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Real Estate & Property Law

: Kelo and Beyond

Back to Basics

By Greg Alvarez

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Sometimes, or if you believe Occam's Razor, it is always the case that the simplest solution is the best solution. Keep it simple, and everything will work out just fine. When it comes to land use, it seems like the opposite maxim is the rule rather than the exception. Somehow, people like to go along with the often more cumbersome status quo rather than trying to change things up. We practitioners are left to navigate through the process with little help. Recently, while attempting to file an application, we were informed that the applicable municipality did not have any records of the building permits that were issued in connection with the existing structure on the property at issue. They asked that we go searching for the permits, because they, as the keeper of the records, must have some record of them before we move forward with our application. Rather than recognize the obvious, i.e., that if the Town does not have the permits, it is not too likely anyone else will, we are left to embark on a scavenger hunt to try and satisfy their request.

Another tidbit out in the world around us that highlighted this point is the crazy system that apparently governs the streets of Costa Rica, where it is almost impossible to find anything, especially if you have no idea where to look. Forget about using Google Earth -- you're pretty much on your own when it comes to seeking someone out in the Central American nation. There are no "addresses," as Americans have come to know them, but instead there are approximations of locations based on landmarks. Postal workers must actually attempt to deliver mail to such locales as "125 meters west of the Pizza Hut," or "from the Tibas cemetery, 200 meters south, 300 meters west, cross the train tracks, white two-story house." Twenty percent of the nation's mail is deemed "undeliverable" -- go figure. The national government is trying to correct this problem, issuing standardized addresses. Thinking how things can go wrong here, it is downright scary to contemplate how anything gets done in a place where no one can say for certain where they live or work.

How about those places where things seem to be working right? Well, the model I always turn to when it comes to land use is Portland, Oregon. Beginning in the 1970's, Portland, among other progressive land use approaches, decided to foster the increased use of bicycles as a primary mode of transportation. Today, Portland ranks as one of the most bicycle-friendly cities in the nation, and its nascent industry to support the level of usage is in turn becoming a vibrant, if not significant part of the economy. As one of the city commissioners has chronicled, "Our intentions are to be as sustainable a city as possible. . . . That means socially, that means environmentally and that means economically. The bike is great on all three of those factors." Who knows how overly-optimistic such an analysis may be, but it does show that simplicity, even in the land use realm, can supply some real answers.

Of course, "back to basics" doesn't always mean "better" when it comes to the built up environment. Take the example of Todd Haupt, an enterprising entrepreneur in Missouri real estate, who is beginning to feel the pains of the market as it comes back to earth from the heady days of the past decade. Out of one semester of community college education, Haupt had parlayed his flipping skills into a multi-million dollar enterprise. When the collapse came, Haupt essentially lost anything, having to start again from square one, to return to the "basics" of having nothing. "I feel like, yes, I overextended myself. . . . But when do you know not to overextend yourself? If I had a crystal ball, I never would have built my house. But when do you know? That's why we're speculators." In a situation like this, it is hard to figure out what may be the simplest solution. In the case of the volatile real estate market, it is hard to see when it will all turn sour until it starts to happen.

Of course, at the bottom of all things land use, the ultimate determination of what is simpler is usually what is cheaper. Take for example the trend in condo building developments, where developers are scaling back from the heyday of recent times when buildings had to offer crazier and more lavish amenities to attract the customer. Today, the reverse trend is in place, where "less is more." As one developer explains, "Costs are through the roof. . . . A developer today has to make every square foot as productive, economically, as possible." Not like this has ever not been the case. But it reinforces the point that to survive in this land use game, change is the key. That is the simplest solution. Of course, as for my predicament, I can only hope to change the municipal minds standing in my way of filing my application.

Full post as published by Kelo and Beyond on November 13, 2007 (boomark / email).

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