Can someone who lived through this era and understood what was happening enlighten us on the following:
Late 1970's real estate market compared to Early 2000's
Similarities
1. Easy access to cheap money.
2. Institutions lending money not regulated or deregulated.
3. Institutions lending money through exotic and non-conventional notes.
4. Overbuilding and high surplus.
5. High level of bankruptcies and foreclosures.
6. Government Intervention intending to help the situation that just made it worse.
Result - Recession of the 1980's and the recession of 2010?
Those parameters that you list in the initial post are the contributing factors to the Cantillon Effects that are cited in the Skyscraper Index (variously attributed to several economists of the C20th). There's a nice analysis of it here
The gist of it is that easy cheap money supply leads investors to look at longer term projects with more debt leverage. Booming (global) economies make this look like a good idea. The booming economies are characterised by success in the Finance, Insurance, and Real Estate (FIRE) sectors, all of which like to be based in prestige offices in city centre locations. This leads to higher land prices. The exaggerated land prices mean that to develop the land, and make a profit, lettable area must be maximised. Thus taller buildings (which the FIRE industries like to inhabit) appear the only way. When the crunch hits the FIRE industries, the tautologous relationship between them, their high-rise offices, and cheap money becomes apparent.
The high-rises that have secured funding continue to be built and completed, thus offering massive amounts of space that would suit the now down-sizing FIRE tenants. The FIRE tenants are subject to higher interest rates and the declining value of their own investment portfolio (which is heavy on commercial office space). Cue global economic catastrophe.
This does not mean that the high-rise structures are at fault, merely symptomatic of a speculative investment market. If well sited and designed, the high-rise does maximise the economic potential of its site, offer cultural capital to the city, efficient use of transport infrastructure, attractive spaces and opportunities for Combined Heat and Power (CHP), renewable energy harnessing, mixed-use contributes to the regenerative opportunities: job creation, more balanced activity and energy use profiles within and around the building. In many cases the high-rise is the only solution to burgeoning commercial and residential needs.
But, as you would read in the linked article, most every time that we build a new "worlds tallest", there is financial collapse just a little way away in the future.
So, sell everything you own, invest in gold, buy a small house with a lot of land and some cows far from the madding crowds, install hefty insulation and energy generation, await the second coming.
Meanwhile, me and the artists are going to move back into the city and party.
Don't know much about History
Can someone who lived through this era and understood what was happening enlighten us on the following:
Late 1970's real estate market compared to Early 2000's
Similarities
1. Easy access to cheap money.
2. Institutions lending money not regulated or deregulated.
3. Institutions lending money through exotic and non-conventional notes.
4. Overbuilding and high surplus.
5. High level of bankruptcies and foreclosures.
6. Government Intervention intending to help the situation that just made it worse.
Result - Recession of the 1980's and the recession of 2010?
....don't know much biology...
don't know much about the french i took
...probably doesn't explain everything, but offers some insight
but i do know that i love you, archinect...
And I know that if you love me too...
wurdan freo, very interesting question. I'm sure we'll answer it after we finish the song.
what a wonderful world this would be
see if you can guess what i am now...
...a zit, get it?
What a wonderful world it would be....
Those parameters that you list in the initial post are the contributing factors to the Cantillon Effects that are cited in the Skyscraper Index (variously attributed to several economists of the C20th). There's a nice analysis of it here
The gist of it is that easy cheap money supply leads investors to look at longer term projects with more debt leverage. Booming (global) economies make this look like a good idea. The booming economies are characterised by success in the Finance, Insurance, and Real Estate (FIRE) sectors, all of which like to be based in prestige offices in city centre locations. This leads to higher land prices. The exaggerated land prices mean that to develop the land, and make a profit, lettable area must be maximised. Thus taller buildings (which the FIRE industries like to inhabit) appear the only way. When the crunch hits the FIRE industries, the tautologous relationship between them, their high-rise offices, and cheap money becomes apparent.
The high-rises that have secured funding continue to be built and completed, thus offering massive amounts of space that would suit the now down-sizing FIRE tenants. The FIRE tenants are subject to higher interest rates and the declining value of their own investment portfolio (which is heavy on commercial office space). Cue global economic catastrophe.
This does not mean that the high-rise structures are at fault, merely symptomatic of a speculative investment market. If well sited and designed, the high-rise does maximise the economic potential of its site, offer cultural capital to the city, efficient use of transport infrastructure, attractive spaces and opportunities for Combined Heat and Power (CHP), renewable energy harnessing, mixed-use contributes to the regenerative opportunities: job creation, more balanced activity and energy use profiles within and around the building. In many cases the high-rise is the only solution to burgeoning commercial and residential needs.
But, as you would read in the linked article, most every time that we build a new "worlds tallest", there is financial collapse just a little way away in the future.
So, sell everything you own, invest in gold, buy a small house with a lot of land and some cows far from the madding crowds, install hefty insulation and energy generation, await the second coming.
Meanwhile, me and the artists are going to move back into the city and party.
la la la la la... history
this is getting good. Keep it going.
don't know much scientology
don't know much paleontology
Block this user
Are you sure you want to block this user and hide all related comments throughout the site?
Archinect
This is your first comment on Archinect. Your comment will be visible once approved.