businesses wiped out by the condemnations, the opportunity cost of having the area lie empty for years, and the over $80 million in public funds already expended on the project.

Ironically, much of the condemned area was a lower-middle class residential neighborhood before the takings, and New London?s current plan is to use the land for roughly the same purpose. The City could have ?achieved? this result at far lower cost simply by leaving the neighborhood alone in the first place. Taken as a whole, the Kelo story exemplifies the ways in which ?economic development? takings not only victimize property owners, but also often destroy more development than they create (see also my more extended discussion in this article, which cites figures for the costs of the Kelo takings).

Full post as published by The Volokh Conspiracy on February 23, 2010 (boomark / email).