 Okay, we can begin. Welcome, everybody. It's Gordon Clark from Oxford University beginning this webinar, this what is in effect today long event, honouring Patrice Darrington and her most wonderful book. With me as well is Richard Florida, who is the co-convener and co-conspirator about this project. And as we go on, we will have of course many others join us as speakers, but also I expect the audience to build and build as we basically go through the process. There are quite a number of speakers and you might notice that I'm speaking to you from Oxford in the UK. We have one of our guest speakers is a course from Belgium, and we can go Belgium, Oxford, we go then to New York, to Illinois, to Chicago, to Los Angeles and Stanford. So we've got quite a spread of speakers here today, and more particularly people who really understand Patrice's project, which actually is quite remarkable on many dimensions. Very crudely, size and scale really astounded me when I first saw her. But equally, she has said something fundamentally original about actually real estate, and she's been a diligent historian bringing to the fore many aspects of the project that the books based on. And I don't think there's anything quite like it in the social sciences. And that's saying a lot when you think of all the academics out there, specialised in this kind of research. So welcome everybody, and welcome to speakers, welcome to the audience. We've dialed in for the occasion. Welcome to maybe your own. Okay, so I've caught Richard in dispose. So I'll turn it over to Patrice, who will also say hello, and so might make some remarks about where she started from, at least very briefly, historically speaking. Over to you, Patrice. Thank you very much, Gordon. I'm humbled by your very kind words of appreciation of this. Yes, it was a long project, but one I just thoroughly enjoyed. I'm sure like many people on this at this event, and many, many people worldwide, we love real estate. We love talking about real estate. We love being in our buildings. We love arguing about it. You know, real property, the things we live in every day are very, very exciting and, you know, definitely material for lots of juicy comments. So having been fortunate to put together an education combining architecture and then an MBA business degree, I have practised in real estate for many, many years. Then having the opportunity to go to an academic institution, wonderful ones like New York University and then now Columbia University, and be responsible for teaching young people, young future professionals about real estate development. I realised how is it actually done? We go and do it. We try to do it well. But have we ever really thought about what are the essential principles? What are the essential motivating dynamics of this activity? And so I started looking back to see where we were doing this, where it had happened. And this took me way back to the 17th century and Covent Garden. Thank you for having me. Welcome. I'll turn it over to Richard, who will now make some introduction. Oh, I'm just sorry about that. For some reason, my connection dropped off for a minute. So I ran the Hardy speed test and found that I have enough bandwidth to carry on. So thank you for bearing with me. I want to echo Gordon's comments. I, well, I've known for his treats for a long time. We were colleagues at Carnegie Mellon at the beginnings of our career. And I think somehow brought there together. I've talked about that by one Gordon Clark. An incredible person and an incredible scholar, but an incredible, Magestral connector of people and human beings and scholars. So, you know, I have been an urbanist. Most of my career trained in Columbia University. Rutgers is an undergraduate Columbia University works pieces as an urban planner in the mid 80s. And late in life, late in life, late in academic career, I came to the belief that real estate was important to urban development. That sounds so simple minded. When I, when I say it, it sounds almost ludicrous, but I took up an appointment. And I believe Patrice also overlapped with me there as a distinguished visiting professor at the Shack Institute of real estate at NYU. And I did that particularly to try to educate myself about real estate. And I learned nothing. And I'm not kidding you that I found in our field. That there was, there was commentary like David Harvey's important work on the spatial fix, but there was very little commentary about the central of real estate. And particularly in a knowledge economy, there was the belief that real estate in space was no longer important. And, you know, then Patrice's book arrived first into electronic format, and then an analog format. And I was literally blown away because Patrice brings real estate, bring it. She not only provides this incredible history, she brings real estate back into our discourse and situates it where it should be at the center of urban theory and gives us, she has, I mean, in many ways she's answered so many questions. But I think Gordon would agree with this and many of you would agree that she sets the table for so many of us to ask other questions, to think deeply about how real estate shaped cities. And I would say even more than urban development shapes capitalist growth. So I just want to echo Gordon's comments. I'm honored and I feel honored and privileged to be involved. I wish I could, I love the city. I love New York City. Even Gordon compared to Oxford to London, it's still my favorite city in the world. I wish I could be with you here there today, but hope to be visiting with you in New York soon enough. Patrice, most of all, thank you for making this important contribution and thanks to all of our guests, our distinguished participants, our presenters, for their incredible contributions. Great. Thanks, Richard. It's worth also saying that in bringing together the commentators today, we were very, we were mindful of the disciplines, we were mindful of, if you like, the critical perspectives, analytical perspectives that people bring to the table. And that I think is also some measure of Patrice's accomplishment here. She's been able to talk to a lot of disciplines and a lot of scholars who, you know, in their own fields may have made significant contributions themselves. And as we went around recruiting people, everyone jumped to say yes. So it's quite a compliment personally and professionally. One thing Patrice didn't mention was, yes, she was in industry. Yes, she was in banks and investment groups on real estate. And I think it's fair to say she met all kinds of people in that search and I was particularly struck hearing one time a while ago a story about going to see somebody who actually owned a casino or seemed to own a casino. I think it's actually more in the latter, seemed to own a casino and seemed to owe a lot of money to banks. And that man unfortunately didn't seem to become president, but he became president. That's just a shocker. But there you go. Patrice has seen rogues. She's seen remarkably talented people on the investment side of things. And she has also been able to conceptualize something whole that most of us otherwise look at in part. So with that, I'm sort of conscious of coming up to 45 minutes. That is to say 15 minutes into the presentation. We're going to, of course, start with the first presenter at 2 p.m. Eastern Standard Time. I think I'm right. No, sorry. I'm very confused timing here at 9 a.m. Eastern Standard Time. But before we do that, we are also going to run a tape from Larry Summers. Professor Summers was very gracious in agreeing to make some preliminary comments. He has also read the book. And unfortunately, he can't be here today. I believe he's in Singapore. But nonetheless, he's also a person enormously impressed by the book and enormously impressed by Patrice's accomplishments. So Patrice, how do we go about getting Larry in the frame, so to speak, to get him his comments displayed? Gordon, I'll play the clip right now. Excellent. Thank you. Welcome, Larry. We'll open this symposium in celebration of Patrice Darrington's book, Built Up. You know, there are important books. There are deeply scholarly books. And there are books that are fun to read. There are not very many books that meet all three of those criteria, but at least for me, this was one of them. It's famously been said that we shape our built environment and then our built environment shapes us. If that's even close to true, developers are some of the most important people determining the destiny of our shared spaces, therefore the destiny of our cities and therefore the destiny of all of us. What they do and how they do it is profoundly important. It's not just the stuff of abstract models or present value calculations. It's the stuff of dreams. Persuasion, sales, motivation, vision. These are as important as financial calculation or carpentry or physical instruction. It's the great strength of this book that it tells real stories about real things and therefore makes the mechanics, the abstractions, come to life. That's why I enjoyed reading it. That's why it gave me a greater appreciation of the work of the developers. I know that's why it caused me to think differently about the malls, the buildings, the office parks, the projects into which I step. And so I'm only sorry that I can't be present physically for this symposium. I'm sure it will be as great a treat as reading this book. Okay. Here we are again. Now I'm conscious that we are 10 minutes away now, just or 15 minutes away from the schedule start. So I thought in this period of time I might make some other comments and then get Richard and Patrice to also make some comments before we introduce our first speaker. So I'm going to start with some of the topics and sort of reinforce some aspects of the debate about real estate and property in modern cities is the, if you like, the flux and flow of what happens in cities. And in my own commentary, I talk about how to conceptualize what happens in one neighborhood, one neighborhood, the same city, and how they join together if not directly in terms of adjoining land, but indirectly in terms of the financial market pricing of one parcel of land versus another parcel of land. And indeed actually what the future value is of that land looked in not just a local perspective, but also in a global perspective. And for someone like me who has been involved in real estate, but also as an investor through what a major institution in the UK in real estate, it's brought home to me actually many of the issues that I hear investors come into our discussions and explain how they value one parcel of land over another parcel of land. And it's really basic sometimes it's, you know, is the land situated in the right place and in the UK. That means being in the midlands at the intersection between major freeways going north, south, east, west. But equally, it's sort of very basic, you know, what is the shell that is the building on top of that land? How does that have an intrinsic value? Does it have a use value? Is it actually not valuable at all except in the sense that it occupies a space of land that can be converted to something else altogether? And that's actually many respects what I learned from reading Patricia's book. That sort of sense of contingency about land, about property, contingency on markets, contingency on ambitions and aspirations of those people who hold property or will hold property in the long term. The last comment I make about this is it's too often to think, you know, when you, when you sort of speculate about speculators, what they have in mind is, is the return tomorrow or the return in a year's time, the return in five years time. But in London, there are, there is a landholder whose time horizon is almost infinite. It could be a thousand years out. So the crown of state thinks in terms of centuries, has a rate of return target over centuries, has a claim on space well beyond actually the building on the space, which is either owned or leased by somebody else. And to listen to how the crown of state thinks about urban space is completely different to a speculator thinking on the price of land today and tomorrow and the building that might reap a rent. The crown of state in London around Covent Garden is also thinking about what's its intrinsic value over a hundred years or 200 years. How can we get people to pay not just for their current use value, but actually their use value in 50 years or 70 years. And indeed, I'm in an organization that had to decide recently in response to the crown of state whether or not to hold the lease for 50 years or for another 100 years. And we decided to hold the lease for another 100 years. That says a lot about actually the footprint of human activity and how thinking about real estate is not only in the short term, but it can be that enormous, very long term. And that's why I think Patrice's historical perspective is so revealing. So revealing. Covent Garden then and Covent Garden now. This is an expensive real estate was then was is now. So I'll just pass it over with nine minutes to go to Richard to see if he has any last comments. And then we'll take a brief comment from Patrice before we move on to Professor Derek Bourjik. Of course. Thank you, Gordon. Just a couple of comments on my reading of why Patrice's work is so important. As I mentioned earlier, there are great predictions and punditry about real estate being no longer important and economy of innovation and knowledge. And in fact, what's so interesting about this is that land or clustering or real estate have become probably more important to capitalist growth and urban development now that at any point in history and a couple of facts that I just included in my commentary. In the United States, just four metropolitan areas, the Bay Area in New York, Boston and Seattle accounted for something like 90% of all innovation job growth over the past couple of decades. And across the world, just six metropolitan areas, the Bay Area in New York, London, Boston, Beijing and Shanghai accounted for more than all of the half of all the venture capital startups that have been created over the past decade. Moreover, there's a recent McKinsey report, which I find really fascinating. The study, which just came out last week and was reported by Runaful Corp in the Financial Times finds that real estate today comprises more than two-thirds of the world's entire net worth, looking across 10 advanced countries, the U.S., U.K., China, Germany, France, Canada, Sweden, Australia and Mexico. And in earlier studies, I found that the total land value in the United States was $23 trillion. Now, that's increased. That's 160% of U.S. total economic output at the time. A new study from Zillow suggests that the total cumulative value of U.S. homes is nearly $30 trillion, also exceeding the total value of all goods and services produced in the U.S. So, really, the U.S. state and land is really important. And also, I think real estate is going through another, the ownership, the capitalist control of real estate is going through another transformation. I think part of this we see as investors gobble up, not just commercial real estate and multifamily homes, but single-family homes. I forget the statistic, but I believe it's a third of the world's home purchases over the pandemics. We're purchased not by individuals, but by institutional investors. And looking out a little further, I think one of the changes we'll see if the 1980s and 90s gave rise to the securitization of real estate. I think we're looking now at the digitalization of real estate coming pretty quickly. And so real estate as a basic asset class is going through this. And so real estate as a basic asset class. But one that's not only a historical asset class, one that could be traded in new ways, is really fascinating. And just one remark on theory. I cut my teeth as a kid at Rutgers and Columbia University on Marx and Neo-Marxism and theories of the state and theories of capitalist development and have been very influenced by Marx through all of my career, although I'm taking a page from the great Christopher Freeman, who I asked this when I was an assistant professor, he said, you may be influenced by Marx, but if you talk about people like Schumpeter, you get your papers published more easily. So I've tended not to echo that so much in my formal writing, but my insights have been shaped with Marx. Marx and Patrice and I were talking about this, and I think we want to do more to jointly understand this. Marx more or less famously talked about Schrift and he lumped the world of capitalism, I'm staying very crudely, into a model where there were two great classes that drove the mode of production forward and in struggle. Capitalist and workers, which was the in proletariat, he didn't have much time for real estate and in the commentaries I've seen really derided it. But the person who like Patrice put real estate at the center of the equation is Henry George. I want to draw your attention to Henry George. Land was Adam Smith's first factor of production, the classical economists like Cantillon developed the land theory of value, Ricardo was very influenced by rent, but it was George who put land at the center and real estate at the center and where Marx, and I'll say this very briefly, where Marx saw the capitalists as making off with the surplus generated by workers. I don't think it's right in this, but I think it's a fascinating view. If you read his work very quickly, not just the book progress and poverty, but the report he did before that, which is trying to estimate US land values. If you read that very closely, what Henry George is saying is that it's real estate owners who make off with the surplus generated by both capital and labor. And why I think that's interesting today is if you look at land views across the board, it seems increasingly that much of the productive advance or innovative advance or surplus that we generate in these places simply gets plowed back into rising real estate values. And that I find to be quite fascinating how this classical factor of land or real estate, which Marx derided is not that important as kind of a fetter, how over time and well into the 20th century, Marx over time and well into the 21st century, it continues to be a critical factor and indeed in much larger fetter that sort of forms a contradiction in that as more and more surplus is generated, increasingly it appears that that surplus is plowed back into real estate and the holders of land. And I think that is Patrice's really remarkable contribution that she forces those of us who work in urban economics, land economics, spatial theory, urban geography, city and regional planning that consider ourselves urbanists to really think about real estate in a different and in a more important way. So again, thank you Patrice and I look forward to your comments and the comments of others throughout the day. Okay, thank you. Look, I've been confused. The first speaker will in fact be Manuel Alves from Belgium and just in case Derek Forzik and Manuel are confused. I was confused. Sorry. So I would like to see Manuel come on video please. You should be able to see me now Gordon. Welcome Manuel. Sorry about that. No problem. Okay, so Manuel and for all of those who were listening in you've got all of 20 minutes. You could take five minutes for questions thereafter, but we always are looking for five minutes of grace period at the end of your time to the next speaker which will be Derek. So just looking at the clock as it goes down, we've sort of got one minute to go. I'm not going to spend a lot of time introducing the speakers because in so many ways well known for everybody. So I will basically give you half a minute, Manuel if you would like to sort of pick up the gauntlet and begin speaking when you like. Okay. Yeah, thank you very much Gordon. I am ready. I don't need to half a minute I think. Can you all see my screen? Yes, thank you. Okay, good. That's that's always good to know because sometimes you think you're sharing something and you're not. Only just yesterday I recorded a lecture for my students of more than an hour only to receive an email this morning that they could all see me but that they couldn't hear me. So I still make these basic mistakes so I wouldn't want to be talking to you for 20 minutes without you being able to see my screen or be able to hear me. Okay, so Gordon thanks a lot for the introduction thanks a lot also for inviting me. I'm happy to comment on Patrice's her book. And I'm not going to do a long praise of the book. I'm going to keep it rather short the praise part because I want to see where we can move on next. So Patrice Darrington provides us with an excellent historiography of real estate development since the 16th and 17th century in London. She takes us through the 20th century in New York City and then takes us into the 21st century discussing not just New York but also places abroad. What I find quite remarking is that the book didn't exist yet. You would think someone would have written this book a long time ago. I think Richard said something along the same lines. You would have found someone would have written the history of real estate development. So only when the book was announced I was like, yes, I've never read that book. That is weird that the book doesn't exist. So I'm very happy that the book is being written. I'm very happy. I hope that you like it. I also wish we could have been in New York City. I used to live in New York for 3 1.5 years and about half of that time I spent in the planning department at Columbia University. So it would have been very nice to see some of those familiar places which I still hope to visit next year when I hope to be back in New York. But for now, let me focus on some of the contributions that we find. Let me see. So as I already mentioned Patrice starts from 16th and 17th century London and what struck me is that already in that early affairs, in that early history of real estate development that real estate development was already not just an economic but also a political affair. It was very clear that if you wanted to do real estate development you didn't just need the capital, you needed the connections, you needed the network, you needed to be able to get the state the local state very often in a way to be okay with what you do. This also may be one reason why a lot of theories of real estate development fall short. They are either emphasizing these economic parts or they're emphasizing the political parts but they're not so good in bringing this together. So what I would like to do today is to go a little bit into bringing them together more. Starting to think from Patrice's work and then trying to bring in some other work to see if we can bring them in dialogue with what Patrice has been telling us and how that could work productively. So Patrice herself builds on both the real estate literature and the urban studies literature which I think is quite nice. It sounds quite obvious to do that if you talk about real estate but it doesn't happen that often, that those literatures are being confronted in the way that Patrice does. There are separate chapters even discussing sort of the critique coming from urban studies to real estate development as a discipline. So the approach she falls is quite interdisciplinary and I would like to go along today and then presenting some sort of political economy of real estate development although some people might say maybe it's more of a sociality of real estate development because they will also be relying on the work of some sort of big names in sociality to make my argument. So if we look at the book at the end of the book in a conclusion Patrice is formulating three objections of real estate development. In a way we could say it's a conclusion rather of real estate development. It's the conclusion of the history of the description of this history of four or five centuries of real estate development. What we find is the first objective is the professional shelter for occupants and the community as a whole. The second being the creation of financial assets for capital markets and the third being the contribution to urban topography and the profession of urban amenities. I was thinking a little bit about these objectives and then I tried to reformulate them a little bit and I came up with these two and both of them actually have two elements in them so you could say I have formulated them into two objectives or into four objectives. The first one being the real estate development has both use and exchange values. This seems pretty obvious but it basically translates to some of the things Patrice says in her objectives. The second being maybe a little less obvious and the real estate development may create both direct and indirect use and exchange value. So let me explain the difference a little bit there. If we think of the direct use and exchange value, the direct value of the house department where I'm sitting right now is that I can sit here, that I can sleep here, work here and do other things. The exchange value here is that I'm actually renting this flat so that there's an economic value that's being generated through my rent payment to my landlord and that my landlord if she wants she could resell the house at some point. But there are also indirect use and exchange values. So the indirect use value is what Patrice calls the community as the whole, the contribution to the community as a whole and what she calls in one of the other objectives, the provision of public amenities. Which is in a way the question how do non-occupants benefit or are afflicted by a building? How do people benefit from my building being here? Well, my building is a pretty nice one from the outside so maybe people would benefit from this building. There is a bar on the ground floor of my building. There's also a dentist on the ground floor of my building. These are facilities that people in the neighborhood may benefit from. These are also facilities in the neighborhood that people might be afflicted by. My building is larger than most of the buildings in the neighborhood. It may take away sunshine from some of my neighbors. The bar may cause some noise. It's not a particularly noisy bar and there are much noisier bars in the neighborhood. But it's also important here that this use value can also be a negative indirect use value. Patrice's focus is mostly on the idea that real estate development could have a positive value for the community and that is great and that is sometimes the case but I think it's important also to realize that real estate development and the existing buildings can also have negative indirect use values. If we look at the economic value that we get from a juice, it's already the example I mentioned my landlord benefits from me paying the rent and I usually pay it in time so that's nice for her. She can resell the building in the future. Also good for her she might be able to make some money there or she might just get her investment back. So in this sense real estate is rather unique. Real estate provides both a stable income and it provides a stable question mark. It's not always that stable. We can talk about it a long time but I won't do that now I'll just leave the question mark up there. It provides investment potential. This means also that real estate has both commodity and asset features if we look at the site from development and construction into the lifespan of the building. Real estate is also of course spatially fixed and this is the key here to the indirect use and exchange values. These values are of course derived from the land. This is no surprise I assume everyone knows this in this room I'm not pretending I say anything new here so location is key we all know that location, location, location are the three important things for real estate as we're often reminded. But this means that the value and price of real estate and the land underlying it or the land potentially being used to develop real estate is derived from the values and the prices of nearby real estate and lands. So the value of real estate, the value of land changes as a result of the changes in nearby plots. This again seems quite obvious but this is quite important for how real estate development is being done. This means also that this is how the indirect exchange value is generated. The indirect exchange value here is about how it influences real estate values of nearby plots. What's the effect of new housing coming up in my neighborhood? What's the effect of the building across the street from me being fixed up and being rented out for higher prices? Is this just one building with higher rents or is this going to have an effect on the rent in the neighborhood? Is this going to lead to possibly a gentrification process? Is it part of it? So the real estate values are always influencing the other real estate values in the neighborhood which means that real estate development always has an indirect exchange value. It's not just about the building that's being developed that has these exchange values and the economic income coming also from rent. It also means that it influences not just to use but also to exchange value of the buildings around it. So this means that developers as well as investors have an interest in increasing investment in a larger area. You would think that if you have two real estate developments next to each other that they're competing with each other and this may be true to some extent. I'm not saying they're not competing with each other at all but actually these two real estate developments next to each other or 10 or 20 or more than that are also working towards the same goal of increasing the indirect exchange value of these buildings. Of course they're trying to maximize their own exchange value by making sure the building can be rented out for more money, can be resold for more money, but also trying to make sure that if the whole neighborhood is lifted up all these buildings benefit from it even in theory the ones that are not necessarily being developed or really developed. So here I'd like to take a step back and look at the work of the sociologist Max Weber one of the great sort of classical sociologists and he argued that economic exchange is not simply about competition but also not about competition between suppliers and competition between the demand side but it's also about coordination and especially coordination between suppliers. So coordination Max Weber argues and many markets might be more important than competition hence the title of the slides to the left. So there's a power struggle between different types of actors rather than just between developers and developers here have a joint interest in enlarging the markets and Patrice refers here to urban policies, I can also think of lobbying she refers quite explicitly to the idea of the growth machine coming from Harvey Mulloch at the New York University and you could also think of the pro-growth coalition that John Malankov at CUNY City University of New York discusses and these are sort of more the critical urban studies literature people from sociology, political science, geography discussing these kind of issues but this is in a way a step back you can think like this is why this is important that actually developers may be working to coordinate with each other because they have this joint interest in the land values coming up. So then we have another possible sociological perspective here one of the more recent big names in sociology the French sociologist Pierre Bourdieu he speaks of different forms of capital economic capital social capital, cultural capital symbolic capital and Bourdieu argues and we're going to simplify here that these forms of capital exist side by side and that to some extent these forms of capital are exchangeable but also foundational to each other it doesn't mean that you can by definition exchange one form of capital for the other but it means that to some extent it is possible to use one form of capital to further another form of capital. So economic capital in case of real estate development that would be obvious to everyone so I'm not going to discuss that. The social capital was actually also quite easy but trees discuss its networks between developers so this is also clear if we extend this social capital a little bit we start thinking about something that becomes cultural capital and this has to do with a club like nature of real states and Bourdieu argues that clubs have a spatial basis and they construct relatively homogenous groups they also keep intact these relatively homogenous groups and these groups are both instruments of inclusion and exclusion so it means that within the club it can be in a conclusionary measure to have a joint language joint ideas but also joint lobbying and things like that but it's also a measure of exclusion of excluding other groups from real estate development other actors that may have an interest in real estate development but are not developers themselves to exclude them here and Bourdieu argues that if this happens quite effectively if actually some of the how you say it the use of cultural capital is some of the use of cultural capital in combination with economic and social capital is almost taken for granted and if the effects are not necessarily seen as a fact of having these different forms of capital then he actually speaks of symbolic capital these are the effects of any form of capital when it's not perceived as such other social theorists may speak of hegemony here but actually some idea of symbolic capital in a way is a little bit sort of a less big concept than hegemony because hegemony seems to be almost like a black and white situation where symbolic capital was always in relationships to these other forms of capital and Bourdieu argues that this form of symbolic capital the use of it where it's actually not being recognized necessarily may also result in symbolic violence this could be for instance when there's development at the expense of the community referring back to what I earlier called negative use values so then let's see if we can confront Bourdieu and Derrington a little bit more in built up Patrice shows that land owners realized that the use that not only the use but also the direct and indirect exchange values of the land in a way she shows how this happened in 16th and 17th century London how before it was all about use value this land owner started to see we can do more with the land we can use it in different ways make more money on the land use it more productively and this is how she basically tells how the first land owners became the first developers you could say in Bourdieu's terms that these first developers used economic social and cultural capital to seek favorable public investments which then became the hallmark of their symbolic capital and this is how real state development was born and in a way how it gave shape to modern and contemporary real state development this is where I could end but then I thought there's another interesting thing to say and if time is still on my side and I think it is I can go in one other perspective here in which one of the great names of political economy also could be put in dialogue with Patrice Derrington Patrice in a way and this discusses the discovery of direct and indirect exchange value again my terms but my reading through a sociological or political economy lands of her work and this reminded me of the work of Fontunen Fontunen is famous in lands economics, real state economics but also in economic geography for his model of agricultural land use I will show it in a minute but what is interesting here is that Fontunen himself was a junker, a junker sometimes translated to English but this is basically a form in Prussia of the landed nobility it doesn't translate necessarily directly into a proper English term but it is one form of the landed nobility it's not the highest form these were typically large land owners and it's a little bit similar to what Patrice describes in London where these first real state developers were also large land owners and these large land owners in London as Fontunen did in Prussia discovered in a way what they could do with their land and what Fontunen did is he developed ideas about land use and how to reap rent from them, how to make money on the land he had he already owned some land and then in 1810 he bought a large estate in Mecklenburg, Sweden a part of what is now Germany and he developed what he called a model farm there in 1826 so that is 16 years later he wrote a book basically about this and theorized how you could use these large land holdings and make the best of them the book was called the Isoliertestat in der Beziehung of Landwirtschaft with National Economy the isolated states with an eye on you could say land economics and national economics so you see here the connection between the land economics and the political economy already developing and basically he asked to question how to develop agricultural land according to its highest and best use if you take out the work agricultural it just seems to be the question in a way that many developers ask themselves so here you see the model what is most famous from the model is this lower part of the model these rings they're known as Fontunen rings for concentric rings about where you would find different land use so I'm not going to discuss in detail I hope many of you will know it what is actually the more interesting part is the top part of the model where Fontunen spends a lot more time about and this is indicating how by having different land uses you can get more profit out of the land and in a way how it works within sort of the horizontal line you look at which of the different diagonal line is the highest ones and that is how much farmers would be paying to leave the land from Fontunen so this is assuming that there's a large land owner and he and in most cases it would be he is renting out this land to farmers leasing it to farmers so what we saw here that Fontunen organized the land according to the economic potential of the land use it was not so much about how to reap crops it was about how to reap land rents it wasn't about the fertility of the land it was about which piece of land located where allows me to prove the land in which way to make the most money on it interestingly enough in the book although this is often forgotten Fontunen also discovers how society and contextual changes affect land rent how technological inventions affect land rent how all kinds of developments, transportation and things like that also are actually a way in which you can make more money on the existing land it was designed to benefit the landowners not the farmers and in a way Fontunen also theorized something that Karl Marx would later call absolute rent and of course it's quite interesting Marx writing as a socialist Fontunen writing as a member of you could say the higher classes as a representative of capital but they came to very similar conclusions about what Marx called absolute rent Fernand Braudel great French historian some people would say one of the greatest historians ever he considered both Marx and Fontunen the two great German political economists and why I'm going back to this history of Fontunen because what Fontunen did is in a way he discovered how agricultural land could be used in a way what Patrice describes about what could happen in London by these landowners owning the land but the difference here these landowners in London didn't write a book they had to wait for Patrice to write the book Fontunen did in a way did the practice and then wrote the book about it so Patrice Barrington and this is where I'm going to end this is going to be my last line Patrice provides us with an excellent sorry I'm going back to my first line so in closing my talk I would like to say one more thing for agricultural land use it took Fontunen a few decades to go from the practice that he developed himself to an evidence based theory of land use for real estate development but such a book was sorely lacking for real estate development especially urban real estate development so Patrice Barrington to provide us with the roots and the advancement of real estate development since its genesis four centuries ago thank you very much well I'm going to step in and thank you very very much Manuel taking us broadening our understanding through of urban real estate through to that historical beginning in agricultural value is absolutely key to what we have inherited in our minds about the importance of owning property and you know the interesting notion of a diversified agricultural portfolio of course is now played out with institutions who seek to hold diversified real estate portfolios so we've got an echo of this very very fine beginnings from von Thürer thank you for bringing that up Gordon Richard I'll pass over to you maybe some questions that was great one of the things that I've noticed as I said being an investor as much as an academic about this space is how you construct portfolios of property and for what purpose do you construct portfolios in a sense that they overlap thematically and in a sense I say in my own commentary that you bring together like types of properties around the world and what you're doing is managing risk if you like geographically across the world but basically taking advantage of the benefits of one type of property that has a quite a universal value but a sort of well understood value or what you do is you build a portfolio say within the country that is geographically diverse so I wonder if you might comment a little bit more on what you mean by these portfolios of property what types of risks that I try to deal with could you repeat the last line again you said something about risk but I couldn't hear it very well Gordon sorry I'm wondered if you might explain in some with some examples about the portfolios you have in mind what their building blocks are underpinning them I need to think about that you mean the portfolios as in the terms of indirect exchange value or well yes but also how do you translate that to property on the ground well I didn't talk much about portfolios so I find it hard to see exactly what you're trying to get at but I might be missing your point sorry well what I'm looking for is a translation of the principles into the practice of real estate investment and indeed the benefits that investors want to get out of property I think it's what you see in many cases developers working together in a way to develop or redevelop an area so I think that is a clear example of where you see they have a joint interest so Hudson Yards in New York is a great example where the location within Manhattan in a way on the one hand is very good it's very central it's close to Midtown on the other hand it's very bad location the infrastructure is not particularly pretty there some blocks feel very unpleasant and there's some mecca developments there's a tunnel coming in with like four or five exits so you can also say that last part means there's a lot of potential there but if I as a real state developer would put one building there and well I might still make a profit on that building and it might work well but if I really want to make money with the land I own whether by developing or whether by selling the land to someone else it needs all the development around it right so you need a lot of developers at the same time or in the same time frame to do something like this to live up to the potential of the land and this is about these indirect exchange values and to do this it's you need coordination between the developers and you need to lobby the local government to intervene in this area to make investments in the area but also to rezone which it doesn't necessarily cost a lot of money to rezone but it still costs a lot of efforts of the government to get this done so I think that's where you see in practice how this idea of coordination works and how through the coordination between them and between them in the local states they shape indirect exchange value. Yes of course coordination comes in many flavours some of it's above board but often it is actually the stuff of life with corruption and other than development go hand in hand. I have two questions from Manuel first of all thank you I've learned a lot in this hour and learned a tremendous amount from your talk and I like probably everyone else on this zoom read their Vontunen but I didn't read this Vontunen and your reading is so contextualized and so important so my two questions are the first one more mundane you can just punt on it real estate has always been a very local industry it seems to me especially with regard to Hudson Yards these players are now more global so do you think that's happening it is my more mundane question and feel free to say I don't know or I don't care the more I think interesting question for you is you have a very close reading of Vontunen you have a very close reading of Marx and I've been playing around with Henry George so theoretically how do you think Vontunen Marx and George compare in their view are landlords a separate class I'm asking that very vaguely are they a separate entity a faction of capital that is extracting a tremendous amount of surplus through their ownership of land and manipulation of land and coordination or are they in your view more of what Marx said just a member of the capitalist class and not particularly interesting at least in my reading or I may have that wrong so I thought you'd be the most appropriate person to ask that question too thanks a lot Richard I think the first question is relatively easy yes I would agree that we're moving partly to global players but I would say it's a partial globalization right in terms of investment prime markets are very much global markets big institutional capital that's behind this Gordon knows much more about this than I do I think in terms of development we see a combination between on the one hand local players but in places like New York some of those local players are becoming national players or international players but rarely are they active globally so this is another interesting thing a lot of them are active in select locations and they might be working in other global cities but not necessarily everywhere so yes a partial globalization I would say the second question I don't know Henry George as much as you do from tuna marks I mean have very different perspectives but I am definitely here more on the Harvey in reading of marks I mean I read my Harvey better also than I read my marks to be honest and I would agree with both from tuning and Harvey coming from completely different perspectives that you could say land use and land development and landlords are worth the attention there's also there was an interesting debate in the 1980s in British housing studies Gordon is asking me to stop soon I'll finish two sentences and it was basically about the question is housing just something where we find the typical capital versus labor or is there something else going out going on in housing market that actually goes beyond that and the Marxists were supposed to say no although not all of them did in the way Barian said there's something more going on here and I think this is true real estate markets, land markets have their own way of producing class in ways that are sometimes parallel to but not necessarily exactly the same as what happens in labor markets I agree entirely thank you Manuel and I must say very very interesting and what breadth what breadth we're going to turn now in a minute's time to Derek Forshek from Oxford University and I just want to bring him online so that we can see him and where is Derek I'm here there you are excellent sorry about the mix up in order but here we are and the same order up to 25 minutes it's best if you finish in 20 minutes five minutes for questions but I'm actually now just wasting your time so I'm going to give you half a minute Grace off you go thank you very much Gordon thank you Patrice, thank you Richard I'm a financial and economic geographer I'm speaking from my residential real estate in Oxford and when I first came to England in 1998 I came from Poland so a country emerging from over 40 years of communist regime a big part of the cultural shock I experienced here other than meeting Gordon as my supervisor which was a positive shock the negative shock was the low quality of most buildings here particularly residential poor insulation double taps thin walls exposed pipes general lack of solidity I don't need to go on so first as a geographer I described it I explained it with weather mild climate a roof above your head is enough to protect you from elements then I came across historical explanations the country has not been invaded for a long time the average building age is high old fashion technology is still everywhere but with time also as an economic and then financial geographer I learned about financial factors affecting this material fabric of England the significance of which seems to be confirmed by Patrice's book land ownership, particularly in England is highly concentrated land leases are relatively short and long term objectives in building are further curtailed by the financialization of real estate development driven by long term profits with community and societal interests sometimes also those the interests of people housed in the buildings themselves falling by the wayside Oxford where I live is no exception there are two more episodes in my experience of English real estate that this book Patrice's book sheds light on so in 2006 I lived in London and every second shop on my high street turned into a real estate agency literally a television was full of programs about IT managers becoming developers because why would they be so stupid to only earn 100,000 pounds a year if you can make so much more easily in property development so I went to my agent on the street asking about the possibility of buying a lot of land to build a house so this is something that people many people in Poland would do buy land and build a house but my agent was shocked only developers and the super rich he said can buy real estate can buy land here maybe just maybe you can buy some rural land north of Birmingham so this was again a lesson that contrasted with my Polish background where buying land and building your own house is still common even in big cities and most recently as a happy house owner occupier I realized that I actually don't know the value of the land on which my house stands in relation to the value of the house itself almost everyone in Poland would know such a thing but hardly anyone does here so again these oddities at least from a Polish perspective are the product of historical, political, financial and legal processes that have been going on in this country as the book shows they have been going on for centuries now speaking about shocks when I first received Patrice's book I was fairly surprised by the big format rich illustrations not just in other monograph as people before me said it's really a work of laugh not just research just look at the ambitious table of contents everything and I really agree with and want to emphasize this is an identification of the research gap here she says private development despite extensive criticism does not itself interrogate its processes or seeks to improve its practices in this it does not qualify as an institutionalized discipline or attracts scholarly and professional respect well just recently I was reminded the research real estate was while conducting input output analysis of the US economy with my associate so imagine in 2020 for those of you who are into network analysis in 2020 real estate was had the highest total strength centrality measure of all sectors in the US economy so put simply to those of you interested in network analysis this is real estate is the most important economic sector in terms of its inflows and outflows and the degree to which they penetrate the whole US economy and its centrality has actually grown over time not only prior to the global financial to the subprime crisis I should say but also ever since now patrice's book follows what she describes as a historical turn in business studies but I think it also offers elements of and potential for a spatial or geographical turn the deep dive into the private property development in 17th century London is fascinating shows the role of shocks in economic development with the great fire of 1666 a changing the use of building materials and the contrast between innovative but conscientious urls of Bedford and Southampton on one side and the speculative Nicholas Barbone is instructive the book is a story of property development as financial innovation as well as path dependence timing a feather innovation for example through the use of the discounted cash flow model again quoting patrice the understanding of the mutual benefit achieved through designating portions of a site to positive economic externalities for the community was not explicitly formulated in the financial calculations for urban development and as a result community community contribution remains a qualitative assessment not justified by economic rational and neglected when financial objectives became dominant and as she documents this process started happening already in the 17th century at least in the 17th century regarding the geography in the book I really love as a geographer I love the patrice's phrase distance of financial interests this reminds us of the quintessentially geographical problem involved growing distance between investors and often developers as well on one side and communities in which property is located on the other side and this distance is enabled if not created by financial innovation regulation technology and globalization far away investors and developers tend to tend to neglect and underestimate both positive and negative local externalities of real estate and as a result prefer reductive financially driven models of evaluating real estate at the expense of more inclusive metrics this problem is aggravated when equity particularly public equity is used as a side effect of the liquidity that equity offers and to compound the issues in addition to investors and developers users can be non-local too think of empty houses both for investment and money laundering or money laundering or both in Miami, Sydney London Toronto, Oxford, anywhere historical case studies in the book illustrate the problems of distance very well the developers of Covent Garden and Bloomsbury which arguably achieved very positive societal outcomes lived within their new built precincts the developers of less socially successful San James and red lion squares in London departed entirely upon completion. I don't think this is a coincidence the role of proximity is also made palpable in the book by the fact that the birth of modern property development is located right between Westminster with its court and the city with its merchants and financiers close connections in both places where crucial for the early developers discussed in the book and such connections are still crucial for developers today now, history and geography in the book, where they meet lies a potential challenge to the book so can we be sure how can we be sure to identify 17th century London as the cradle of modern property development business or does it smug of Euro and Western centrism it's the kind of bias I experienced in San Marco library this summer I was lucky to go to Florence San Marco library in Florence was funded by Cosimo di Medici in the 15th century Medici the founder of the banking dynasty and the library is wooing its visitors with the writing on the wall that it's one of the oldest public libraries in the world full stop but then when you actually read the research you find that Damascus had a public library 750 years earlier and later the dozens of cities in the Middle East and elsewhere now London's tripling of its population mainly through migration during the course of the 17th century from 200,000 to 600,000 nearly 600,000 by 1700 indeed created huge demand for shelter and public space but there were many cities that reached larger even much larger populations of one million or more before London I counted 10 such cities Alexandria Rome, Constantinople, Baghdad Cairo as well as five cities including Beijing in China all of them hosted major financial innovations so is it not possible indeed likely that private sector was involved in property development to house the booming populations and shape public spaces in these cities before London and if so is it possible that these innovations have influenced developments in 17th century London as they probably I think circulated in the Silk Road network trade network connecting London with the Middle East and China via cities of Renaissance Italy like Florence and Venice so there are other potentially missing links in the story by the 17th century Amsterdam the button of the leading financial center in Europe from Antwerp which in turn superseded Bruges and Venice that were dominant in which were dominant in the 16th century Florence, Venice, Antwerp are mentioned in the book Amsterdam I don't think it is so my question is wasn't the development of London real estate influenced by the role of Amsterdam as the beehive of financial innovation with its own stupendous property development during the 17th century and also by the Anglo-Dutch personal union that followed the glorious revolution in 1688 the book says that London with rising agglomeration of migrants, flourishing intellectual activities, variety of skills capabilities and focus on financial transactions was ideal for the emergence of the early real estate developers I agree but so was Amsterdam maybe before London another missing link that could be explored building on this wonderful work is the role of offshore finance, corruption and illicit finance the dark side of things the book touches on it when it mentions the plague of unoccupied luxury condos but when I think about the globalization of real estate that Richard mentioned and Manuel in the Q&A 10 minutes ago it takes me all the way to the boardwalk in Miami beach overshadowed by high rise residential blocks which get totally dark in the evening because nobody lives there when you read about the majority of multi-million dollar condos in Miami beach are purchased with cash often I bet produced out of a suitcase with few or no questions asked by Miami realtors and lawyers so there's much more work to be done on the abuse of tax laws the use and abuse of trusts secrecy in private property development this note is interesting to read in the book about the 17th century Bedford's and Southamptons invested in the Bermuda company back then it was obviously about exploration trade and slavery thrown in for good measure now it's about another form of colonialism using Bermuda trusts other legal vehicles to establish and prolong modern English and other dynasties so questions can be asked both about the origins and the impacts of private property development in 17th century London that the book focuses on the book states that the model of private urban developments that started in London spread across the Anglo-American world and with only the slightest legal and economic modifications has been embraced by formerly known capitalist economies and other governmental systems but perhaps what I said about my Polish perspective on these things this statement is exaggerated what for example about the lack of trust as a legal construct in civil law countries what about traditions cultures, institutions of property development which had suddenly been established in many countries for centuries and do not change so easily and there are vested interests involved in the reproduction now one of the paradoxes of real estate globalization highlighted by this book so well is that this globalization has happened without much standardization of property development as a sector or a profession so the book describes that the relative lack of professional association or regulation of practitioners for the development activity continues today and this may be related I think to the often observed loads standards and also corruption while we read about professionalization of architects so think of Inigo Jones in 17th century London property developers escape simple categorizations they are entrepreneurs they are professionals financiers at the same time you may want to think or not to think about Donald Trump I leave that to you interestingly in the context of real estate as part of the financial and professional services complex property development is probably one of the areas where the role of big companies has been minimal big four advisors on absolutely anything and everything even underwriters of financial deals but I think that real estate seems to be the market they have difficulty getting into and this maybe says something interesting about the sector so the book stimulated me hugely to reflect on topics which are obviously beyond the scope of the book itself what about sustainable real estate development there are mentions of ESG but what about green bones impact investing in relation to real estate in addition to community impacts of real estate we have to consider global externalities to add to what Manuel was talking about for example for climate a ton of CO2 emitted from a building contributes to the global emissions with global impacts what about diversity I guess real estate development is male dominated with major consequences on its models operandi many of the characters in the book itself are Oxbridge educated white English males and what about technology including prop tech smart cities and internet of things in particular makes buildings and real estate tools of surveillance so that multiplies the dilemmas and tradeoffs involved in property development as if it wasn't convoluted and complex enough already and what about COVID-19 impact given the likely lower demand for office space higher demand for residential building and change in the nature of what is sought after so to move towards finishing here I'm absolutely fascinated by Patrice's motivation as she explained and interest for this book and her interest in real estate teaching and the potential impact this book can have on teaching programs I believe as a financial geographer that we also need to teach geographers more on real estate proper I'm sure Manuel does personally I'll never walk in Covent Garden or Bloomsbury again without thinking about property development and I will thank Patrice for that I hope to take my students on a field trip there interestingly the leading property development companies in the UK are still headquartered exactly between the city and Westminster so you know three and fifty hundred years later to the events described in the book Brookfield prologies Welltower, Seggro, Land Securities the list goes on all there and the book is a reminder that financial geography is not only about specializing finance but about financializing space about financial production of space so I really also love Patrice's use of quote from David Harvey that money maybe as the moralists have it the root of all evil yet it appears also as the unique means of doing good I haven't seen many people quoting that from David Harvey so on this parting note I just want to say maybe the book is also or should also be a call for the moral philosophy of real estate real estate is long-term in nature changing communities and societies in the process as such it requires long-term commitments in other words used often in economics in the world where people use finance to turn these long-term commitments into short-term liquid money-like claims to make it like money basically when people use law to rob a stamp they charge financial transformations in the form of contracts and when people use accounting to obsess with short-term mark-to-market valuation and the government quietly approves or even promotes all of these processes the long-term commitment may go missing or goes missing and the result may be a short-term quest for quantity and superficial appearance so my question is working towards more long-term objectives of real estate I put it to everyone here thank you great thank you I wonder if Patrice you might have some comments in response I would just I'm so thankful to Darius for expanding just my sort of meager exploration of this of those key things that we are challenged with today and I hope that there's thank you I am already making ideas for projects to continue that myself so thank you very very much and that's the whole point of opening up this doing the open commander of what real estate development is about to say where can we go from here thank you could I ask a question Derek why do you think you make a point about real estate development in western cities to be in a sense underdeveloped in terms of the institutions or organizations that would have otherwise cornered the market say for example in power generation or even retail for that matter why do you think the property market or indeed the building market is so fractured and fragmented why so in general or in relation to other geographies other than western Europe why don't you start with respect to western Europe and indeed you know you sort of making the contrast between whole industries in the UK being incredibly sort of there are dominant firms why are there dominant firms in property in real estate markets in the UK so first what I wanted to say is that where some of my comments come from so I've been starting financial centers for a long time not particularly focusing on real estate development and something I confess and after reading this book I want to correct and and I'm myself an example how you can easily just kind of make assumptions about the origins of a lot of these financial innovations and developments in western Europe sometimes going back to Italy sometimes going back to classical civilizations but then for all kinds of reasons I've been in recent years I've been pushed to read more on China from a similar perspective on India on Mesopotamia and so on and so forth and the role of the middle is actually in the birth of capitalism itself and how a lot of ideas that influenced Renaissance Italy for example actually came from the fact that also Venice was the terminus of the Silk Road network so I would just say that I cannot imagine these big cities in other civilizations developing so successfully for centuries and sometimes millennia without some good solutions to the questions that we're asking now in the context of 17th century London or even 21st century western Europe or America I sense there's a huge potential there to learn and geographers should lead the charge on it okay so Richard you're currently occupying an apartment in a building that is otherwise probably fairly empty according to Dharik what is it about Miami you're a recent joiner of Miami is it actually this coexistence of the occupied and the unoccupied in these buildings that sort of makes the economy work well um you know partly I live in Toronto where it gets extraordinarily cold in the winter yeah we wanted a little bit of a getaway where things were a little bit warmer and you could have a reprieve um you know I want to ask Therese I think he's very spot on on this I want to make just one general comment and ask one question first of all I think this globalization of real estate is happening in real time and I think you pointed out innovation property tech but the the aggregation happening with even the big four the Goldman Sachs is that there is a move now for the black stones the black rocks the Brookfields to acquire lots of smaller players and it it's incredible black was it black stone bought AIG's affordable housing portfolio for nine billion dollars a couple of months ago this is happening in real time and I think you're going to see an industry that is more rationalized and where these players want to get more involved but and you can comment on that but I have a more specific question along the lines of Gordon's question I think real estate is really a two hats a white hat blackout problem more so than most other industries I think there are organizations you mentioned Brookfield I think they're large organizations and major many of the major pension funds that Gordon speak about that really want positive impact ESG sustainability affordable housing but I think there's a horrific dark side and this is what Gordon was getting at in real estate where is a massive vehicle for money laundering and for all of those you have the Donald Trump's and and I would just like you to reflect on this issue of not just the bark buildings but but the real estate's role in laundering money and I think we need that's an area of capitalism that has been very not studied empirically or theoretically just like you to reflect in a minute on that thank you Richard and you have one minute one minute is great it's all you need I think it does seem to me like I've been studying the financial business professional services complex for a long time and after reading this book I am I'm kind of the book confirms my suspicion that real estate is the most opaque of all of industries I absolutely agree and the globalization also hugely happens now through the real estate investment trust owned by institutional investors and owning the shopping malls and much else globally I think it's yeah it's happening at the staggering pace that has to be that has to be studied okay thank you very much thank you Derek I'm looking for Sam and I wondered if Sam no no Janelle sorry yes right Janelle okay right I'm looking at a different schedule all together but anyway sorry Janelle wonderful I'll go ahead and jump right in so Patrice thank you so much it was such a privilege to read the book and to contribute to the symposium I think as the other commentators have said it really is a remarkable body of work and for me I read although the focus is largely on 16th and 17th century London I was really fascinated by the earlier origins or Patrice begins with the kind of classical orientation of land privatization and property and then the moral imperative that's directed through those classical learnings I was very deeply impressed by the scope of covering 2000 years of history in some sense and then the meticulous detail of the developers of which Patrice wrote so my commentary is going to focus on these origins and then also thinking about pathways of development for the future so let me see how do I move my screen to go so Patrice really organized the book around three questions I think Manuel already noted this in the conclusion and for me this was a way to really read and organize and understand the text and so I also want my commentary to reflect this structure so how and why did such a model of production emerge when it did and become the dominant mode of urban growth why does it take the form it does and what exactly is that form and why is this form of economic production so poorly regarded and charged with responsibilities for so many urban ills where might improvements be made so for the first question of how this is where Patrice delves into the philosophy of Plato and Aristotle and I think this is kind of fascinating because it's actually if you go deeper than the neoclassical political economists this is really where it begins at least for the western world which is this wonderful quote the better system is that under which property is privately owned but is put to common use a kind of public imperative in the writings of Aristotle that privatization is the way to maximize the value of land but it should always have this leaner this direction of facilitating common use and to that I also I think Manuel already comment on this and I went back to the original thinking on use and exchange value in Aristotle's writing on the politics that he identified two uses and didn't exactly identify these as use and exchange but said one is the proper and the other is the improper or secondary use of anything and then went on to say that exchange is in fact unnatural a mode by which men gain in the most hated sort of way and with the greatest reason usury which is gain for money for money's sake for money was not intended to be used in exchange but instead to be put to sort of what he called the management of households and so I think in this idea of the use value in exchange there's two really important principles to pick up for understanding the privatization of land one is that there was originally this moral imperative of public good and throughout the book Patrice explores that tension how do you generate a range of different utilities for the use of real estate but with that always the public amenity and I think in that moral imperative Aristotle recognizes that privatization tends towards excess and exclusively private benefit so I'll come back to this idea in a moment the second is that in privatization the land is only realized in its productive use and to this I think is where Aristotle brings the idea of there's the proper and the improperly or secondary use of it this idea that to really fully make benefit of the land you have to understand and capitalize on its productive use and so again I'll come back to that principle but I think it's really important to Patrice's question of why maximizing the use of land here she drew from the Enlightenment philosophers Thomas Hobbes and John Locke and again leaned on what is the moral imperative land is high demand civic responsibilities there's a natural law embodied in a constitution of a civil power which provides for the governance of property rather than it's being administered through religious politics so there is a public responsibility and then with Locke this really interesting principle that first property not be wasted but rather through human labor it be used to create value and secondly that the quantum of property in an individual's possession should be limited so there would be enough as good equality remaining for others so in effect if an individual own land enclosed or fenced but did not cultivate it or make it productive Locke argued such land was still to be looked on as waste and might be the possession of any other I think this is absolutely a fascinating principle because you can see the positive moral intent in it that you allow private possession of land but always with the eye towards making it productive to public benefit and problematic because it is also the logic if we look across the colonial world through which indigenous and other native inhabitants were dispossessed of their land if they weren't making so-called productive use of it or putting the land to its productive use there was this inherent argument that it could be better used by the white civilization moving in to occupy the land the other piece of it that I think is also really fascinating to consider is that the conceptualization of land value is in its nature extractive it sees only the value or the benefit of exchange value the private benefit of the land realized through its productive use and fails to recognize the social cost or the indirect cost that Manuel Albers addressed so in my own work I sort of say well wait a second if we look at use and exchange value we're really only identifying a spatial distinction to this we also have to add the temporal distinction and to the questions of why or what is so unique or special about the developer I think it's absolutely this it's the capacity to extract tremendous future potential value of land and represent it in the present so if we add not just use and exchange a spatial distinction but a temporal distinction and think about value already realized versus value that is potential we have not just two types of value but at least four so use exchanged derived and external and a lot of my work on carbon markets has been about theorizing externalities and external external value but I think that for the relationships with land this distinction is also really important so if value is considered across not only its spatial but also temporal there are these four types of value but also there's a recognition that we consider most forms of value as commensurate exchange but not all forms of value are equally capable of producing social benefit the ghost apartments in Miami are terrific example of this there is a sort of speculative advantage of storing wealth in these places but then there's also a distinct difference in the capacity to provide housing for residents in the city that need it and then to this I would add a third point which is the long-term or sustainable value generation must be systematic and consider not just socioeconomic but also socio environmental systems in the assumption that land is a commodity there is this idea that the land is not a living thing development proceeds over or on top of or through what is considered to be a static environment and for a range of reasons that is incredibly problematic I thought Manuel Albers diagram from Fontunin showing the value of different utility of land was really instructive because you saw at the end of it the thing of least value was the old growth forest and there's an incredible kind of arrogance or human perspective that something that takes 500 or more years an ecosystem of 500 or more years of growth is worth less than the agricultural product of a season and so in that I think you see that there's a sort of missed opportunity to understand and fully realize the capacity of a range of values for a civilization so so moving on from this I think the third question that Patrice raised about the problem why is development so problematic she identifies from Covent Garden and the development of a range of the 16th and 17th English developers a very concrete practical model that is established a four step model of land development first obtain control of the land to calculate value based on possible uses three determine its highest and best economic use and for achieve any necessary legal changes of use to maximize its potential and then goes on to say that this model with little alteration adapts into the present day and then perpetuates not only across the Anglo-Saxon world but also with slight modification to other worlds and I agree with Derek's critique there is obviously there is other influence from other older models and practices of land development but I think where this is really powerful and potent is in its capacity to generate the logic of settler colonialism is something we absolutely see in the North American context it is the logic that underwrites the history of settler colonialism and land dispossession of millions of indigenous indigenous people not only in the West but in other colonial states around the world with it there is also the challenge of what Patrice identifies as the Faustian bargain the developer can never stop developing and so absent ecosystem considerations relentless development leads to a situation whereby virtually every measure the Earth's biosphere is in decline I see climate change is symptomatic of that condition not as an underlying cause and finally this third issue the idea that land is a commodity this sort of unquestion assumption it is a thing to be possessed here I think it's interesting to consider the alternate logics and for most indigenous cultures land is not a thing it is relational it's not an object of control but rather an integral entity in relation to the community that inhabits it and with this there's a principle of connectivity the idea everything in the universe is connected the spirit world is represented in this diagram is connected to the moral world the sea is connected to the land the sky is connected to the ground connectivity expresses the ontological foundations of indigenous society the connections that people have to their communities their traditional territories and the ecosystems and so in this idea that's not an argument that we can we can undo 300 years of history and go back to where we began but it is this idea that we need to return to the principle that land exists in reciprocity it is a living system it provides the resources a community needs but only if they carefully steward and renew the land alright and so I think you know it's difficult again to conceptualize this in the context of modern capitalism of cities that are already established where it becomes more promising is when confronting climate change in the reality that 80% of human population lives on the coast and that in the next century these cities these civil settlements will have to be radically transformed these are a few images from the recent storm Hurricane Ida that hit New York and showcased the absolute vulnerability of the infrastructure because again it was built with this assumption it exists over a static environment the land on which it resides the natural environment is a thing that sits in opposition rather than in relation I wanted to briefly in the commentary I talked through the Boston Seaport District case because I think this is emblematic of so many of the principles that Patrice describes in her book you see here a sign it's just for the last 20 years and a place of incredible productivity and development but it's envisioning what the developer always envisions for the city you have these beautiful green spaces you see kind of the ideal of the public domain that's never actually fully realized in the city so the Boston Seaport this is an aerial view of the city it's a 1000 acre low-lying actually built on backfield land post-industrial area just east of downtown Boston it's a site that's been built on landfill historically it was used for fishing piers and then for range of industrial activities and by the 1990s was quite dilapidated so as the city cleaned up the harbor built infrastructure to connect this the transit and roadways to connect this region developers began to realize there could be potential use so a tremendous amount billions of dollars from the 1990s of both private and public investment has been poured into the seaport district originally this was planned as a mixed use neighborhood for families with parks and other public amenities in 2010 it was re-christianed is the innovation district because again here is the highest extractive value of the property so the intrinsic benefits it was meant to create construction jobs new tax revenue it was also meant to have a housing linkage job training linkage on-site affordable housing and to connect to the regions on surrounding it and then there were a range of negotiated public benefits in the plan including a tremendous amount of public open space of civic and cultural buildings public access and recreation of a diverse neighborhood and water activation and transportation and over time you see how this beautiful vision of what the seaport could be evolves into something that's quickly adapted and acquired by elite tech and life sciences businesses, luxury offices, apartments and restaurants it now has the highest household income on all of Boston it's predominantly white 89% white and it's a good example of investigating longstanding issues in the city of segregation so here you see one of the two-bedroom luxury flats that's recently sold for nearly $2 million and then I think the other really important consideration is what does this mean for the future the seaport is being built on land that under climate projections will be underwater by end of century and developers have been aware of this and assume two things one they will acquire the return on their investment long before this problem becomes a reality so it's not really their problem and in any case it is a challenge that will be addressed in some way by government intervention so there's a range of different ideas or plans about what all of what sea level rise means for the harbor here's a vision of this massive harbor wall system including an outer wall a harbor island wall and then an inner city wall that could be built and a recent study by the Kirshen lab and UMass Boston has demonstrated that across all parameters environmental, economic, cultural this piece of infrastructure is unviable so in fact there isn't really a plan to confront sea level rise and to deal with this challenge so in some way looking at what Darrington wrote and thinking about the takeaways for me I think there's a remarkable history and a remarkable set of principles to study and understand but in thinking about the origins of development there's also this realization that the development of past centuries will not adequately confront the challenges of the next century so we need more considered plans not just for the city of Boston but for other cities that will face the same challenges for thinking about the relationship between the built environment and its natural ecosystems for ways of addressing systemic inequities and vulnerabilities and then limiting development high risk areas so that we accept plan sea level rise rather than trying to build infrastructure that is unlikely to be viable in the long term alright so I'll leave it at that and open it up to questions thank you so much it was really a pleasure to read this work Janelle thank you very much for your comments insightful as usual and I might encourage those who get a chance to read Janelle's commentary about the case study about Boston was very I thought very revealing we've got dare I say it's we have a break as I understand it am I right team yes I wondered if other speakers might have comments or thoughts in reaction to Janelle before I pass it over to Patrice silence is gone Patrice over to you right well I'll kick off I'm sure hopefully even some folks if you have questions just please post them on the Q&A we would love to you know not have you take advantage of this opportunity to us something directly of Janelle's wonderful work but very I very much appreciate your your ability to utilize the what I've revealed in terms of motivations of land use and exchange and so on what we have done as you say is arrogantly take that as being a right to any land that we land on or that we arrive on this is going back to the indigenous aspect and in fact you know I was raised by another who was a historian of Aboriginal art and she always said to us you know they do not own their land they do not believe that anyone should own their land they themselves the Aboriginal people who are Indigenous to Australia and in fact often nomadic they just see themselves as responsible for the stewardship in return for the livelihood that it provides no one ever would dare to have a right to own it so very interesting and of course we've all ignored that at great tragedy but thank you for bringing that up I know she will be very touched to hear your affirmation of that Richard Florida Thank you Janelle and again for me just incredibly instructive and I learned a ton I have a really basic almost dumb question for you which I think you would be able to answer better than just about anyone else I've heard speak a couple of times we've touched upon the growth of real estate interest both from the development community but also from the investor community in things we would lump is ESG in fact invest in or sustainable development goals and I myself have been asked by real estate developers to comment on that help them formulate plans I see that Mark Carney the former governor of the bank of England is now a vice president at Brookfield by the way a Toronto based company that operates in all these major markets he's joined them as a vice president I think either a vice chairman in charge of impact or sustainability I think of all of this is this for real is this partly for real and partly you know people trying to bolster their image so called greenwashing if it's not for real can it be a trend for the good in other words is it something that governments or other regulatory bodies whether national or local or global can enforce or investors is there something is there a there there or not much at all I think it's a fantastic question Richard and I think maybe it's all of those things is it what is the motivation I do think for work that I did several years ago documenting systems of mitigation around the world and how markets emissions markets are established I interviewed or financiers and developers and regulators and you know often middle-aged white male professional service operators in different capacities and it was fascinating because it was almost as though they had had this sort of you know religious or spiritual journey that had brought them into the ESG sector into this idea of green finance where they had a very productive career and traditional finance and then realized they had children or grandchildren and wanted realize they wanted to leave something else and so I think that that motivation or this realization that there is a tremendous problem and a need to generate both social and environmental wealth or benefit is real in terms of the mechanisms again like this is where and I apologize I probably didn't felt rushed for time so fully explain this but I think one of the challenges is this assumption that everything is commensurate in exchange and particularly the idea of what I call derivative value derived value this idea that you can extract potential value options swaps derivatives so much of finance and make it present make it realized in present terms and so what I'm finding with carbon markets and with other forms of externalities or external finance it's this idea that again the path towards achieving green objectives is to creating a price system creating exchange value for those environmental parameters and I think that thoroughly misunderstands the nature of use and exchange value and external value is something sustained through use not through exchange so it's less about I think a sort of malicious intent or malicious motivation and just a failure of modern economists or even historical orthodox classical economists to properly theorize the nature of value and to really consider the dynamics of spatial and temporal connotation beautifully said agree 100% can I just catch up on that a little bit I've been very interested in this question about why ESG has got out ahead of public regulators in the US through the previous administration for example they wanted to outlaw ESG they wanted to stop pension funds using ESG and there was a somewhat of a constituency in the finance industry in Wall Street to do that but it wasn't very loud and in fact actually when you look at who's peddling ESG it's often finance companies looking for an edge in a market which they think is evolving and growing and we know everyone wants to be in a growth market a declining market is not great likewise carbon and likewise power stations systems of energy generation that rely on fossil fuel you know I would have thought COP26 was the death now for fossil fuel energy generation and it's not that anything was decided but it was the direction of travel and the direction of travel now is of course we'd better get out before we get caught if you like with our hands in the till if you like on carbon so there's a sort of momentum that is I think it's taken the politicians by surprise I'm shocked actually in the UK that Boris Johnson is interested in the environment you know there's no evidence that he is but it's that sort of sense that the politicians are on the back foot finance industry is on the front foot but they are doing it because they don't want to be caught short that is holding at the same time they want a market edge looking forward are they genuinely ESG you know heart on heart only when they put their head on the pillow and think I made a lot of money today that's a bit cynical yeah cynical though it absolutely is business interest and this is where the short termism is so critical because if 20 years ago you could have known Google is the great company Tesla is the you could have this foresight to know what's the next innovation you would absolutely invest there if you could see that in the future we know renewable and we know there's going to be an energy transformation you know we absolutely if we think into the 21st century we're not going to be producing on coal and petroleum and yet there is this latent inability to capture that advantage because there's the incapacity to think long term and to realize those gains across the long term that the short term present always overrides those considerations and so I think the business community is starting to move on mitigation they are realizing the advantages of energy transformation for mitigation but they also don't want to be caught holding an asset that's going to bleed on them so there's that sort of sense of gee you know if I don't move now when I'm am I going to move and do I want to be late or do I want to be early where's the payoff if you like right and and to extract as much value out of the conventional energy economy is they can't move forward over yeah what I think what everybody is missing is the rate of adaptation even at the cop this this sort of you know there's an undertone or an undercurrent among developing countries among the youth non-conventional non-state actors but I like I doing work with tribes in Louisiana even over the last three years I and I've studied as you know Gordon for 20 years from an academic standpoint climate change absolutely astounded visiting Louisiana and seeing what is happening to these communities on the ground we are in the present losing that coastline it's absolutely devastated by each subsequent year of storms I had destroyed thousands of communities and we're not seeing that because it wasn't you know one big flashy city it is a reality that we're going to be confronting around the world everyone is confronting and I think you know Manuel alluded to this in his talk private that the value of real estate doesn't exist in a bubble it is subject not only on its neighbors and its external conditions but it's on it's based on its socio-political cultural stability climate change is going to undermine that for everyone and so while we have this opportunity to be thinking about adaptation and development we absolutely need to be doing that now before we have mass migration of millions of people cities around the world destroyed I know that sounds alarmist but I think it's just being realistic about what is coming okay now thank you very much it's been fantastic hold on sorry we do have one question do we think we could just have Harpreet Gill asks Janelle tax revenues were labeled as you labeled them as intrinsic you know how did the question is the curious Harpreet is curious about how that choice was made obviously between you know intrinsic or extrinsic yeah and I'm apologies I don't I'm not sure if internal or external maybe was the question is not seeing tax revenues as external so apologies I'm not sure I fully I'm catching the reference so for maybe for the sake of time I'll give that question some consideration and can add something to the chat so thank you very much okay Patrice it is 3.30 in the afternoon my time it is 10.30 in the morning your time yes we have a break now until 11 a.m. your time mm-hmm for a clock my time I keep saying these things just to remind me so shall we get together again five minutes before start that would be excellent if folks don't mind we would then have our fabulous Sam Chandran who is the Dean of the School of sorry the New York University Shack Institute of real estate and also a very renowned speaker globally about the pandemic and its aspects or its impact on real estate and so on so we shall look forward to seeing Sam then and seeing you all back at 11 eastern standard time or whatever that means wherever you are thank you there you are there you are good good thank you thank you all right well you know in a minute Sam's there I'll just give him an up a heads up good do you want to introduce him or do you want to introduce Sam, Richard and Rachel is that valuable or not well I think look I'll just introduce Sam hi Sam there he is hi I've known him we share real estate yes we do do you? real estate exactly are you in the same building not quite not for Patrice are you in your office today yes yes but we are sympathetic of our graduate students who are not who are on strike so that's why we're not doing it in person so anyway we're not striking against sorry the university's harsh treatment all right yes yes Patrice and I are actually the only two that are probably on Columbia's campus right now so I don't know if you saw on my note that actually I'm in a faculty apartment on campus so I'm just behind the library very good wonderful well you know it's very pretty here so yeah so let's get to it I would like very much welcome back folks and thank you and I would like to introduce my very well known colleague the Larry and Clara Silverstein professor of real estate and the academic dean at the New York University Shack Institute of Real Estate Sam welcome. Thank you so much I'm delighted to be here very flattered by the invitation to join you and it was such a thrill for me to read the book the thing I'd start by saying is that I because I imagine this is something on the minds of a lot of people here who are both presenting and tuning in you know for me Patrice it's been a very long time since I've encountered a book particularly one is substantial as this that I would even consider you know assigning to my students to read but this is one of those lucky times where you know every page I turned I couldn't help but think to myself how well that particular chapter or that particular passage or graphic would fit into something I'm doing next semester and I very self-servingly and hopeful that either you or a group of us perhaps will develop some teaching materials that can go along with the book to facilitate our being able to leverage it with our students I think Larry said at the outset this morning that it sort of has that rare combination of being so evidently readable but also so scholarly and really filling an incredible gap that has persisted for so long in our historical understanding and it really is one of those things where absent you know this book certainly I learned so much and by the way I've been taking notes all morning the but a lot of this I think absent the book would be sort of lost to you know the next generation of real estate and urban students are very grateful for again I think what folks have described as a labor of love and creating this and it wasn't lost on me that you've got sort of Mark Holiday's New Tower one Vandy right there on the cover of the other thing that I'd like to comment on briefly because the conversations that we've already had this morning have been so interesting to tune into that just before the break Gordon and Janelle and Richard where we're chatting a little bit about ESG and for folks who maybe are in other parts of the world and not as familiar with real estate landscape and sort of collection of players here in New York between Patrice's program and mine we are board members and benefactors probably own almost all of the class A properties in town so we have this handle on the thought process and the thinking of a lot of people that have fallen sort of the institutional segment of the market certainly there are there's an incredible need for and a lot of attention to segments of the market that are not as institutional outside of the REIT space outside of securitization of debt the areas related to personal housing which only more recently has taken on more institutional flavor by virtue of many of these conversations I think one of the things that really comes to mind for me is that sort of reflection of what folks were describing just before the break real estate being a little bit ahead certainly in the United States of where we see policy but looking at the examples of other countries I would speculate that I'm not a political scientist by any stretch but I would speculate part of that has to do with the current state of the political dialogue in the United States and are being in a place now where whether you agree with the policy priorities or not issues related to climate change the environment equity in cities are clearly higher priorities and they might have been two or three years ago and again not casting aspersions on folks who might think that the current environment is worse or better than where we were but certainly we've been in a place where building a national consensus around issues related to ESG is very very difficult and there's been a geographic element to it where in some parts of the country there has been a different sensibility around this now Richard describing Toronto was very very cold I would remind him that he is quite close to the US border and that there's an entire country north of him that's even colder but being a Canadian myself I will pitch in for him because Toronto is quite livable but I think when we're looking at the issues that Jenelle and Gordon were describing I do agree that while on an individual basis it may be the case that there are folks within the real estate industry that Patrice and I and others know that may have very strong feelings about the importance of prioritizing issues related to ESG when we look at the way business decisions and investment decisions are being made and I think Jenelle described it as a business imperative and a business decision for how people are pursuing things it reminds me of LEED certification perhaps 10 years ago where it wasn't necessarily the case that the investors whether they be domestic or non-US bringing capital to the United States were prioritizing the importance of green building at that point in time but certainly we're thinking given their longer investment time horizons around the liquidity of those assets and whether or not there would be a richer deeper more liquid market for assets that were LEED certified simply because of the signaling mechanism completely independent of the energy efficiencies that it might represent so I think there is an element of this that is market responsive what do folks who are developing think that or feel that tenants want what do their investors want certainly folks for whom some of their capital is coming from pension funds or from outside the United States are having to be mindful of those issues as well government contracts and see when to play a role over here but I think a lot of it is market responsiveness factoring in the longer time horizon and there are people having to think ahead if I own this asset for 10, 15, 20 years what is my exit what is the attractiveness of the asset on an operating basis to tenants maybe not today but down the road that being said I think we also see that there are a range of interpretations around what constitutes ESG and just how far folks are willing to go and so that continues to present an issue for us one of the things that places like Hudson Yards one Vanderbilt, Scott Reckler's new building at Grand Central come to mind World Trade Center properties downtown certainly we do see some unevenness in the burden of meeting those goals where relatively newer properties are going to be in a privileged position in meetings or ESG goals just by design and whether it be sort of energy efficiency spaces that are conducive to the health and well-being of people that are working in those spaces the ability to provide green spaces and terraces in a lot of these buildings who haven't visited one Vanderbilt you don't want to miss the opportunity it's an extraordinary asset but it does raise the question of the most visible participants in the market are going to be in a very different situation face a very different set of constraints in meeting those goals as compared to the investor that owns or is left holding the B or C asset the office building that was built in the pre-war environment and I think we're far enough along there that I have to clarify for my students when I say pre-war I mean the Second World War the the so all of this becomes really important for us I'm really interested in hearing you say about it I'm going to share a brief deck I didn't want to overlap with some of the commentary from earlier this morning and so I'm focusing my comments on a slightly different aspect of the discussion in the book and it dovetails with an area of great interest for me in the realm of public health and this was really instructive to the text and I've included a couple of pulled out a couple of examples here from Patrice's writing it was well known that the use of coal for domestic purposes brought small conditions for many months of the year and encouraged London's wealthier inhabitants to move westwards there are a range of a number of different sort of references to that interaction between health and well-being and perhaps in the early 17th century not cast in the frame of or through the lens of overall public health as much as individual households optimization of their behaviors but the interaction between the built environment and outcomes for both individuals and for communities has been a feature of the real estate markets going right back in some cases through I pulled some quotes from the preface of the text that go back to Roman times and I think that we are at a point in the market today and in part it has been motivated by the more robust conversation around ESG part of it relates to our response to the pandemic and our thinking about how we might need to do things differently the clear observation of disparities and outcomes for households in some cases that are at a minimum correlated with where they live and their living conditions how they work but also differences emerging across sort of systemically important cities around the world depending upon how they are built how people access the transportation network and it is underappreciated that there is a deep connection between public health and the built environment and again it was very instructive for me to read the text and to see references to this interaction going back more than 2,000 years and then interviewing the later parts of the text to the 16th and 17th century another two quick examples health governance of the area was outside the jurisdiction of the city and relied totally on overburdened parish officers again sort of a key thing for us here when we are thinking in a post-pandemic environment around how it is that private real estate investment and development decision making is shaped by or interacts with issues around the externalities associated with private development or the need for collaboration and partnership with public entities with Hudson Yards is an example of this someone mentions the infrastructure around Hudson Yards without the seven line extension for those who are not as familiar with New York a lack of subway access historically on the far west side in the neighborhood of Hudson Yards so a critical element of this being through the public expansion of the subway system if you come into Grand Central you could immediately hop on the seven train and now the seven train will take you right to the heart of Hudson Yards arguably Hudson Yards would not be viable in the absence of that investment having been made and certainly sort of speaks to the locational advantage of building like one Vanderbilt where you don't need to hop on the seven train you can just exit from Grand Central and you're right there but this issue around sort of where does the jurisdiction and responsibility lie for thinking about how the interaction of the built environment in public health are ultimately driving outcomes for households in an environment that is more attuned to ESG and the importance of equity in outcomes in an urban setting where we see a disproportionate number of income constrained families becomes I think critically important for us because this question 400 years later has not been entirely resolved and you know we're at a place now where I think the absence of coordination between public health authorities and private real estate development firms is still sort of a stark reality for us. Finally then they wish to avoid the unhealthy crowded and dirty conditions of the city and to locate in the salubrious emerging suburbs to the west I think what this captures for me also is that while we often will think of that interaction between public health and development as being sort of you know conditions in the environment in the natural environment or in the urban environment impacting people's location preferences and decisions about where to live that there's significant endogeneity here and what we know is that it's not only that okay you know there's that example of coal you know in air quality you know three is so prescient because you can go to the BBC's website today and read about exactly that same set of conditions in New Delhi India the but I think what we see here is that while individuals may and households may make decisions about where to locate based on the quality of the environment around them what we also see is that the nature of the investments we make in the environment is driving out outcomes as well now why does this become important for us and I wanted to give this one example it's a little bit further along in 1854 but the origins of our thinking about sort of that formal discipline within public health of epidemiology you know we're also you know just around the corner from you know from a lot of what you know sort of a lot of the projects and history that Patrice is describing so the gentleman who was considered sort of the father or the originator field epidemiology John Snow you know in 1854 was conducting field research during sort of a cholera epidemic in London and in the Golden Square neighborhood was actually looking quite specifically you know at this one neighborhood he mapped out to review each one of these dots if you're able to see them clearly enough represents sort of a household with incidents of cholera and was able to see that there was a clear density pattern here and the density of cholera increased in proximity to water pump a on Broad Street in London and I think again what this highlights for us is that you know there are going to be associations I think you're one of the big things that I know Richard and others have written about and discussed over the course of the pandemic is that we should not make the mistake of associating density with severity of epidemics or infectious disease there are other intermediate causal drivers so density for all of the things that we know are wonderful about you know scale and agglomeration density ultimately also leads to you know some other feature of the built environment that is a facilitator of you know disease or negative outcomes but what that means for us and this is for me sort of a conceptually absolutely critical point density at this point in our history is you're perceived very very negatively I think sort of that's one of the outcomes of the pandemic but in helping people to think about how the connection between density and health outcomes is intermediated by other factors or features of the built environment like are we keeping that pump filter or clean are we ensuring that there isn't sort of garbage being collected nearby these things become very very important for us in thinking about how we can mitigate you know some of the risks associated with density and ultimately arrive in a place where some of that negative stereotyping around dense urban areas is better understood now this does become I think important for us and it's a real takeaway for me from Patrice's work because we're at a period in time where after 100 years of seeing improvements in outcomes for how it is that people fare from a health perspective in the urban environment we now find ourselves in a situation where probably over the last I'd say 20 years we've seen something of a reversal there part of that reversal is related to what we refer to as zoonoses and so about 60% of all emergent infectious diseases that we will be able to catalog our animal in origin and what we're going to see here and again sort of it's that endogeneity in public health outcomes impacting the built environment with the built environment impacting public health outcomes what we're going to see here is that much of the reason why we have seen an increase in the rate or frequency of emergent respiratory diseases SARS, MERS COVID is going to be related to issues of urban development and development overall I think Gordon I just have a couple of minutes left here if that's right you could see me creeping up on you yeah yeah yeah so in short I'll simply say there's a considerable body of research work that's been done to identify how it is that changes in the way that we are developing the intensity of development and activity when it is not tempered by an appreciation for that intermediation between density and disease outcomes is allowing for those disease outcomes to increase in frequency and so identifying what that intermediation is so that we can mitigate it becomes critically important and it was just so instructive for me to see in Patrice's book references to this going back for those of us briefly who may be thinking of the critical conditions or the necessary conditions for the emergence of a new zoonotic disease being something that happens very far away you can see here on this map certainly the critical the necessary conditions unsurprisingly South Asia Asia Pacific and also see here is that those necessary conditions exist in a very concentrated area in the northeast of the United States along through the northeast corridor and in parts of Europe as well so there's something that we need to be mindful of the last piece of this is that while coming out of the pandemic we are acutely focused on the need for pandemic response and to be better prepared for the next time something like this as far as the relationship with the built environment goes what we also know is that the United States and many other advanced economies over the last hundred years have experienced what we refer to as an epidemiological transition and by that I mean that we've moved from a scenario where most people when they die die of some kind of infectious disease if you look at this chart and I don't know how clearly you're able to see it the big killers are going to be diphtheria, gastrointestinal infections, tuberculosis, pneumonia we didn't live long enough or have a good enough control over many of these diseases prior to the introduction of antibiotics to actually die of the things that kill us now and so while mortality rates have declined overall what we also see is that infectious diseases while the idea of Ebola or COVID might frighten us and there's a clear sense that there's an increasing frequency ultimately the things that are killing us are cancer and heart disease and diabetes and this becomes again another critically important part of our thinking about the built environment what this chart shows in my closing one is that this is a map of percentage of the population in the United States that lives within half a mile of a local state or national park what we do know from the research is that proximity when we're thinking about the built environment proximity to well developed usable public spaces as was reinforced by the pandemic is actually quite critical to the public health outcomes that we observe and so we're thinking very holistically about this relationship as part of the built environment the need for public spaces access to transportation good quality public schools how it is that we might think about directing some of that the largest of the Build Back Better Act becomes a critically important piece of this conversation and one of my key and many takeaways from built up is that this has been an issue that has remained underappreciated in our thinking about the built environment going back to the Roman times so Patrice I think we all owe you a great debt of gratitude for your work and again I greatly appreciate the opportunity to join you today great thank you very much Sam I'm conscious that my fellow participants might want to have a question or Patrice you might want to have a brief response we've got thank you Sam the critical analysis is perfect and Covent Garden of course renowned for its public open space and by a private owner and continues to be but Richard Florida Sam nicely done and great to see you I guess my question to you is given your role one about public health and the contemporary scene why do you think that we have what I would call an ironic if not counterintuitive if not an insane thing happening in the United States principally I don't think it's happening in France I don't think it's happening in England I don't think it's happening in Canada where the places that have done the best at protecting themselves from this virus New York San Francisco that have had the most stringent public health measures are the places that either rightly or wrongly are speculated to be seeing the greatest out migration to be crazy sorry who was it what's his name Marty Lipsett always said the best thing you can do by moving to Canada as American it's come to understand the country you could say the Americans are uniquely insane or you can say that Americans put an incredible value on Liberty and I'm not just talking about Trump Trump or populous that Americans put an incredible value I'm not saying this is right put an incredible value on Liberty and don't want anyone telling them anything else the places that have done probably the most to protect their people with regard to public health, have seen arguably large outmigrations and those outmigrations have gone to the places that have done the worst, whether that be Florida, Miami, you know, Fort Lauderdale, Palm Beach, Texas, Houston, Dallas. I just wondered if you had a reaction to that or rightly or wrongly. Absolutely. It's not just the pandemic when we talk about Serbia people migrating to some of the places that have performed quite poorly. I think to Jenelle's point earlier, folks are also migrating to some of the places that are the greatest risk for climate change. And so while Serbia we profess to care deeply about ESG, you know, for both firms and individual households, we don't always see that concern and that commitment reflected in people's location preferences and decisions. I would suggest that there's two things. One, a broad misperception about the role and contribution of density, where we don't see the intermediate factors. The in the United States and part of that reflects, you know, people's reading of people's reading of of, you know, New York having been hit hardest first, and just simply assuming that that must be a function of density. The other to round it out is that I think what the pandemic has done and this is unrelated to the disease issues and the public health issues is shown for many people that they have the ability to exercise some kind of geographic autonomy at work. And so the issue that is vexing New York and Boston and some others is not really density in the pandemic in some of these cases, it's that we are fiscally inefficient. In terms of what the, you know, so the contributors to the cost of being located in these high and long duration locations, whether it be local fiscal policy, the taxes that are being levy, issues around the quality of life and quality of infrastructure. I'm done. It's a tough place to live. Thanks, Gordon. Hi, my word. Thanks very much. It really a two to four Sam, a two to four. So it's really impressive. Now Jerry's got his hand up, but I'm afraid Jerry. Oh, no, please, please let him Jerry, please jump in. Rich Rick, Rick Paz is here. Hi, Rick. Do you mind a minute or so? Well, just a minute. I can do it in one minute. Yeah, come on, Jerry. Go for it. The comments one on Richard's comment about people moving out of San Francisco and New York. For San Francisco, for example, they didn't move out of the Bay Area, they just moved to cheaper apartments further out because they could, they were working from home. I remember that it was they wanted freedom rather than lower rents for the year that they were out. And second comment on the map, which I thought was really significant about open spaces relative. I think one needs to dig down a little deeper. So for example in Los Angeles, you have high proximity to low to open spaces, lots of open spaces in the mountains have run through the city. There's no transportation from the lower income neighborhoods to those open spaces. So they could be 100 miles away as opposed to the 10 miles that they are. I did that. Right, Gordon. I look, you know, beautiful. You've, you know, we, we like. Yep. Totally agree. I think what we see is that in a lot of cases, the migration is just a little bit further out if you live in New York. You know, in maximizing your utility function, you need to be close to work because you know, sort of it's, it's costly in terms of time and patients and sanity to be able to have to commute, you know, a lot in New York City. But I think what we see is that with people expecting that, you know, I'm going to go into the office three days a week, two and a half. The geographic radius over which they can optimize their location preferences just wider and so they're maybe outside the core. Okay, to someone who follows Zillow and house prices outside of New York City through not through to the Connecticut border. So it's always house prices in big blocks. Beautiful houses go up through the pandemic. What we're seeing is them going down on the other side of the pandemic. Interesting moment. People are coming back to the city, Sam. Watch out for them. Okay. Thank you very much, Sam. Just super good. And let me pass over to Richard. Pisa. Pisa. Here. I'm being English, asking the obvious question. But anyway, so Richard, over to you. Oh, it's a pleasure to take part in this and I'm very grateful to Patrice for not only writing a very provocative and thoughtful book, but it's a very interesting conversation. And I know I've learned a lot and I hope others have as well. The current conversation actually tease up what I wanted to focus on, which has to do with is the pandemic causing a return to urban sprawl. Before I jump into this, let me just say that a few years ago, we did a small research design project on Covent Garden by for the owner, which is the big insurance company. And at the time, Covent Garden was actually starting to fall on hard times. The retail was really not in great shape. And they were bemoaning the fact that all the retail around Covent Garden was sort of low end tourist stuff. And so we were looking at design interventions to take advantage of the wonderful public space around Covent Garden with temporary facilities to really enhance programming, which I think just speaks to how as Patrice very so nicely notes how these critical center center city areas change over time and how they go up and down. But places like Covent Garden will always be very special and I think the perspective of the forces that cause them to go up or down. Patrice emphasizes in her book or I get to the heart of why all of us urbanologists love the study of cities. So with that brief preamble let me just jump into a brief presentation on some research that I'm doing right now. Let's see if sharing my screen will work here. So whoops. So, can people see my screen. All good. Thanks, Richard. All good. Okay, thank you. So it happens that urban sprawl has been a topic I've been writing about for a lot of my career and I was pleased to see with the change from in migration to out migration for major cities that I think this raises the question again. Are we seeing a fundamental shift in patterns of migration. And of course that has huge implications for the future of cities. So as you've noted there are many stories about people moving to the excerpts and to rural areas as brought about by people working from home. The need to commute into the office either not at all or looking forward one or two times a week. And the question is this really a fundamental shift in migration patterns, or is it a natural change as many millennials marry out of children move the suburbs for schools and raise their children. So, looking back on writings about urban sprawl. It's a very misused term in my view it's been a catch all time for everything that's bad about urban growth, including congestion blight monotonous urban development ecological destruction and so forth. There have been many strategies to try to control urban sprawl. One that I was personally involved in years ago was when Florida past concurrency legislation that required developers to only develop in those areas that had traffic intersections that were rated a B or C, whereas the D and F for the worst congestion, and Florida was very surprised to find that instead of pushing development back into the city, it tended to force development even further out, because the worst congestion was in the suburbs where and the city where development was occurring, and the way developers could get around this concurrency legislation fight intersections that were congestion was go out to the rural areas. And that actually had a very counter intuitive impact and often I think that's what happens with urban policies designed to control urban growth. So, when you read about sprawling cities today, Ewing and Hamidi point out that Charlotte is competing to be the next Atlanta, and being from Dallas Dallas is always vibe with Atlanta to see who can have the most urban sprawl. We've seen an urban Renaissance from 1990 to 2015. No one's written about this more than Richard Florida with this fantastic work on the creative class and who is it that has helped cities turn around. And I think there's a consensus that signs of inner city revitalization. We're appearing in the early 80s and began to grow in the 1990s. And by the early 2000s, especially with the growing growth of technology and life science firms wanting to move back to the cities, repurposing post industrial real estate, and the focus on ads and meds. We've really seen a rebirth of urban cores. Another explanation for the population influx is that these are the most desirable places for young college educated migrants who desire services like restaurants bars hair salons and similar places. In a recent study by Brombeck, looking at where growth was occurring in four cities. If you look at where growth was occurring in Atlanta in the upper left you can see. In the period from 2000 to 2010 Atlanta grew even far faster farther out from the city core, whereas Boston was actually grew. Well, it was quite flat. Philadelphia showed some uptick but comparing 1990 to 2000, the later decade. In Philadelphia you can see actually was greater close into the center city and flatter as you move farther out. And Portland, similarly, the very high growth in the 20 to 30 kilometers in the city was reduced in the early 2000s. And this is a little bit hard to read. But if you just look at the right hand corner of it what we see is that the most recent change of migration and this is after 2015. The places that were growing the fastest were suburbs followed by excerpts, followed by midsize metros growing less than. Well, actually not growing. We had a small metros. There was an uptick in excerpts, which were still not growing. There was more accurate migration and then migration. And at the bottom, we saw that major metro cores actually went down. Now this of course is before the pandemic effects. So if we look at monthly net out migration from in the last two years, there's been a huge uptick in monthly urban net urban out migration. And there's some articles just came out yesterday that we're pointing out that this net out migration was more caused by not the fact that more people were moving out but fewer people were moving back into the urban core. So is this a short term or long term change is it a return to urban sprawl. And I think that's what I find is a tension between technology and life science firms who are creating the millennials desire for 24 hour cities and other firms that are not so focused on on these areas that particularly cater to the to the millennials and the kinds of lifestyles they prefer. This brings you to the end of my prepared remarks. I happen to be teaching a class right now on ESG and I know that's been part of our conversation. I do think that ESG we're at a pivotal moment in development firms I think ESG is it's here to say while yes as was noted a little earlier there are some pandering to ESG by the financial firms are trying to get a leg up on raising money from other private equity funds and so forth. I think that the development industry which in the US is probably at least six years behind Europe and facing up to ESG demands and requirements but this is the freight train coming down the track and I think is going to fundamentally change how development well how developers deliver buildings. We're seeing this first I think in the office market and but it's coming to all all aspects of development and well while whereas right now there's more emphasis I think on the E on the environmental side of the equation that increasingly there's going to be a focus on the social and governance sides. So let me stop my share and see if I can we can get some dialogue going. Thank you very much Richard absolutely you know interestingly as the development of cities occurs we have this larger dynamic of you know into the center and away from the center and all sorts of reasons driving this. And I'm very you know I'm really not surprised that you're adding the ESG issues to this because they're absolutely integrated in how we go about that dynamic but thank you for that that was you know really really a wonderful parlay of what is what happened way back then. In terms of the sprawl in London from the west of the city from the city center west towards Westminster. And in fact then turned around to be a healthier more optimal space for people and so on. And then interestingly as we see today as you say areas come and go and once upon a time that square mile of London city was not in favor. In terms of location by by businesses and major major tenants. In fact Canary Wharf was built and developed primarily to offer a an alternative but what's happening now. Everyone's flooding back to that square mile of the city and those buildings are going up. So you know an extraordinary dynamic that keeps that keeps changing and which you explain very very nicely in that notion of sprawl and you know back and forth. So thank you. Gordon would you have a question. Yeah, I've got a couple of questions which I mean I get gained a lot from listening to you and I was really, you know a lot so the questions I'm going to ask really sort of eliciting. Comment on whether my presuppositions are correct or not. I've heard two comments recently about the US. Housing industry and they go this follows first. The housing industry used to be. Driven by the fact that people owned a lot of land and wanted to realize the value of land so they built houses on them and sold them. So in a sense, the argument there was that it wasn't really housing. It was the capitalization of the value of the land that they were trying to realize and that we got basically what we got in the American city by virtue of the land holdings of these developers. And so sort of housing was the byproduct of realizing the value of land. The second comment I've heard recently is an immense or accelerating concentration in the US housing development industry, such that there are more and more. Well, more and more of the housing each year is produced by fewer and fewer, but larger firms. So I wonder if you'd comment on those two comments that have been made to me recently. First, is it that actually in the past, the urban world that we got was the urban world that was, if you like, was the property that was built on and wasn't actually conceived. Other than realizing the property land. And then the question the second question is, is the industry consolidating around really big players and what's what do you think of the likely implications of that. These are two great questions. First, unlike England where I spent a lot of time since that's where I did my dissertation that there are very few cities where one has dominant players who have huge tracts of land. And I really don't think, well, yes, every landowner every farmer would like to someday monetize his property. I mean, it's well known why people start with houses at the urban fringe. That's what is in demand. And if you're trying to monetize your property. You just looking at where the demand is. And I've worked on everything from small subdivisions. My specialty is new towns and I guarantee if you if you have a 6000 acres or up to 20,000 acres and they're trying to develop that land that the great majority of the land is going to go into housing because that's where the demand is. Now, what what to me is very interesting is the best planned suburban and ex-urban places are ones that carefully they make room for the future infill of higher density housing and also create town centers and shopping nodes that become the places that are will be very exciting. I think you can look at your own new towns in England and and see, you know, some of the earliest are still largely residential so personally I don't see this as just a phenomenon of landowners who are trying to monetize their land and put houses there I think is more reflection of the market and supply and demand. So the issue of consolidation the housing industry, you have to remember that we start from one of the least concentrated industries across the whole spectrum. So there really aren't that many. Well, in the good old days I've seen the current numbers but I think it was the five largest players accounted for less than 5% of the homes built very very different from the car industry where the five largest players would be, you know, almost all the cars built. So yes, there is consolidation in the industry. And that I actually think on balance may be having a good impact at least on the quality of what gets built that firms larger firms are doing multiple subdivisions and homes and more I think are able to maintain standards factory development processes and just efficiencies of design and building and marketing and finance that overall lead to a better product. And it also in the battle between the cities and developers, where you have a very large developer, they will become much more the focus and much more balanced negotiation I think in in this developer paying for and providing more urban services than where you don't have consolidation with small individual developers like me, doing small subdivisions where we just look for land and, and, and we're not negotiating to offer any set of public goods beyond what we might be required to. Can I just ask one follow up question about housing dynamics in the US. Where do you place Zillow in this. Yes, I know in the media and all this kind of stuff but, but, but it is an intervention in sort of orchestrating demand and supply transparency and pricing. Visual imagery gives you some sense of what you get for your money. It's really good on placing in terms of location in relation to other places is Zillow just an extension of real estate dynamics or is it actually a game changer. I was chuckling because Zillow is most in the news because of the failure of their AI to accurately predict housing prices and the fact that they've lost a couple of billion dollars, I think in Phoenix. Which most of us academics who follow Zillow are not surprised because we think there's still an AI hasn't quite gotten the point of replacing all the factors that we humans are able to incorporate as we assess value. But Zillow is one of a number of firms that are on the forefront of of proctech. Well, the revolution and prop tech that is absolutely going to have huge impact on the real estate markets through transparency. Greater data easier interface between those companies and buyers and share knowledge of the market and so I think Zillow or I may be critical that often if you look at their values they're based on property taxes and may be 50% off of what someone on the ground knows is the true value over time those those get better and I think overall that's that's a very good thing for the real estate market and is is absolutely a game changer not just for Zillow but the other firms in that space. Okay, look, I'll pass it over to Richard Florida if he's here or No, I might just jump in please go ahead and yes. Richard Green, who we will be speaking to us a little later just is providing a note here to us in our audience that there's a paper by Lewis Quintero that supports the idea that local concentration that the local concentration of how house home building or house building subdivisions is actually having a price effect and they they are tracking that so that you know contributes to that discussion that Richard had raised. So, thank you for that Richard, Richard Green. Richard Piza now you are renowned from even my days of studying real estate for having done the inaugural book on real estate development a textbook on real estate development published by the Urban Land Institute. I'm not going to mention the date of the original publication but now into its fifth or sixth edition call professional professional real estate development. And so, you know, it was, it was really your book, and it's, it's attempt to talk about well it's, it's success in talking about and describing the process that made me realize that there is so little known and researched and understood about this process. And so, and you and I have both seen the rising of real estate education, in particular, even at this graduate school level. Over these decades since you've written the book, and I was wondering if you noticed differences in how that education might proceed today with respect to you know what you what you presented in that book initially. Thanks for your kind comments about the book. I'm right now in the middle of finishing up the fourth edition. I write a new edition every 10 years it's pretty much a largely new book all new cases and everything, but I don't want anybody to run for the hills but I would just note that every time I publish the book. It's usually just after there has been a cataclysmic event, starting with starting with the SNL crisis, then the tech crisis and the great financial crisis, and now the pandemic. And we hope before the book actually hits the street in the next year or so that there isn't some other crisis. But, yes, I, as a, I got my start actually as a developer, I started with Gerald Hines. I'm from Houston and I thought I got my job as through my great credentials and it turned out because he knew my father, and remembered him kindly, and got my start on new towns and then went into home building and apartment building and more recently industrial and other stuff so I've always had some foot in the development side. And I've just personally been fascinated by the delivery of different kinds of real estate and I found that the notes heard of my main competitor is Mike Miles book also published by the uli, which takes more of a process approach. And I guess the main distinction is, I think each product, the way it gets delivered is quite different so that I, I, I approach it through the lens of land development, apartment development, office retail and so forth. Of course, the changes are happening and each of those product types from retail to office residential are just so enormous, you know, over a 10 year span. And things are happening now that one really never dreamed of 10 years ago. Yes, she was on the horizon sustainability was but a prop tech really was in its infancy and no one expected pandemic. So, no, Patrice, I'm just thrilled that that you are both leading or the one of the great programs. And the other thing I just note on education is that over the last 50 years we've seen a real professionalization of how people get educated and real estate. I did my degree in the Department of Land Economy in Cambridge when I thought land economy had to do with land development turned out it was about the conversion of the rural tribal societies to more sophisticated societies. And that I was there as Gordon Cameron came in and then the change to urban development as the has ascended. I see Richard is here, maybe because Richard Seminole book on the creative class. And in fact we met, he may not remember at the RICS many years ago as that was just coming out. So Richard. I do remember Richard and thank you for that fantastic presentation we don't we know I can see Gordon want to interject because we're almost out of time. No, I thank you for being part of this and thank you for all you've done I guess if I had one quick question if you can make a half minute responses. What do you think the biggest impact of the pant the single biggest impact of the pandemic will be on real estate. Oh, that's a tough one. Top three. I think of it in terms of the product types. I think it's, it's very much exacerbated the pace of online retail. I think it's really changed totally how people are going to work and the implications of office development. For my book I was talking to Owen Thomas yesterday who was pointing out how many of these older office buildings that one would like to convert to residential have floor plates that simply don't make that feasible so there are going to be so many changes related to the pandemic that I think are going to change. I think that gets developed and how it gets developed. And I also as I was presenting think they're it. I think the jury is out but I do think we're going to see a more of a return to out migration and while certain cities that are huge and the texts and life sciences like Seattle and Boston will do very well with the I think many other cities are going to have a real real trouble energizing their downtowns and we'll continue to see this change. Thank you very much Richard. Next time you go past gun pool look up on the corner. As it fronts on to what Broadway or no near looking towards Broadway. That was my office once so just go and knock on the door and say Gordon Clark was once here. But anyway, thank you again. Yes, I remember. Thank you. Thank you. Thank you. So this brings us to Rachel Webber. Can you all hear me okay. Rachel. Good to see you. Yeah. Thank you. Thanks Patrice nice to see you all even through this strange and disembodied format. We're all we're all expert zoomers now it still feels a little weird, but it's great to see you Rachel. Why don't you off you go. Okay, sure. Well, my presentation is a little different from the two previous ones and this sort of the second panel. But I'm more of a political economist or an economic sociologist or an urban planner I teach in the urban planning department at the University of Illinois Chicago. And I've been conducting research on development and urban development for the last 10 or 15 years. I'm assuming that you've all read the book by Tom Wolf called a man in full it came out in 1998. And even if you haven't you're in luck because apparently Netflix has optioned the rights to the book and the actress Regina King who I love is going to be directing a six part series based on the book. But in the book, the protagonist is a developer named Charles Croker, and he is a developer. And he's in Atlanta, and he's there's one scene in the book where he's looking out the window of his private plane, and he's admiring the skyline of Atlanta. And he says to himself, I did that. That's my handiwork. I'm one of the giants who built the city I'm a star. So I just want to sort of start off with the idea that developers like Charlie Croker we often see satirized in pop culture for having giant egos right from George Potter, and it's a wonderful life to George in the television show Arrested Development. And there's some basis for these caricatures. You know if you read the autobiographies of real estate giants like James Rouse or Donald Trump. These authors portray themselves as lone wolves right as lone visionaries in whose hands the keys to the city can be found. And I've been, as I said, sort of I've been interviewing a lot of developers over the last couple of years and I do find that they often subscribe to a theory of the world that grants them considerable agency as strategic risk takers, in an environment that is according to them, entirely of their own making. So you can you can see how easy it is to develop a kind of God complex. When you do have so much influence over the physical settings and which millions of people go about their daily lives. Now what I, one of the one of the many reasons why I appreciate Patrice's opus is that we get a much more nuanced analysis of these individuals of the kind of corporate organization that development takes, you know, in the intervening couple of centuries, you know, since the 1600s 1700s about which she's doing a lot of her writing and her history and so we really see commercial real estate developers portrayed I think in a more realistic way. We learn about how this new professional class emerged in the Anglo American world, and how certain financial and legal practices became established norms in this field. And as we've already said Patrice emphasizes the significance of London in the 17th and 18th centuries, because it's during this period that we see these kind of nascent developers who were somewhat adjacent to the landed aristocracy. They still were sort of titled men like like Earl's, and we see them completing successful large scale building projects against all odds so we hear about the Earl of South Hampton's Bloomsbury and the Earl's of Bedford's in the development of Covent Gardens and even reckless Nicholas Barbon who developed Red Lion Square and its environs and Holborn without the government permissions to even to do so. And it's interesting I kind of thought of him in terms of you know his abuses of his contractors in the court system is something of a 17th century Donald Trump. But regardless their designs these these early developers became models for beneficent harmonious and high quality residential and mixed use developments for which central London is still renowned. And their methods of financing their methods of gaining site control laying out different land uses and engaging in site planning project management and mark marketing are still in use today so I think this book is really helpful for seeing this kind of long array the sort of the these these historical antecedents for a lot of the practices that, as I said have become sort of norms or conventions in the field. And I think also from Patrice's book we see a lot to admire about commercial real estate developers that you don't, you know, hear about in Tom Wolf's book. And this makes clear that private developers were creating planned spaces long before public sector planners ever got in on the action right and we don't see the sort of, you know, if you look at the sort of the history of state formation and the development of municipal governments, you know it's sort of understandable that they were not yet really sort of players in this field but you see master developers in some ways. Again sort of acting as sort of precursors to what public planners have, have in a sort of learned how to do. They were able to mandate a uniformity of style that temporarily tamed the chaos of urbanism at this time. They were not seeking just to maximize the rental potential of their buildings but instead were concerned about the public types or collective amenities public gardens piazza's courtyards. And they also experimented with social planning because they were creating units with very different designs and price points. And so we're sort of thinking about what kind I mean in some ways the precursor to kind of the mixed income developments that have replaced, you know, section eight art, you know, sort of public housing in the United States. They were also strategic risk takers, they were the first one ones on the dance floor. They helped open up new markets and absorb some of the initial risks of building in particular places. And in doing so they de risked those neighborhoods, or particular building types and paved the way for others, maybe with less capital less information. And, you know, sort of fewer social networks to follow suit. And they were, I'm not sure where I got this expression I think it was from the there's a book by Miller called here's the deal which is about the it sort of tells the history of the urban development in the city of Chicago by looking at just one parcel of land and it's also a sort of a great companion piece for patrice's book if other instructors and professors are looking for the teaching materials. But he was talking about Arthur rubeloff, who's a famous developer and property manager in Chicago and called him a radical reimaginer of land. And I have always really appreciated that phrase, the ability of the capacity to see the development potential in places that few others could see it. So, I think patrice is trying to get a handle on and sort of define the parameters boundaries contours of this field or profession called commercial real estate development. And that's kind of hard to do that's a hard task because, you know, human beings have been building physical structures to house themselves and their business operations since time immemorial. You know we didn't have the urban land Institute back in the 17th century so you know it's not it's not such a simple task. And even today it's sometimes hard to get a handle on who is and is not a developer. And you see the field is crowded as it is with general contractors and brokers and property managers and owners reps and the financiers and the corporate tenants and the architects. And you do see a restructuring within this industry I mean Gordon was asking this question about consolidation and concentration. You see the sort of firms themselves the corporate organizations themselves, sort of shapeshifting over time, and in some sort of periods of time we do see more vertical integration. So you have developers that also have you know, our REITs, you know they're real estate investment trusts or they also have brokerage firms or they are also lenders, you know they're also, you know mortgage brokers or mortgage banks. So it becomes tough to distinguish between who is and who is not a developer or sort of part of the development team and when I teach this material I like to tell my students that developers are like the producers of a movie not to keep on using you know pop culture references but they're involved in every aspect of the project you know they're arranging financing and hiring the general contractor. They're the ones whose collateral and reputation and equity is on the line in the event that the project goes south. So anyways, it's kind of less what developers do and more sort of why they do it that helps to define them and Patrice argues that what really sets the professional developer apart from the amateur, from the occupant from the landlord or property manager is the act of speculation of speculating for for profit. So, Patrice's book for me got me thinking, got me speculating about the meaning of speculation and also it's kind of ethical or moral valence. So just looking at its etymology speculation has a dual meaning right just from the sentence I just spoke you can see that, you know, in one hand speculation means to think about, or to contemplate the future speculatio means observation or the act of looking, but it also means to take a risky position in that future with capital that turns on an envisioned or expected outcome so there's a sort of element of expectancy. There's an element of risk. And there's a kind of dependence on the future that is very important to commercial real estate. So commercial developers are speculators in that they produce space to generate future income and capital gains it's really the capital gains it's that appreciation where the real treasure lies. So they treat landed property, more like a financial asset more like a stock and bond than as an input in production. In the aftermath of the Great Depression, John Maynard Keynes wrote, or he defined speculation as a financial practice that involves attempts to anticipate or outwit short term price movements ahead of the general public. And he distinguishes speculation from enterprise, which is, in his mind, earning money in the productive economy so that productive economy see sort of reappear over and over again in these sort of different analyses of what speculation is. Keynes also famously wrote that speculation and investment that these were both subject to animal spirits, right the spontaneous urge to act motivated more by emotion than rationality. During the time when Patrice was writing about, you know, her developers in London speculation had a very bad rap up until really the 19th century the late 19th century when we see the development of you know the of the abortion stock exchange speculating whether it was on tulip bulbs or on property was really viewed as quite a disreputable and the sort of boundaries between speculation and sort of acceptable economic activity were policed by religious authorities and irreligious or a, you know, sort of connotation associated with speculation. I think you know it was considered wild and savage, compulsive and uninformed. Max Weber who Manuel brought up early on and who has, you know, no, you know, blood blood relation to myself. I felt speculation was pre modern in that it was out of line with the protest Protestant ethics of self discipline and rationality. Marx also thought poorly of property speculation because he did not believe that it involves any productive labor. And, you know, Janelle was also talking about sort of lock and you can go back to Ricardo and to Henry George right who talked about this sort of the kind of unearned increment from from investing in land that you could just own land and it can increase in value without you having to do anything to it. So, you know, Marx argued that the value of land was a structurally necessary necessary fiction because so little labor went into it, and Marxist to the to the stay continue to prefer to talk in terms of rents right for the ground rents that can be generated by land as opposed to something like value, because they ascribe to kind of of the labor theory of value. As I mentioned speculation really only became viewed as a legitimate economic practice in the late 1800s, the stock market channeled some of the sort of popular passion for gambling and games of chance. And then you know I see a couple of decades later at least in the United States, more government oversight over financial activities to help better inform and protect investors which with what eventually became the corpus of securities regulation. So we see sort of the institutional foundations for speculative investment taking place that kind of help to sort of stabilize and popularize and make it more acceptable made made speculation more legitimate. So I was wondering about what the sort of ethical or moral valence of property speculation is today in an era of financialized capitalism or what some have called the asset economy. And we're witnessing an extraordinary ability for you know ordinary people to engage in real estate speculation, whether it's your pension fund owning a slice of, you know, Richard's new residential tower and in Toronto, or the the new possibilities to help by crowdfunding, or the fact that shows like flip that house or house flippers are so popular either video games, or that monitoring Zillow has become a national pastime. Apparently, we are all speculators now and I don't know how many of you saw, there's my prop, you know the front cover of the New York Times magazine, this past Sunday was about housing prices in Austin, and sort of made this point that, you know, because of the sort of, you know, the fast paced of transactions and the, you know, very high rates of price appreciation in Austin again sort of anybody who wants to buy in that growing market is now a speculator. I take issue with their definitions of speculation but anyways I've been interviewing the developers and, like I say no one really wants to own up to this term right so there's still a kind of a reticence to being called a property, you know to be being called a property speculator, even though developers call certain buildings of theirs speculative right if you're building a building and you don't have it released. You know if you're building and you're expecting or anticipating that you know the occupants will come. You know you very casually call that spec development but the individuals themselves were reluctant to be called speculators. And the developers I interviewed, you know, they were very quick to distinguish themselves from pure speculators, who they call who they consider to be folks like who are banking and flipping land he said oh you know some of those are the real speculators, because they're not adding to, or they're not changing them physically they're just buying and selling, they're just exchanging, you know they're investors and they're quickly buying and selling, either buildings and structures, or you know and and or the you know, and the land that they came on or just simply land. And you do see a lot of these these kind of sort of acrobatics in order to distinguish between productive labor right when spec you know speculation still makes people uncomfortable because of its pose a lack of productive labor. Economist Bill Janeway likes to distinguish between non productive bubbles like the Dutch tulip bubble, and the recent housing bubble and productive one such as the tech bubble of the 1990s. So developers expend labor to build environments and urban spaces in which we all live and work and we play, but they are still building speculatively in that they can they may not know who their tenants are. But they are also, you know they are expecting the assets that they build to increase in value, but it's hard to argue that they do not put any productive labor into this into their work I mean I'm, I am not just an academic but I am, I sit on the board of a small development organization a public private development organization. And I see how much work is involved, particularly when there's nimby sentiments expressed and I see how long and drawn out of the process is but the you know you definitely see the productive labor that goes into developing the built environment. But I also think again this sort of speaks to our present moment that speculation gets a bad rap because the price of property as a financial asset has become increasingly separated from the asset itself the sort of the, you know the apartment building or the office tower, the asset the economic asset that is generating cash flows. And I think there's some insecurity or uncomfortableness about the sort of active sort of dematerialization. So, you know, and I do think that this in this time of financialization that development means something very different than it did for say the second Earl of Bedford. Right whether it's, you know bankers, you know, we feel like, you know in previous eras bankers and investors really only entered into the picture when visionary developers sought backing to make their plans a reality. So today, many people would argue that you kind of have the tail wagging, the dog, the influence of financial markets over what gets built and where it gets built has grown a lot property and financial markets are much more tightly coupled. And the value of property is more intimately related to risk and to the credit system and to the stock market. We've got complex securities that are built on the backs of real estate assets and their mortgages. And many of the developers that I was talking about when I asked them like how did they know when it was the right time to build. They weren't looking at demographic trends or market analysis they were looking at CMBS yields they were looking at commercial mortgage backed securities and how they were doing. So as the instruments and processes become more dematerialized and the distance that Derek mentioned between investor in place becomes more attenuated. The building sometimes drop out of the picture. I mean you can have securities that are being hedged against other, you know, ostensibly property based securities. And other people have mentioned this but that's partly driven by the sort of short term horizons of developers are partly driven by the short term horizons of investors and of capital markets. And the key to most speculative development is Patrice notes in her book is getting one's money out of the project and unloading one's holdings as quickly as possible during what property developers know are finite windows of opportunity. And I think the although the book highlights the work of a few long termers. Most developers today tend to focus myopically on the short term performance of their buildings, rather than surveying future user needs and market conditions and this is concerning obviously for all the reasons we've just been talking about in terms of ESG and responding to climate change. But you know the sort of accelerated path pace of transactions is something that it's easy to get addicted to and when because when buildings are flipped. You know that that brings sort of immediate returns and benefits to the original developers prices rise and the buildings occupancy becomes someone else's problem. This deeply ingrained short termism is encouraged I would argue by capital markets who put pressure on developers before go the kinds of improvements that Patrice praises in her in her book, you know, things like courtyards and, you know, really sort of high quality site design because those things have high fixed costs and potentially long run payoffs. Sometimes they are very difficult to capitalize into the sort of immediate price of property. And so they often have to be sort of pride from developers unwilling hands by municipalities who bargain for them is public benefits in exchange for additional floor area and development rights. This sum I realize I'm a little out of time just want to say that property speculation in a capitalist economy means sort of building to this sort of the highest and invest use which often involves price inflation and developers are very dependent on that on that price appreciation and inflation, because they're able to extract rents from their monopoly ownership of space. But we also have to think about those who are not able to do that, and those who do not have that property claim to space and I really do think that some of the projects that we've been talking about today and, and the profitability of real estate does it does have the potential to exacerbate asset in place based inequities, you know, and have and can lead to the kinds of recession and displacement that we've talked about. So that makes me a little shy about trying to resuscitate the reputation of speculative developers even though I recognize all the good things they bring in that the incentive of profit leads them to do oftentimes great adversities. So, appreciating patrice's wonderful historical research and compelling argument. I still want us to sort of think about the fact that the ability to accumulate capital from speculation is unevenly distributed and that also needs to be sort of part of this story. So, I will stop here. Wow, that was really very, very impressive, very helpful, very helpful. Thank you. And your conversations with the black hats or are they the white hats? Hard to say sometimes. Any, any giveaway clues, you know, you're sitting there for five minutes, and you realize definitely black hat or is it maybe white hat. I've interviewed all kinds of developers I mean from, like I say sort of small land flippers on the south side of Chicago, we're just waiting until there's more speculative activity right because it's really hard to speculate on your own it's not a kind of solo activity. It goes back to Manuel's earlier comments about how there's there needs to be some coordination and cooperation and you need more of a crowd it's hard to it is hard to do it on your on your own no matter how big of a developer you are and how big of a project. You know between talking to them but then also some of the big global real estate firms, you know the one the the ones who are multi divisional and vertically integrated and who and who have operations around the world, you know the JLLs and the CBR is not just inspires and so, you know, sort of pretty big range. And well Rachel thank you so much you're absolutely right and that's fascinating and I'll be so keen to read about these people. You know one thing and you know like you I've wrestled with this. Who is a developer. And in fact, you know what I try to sort of start to unearth in this book is that speculators or flippers of land are not developers. In fact, you know, although I do raise Nicholas Barbon as the one who came and did this with, you know, great further. You know that's where I said it was all ruined, what a developer could do and should be doing was all about all ruined, because he was so solely interested on extracting the benefit as quickly as possible and moving it on and that benefit you're absolutely is the appreciation of value appreciation that speculative part, whereas what originally began and what still remains important for long term holders is the ongoing rental income from someone's productive use. And so, you know, and that's what you refer to as enterprise and I am so grateful that is exactly the term, you know, real estate development should be an enterprise like being a lawyer is an enterprise. We are going to put our skills to work. Does a lawyer speculate as to whether a contingency fee of taking on this matter is going to be hugely profitable, maybe they do within the contingency fee system. And, and then I would say just as the contingency fee system may have created some moral degeneracy for lawyers, it also creates the moral degeneracy of real estate developers. So, you know, I think that, you know, we're both, I really appreciate how you've identified that developers do do something they they should do something and you know that sort of supports what and and the problem with what they do speculatively, which I really put on and as by students know I found the table on being that exit value, that exit value which is all appreciation, what a lot of nonsense and that speculation, yes. It is hard to distinguish the two right because if we if we're looking at if we're estimating the future value the sales value the termination value of a building. Right, it's going to take into account the, the, you know, the rental income. That can be generated from a place so it's not as it's very that's it's very hard to distinguish and it is very hard and the problem is we use that pro forma that takes annual in that holding period all the annual and you know net income, and then takes the income and expected for the following year, but the key is, it's not just that rental income, the real problem that is applied is called the capitalization rate. That is applied to that, that is where, you know, the belief system and, you know, and so on rental growth, you know, can be probably extrapolated by very clever computer. And there's the magic involved in choosing your cap rate right if you're off if you're, you know, you change that by a, you know, whatever point zero zero the basic point whatever a very different project or a very different expected project or exactly, exactly. And that's what they'd like to believe it and that's where all the, you know, the, the card game begins, although you know, so, you know, but thank you I appreciate that it's, you know, it's so, so rarely do urbanists really, you know, break out what developers are doing, and I really appreciate you're doing that for us thank you. Okay, so we've got 30 minute break back in half an hour for those who don't do 30 minutes or half an hour. And that will be Ashby monk from Stanford. I hope that's true. And then Jerry, then Richard, then Patrice. Shall we just take a break half an hour. Excellent. Thank you very much. I think people like a little coffee or maybe you're into the wine there now on that side of the Atlantic. We could. I'm trying to focus. See you back. And thank you once again, Rachel. Bye. Okay, Patrice. I'm here. Absolutely. Hi. Well, we'll just leave it. Hi. Gordon, there we go. Thanks. I think so I think we're probably almost ready to get started with Ashby on the line. Ashby is on the line. I've been here. Of course he is. Tada. Here's Ashby. I'm excited to be here. Honored. No pressure. No pressure. Ashby, we're honored and delighted. Thank you. Yeah, look, the numbers have just gone up moments. Absolutely. There you go. So. Now, Ashby, do you have PowerPoint slides or I was encouraged to just talk. Yes, which is perfect. Thank you. I'm ready to, I have my, my paper open. I have notes. I'm ready to talk to it. And, and then to the questions. Wonderful. Well, we'll ask, you know, our audience will come in with some Q&A. So towards the end, we, you know, at the end, we'll, we'll chime in with that. But we, in the meantime, we get a beautiful sunny backdrop there. California, right? Yeah. Yeah. This is coming to you from Los Gatos, California. And yeah, it's a, it's a beautiful day. Again, 55. Again, I know. We like the rain here because it solves problems for us. But it's not like when I was an Oxford. Oh, no, no, no. Oxford is in a drought prone zone. Is it? It is in a drought prone zone. Yes. Yes. It doesn't rain that much. It just looks like it. Well, next thing you're going to be, next thing you're going to have rising water and you'll be flooded. Absolutely. Absolutely. I'm, I'm very, very thrilled that people have brought in this, you know, the, the current challenge of climate change and so on. And, you know, the, the book, of course, does address those contextual issues and challenges for mankind and they're abode right from the outset. So it's really nice to see it resonating now with discussions of climate change and resilience and so on. So thank you. Look, the book is so big. You do everything. Come on. He's got a cupboard. Patrice, I think you will be pleased to see what I'm going to talk to you about, which is all about how you've inspired me on, on climate, how we transform financial markets to consider climate through the lens of your model is all about climate and resilience. Ashby, well, there you go. If they couldn't be a better segue. Drum roll, Gordon. Over to Ashby from Los Gatos, California and Stanford University. And as I said, you know, you've got 25 minutes max. Yep. If you finish early with a match, you can have more questions. How about that? Beautiful. So hi, everybody. I'm Ashby Monk. It's a real pleasure to be here. This book is, is a fabulous book. And I, I heard somebody earlier talk about just like the feel of it and like the desire to assign it to students. And I have that same sense. I, I so rarely protect books from my pen, but in this case I did not mark it up with a pen because it's just such a lovely item. It should be on a coffee table without my notes. Anyway, so I'm Ashby. I run a new research program at Stanford as of Monday this week. So I actually have a new job. I used to be the executive director of the global project center. And as of Monday, I'm the executive director of Stanford's research initiative on long-term investing. So I, as you can imagine, I'm going to spend a little bit of time talking about the world of long-term investing, rooting it in this fabulous book, providing some interpretations out of the book, and then moving into the world of the future. As, as an academic inside an engineering school, we have a pretty unique mandate to solve problems. And our, literally our charter includes the solutions to big problems at the engineering school, which can leave some academics feeling a little bit uncomfortable as we move into that world of normativity and subjectivity, but I'll try to control it for this, this group. But yes, we often think about how to solve problems and how to interpret from the models. And there's some great models in this book. So I'll jump into it. We have a lot of money investors and investors are in the business of making projections. They have wealth today, some form of financial capital today. You need money to make money, as the old saying, and they allocate their present day financial capital to investment opportunities with an explicit expectation to receive some future economic benefit. I take my cash and I don't spend it today because I want more cash in the future. As this implies, the process of giving up your present day consumption means having confidence in your ability to make predictions about the future, about your portfolio's value in the future, about the value of assets that you're investing in the future. And so the best investors, according to the work that I've done with Gordon Clark and a few of the others on this conference, try to understand how their own objectives interact with the investment opportunities that exist in the world. They seek to define their own risk tolerance. And then they seek to understand the risk and return profiles of the assets that they're going to rely on to go and generate performance. And that's my co-author back there that just walked by. His name is Mega Dog. So this can be challenging because some investors have extremely long horizons and certain assets have very long lifespans. I can tell you that some of the pension funds that I have studied have 100-year liabilities on their books today. So they are thinking about what could prevent them from meeting their objectives in 100 years. The Canada Pension Plan states on their website they have a 75-year holding period, an investment period. That's a very long time. And then the assets themselves can have very long durations, which may not affect everybody if you can sell the asset today in a viable market, but it could affect the price upon which you sell it. If certain risks materialize in the next 10 years, even if it's a 50-year asset, the price at which you can sell that asset in 10 years time changes. Real estate, as an example, we're going to talk about a lot today. I've been talking about exposes investors to an intergenerational location-bound risk. The buildings are often seen as permanent when they're put up. There is no intent to remove them, and they are immovable. And this means that analyzing those long-term risks is much more difficult, but also much more important. If you're a long-term investor investing in a long-term asset, you need tools to really begin to understand what are the environmental, societal, and governance threats, ESG, that could prevent us from achieving our goals. And so this is precisely why real estate has been so important in my work, but also important for the transformation of finance. It's one of those asset classes. We might argue the first asset class that truly required investors to consider intergenerational risk. The long-term value of real estate is a function of its long-term resilience. And that's why the title of my paper for this is Value the City Intergenerational Risks, Returns, and Real Estate. And I've been informed and truly inspired by Patrice's book to see real estate as a role model for the broader investment industry. So taking that lens, as I always do, of the world of capital allocators, the book reminds us of that interplay, and I would even argue mutual dependence of real estate developers and capital markets today, as in the past. The book notes, sorry, I'm getting text messages somehow. As the book notes, there are really only three core goals of developing real estate, and one is to create financial assets for capital markets. So that's a big goal. And the book puts the provision of financial assets to capital markets on similar footing with the provision of shelter and the provision of public amenities. And this means that real estate developers are incredibly well-attuned to the needs of investors. The developers need to understand the investors. And on page 277, Patrice talks about how capital is a critical part of the model of urban development. Costs are incurred to produce assets, which will deliver a regular revenue stream over the length of the leases of the completed buildings. And over time, that revenue will repay the capital and provide a competitive compensation to the investor for the use of that capital. This is going back half a thousand years. This is an incredible foundation upon which to begin to understand and analyze the role of financial markets and its interaction and some of our key societal needs. Put another way, the investment community has greatly influenced the evaluation of real estate. So I think there was a certain point. Page 334 talked about how investors push developers to privilege certain types of assets, such as the upper and middle class residential projects over other types. So that's an interesting influence of the financial community on the built environment. At the same time, the real estate developments have helped to shape financial markets. The market-led concept of valuation has been transformational for the pricing of all sorts of other durable goods, not just real estate. And so my interpretation of this is as real estate having the capacity to change financial markets and, if done correctly, improve them by rooting them more directly in long-termism. Obviously, we've seen the real estate industry have interesting consequences to the financial markets in the past decade. But I think there's still an opportunity to use this interaction to our benefit, especially as I'm going to talk about in a second to solve problems of climate change. In the book's conclusion, we are told that the investment community needs to change their methods of valuation to deliver a longer-term understanding of the stakeholders' needs and requirements. Patrice calls on us to focus on the long-term by better calibrating the risks and returns beyond the dominant narratives of short-term capital markets. I feel like I've almost written that sentence 20 times in different papers talking about my work, trying to push the capital market community to move beyond short-termism. It's amazing to see that reflected through the developer community in the built environment. It's a very similar set of problems. And I think the fact that both are suffering from those problems speaks to their mutual dependence. And so that's the opportunity here. And this is almost where my point of departure is because I asked the question, can real estate development be the role model for long-termism among investors generally? And, you know, the problem that I see everybody trying to focus on that is the kind of quintessential long-term problem is that of climate change. And it's becoming obviously increasingly clear. There is an interaction between climate change and the built environment. And the question that we all are wondering is where and when will the investment in capital market community truly begin to integrate climate hazards and risks and vulnerabilities into their decision making such that that decision making can then flow back into the built environment and change truly the shape of the world we live and make it more resilient. And so that's what I want to speak about, which builds on the model in the book. There's huge vulnerability to the built environment today from climate hazards. There's huge data that I have in my paper on this. You know, the economists said that under aggressive climate change scenarios, 10% of global assets are at risk from climate change. And there's, you know, Munich Re said the global losses from natural disasters jumped in 22, 20 to 210 billion compared to 166 billion in 2019. And all of these folks, the economists, Munich Re, project that these numbers are going to continue to rise. And the kind of interesting thing here is a third of these losses are generally uninsured, which means that the owners of the assets, the long-term investors are getting hit with the full weight of a third of those losses. And so all of a sudden climate change is becoming incredibly material to that profit motive. And that at their end is the real opportunity to transform how they deploy capital. And I think the financial markets will be called upon to help incentivize and manage this transformation to a more resilient built environment, just as the provision of shelter we learn in the book was intertwined with the investor's profit motives. So too will the provision of climate resilience be a function of risk and return calculations of today's investors. As Patrice explains on page 285, successful real estate projects must take a long-term view, which I again interpret to mean that modern successful real estate projects must consider climate. This is what the entire world is searching to do. And this is a focal point that could actually serve as a role model for the world. If investors can get the right signals and they can meaningfully integrate climate change into their core risk decision making, we can rebuild this, not only capital market decision making process, but then that ideally would flow through into the real estate developers to integrate climate change into their plans and intentions, building a virtuous cycle on the back of data and process evaluation and pricing. Encouragingly, the risk of climate damage has triggered a huge uptake in ESG and climate data analytics being sought after by investors. In May 2021, a global poll of over 40 institutional investors ranked climate change as the top issue, most likely to prompt engagement with an underlying asset. And also thanks to like the rise of sensors everywhere, what we call the Internet of Things and advanced computational toolkits, we really can start to collect data and analyze it in ways like never before. And with these new analytics, the idea would be we can shift how the investors understand their exposures to the built environment and in turn that can change the real estate while changing finance, again, that virtuous cycle. The challenge here is to date that ESG reporting landscape has been helpful but not entirely useful. Environmental factors tend to include proxies for climate-related risks that are kind of pulling policy statements or carbon emissions, doesn't really get to the point of translating a climate risk into something an investor understands in dollars and cents terms. What is missing is how material these risks can be for specific assets, facilities and portfolios. And ultimately, that is the work that we are doing at Stanford. How do we translate these intergenerational risks, this long-term focus on the built environment into something an investor could quite literally drop into a discounted cash flow analysis. The good news is there's all kinds of models in the insurance industry that can give us guides on how to do this. The work of Alex Gelber, he's at UCSD on a methodology for translating climate risks into damaged projections is incredibly valuable. Gelber shows that catastrophe models are the foundation from which we can build climate risk pricing for property insurance premiums. And ultimately, this is about translating climate change risks into financial risks. And he has a two-part model for doing this and you need to combine them both and I'll talk about it for just a minute. You start with a hazard module that specifies the frequency and severity of climate perils such as hurricanes, wildfires. That hazard module is linked to the climate scenarios into the future. You can downscale it, tie it to local addresses. The next component is a vulnerability module that estimates how the magnitude of a physical hazard will translate into monetary value of financial damages. You can think of this as an example of, say, how a hurricane would create damage losses related to wind speed. And this is the type of data that insurance companies have today whereby we can see claims data showing exactly the vulnerabilities of locations to these different environmental factors. Again, all of this data, the hazard modules and the vulnerability modules can be developed. The data exists and the tools exist. It's the work to connect the hazard to the vulnerability that is the next phase for us in developing correct pricing of these risks. By combining these two sets of information, again, the probability of climate events and the impacts of climate events on financial outcomes, we can help investors assess how climate will impact financial outcomes for assets, facilities, portfolios, both now and in the future for any location on Earth. Literally an address we can understand the building, we can understand the vulnerabilities, and we can understand, will an asset be insurable? Will your home in Napa Valley be insurable for fire? We can begin to inform you on that and help you begin to make changes to your portfolio. What this means, I would argue, is that empowering institutions with this decision-useful climate risk analytics, yes, it will help improve capital allocation. It will also increase the incentives to launch mitigation and adaptation measures. There again, the financial markets creating the cost, internalizing the externality today, creating the cost and benefit of investing in resilience. That's the goal. That's a lot of stuff in 10 minutes. Let me begin pulling some of these threads together for you so I can start to leave you with some kind of core thoughts. So the book reminded us how the profit motive investors, the profit motive of investors, capital market participants, was important to the provision of shelter 500 years ago. And similar to then, the profit motive will be critical to the provision of shelter from the worst effects of climate change today and tomorrow. Investors saw shelter at the time as an opportunity for profit. It was an objective to attract their capital into this asset class to generate returns. It was partly why they avoided the construction risk and the development risk and wanted it after that, as Patrice talked about in her book. Similarly to now, we can't expect investors to see climate change or resilience in a different manner. It can't be and it is not their sole objective. It is not their job to solve climate change. The plan sponsors has set these organizations up to generate high risk adjusted returns to pay pensions or fund universities or bolster healthcare promises. As much as it pains some of us, they don't exist to solve climate change. And yet they have the long-term horizon. They have, if you sum up some of the data recently, about $150 trillion. That's a big amount of capital. If we can show them that these risks are material and translate climate into dollars and cents, we can begin to do what occurred 500 years ago as investors participated in the development of shelter. And so that is the ultimate challenge here. How do we illustrate how climate affects their portfolios? And I'm convinced even more, if I was already convinced, I'm more convinced now that real estate is that central lens to do it. Patrice demonstrates the huge importance of real estate then as now for people, for government and for investors and the role of the private sector in building and solving really critical problems. It's also important to note the community of long-term investors truly relies on real estate to meet their investment objectives. This is perhaps the biggest allocation outside of fixed income and public equities. Real estate is where they turn next to get diversified return streams. So long-term investors are not fully integrating that risk into their decisions just yet, but based on the model, I think we can push them to do so. To be clear, this would not be financial innovation to hide risk, okay? This is what occurred in the subprime mortgage industry prior to the financial crisis of 2008. That was about smoothing away vulnerabilities through widespread diversification. If you didn't have the data and analytics, that would be the least bad strategy. Let's diversify, let's spread, and let's allow investors to deploy. But with today's technology, we can do better. The goal should not be to diversify way this risk. It should be to reveal to investors the actual downside in their portfolios stemming from climate change. So we need to be granular, bottom-up understanding. We should not be satisfied with a top-down approach to managing this risk at the local level. And so ultimately to do this, we need to shift their focus to the vulnerabilities, translate their hazards into dollars and cents terms. And if we do that and we use similar, if you read this stuff about valuation in Patrice's book, it's gonna be similar, that process of forming valuation toolkits. And just the last statement, the correct pricing of risk will change where capital goes, thereby changing the incentives in our economy and the economy itself. Real estate developers can shape the future of finance, which in turn can transform the entire built environment. And I've tried to communicate 10 years of research in about 15 minutes. So I probably left some things out. I'll cover it back to you guys. No, it was very succinct and Ashby, just you are taking on that exploration of, how do we just change the thinking about this? How do we change? We know the impact is there. And we have one of Rachel Weber has spoken for decades, a couple of decades about the impact of capital, of poor capital decisions on our built environment in terms of urban impacts. And you're now saying, well, similarly with respect to climate. So it takes a lot to tease out all of these pieces that make up that clarity of understanding. So all kudos to you, it's fabulous. And you're absolutely right. I can see it having the same sort of intricate balancing of financial impact as we go along, plus that end piece that is often to the future, where we speculate about what the world will be into the future and hopefully support speculation in a good sense of how we can invest in a better future. So thank you, thank you. Yeah. Yeah, I think one of the points you mentioned, you can't regulate in the impact. And I think similar in this world of long-term investing, we can't force them to do, to truly consider this stuff. We need to reveal to them that it's in their interest. And I think in thinking about your model and how you managed to pull together that those, those different interests, governments, markets and developers. And the fact that like some of the people that are investing aren't using the asset that they're investing in, whole set of different stakeholders, very similar to the world of long-term investing and managing all these different pulling constraints. I was struck by the use of property as kind of a lens through which investors understand actually aspects of the downside, if you like, or the risk management part of climate change. You might have, and I'm sure you've got lots of experience on this, you might have talked also about the opportunity represented by climate change, particularly in technology, production technologies, but also in sort of distribution technologies. So what should take on that? Yeah, it is a huge opportunity. And I think in order to spot it, part of it is like understanding this risk is there to your portfolios and then taking, using your fiduciary duty to manage that risk means managing the downside, but also leveraging the upside. And the upside are the solutions, the new resilient buildings that people are going to end up moving to. This is a two-sided coin. One is let's avoid the, you know, the damage to the portfolio that we need to control to, but also let's reposition for the upside. Who's going to pay for the investments abandoned or rather these investments discounted and dropping out of a portfolio to somebody else? Who's going to pay, if you like, for the rebalancing of portfolios? So the people who haven't correctly assessed and understood these long-term risks will be left holding the back. And so this is like why, when I say to these organizations, like look, you need to integrate your ESG into your risk management. This is what we call portfolio resilience. You need to be building a long-term portfolio that correctly spots the threats to you achieving your goals. Holding a piece of real estate on the coast and New Orleans is probably not a risk return bet that you want to make. And so as we begin to see those properties sold and other properties purchased, we're starting to put a price on this risk through that market lens. Sadly, today, the mortgage market in the U.S. doesn't use location as a determinant of price of mortgage. So your mortgage in Ohio will have the same price as it does on the coast in Florida. Now that means all the other individual specific factors are being taken into consideration, but not the location factors when that seems like it's a complete mispricing to me. So why do you think the finance industry has been particularly open to this conversation where other industries have heads in the sand and otherwise? But what's special about the industry that gives you, if you like, an audience? Well, I think part of it stems from the long horizon investors. I think if you go talk to the shorter-term fund managers, it's simply trying to respond to the pension funds. So let's differentiate the fund managers and the external asset managers that often do the investing. The pension funds are the asset owners that have the intergenerational time horizon. The fund managers are responding to regulators and the desires of the asset owners to consider these things. They don't yet truly integrate this risk. It is, sadly, and this is where, like, why we need dollars and cents pricing of this through a vulnerability model, they just don't see it as important for their investment strategy. The pension funds have stakeholders that really care about this stuff, you know, like Harvard University divesting from fossil fuels. The students care, right? And so the long-term investors are going to drag the managers and the property developers who are kind of sitting there building these things ultimately are going to respond to the managers. And so it's that kind of, I mean, I hate to say trickle down set of incentives, but it almost is like if we can't get the big pensions to truly price this stuff and care about it, then we're going to have to rely on government on that far side to put a price on it through regulation. And maybe we need both, but I'm not willing to wait for the government to put the price on it. Let's instead make sure the pension funds are pricing it themselves. And then if we get two levers pulled, great. But at the very least, we need that one lever pulled with the pricing of climate risk. Patrice, any last comments? Because I can see Jerry there, but Jerry's going to speak anyway, so... All right, Jerry has to hang off. Okay, all right. Richard, you're fine? Richard Florelli, you're all good? No, I think... It was terrific. It was terrific. Nothing to add, it was just terrific. Well, thank you. Absolutely terrific, Ashby. And we will prod each other along with how to better hone this understanding. So really thrilled, thank you. Thank you for having me. Thank you very much. Thank you, Ashby. It was terrific. Okay, now, Jerry. Where's Jerry? Right here. Can you see me? Yes, I can see you. And you've been very patient, but you get to speak as you know for up to 20, 22 minutes. Take a few questions. And the floor is yours. Thank you. And so let me make the comment that I wanted to make on Ashby's. And I really appreciated Ashby's remarks. And it's a nice segue to what I'd like to talk about. But the comment that I wanted to make was... You know, when we're talking about risk and climate change, government disaster policy takes away that risk. And that's kind of one of the reasons why we don't see as much of a shift as we might. So if you're a property owner, I think Ashby, you pointed out the risk of wildfires in Napa Valley. But if you were in Napa Valley, you get subsidized insurance through Cal Fire. And you get FEMA as well. And so the risk is mitigated. And if you're a corporate owner, you can't always sell the individuals. That changes the risk return. And keeps developers from taking climate change seriously because that residual value is really protected in that way. So I think that's a real problem, at least in the United States, the disaster policy is doing... Do you think, Kerry, there will come a storm too big? You know, one day, government won't be able to do what they've done, say, on the Gulf of Mexico. Do you think there's a limit? I mean, you would think so, but when people have their homes destroyed and they're sitting out, they're looking at their lives disrupted in that way, there is a tendency to say, we have to help them. Okay. I mean, there is a move to try and move, you know, by land and move people off away from... But it's fairly small and it would be expensive to do. So I think it's going to be a long time coming and it won't be in response to a hurricane or wildfire, but rather a more thoughtful policy, which sort of turns me to my remarks. So I'm a macroeconomist interested in regional economies and transportation economics. But also interested in policy and policy, particularly as it affects things like residential construction that gives you the trajectory or the forecast of what's going to happen in any particular economy. And that's why I really appreciated Patrice's book. So I'd like to begin my remarks with some reflection on the discussion about housing in the urban environment here in my home state of California. And it may be sunny in the Bay Area, but it is cloudy. And for us, it's cold here in Southern California. Housing is clearly expensive here. And particularly in the coastal cities where most residents live. And this is what's called an affordability crisis. And we have vociferous discussions, but they're really not discussions because people are talking past each other than with each other. So between NIMBs and NIMBs and politicians and journalists, etc. And importantly, the why of the situation seems to be relegated to bad policy on the part of homeowners and their elected representatives, you know, and I think it's a good question. I think it's a good question. I think it's a good question. I don't have any majorities, but Golden Gates, he points that out and basically says, if we were only like Austin Phoenix in Seattle, we wouldn't have this problem. And I think it was, it was, it was maybe Rachel. Who mentioned that recent New York times. Cover where Austin is facing. And that's what we see here in California. And so that leads me to what I see is really an important contribution of Patrice's historical study of property values and urban development in London. And we learn a lot from that. And it should be instructive for policy today. And Patrice describes a trend towards increasing outsourcing of growth of cities to the private sector in the context of the span of, of history with different economic and social and political conditions. But you know, it was clear to me in reading it that the incentives and the tensions that she described are very similar to the ones that we see today. That the things haven't changed much if at all. And so this analysis really provides a historical context to evaluate, you know, not just the evolution of the urban landscape, how we got here today, but also the current move to make high cost of living cities, such as those here in California, more affordable. And I think the way to think about this is that the public sector is optimizing the social utility functions somehow defined by the political process. And so this has got a lot of arguments in it. Of what is in the social good. The private sector. You know, as was just succinctly pointed out is focusing on creating a satisfactory return for investors. And these two objectives are clearly in conflict. And so to highlight that, I'd like to be in the balance of my remarks, take on one aspect of the urban environment. That's at the heart of this, and I think it's a very important aspect of the densification of cities in the United States. That are the provision of open space. And we've heard quite a bit about this from Sam, Richard, Manuel and others. And just going, going back to the history that. Patrice outlined. Early London. You had a lot of open space and, you know, part of that was for the commercial use for markets. And the 16th century enclosures. You had this real conflict between those who were using the open space and those who were enclosing them. And, and people were forced off the land. And what that privatization resulted in. Was migration to the cities. And we heard in earlier remarks about how demand was driving farmers, landowners on the periphery. To monetize their land by building homes and selling them. And that was really part of what was going on. And because of this migration. You had a lot of pressure on the government to do this outsourcing that's described in built up. To the private sector to build houses. You know, what we hear today, build baby build, get more supply. Because people need shelter. And so things like open space were subsumed. To having. As rapid a growth in shelter. As possible. And today in high cost of living cities such as Los Angeles and San Francisco. There's some. Real sense in which the same thing is going on. As was described in London after the enclosures and later. You know, what the attitude that we hear here. And you hear it in New York and other high cost of living cities, but now you're hearing it. In places like Austin is it's all about supply. And there isn't a discussion about. The externalities and open space externalities. And so, you know, one of the things that happened in London that. That Patrice describes is the set in mid 17th century. The plague and the great fire. Really provided an opportunity for a reset. And it's not that dissimilar to the opportunity for a reset that we see today in a post COVID world. Where one can work more remotely. And we can redesign our cities around that. But we had, you know, we have to keep in mind that. That there is this tension. Between the private sector and the public sector. Now in the rebuilding after the great fire. We saw things like covenant gardens and Queens road. Those have been described earlier. But they're really for wealthier Londoners. And you see that as well in the United States where you can, where developers are able to privatize open space. And sell their homes. At a higher price because they can privatize that, that space. But it's not really for the general public. And, and when we think about this, you know, for the, for an individual open spaces monetized through the value of the land that they live on. Land closer to open spaces. And it's not a premium over parcels further away. And that's just a, you know, a rent gradient that we see. In, in every city. And that was my earlier comment about Los Angeles has a lot of open space. And it's priced into the price of land. And if it's priced into the price of land, a developer can't capture that because they have to pay for that. In their purchase of the land. So there's little developer that can do in, in, in that sense. And, you know, it's also really difficult to capture the externality by the private sector. That is the widespread enjoyment, the social cohesion and a sense of well-being of the population at large that it gains from open space. So, you know, when I go to the beach, for example, I enjoy being at the beach. And I would be willing to pay for that enjoyment. And I don't really recognize that the other folks at the beach are also enjoying it. And that is creating a social good. There's an externality there. And so I'm not really willing to pay for it because I don't recognize that benefit to myself. And, you know, so, so. You know, as I was reading through the history of London. I mean, how generalizable is this is seen clear that the privatization of development resulted in a sub optimal amount of open space in London. But that might be idiosyncratic. As other cities. Have different characteristics, the availability of open space. The presence of mountains, bodies of water, climate, ecological conditions and the sorting of land between residential and commercial use are just but a few. So is London and kind of the other examples in built up. Unique or is it generalizable and what can we learn about that? So in that regard. I want to look at the United States. And started with the following working hypothesis. That for cities where developers could. Incorporate open space. So these would be cities with a large amount of flat land. And they could build their housing around some central space, making it more costly for those outside of the. Development to use that open space. And then, could they then capture the value of that open space to the renter or buyer. And that therefore the private sector would have an incentive to provide, if not the optimal amount of open space, at least near there. And then for cities. That would be. You know, where we have densification. It's really hard to. It's really hard to believe that because if you put open space there, anyone can use it. You have a lot of people in buildings that are close to that. And so it is much more difficult to capture the value of the open space to the folks who are living. In those developments. So there should be, you know, a real. Difference between cities such as Dallas and Los Angeles and New York. In the amount of open space is being provided. By private developers. And just as kind of a digression, you know, we know of. Places like new hall ranch that's in Santa Clarita, California, where they specifically advertise, you know, come by your home here because we have hiking trails and. And we have bicycle trails and lots of open space. And so. In order to look at that. What I did was put together some data. On MSAs in the US. So these are. Metropolitan areas. And looked at some preliminary regressions. And so this is. Not an extensive study. But just really a data exploration exercise. And in that. So I was looking at. At the land form and the US department of agriculture has an index on that. And comparing it to two measures, one is called park score. Which is the amount of open space in. In a city. And the other is an estimate of the amount of loss of open space by development on the periphery. By city. And so that is from the national wildlife federation. And you would expect. You know, what I just just said that cities such as Dallas, where you have plenty of room to expand in Houston and the like. That you would seem. More open space. And cities that are more constrained, you'd see less. But that wasn't the case. There was actually no correlation between. Between the two. And, and, you know, Looking at different ways of analyzing this data. You simply can't come up with. Any support for the theory that the private sector is providing. Optimal open space that is very similar to the case of London. And that. What. In. Patrice's really amazing study of the history of development of. Real estate in London. You know, points out there is generalizable. That you get suboptimal open space. And as a consequence of that. You know, one has to think about development and in the context of. Making cities more affordable. The public sector has a much greater role. Then even though the public sector may be limited in. In its. In its finances, it has a much greater role. In providing for open space. In creating the kinds of cities that. Urban planners and urbanologists. And I think we all know are going to be much better places to live and to increase the overall utility of the residents of the city. But. You know, there are some experiences that I think. We need to look at and have some. Real skepticism about the way in which. That's achieved. And. So one place to look. Is Christine Miller's. Description of what happened with the pops program in. New York. Her book is designs on the public. And the pop system. So I think that's pop stands for privately owned public spaces. And so this was an incentive that changed zoning. And so that. Developers who wanted to build higher. Developers who wanted to. Increase the value of their development. Could do so if they provided these privately owned public spaces. And many did that. But what you found over time was. The incentive for the owner to the buildings. Particularly when the buildings were sold to a different owner. And so they didn't have the same energy and preserving that open space. The incentives were to privatize that open space. And, and, you know, for example, if you had some open space that you would walk through. In order to get into the building. By doing various things so that. Homeless people wouldn't come and sit in that space. And so that folks who are entering the building would have a better experience. That would allow you to charge higher rents. And so this resulted in. These open spaces not being quite so open. So I think there's a real object lesson there that. That the public sector. Has a much greater role than it has played in the past. So I think that. If we're going to provide the optimal amount of public goods, and I'm only talking about open space. There are other public goods associated with the urban environment. And I think that. You know, as, as I read through built up. I see it in sort of many other dimensions. But it is illustrative. That to create. The optimal urban environment for the city's. Residents. And so I think that. One needs. Exactly what Patrice. Was advocating in. The last chapter of built up. A new model, a model that. Emphasizes. The role of public goods in creating. A quality urban environment. And so with that, let me stop my remarks. Jerry, thank you very, very much. You don't need to stop. It was, we were. You know, there's, it's, it's extremely hard to see. And you've, you've presented that in your study there that. You know, case study is extremely hard to see how. Economic. Benefits of, of open space. Can be identified, justified, utilized and so on. And, you know, a bit of, once again, you're also. You know, pounding the table on the fact that we, we need it for a variety of things. In terms of our human condition, particularly within cities. So thank you very much for that, Richard. Because. Great stuff, Jerry. And thanks for being part of this. You know, it's really interesting because I remember. When I met Jane Jacobs. And she said, you know, I remember one of my papers marked up by hand next to her rotary phone. And she said, outliers really matter. I remember her just focused on outliers. And, and. I guess I keep thinking. I totally agree with your empirical results. And I, I find them fascinating, but then I see like what happens with the Highline Park. Right. And, you know, I know the founders of the Highline Park. They were concerned with inclusive development there. They never, you know, they wanted to build a park which celebrated, in their view, the gay male heritage of that neighborhood. And real estate investors and developers took great advantage of that. I mean, they saw the park coming. They saw the open space there. And they knew maybe they didn't know quite to the extent they would gain from the availability to that open space, but they knew. And I guess this is the question. Now the Highline folks have set up not only their own organization, but a national organization to help open space folks, not kind of figure out ways to gain some of the, potentially gain some of the financial upside that developers gain. So I guess that's the question I'm asking you when, when we build these urban parks and public goods. Why do we allow developers to capture all the benefit? And are there mechanisms for enabling some of that benefit? Community development to be plowed back into the neighborhood or into other parts of the community. Right. So I mean, the Highline, maybe the exception that proves the rule. And, and, you know, because one of the things that was surprising, I expected San Francisco. And that's the metropolitan area. It's not just the city and county of San Francisco, but San Francisco to be very different from Dallas in, in this respect. And it's not, it's not. And so that was a surprising result. Is there a way for the city to capture these benefits? I think the answer is yes, but you have to start off with, here's the amount of open space that we want to create the quality of life that we want for our citizens. You developers are, are, are welcome to go ahead and build, but we are going to tax your building. So that we have the funds to develop this open space. That if you do the opposite, like in the pops program, then that space is privately owned. Yep. And over time. It's going to be privatized. I mean, one of the, one of the issues there is, you know, with, with the pops program and other similar programs is enforcement. Yep. It's all well and good, but those open spaces require maintenance. And, and they require care and feeding. And once they're there, the city will ignore them because they're private. So I think that one more, one more follow up. One of the things we see in the current post COVID, emerging post COVID environment is that open spaces and cities, which seem to have had a glory day. We want to build more of them. We want to figure out public private partnerships to do that. They're part of quality of life. They're part of attracting talent. There is a beginnings of a reversal. You see it in New York with regard to Washington Square Park and other parks, which are now thought to be, you know, the city of Washington. And so I think that's, you know, the importance of attracting a, all my party crowd and disrupted to the neighborhood. You see it on Miami beach on ocean drive. Where the mayor just allowed cars back on ocean drive because he was concerned about disruption. You probably see it in parts of Los Angeles. I'm guessing like Venice speech. You hear the, you hear the tall tales at least out here on the East coast. I wonder if you see any of that, that there is a reversal. You know, there's a lot of open space, which used to be seen as a talent attract, or now being a kind of a void that's being filled by, you know, what I'm saying, less in their words, not my words, less desirable elements, nighttime activity, urban disorder. That is less desirable. Do you see any of that or sense any of that? You know, there, there definitely is. And particularly with respect to homeless encampments. You referred to Venice beach. And there's a fairly sharp backlash against that. But to me, what that says is. We are way below optimal open space, right? Because we're not, we're not providing enough open space for teenagers to gather for. For seniors to gather and so on. And so everyone is crowded into the public space. And so it's not that there's a problem with having open spaces. There's a problem with not having not enough open spaces. One thing, yes, Richard, you know, who did reference and Derry spoke, you know, mentioned this and it's not just the ownership of the public space. That's one thing. You know, that can be. If it is owned and given, if it is owned and given to a municipality, a municipality often says, no, no, no, we can't afford to manage it. We can't afford to operate it. And that's why I say that the very, one of the key things about Covent Garden was that not only did Bedford provide this open space, but also dedicated the rent revenues from three of the houses to support the open space and the church. And the church was made responsible for the administration and maintenance for that public space. So there was a distinct understanding that it's, you know, real estate once again has no value or is no good to anyone if it's not able to be utilized in the, you know, in the desired manner. And that is as a place, a safe place, an inclusive place, you know, and so on. And an example in recent times here in New York was Domino Park. The Domino Sugar Factory was developed by two trees. They gave a, they took a waterfront portion of their land and has made it a public park. Not only did they make it totally open to the public, you would never think it was private land, which it remains, but they also spend $0.9 million on operating and, you know, managing and maintaining this park every year. The fact that they can weave that in to their economic evaluation of their development project and its long-term economic viability and so on, I think provides hope that there is something important happening there, but we do have to, we can't just talk about the space without talking about its operation maintenance. And as you say, through the POPS, the POPS were coming in with the operational budget on top of the publicly owned land, which once again is a necessary combination. Yeah, I think that's exactly right. And here in California, we have a nonprofit organization that takes, so the state and the cities will give open space land to this organization. And its only purpose is maintaining the properties and it has a source of revenue from the state. And so that takes it out of kind of the, each municipalities budget fight every year. And, you know, it has a dedicated mission. But I think we have to, you know, we have to think through these things in order to make sure that they're not unintended consequences. Okay. Might I just interject a little bit of comparative economics. So I've lived in Cambridge, Massachusetts, South Shore, Chicago, Pittsburgh, wonderful places, historical places, history, full of parks, at least parks in the inner city areas, or inner city sounds a little bit not quite right, but certainly within the Beltway networks that surround the cities. And so history matters a lot actually for American cities in terms of provision of open space. And they matter a hell of a lot for the UK, because again, you know, look at central London, you know, it's full of parks. But the parks weren't made in the 19th century. Parks were there and been kept and some of the parks, of course, owned by the Crown of the State. The question is, why and the UK has kept a heritage of parks, although more or less good depending on the new development. Is it that in the US that the issue is confounded by the fact that you're building housing for relatively lower income to higher income, that's the mass housing building market. And there is an issue of disposable income, which is the justification for not providing parks because you're sort of filling up the available space with a house or houses, and a park would be in a sense an added cost to the sale price of the existing homes. Is it that it's an income problem that American cities, ex-urban cities, other cities, they are in or is it an unwillingness to tax property developers and what would then be the basis for unwillingness to tax property developers? You've got all of 30 seconds to answer. Okay, so I think it is both. Property developers are politically very powerful. And they don't want to be taxed. And the argument that they make is if you tax us, we will have to raise the price and we're trying to provide housing for middle income Americans and we're going to have to build luxury housing. Okay, so then you agree with me, it's actually partly of the explanation is the income of the purchaser that makes all the difference. Thank you very much, Jerry. Also, Gordon, if I could add one thing that I point out in the book, you know, Jerry said real estate developers are very powerful and they work hard to maintain that power, particularly with respect to municipalities. The question is, why did they become that way? They just didn't get up and say, well, I'm going to throw all my money at local politicians. But what I describe in the book is how immediately they realized this connection to local politics was critical for their success. And it didn't begin. So in the UK, property developers are very influential throughout the world in China. Okay, enough. Jerry, really interesting. We're talking too much. Thanks for contributing. Written and also your presentation. Very helpful. Okay, Richard G, Richard Green. We're just full of Richards today, aren't we? Is there too many? I noticed past speakers have, I prepared slides. Is that all right? That's all right. No, you've got your screen. You can do whatever you like. You're between us and drinks. Because what I wanted to prove to you, even though I'm an economist, I'm not necessarily a Philistine. Although you may decide that I'm Philistine at the end of this. No, we started with an economist who claimed not to be a Philistine. So, you know, Richard. Yeah, I know who that economist was. And forgive me, I did not get up at five in the morning to listen to him. You'll be able to watch the rerun. Yeah, so, well, again, thank you very much. Thank you very much for having me. I'm not sure why I was invited here. I don't know that I'm particularly competent to comment on this book, but I'll try my best anyway. And it will be from the perspective of an economist. And it will be from the perspective of someone who thinks there are tools and economics that can be very helpful to achieving some of the aims that are described in the book that are not used as well as they should. And to some extent the conversations from Professor Weber and from my friend Jerry pointed in that direction, I think. I will say this, first of all, Patrice, thank you very much for sending me an actual copy of the book. Because I really wasn't expecting you to buy me one. I just figured Columbia has money and they could send me one. But it is, it's a beautiful book. And I'm not saying that in the sense of, oh, I got to find something nice to say. So I'll say it's beautiful. It really is aesthetically a very wonderful thing to read through. Because of that inspired me in this presentation to share pictures instead of, I don't think I have an equation. I have a couple of graphs, but I don't have any. I have quite a lot of pictures. And I'm going to divide my comments sort of into three. I want to talk a little bit about London. I don't know anyone who doesn't like London. But that's also kind of a problem with making it an example is it really is, I mean, Richard F talked about Jane Jacobs and you've got to pay attention to the outlier as well. If any city in the world is an outlier in many, many dimensions, it is London. I want to talk a little bit about what I think is really important in here from a real estate teaching perspective, real estate education perspective. And then I want to talk a little bit about some economic policies. And I am going to, and I'm going to focus a lot on the last chapter of the book, which is about criticisms of the development process. And I'm going to say something that's going to get me into trouble with the place I used to teach, which is the, I taught at the University of Wisconsin, Madison for many years. And while Jim grass camp was an inspiring and many ways admirable person, I think he actually was part of a tradition that in many ways led to some pretty bad outcomes. I'm going to talk a little bit about that. So I can't help thinking about London is fun, but I just couple of quotes from couple of my favorite pieces about London from Pip and great expectations. After this escape, I was content to take a foggy view of the inn through the windows and crusting dirt into standoffly looking out, saying to myself that London was decidedly overrated. So and of course Dickens, his love of London comes through his novels, but he had a very also keen eye about its limitations and its problems. And it's what made Dickens such a magnificent writer is, is he could describe vividly the complexity that was London at it during his time so well. And then from my all time favorite musical, Sweeney Todd. This is the more PG rated quote about it. There's a whole the world like a great black pit and the vermin of the world inhabit it and the morals aren't worth what a pig could spit and it goes by the name of London. So that was sort of London reflected in the mid 19th century, right? But whatever the development process has been since then, however good or bad in a sense one could say it is, London has done pretty darn well. So on the left is, and I'm sure everybody in the room knows this, this is my favorite part of London is on the left is Bloomsbury. And maybe the reason for that is I'm an enormous fan of John Maynard Keynes. And actually this picture doesn't do Bloomsbury justice because the sky is blue in this picture. And I actually think Bloomsbury is at its best when you have a misty rain, a little bit of fog of the street shimmer. It's a really beautiful place. And the other thing that I think is really interesting is that it's been repurposed many times since its original development with different uses inside of it. And yet it continues to be, you know, there are periods when it's been better or there have been periods when it's been worse, but a central gathering place in London that works pretty well. And the other thing about London, to me this is the most important indicator of how good a place is to live. I could use only one statistic. It is life expectancy. And if you look at life expectancy in London from the late 18th century through what I will call the point where the Industrial Revolution really got going, the Metropolitan Line opened in 1850, which basically transformed how London could develop as a city. That was a little before things started to take off, but by 1875, boy, we start to see that really strong upward trend in life expectancy. World War I and the Spanish flu, of course, interrupting that trend. And now COVID and drug dependency are creating a, I mean, not that sharp downward phenomenon we suffer from World War II, but really problematic. But nevertheless, I think we need to appreciate how much better things are now in a very important way. You know, we think every year of life has some value to it from 150 years to 107 years ago. So, okay. Two of the problems that, you know, developers to London faced that Patricia brings out in her book that are remain difficult for us to come to grips with are the problem of land use succession. And this is one of the places in the world that actually allows it to happen. This is the HSBC headquarters on the left before the foster HSBC headquarters succeeded at same location. Look at that building on the left. That looks like a pretty much a fortress building that's never going to get torn down. But given the density levels in Hong Kong, it didn't make sense economically for that building to remain in that place. And so it was torn down and the problem is if I'd scaled this right, if I had the pictures reflect the size of the building, the one on the left would be, I don't know, about a fifth the size that it is compared to the one on the right. The one on the left is not even 20 stories tall. The one on the right is well over a thousand feet tall. People sometimes economic pressures really do tell you give you the right answer, which it is time to do something different with this property and convincing others and developers had a hard time in Patricia's book convincing lenders, investors, et cetera, that it was time to transform farmland, agrarian land on the edge of London into urban land is a problem that remains. People want things to remain as they were, even if what was is not very productive anymore. And something I find remarkable about Hong Kong is it still has land zone for industrial use. The government is hanging on to the idea that maybe manufacturing can come back to Hong Kong someday. It's not going to happen. It's too expensive to do it there. So using that sort of romantic view of the past as a way to prevent the development of and I'm going to come back to this phrase highest and best use I think is misplaced and was so 300 years ago. The other thing, the thing I really liked in the book and it is absolutely relevant today is relying on discounted cash flow as a mechanism for determining use. So I've become a person who in general prefers just income capitalization to determining what to do right now because at least then there's lots and lots of market signals forecasting for you. Whereas when you use a DCTF model you're making forecasts about values in 10 years and about discount rates in 10 years things that you can't possibly know about. And on the left I have the history of 10 year and I'm sorry the left I have the history of commercial property values in the United States going back to the 1950s. As you can see it's quite volatile and on the right is the 10 year Treasury maturity just going back nine years and you can see it's also quite volatile and one of the things about real estate is it has lots of what we call duration and finance and the thing about duration is it means its value will be very sensitive to changes in interest rates. What you can see in just the past four years we have a 200 basis point swings in interest rates that long term interest rates that's actually a pretty modest swing by historical standards. But basically that means if you're looking at a 10 year horizon you get a 20% swing in value based on that 2% point change in interest rates. So the problem with DCF I think is it lends a patina of scientific respectability to what people are doing where there is nothing scientific about it. Because we don't know the parameters we don't know the appropriate parameters going forward and we should be modest enough to accept just sort of what the market is telling us at the moment when we're looking at cap rates we can argue they're too low or they're too high a little bit here and there but in general that makes more sense. The only place for DCF in my view is if you are acquiring a building and you have a bunch of leases expiring during the time that you plan on holding it of course you need to think about that from a risk management standpoint you want to identify that. But yeah I think let's do a static analysis less dynamic analysis when we're making these decisions. All right I want to move on to and I can see I'm running out of time already. You know imperfections with the development process well you know I've heard Ricardo already mentioned I don't know if Henry George has been mentioned yet by a previous speaker. I looked through the book for Henry George I think Henry George certainly didn't get everything right but he had very useful things to say about this problem of the monopolist owning land but there are some correctives to that from economics. On the left you have Frank Plumpton Ramsey who is one of the great economists of the early part of the last century he died at age 28 being as one of the most productive economists of his time and he had this idea called the Ramsey tax which is it taxing any elastic things is an efficient thing to do and land is by its very nature particularly well located land is inelastically supplied and as a consequence let's go after that and Henry George said let's do that with the Henry George tax which is about you apply taxes to property to land but not to improvements. Now I think that's naive because I don't know exactly how you measure one and the other always but nevertheless I think the principle is the correct one and on the right is William Alonzo who wrote the competitive theory of the land market which pointed out that if you don't allow people to have concessions in lots and lots and lots of applications not all of them you actually do get quite a lot of competition in property markets and so you don't have these recording rents as a result of that and very often what I see through the regulatory process is effectively the creation of concessions that lead to the possibility of these monopoly positions in the property market. Beyond Ramsey tax is something I love is value tax capture and this is not a sort of theoretical construct there's a place in the world where it's done really well which is Hong Kong and basically what they do is they put property out to bid in auctions there's a reservation price so that if the highest auction value bid is not sufficient to deal with the infrastructure necessary to support Hong Kong and by the way that infrastructure includes subsidy for housing for lower income residents of Hong Kong but it's also this is the MRT one of the most magnificent transit systems in the world. Don't give property away and in the context of an American city don't give entitlements away so here in LA we are under zone we need to be zone more densely but instead of just deciding this developer gets more density but that developer doesn't auction off development rights auction off air rights and use that as a mechanism for returning that property value increase that happens from the development rights and put it into things like housing subsidies, transit parks, etc. I think this is a much more sensible thing to do than community benefits my problem with community benefits is I see the money gets given to people and I don't know actually what happens to the money I don't know how the community benefits from it but you put it in a metro line or you put it in a BRT or you give people vouchers for housing then I think you have something that is tangible and useful to the people who are surrounded by or nearby to the property that is developed okay pollution obviously there are a lot of externalities involved and again it's so I like Pagoo let's tax externalities again I think we know how to do it I'm a big fan of carbon taxes why we're not spending 80 bucks a pound on carbon emission is something I don't know but we're not but that would certainly change the shape of cities and go a long way toward making them more environmentally sustainable and that said of course in general cities to the extent you keep people from living in cities you're worsening the planet right to the extent you're restricting the ability of people to move into cities you are not living lightly on the earth you're making the earth worse off and one of the ironies is when cities become regulated you have more green field development which is environmentally work and on the right and when you have arguments over how do you use property this is one of my favorite pictures this is Crocker's spite fence and he couldn't acquire a neighbor's property and so he decided to basically put a fence around it that kept it from getting any sunlight you can't allow that sort of externality to happen alright I'm going very fast I just want to start with how planning is part of the problem and Jane Jacobs and Ellen Bertot wrote a wonderful book called Order Without Design about development of cities as organic instruments and I highly recommend it I want to finish because I'm running I'm out of time already but in her book Patrice talks a lot about rethinking the highest and best use and she refers to James Graskamp who talks about most probable and fitting use and here's where I have a problem with that is it leads people to claim that things are externalities when they're not externalities at all and if we go back to this Wisconsin tradition of urban led economics it's one rooted in Richard E. Lee comments who were among other things eugenicists and led to a movement that proclaimed that you wanted to keep people with certain races and ethnicities out of certain neighborhoods within cities this was followed up by Homer Hoyt with his dissertation at the University of Chicago 100 years of land in Chicago 100 years of land values in Chicago and we wrote the FHA manual that specifically maintained that places that permitted African-Americans Mexicans and my favorite category because I would have pit fit Russian Jews of the lower class from living in particular cities because they were not considered fitting people and Graskamp didn't do this himself at all and I wouldn't want to imply that he did but he came out of a tradition that countenance the idea you had to basically manage the kind of people who were living with each other and that's really problematic and people use the externality argument as an argument of exclusion it's why I was thrilled when Minneapolis got rid of it single family zoning making the argument that zoning had been used as an instrument of exclusion for many years and so I want to finish with just a little trivia question which is I wonder if anyone knows the large American city with a substantial African-American population that is the most racially integrated is measured by the similarity index and I don't know if anyone wants to guess I guess I could just say and the answer is Dallas, Texas okay the most the least segregated city in America, large city is actually San Francisco but basically it's lost all of its African-American residents it's 5% African so I don't think it really counts Dallas is about 20% African-American if you look at this dissimilarity index it's far better than cities that purport themselves to be much more progressive and Dallas is a city in which it is pretty easy to build and I think there's something to be learned from that and I have gone on too long thank you for allowing me to speak today not at all Richard no not not too long at all but thank you very very much for that I truly truly appreciate you know the macroeconomics these aspects are central to what real estate is about can do and is able to utilize in its role within urban areas and society and so on and so I very much appreciate you're coming in strongly and talking about let's not get too fuzzy on what is really driving these things here and you're absolutely right raising the notion of are there things which we falsely categorize as externalities which in the end aren't they're part of what we actually do they're not external and so where's our responsibility for them I think that unfortunately we don't have James Gruskram camp around with us these days but we could certainly spend some time you know talking through how we saw things and he was of an era you're right he was of that coming out of that 60s 70s 80s era where the notion of urban planners defining how cities should be and who should be there and how they should be you know was was definitely still a force of the urban evolution I think you know one thing he was trying to say said you know probable and fitting was yes the planners would have their say but he also did concede that it wasn't just an economic a purely economic decision but you did have political salience you did have community issues community concerns and so on coming into way on these things and whether they would impact it so but thank you very very much for that it's you know it I love the way it goes back and forth between social concerns macroeconomic issues and so on and I will send you Larry's little snippet so you can see how you're providing a wonderful bookend to his launch this morning but thank you Richard well Richard it's great to see always good to see Richard in far too long it's been far far too long it's great to see you and I know you're in your in your actual office I know so that's particularly nice I I don't think I'm not in Toronto but I don't think we're still we may be allowed back but it would be just the beginnings of us being allowed back it's interesting some you were not the only person to use slides someone this morning had a very wonderful slide deck and I sent you in the chat I mentioned Henry George and I would just like your reaction to the comment I made on patrice's wonderful book because I said she's done a great job of bringing real estate back into urban theory and in a way her book reminds me of Henry George and and I contrasted George and marks and I said that where marks denigrated real estate thought and he actually denigrated George there's correspondence of him denigrating the George he saw the world is as pit the modern world his modern world the industrial world pit against capitalist and labourers and the capitalists made off with the surplus George not only in progress and poverty but there's a big pamphlet on whatever it was on land or something wherever it was called on land empirical one he kind of says no no no no no there are three classes there are capitalists and workers and there's these people called landlords and and indeed the last one is the one who runs off with the surplus produced by the former to and it kind of reminds me of today like like so much of the wealth that's being produced and it's it they're surging all over the country you know i'm talking to you from Miami beach where prices are up we go down the list you know I just wondered what you thought about this conceptually and also not just with regard to those two you have a great sense of economic history with regard to other contributions in economics and land economics how to how to think about that issue of who's making off with the surplus yes so I think a couple of things one is just the world is awash at savings right now needs to show up somewhere and I think that reflects the fact that we're aging as anyone with money any society with money is aging and the places that are young don't have any money and all people are afraid of running out of money so they say so ironically you think hey I'm only going to live five years might as well party on but that's not how actually people behave is is they save and so they neither you know any elastic repository is something that is a natural place for money to go but I do think the city elasticity is created in part by the political process and particularly by I so I don't object to regulate land use regulation per se what I object to is when it is bespoke and untransparent and political and let's talk about to play let's about Los Angeles let's talk a little bit about London on that so here in LA basically all new zoning is spot zoning which means everybody is competing for the politician and they're giving political contributions and so on and but if they get it if they get the entitlement they get an enormous windfall which leads them to have an enormous incentive to bribe city council people and it gives city council people an enormous incentive to accept bribes and again this is not hypothetical is we've had three of the 15 city council people in Los Angeles and died by the FBI over the course of the last two to three years and it always revolves around land dealing somehow so I think if you have a transparent process that allows for the change in use and that's why I like auctions and again this is not a hypothetical they do this in Hong Kong they do it in Singapore it actually I think it works it gets the money also government more money than other mechanisms the other thing is I'm a big fan of property taxes and I look at Texas and you know people here in California yell at me for saying nice things about Texas but and there's stuff about Texas I think it's awful but they rely very heavily on pure avalanche property taxes for raising money and I think that does a really good job of basically capturing most of those land rents maybe not all of them but a good share of them in London I think one of the issues is in this stun me but I learned that there was no zoning in London and that doesn't mean that people could do whatever they want admit that people needed permission to do anything including like re-fenestering a building and so that gives enormous opportunities for mischief that gives enormous opportunity for monopoly and and so that's why the Alonzo point about making the land market as competitive as possible is another important element of this to me very true and you know competition is also a way into having to stopping exclusion and allow much more inclusionary entrance of people and so on so I'm I thought it um yeah look Richard Richard Green it was great to hear you give you a presentation not least to which to talk about Bill Alonzo so that was that was a blast from the past which I was a faculty member with him and I thought he was really well an imaginative guy who did excellent urban economics and there was a funny bit some of the brethren your brethren sort of cast him a little bit as a sociologist to sort of running in guise but no he's a very imaginative guy about land and land pricing and these types of things so that was excellent about London and actually the UK in general um if we wanted to put a shed at the bottom of our garden we would have to go to the city council in Oxford and get permission and they would say yes you could do that but look this is what it has to look like oh by the way it can't have running water or sewerage um it can't actually it can be insulated but it can't be permanent so it's and this person will come around and actually look over your shoulder as it's being built and say oh no this doesn't really so there's that level of intrusion as you say it's not zoning but it is actually land use regulation against norms rather than standards that are sort of set out in concrete so to speak and it's a very interesting thing to watch and I get really irritated at times because we put a big skylight and we wanted a big glass canopy oh you can't do that you've got too much glass what how can you have too much glass in in in England but anyway these things are important but they also go to really fundamental issue that is the relationship between the form that regulation takes and the choice of that form and then what you want to achieve for society and you and Jerry are beating the drum properly so I think about not just what is the form of the city but its equity consequences and then if you sort of take that a little bit further green space a living organism of the city as opposed to something simply built around tarmac and lines on the road so I really value your presentation and I think in lots of ways you've sort of captured Patrice's sort of big agenda because Patrice has written a book that's big it isn't Bill Alonzo doing a sort of handbook on heavy heavy that's heavy as well. Bill's books were small yeah I know it's valuable don't throw it around I was doing, I was weight lifting with it I hope I can get a signed copy at some point a door stop weight lift many users enjoy thank you Richard Greed very very helpful it was a pleasure just quickly on Alonzo it was fun to have to write something although I'm a little annoyed that I had to keep it 2000 words I think Alonzo might be my most recent reference from 1961 or something like that 64 is the book I know there you go those were the days okay I think Patrice is over to you thank you very much thank you no it's definitely not my turn I feel I feel very indebted and as I say really humbled by this array of scholars and the fascinating insights that the scholars have provided that they've sparked in terms of additional comments by other speakers questions from the floor and so on so one thing I just would like to do before I do some final comments is ask if there's anyone from our audience who would like to throw a question into the mix at this stage appreciating that many people are weary we're in between keeping people between their various after work activities on a Friday evening but is there anybody who'd like to chime in Richard Green to Kendra wants to say welcome to Kendra Stenson Stenson wonderful great to see you Kendra Stenson and to have Richard Green be able to speak to you over these across the years across the geographies as part of this so that just indicates how many folks we've had come in from all different perspectives and that's been the key so perhaps if there's no more questions what I wanted to continue that and say that driving my exploration of this book was to understand all of the many details the nuances the contradictions the frisson that is part of this process of how the built environment is envisioned and delivered for us in our cities globally now and as I said the utilization of the model has expanded from that Anglo-American beginnings to now being adopted through many parts of the world I thought so I was interested but you know what made me think it was worthy of a book was how many other people how many people are just generally interested in real estate and whether it is speaking about their apartments between Toronto and Miami as per Richard Florida and the changing pricing that occurs during our holding periods and so on to what it means for us status wise it means in terms of economic security it means in terms of inclusion or exclusion from communities this is what occupies many many people and probably all of us in many ways so I thought to really explore how this gets delivered was worthy because of that broad general popular interest what today's symposium has done and you know as I say I am overwhelmed and very very grateful was how many areas of scholarship can adopt what I provide in terms of this exploration of this real estate development process can adopt it into their critical and important areas of research on the human condition as a generality we're all concerned essentially with our human condition and for instance these speakers today and I'm just going to run through and thank them all firstly our Gordon Clark someone I've just known and respected enormously over many many years who has led the way and perhaps probably influenced my thinking in terms of constantly relating what happens in our economic world to the impacts on society on people and so on and he has taken this to talk about the rise of institutional capitalism of course and the challenges for responsibility that come with that and how it then works back to being a responsibility for real estate its production its ownership, its management and the occupation of it and then Richard Flora the co-host of today thank you very much Richard of course is well known for having having spurred our interest in understanding in actually how people live who are the people who live in cities who are the people who thrive in cities why do people want to do that and why do they want to be there and of course to be able to contribute a little to his discussion about that behaviour and the clustering and how things play out offering some of the economic or the financial understanding behind that I'm really grateful to Richard for including that thank you Larry Summers of course has a macro view of the world but he and his tradition, his family tradition has been one of the most important of course to talk about how real estate shapes us and how we shape our world was a very nice compliment in support of the book I appreciate that of course it makes me feel even more responsible for trying to get this right but Manuel Albers who has also been at Columbia and done his studies early on and has really made an impact now in talking about how this financialization we heard it many times today how the financialization, the players the financial players, the capital players all over the world are affecting how decisions are made because they are influencing decisions that were once just qualitative aspects of our human condition they're financializing it they're turning it into a financial metric and therefore changing the way in which it's incorporated so I'm very very grateful for Manuel for including that and linking really appreciating and pointing out how I'm reintroducing real estate into that discussion that he leads on labor and capital and of course Derek Wajik is so well known for looking at these the sort of economic financial economic economic geographies and so on of the world and to include real estate into his discussion of that and the total economy thank you very very much you can see it so much so much more clearly than I but it does make me feel very very interested in pursuing this with rigor Janelle reminded us Janelle Nox Hayes of course reminded us that when we're talking about real estate we're talking about people and their conditions and reminding us that that condition is particularly pertinent to people who are indigenous landowners and all of those who are vulnerable to the problems of climate change and how it will affect our relationship to our land our real estate and so on so Janelle thank you very much for including me into that and really then launching the discussion of climate change and the pandemic and our health and our social situation which Sam picked up on linked once again the question of the pandemic through to notions of urban density and reminded us or warned us not to just make a very simplistic an overly simplistic and erroneous translation of pandemic to density but to look at actually what we do as human beings in terms of once again our economic behavior how we actually build our buildings and create spaces between ourselves and so on that is the intermediary between the pandemic and the density of the urban city and Rick Pizer whom as I said you know has had inspired me about the education of future real estate developers and for Rick to be continuing to work with this question of urban sprawl the dynamics the back and forth and urban centers and urban outlying areas and what it means to how our environments are managed and support communities or don't support communities that was very very very pertinent I think and of course Rachel Weber who is who has had my most profound recognition for her incisiveness I mean she is the one who just really zeroes in with the laser beam on developers and what they're doing and how they're acting in the city in urban construction and talks about the things that are motivating them and helps me understand the difference between the provision of shelter as you know a very valid professional and economic activity within a community the provision for shelter for a decent economic reward and that is what we could call enterprise to going too far with that and raising the notion of speculative self-interest and how that begins to undermine the whole productive process so Rachel thank you very much and of course then Ashby takes it further to say real estate is a perfect manifestation of all the problems of climate change it's there it's fixed it's suffering it's vulnerable and if we can use it as a proxy for ourselves and what's going to happen to us by looking at the financial impact on buildings with respect to ignoring the building for resiliency and environmental conditions then you know that's obviously going to be an important role for understanding real estate which cannot be anything removed from the climate and the impact of climate and not only climate but even specifically that open space I'm really grateful to Jerry for reminding us that you know the question of open space is something that we all think just a knee-jerk reaction we've got to have we've got to have it and it's got to be there and so on but how does it how does it appear who looks after it who what does it what impact does it really have and so on and the details of that are much more complex and of course you know that was followed up by Richard Green who reminded us that you know some things some external externalities and you know we can give macro economists full credit for this for really not taking the notion of externalities at face value but rigorously checking to see what can be regarded as such and what can be responsible for such so such a tremendous input by so many people today I'm very very grateful hopefully the discussion around the book the book itself will continue to drive some interest and thought and discussion about all of the things that impact our built environment and our human condition within it I want to thank my students of course who over these years have have asked the hard questions and have refused to take pattern answers and really were the compelling force for doing this book this book and its discussion continues to inspire them then it has been worth every minute of the writing of it. Thank you once again to our hosts and to all our fabulous speakers for being here thank you thank you I'm honored and sincerely very very grateful Richard well thank you Patrice and thank you Gordon and thanks to all of our contributors I don't think that I have anything additional to add and it's Friday afternoon other than what I've already said but it just echo I think which we heard from every single presenter it's a landmark achievement it's a majestic work of history it synthesizes that work of history in the context of urban theory and on top of that it's beautifully done it's just a beautiful book and so most of all I just want to convey my congratulations to you Patrice and I guess we've known each other for a long time brought together by Gordon and I hope I really get to see you in person soon and I would say that for all of our participants I am now up and around in traveling again a little bit and I'm paying the price with back and shoulder ailments it's funny which my physiotherapist said you haven't done this for 20 months it's no wonder you know you've been exercising you've been doing all these things so be careful when you get back to travel but I hope to be able to see each and every one of you and Patrice particularly you and congratulate you in person in New York City again thank you so much for such a marvelous contribution so Patrice this started off as an idea rather than a fact matter and I think I was taken by the sheer scale and significance of the book and it's been astonishing achievements and you should be very proud indeed of what you've accomplished I think I've been very impressed by the commentary that's been presented today not least of which they've engaged with your book in a detailed way in a sort of in a conceptual way they marveled at your history so that doesn't happen that much in academic life and you know it's a hell of a compliment for the book that you've written the other thing is all of us have got sort of an angle on the book and it's been great to hear some of those angles you know I was very impressed by each one for their specifics if you like and their take and the confidence in which that their take is presented they're not intimidated by your book they learn from your book but they've also built on your book and that doesn't come a big compliment just to last sort of points of organization we will be back in contact with all the contributors if they're on the line or still listening in but we will be basically collecting the final drafts of the commentaries I guess Patrice either make them available when they're complete or when they're final but equally these commentaries are going to be part of be published in Environment Planning A when they're sort of complete and full and that's I think also going to be something to watch and look for as well because in lots of ways the written commentaries they sort of go deep and are interesting in their own right that go well beyond what is being presented today so in my world it's 10 to 8 that is 10 to 8pm in London time and I'm sort of keen to finish the last couple of chips on my fishing chips and I hope something nice and rare that goes down smoothly with the company and I must say again to thank Richard Flora because between the two of us we've really been able to put together speakers and ideas here that I don't think by ourselves we could have possibly done you have and if you think you can you can but thank you to come around and recycle back with this so delightful and I'm truly so so grateful thank you to everyone and we will look forward to publishing and talking further okay thanks again thank you bye everyone thank you