Boston humming as appeal of life in city booms
The century’s first decade has brought a historic surge of newcomers to the city, most settling downtown. They carry fresh expectations — and pose real challenges
By Casey Ross | The Boston Globe | March 3, 2013
Susan Mai’s Beacon Hill apartment is a postage stamp of a place. The kitchen isn’t much bigger than the bathroom, and entertaining friends is a bit like playing Frisbee in a phone booth.
But for all its drawbacks, Mai says she couldn’t be happier. She walks to work at a local publisher, eats out five times a week, and thinks of Boston Common as an ideal front yard.
“It hasn’t crossed my mind to ever want to leave the city,” said the 25-year-old Mai, who shares the 450-square-foot apartment with her boyfriend. “I’ve never thought of our place as too small. I really don’t need a big kitchen or a garden.”
Mai is among the thousands of young professionals whose devotion to urban living is causing Boston to grow at its fastest rate in decades. The influx has spawned a sweeping transformation of the city, with new residences and office buildings filling the skyline and reinventing commercial districts that once felt hopelessly time-worn.
Almost everywhere you look, it seems, is a new building site: A dozen towers are rising in the downtown area, and city-wide some 5,300 homes are currently under development. Boylston Street near Fenway Park is humming with construction during the day and crowds of diners at night. Downtown Crossing has lured fine restaurants and hundreds of luxury residences. And even once rough-hewn neighborhoods such as South Boston are increasingly drawing gourmet food stores, hip bars, and tony apartments.
The population surge has thoroughly reversed the suburban migration that began in the 1950s, when Boston peaked at about 800,000 people. Head counts in the South End and downtown have jumped by 20 percent since 2000.
In just one year alone — 2010 — Boston’s population grew by 7,500 people, and is now above 625,000, its highest level since the 1970s, according to city data.
Though largely driven by the generation between 20 and 34, the city is also swelling as empty-nesters trade suburban homes for urban pied-a-terres, and more young families opt for Boston over the traditional move to the suburbs in search of better schools. Regardless of background and interests, these people are drawn by the convenience and energy of busy urban neighborhoods.
“I like the feeling of being surrounded by people,” said Ece Gulsen, 27, who grew up on Turkey’s Mediterranean coast and now lives in the Charlestown Navy Yard to be near the water.
Companies are also moving into Boston to attract talented workers, developers are responding with even more housing, and restaurateurs, sensing a growing appetite for inventive food and entertainment, are opening eateries in places that defy conventional wisdom.
During the last two decades, Brad Fredericks, proprietor of Fajitas & ’Ritas, has watched the changes wash through the city’s downtown, where he recently opened a new eatery, the Back Deck grill on West Street. First, he said, Suffolk University and Emerson College expanded. Then the Boston Opera House was renovated, and the Paramount and Modern theatres reopened. Businesses then formed an association to help improve the area, and hundreds of apartments and condominiums are now under construction.
“I’m more optimistic than I’ve ever been,” he said. “There have always been a lot of activity generators down here. But the crowds have become more consistent. You see more people strolling around.”
The Boston real estate market is one of the strongest in the country, according to the Urban Land Institute, in part because of its strong housing market and the medical and technology companies who want to be near its population of highly educated 20- to 34-year-olds.
Maureen McAvey, a ULI fellow who specializes in retail development, said young professionals have particular preferences for housing, shopping, and travel that dictate how a city grows. For one, they are more willing to live in small spaces. They don’t feel the need to own a car, and make more frequent shopping trips.
“From a consumer standpoint, we’ve seen a large increase in people buying food on a two- to three-day basis,” McAvey said. “This generation wants the access and convenience that the city provides. They are much less interested in having a big lawn.”
But it is not just young workers queuing up for the city. Dick Reynolds, 67, relocated with his wife to a two-bedroom condominium in the South End when their kids moved out of their old home in Needham.
“We’re delighted with it,” he said. “We’ve always loved the ambiance of the city. And we can go to a variety of things without getting into the car. We don’t have to worry about parking, cutting the grass, or shoveling snow.”
Though positive in many respects, the population growth creates many challenges for city officials and residents alike: crowded schools, roads, and transit lines, and harder-to-find housing at moderate prices.
“It’s virtually impossible for someone of my income level to own or rent in the city,” said Quinton Kerns, a 27-year-old urban designer who pays $600 a month to share a Harvard Square apartment with five roommates. And with $150,000 in student loan debt, Kerns doesn’t see himself moving up in the housing market anytime soon.
“It’s frustrating — I can’t just go to the community of my choosing,” he said. “I’m at the mercy of what’s affordable to me.”
Even though Boston added more units of housing in the last decade than in the three previous decades combined, the pace of new development is not keeping up with all the people who want to live here. The Dukakis Center for Urban and Regional Policy at Northeastern University predicts that unless annual housing production in the Boston area doubles — from 6,000 units to 12,000 units a year — already sky-high prices will soar.
“The circumstances call for a very different approach to housing,” Dukakis center director Barry Bluestone said. “There’s much more demand for multifamily rentals and condos. We need to get communities to rezone to allow for that kind of housing.”
Average rents in Boston are about $1,700 a month. But much of the new housing built in the past few years are luxury residences that command monthly rent of $4,000 and more. Both the city and state have launched initiatives to build more moderate-priced housing; the Compact Neighborhoods program by the Patrick administration aims to spur construction of 10,000 multifamily housing units a year in Massachusetts, largely to retain young workers being priced out of the market.
Mayor Thomas Menino’s administration has begun encouraging developers in the South Boston Innovation District to build micro-housing units — tiny apartments with rents that people just starting out can afford.
Yet here too that goal is proving elusive. At Factory 63, a newly renovated building with units as small as 375-square-feet, so many people applied for its first group of apartments that a lottery was required to parcel them out. The prices ended up at $1,700 to $2,400 a month, a few hundred dollars higher than officials had initially hoped.
“Just because the units are smaller doesn’t mean you can build them cheaply,” said Kelly Saito, president of Portland, Ore.-based developer Gerding Edlen, which built Factory 63 on Melcher Street and is also constructing a 21-story housing tower on A Street.
Boston already has among the highest construction and land acquisition costs in the country, he said, while a building full of studio-sized apartments means many more expensive kitchen and bathroom fixtures than normal.
“I think the effort to produce lower cost housing can be achieved at least partially,” Saito said. “But it really depends on where the expectations lie.”
Meanwhile Boston is grappling with another by-product of its popularity: crowded classrooms. Enrollment in city schools next year is expected to be at its highest in a decade, with another 1,200 children entering the school system, mostly at the lower grades. The additional students will require a $61 million increase to the city’s school budget, according to a recent report to the school committee.
Boston officials are in the midst of changing the classroom assignment process to make it more predictable and to provide easier access to quality neighborhood schools.
One of the fastest changing neighborhoods is the Fenway area, where the population increased 15 percent from 2000 to 2010. For decades its main boulevard — Boylston Street — was a scrubby, traffic-choked row of gas stations and repair shops. But in just a few short years, several modern, sleek apartment and retail buildings have gone up, and the strip now boasts a sushi place, Southern barbecue restaurant, and popular nightspots that spill crowds well into the night.
Dave DuBois, chief executive of the Franklin Restaurant Group, said the neighborhood’s rapid growth has quickly produced a creative food scene that is entirely distinct from Fenway Park and nearby Lansdowne Street.
“Five years ago, if I opened a restaurant in the Fenway, people would say, ‘Oh, you doing beer and nachos? Wings?,’ ” said DuBois, whose company opened Citizen Public House, a fine whiskey bar on Boylston Street that serves a pork pate melt. “The neighborhood has the energy of people in motion. Top restaurateurs are taking a serious look at it.”
In February developer Samuels & Associates proposed construction of another 22-story residential and retail building called The Point — a sharply-angled glass building that would replace a row of run-down retail buildings at Boylston and Brookline Avenue.
Mai, the Beacon Hill renter, said she would love to move into one of the new buildings rising across the city, but the prices remain stratospheric. She said she and her boyfriend are able to afford the $1,600 a month rent in their Beacon Hill unit. But her landlord has already increased the rent once, and may try do so again.
Mai is beginning to consider other options, but like many in her age group, communities outside the city are not among them.
“I think the farthest I would go is the South End,” said Mai. “I know a lot of people want to live in the suburbs because they crave the extra space, but it’s never been something I’ve wanted. I’m happy staying around the city.”
A demographic revolution is coming in housing
By Barry Bluestone | Boston.com | December 20, 2012
As we enter 2013, the latest news on the housing front is encouraging. This past year sales of single-family homes in Greater Boston rebounded for the first time in seven years. Condo sales are up as well, nearly 30 percent over 2011 levels. And with mortgage rates remaining at historic lows, this coming year could see more of the same.
But the big story in housing is the dawning of a seismic shift in the region’s population and with it, a dramatic change in what kinds of housing people will want and where they are going to want it. It’s all about the greying of the baby-boom generation and the coming of age of the “millenials.”
Between 2010 and 2020, the population of Massachusetts is projected to grow by roughly 200,000 or about 3.1 percent. But as the figure below demonstrates, the age structure of the population is going to change dramatically. The number of young “prime age” individuals, aged 25-34, is expected to grow by about 91,000. These are the millenials who were 15 to 24 years old in 2010.
The number of older prime age population – those aged 35-54 – will actually decline by a whopping 220,000. These folks represent the aging of the “baby bust” generation.
The fastest growth in the population will occur among us geezers – those of us in the huge baby boom generation born between 1946 and 1964. There will be over 250,000 more households headed by someone 65 or older.
This demographic shift will affect housing demand dramatically in Massachusetts and especially Greater Boston. Many of us older folks will wish to “age in place” where we have lived for decades but move from the suburban three and four bedroom homes where we raised our families to apartment and condo developments that are right-sized for us, allow us to use our cars less to go to Starbucks or the grocery store, and have plenty of amenities – especially elevators.
What we know about the millenials is that they are starting families later, want to live near work, hate to commute, and love to live in places where they can easily walk or bike to the same Starbucks we like to visit. We also know they have suffered from this Great Recession more than anyone else. Their incomes have fallen, their college debt has soared, they tend to be geographically mobile, and many will have trouble qualifying for mortgages. Rental housing will appeal to them while others will have the dough and the desire to purchase a condo. Few are going to opt for the suburban home on a large lot.
Those “disappearing” from the scene are older prime age families aged 35-54 who have historically chosen to raise their children in large-lot single-family homes in the suburbs and have been willing to sit in their cars for hours on Rte 3, Rte 2, the Pike, and I-93 commuting back and forth to work in order to do so. (As they sit in that traffic with a good deal of time to contemplate, many are coming to the unsettling realization that each year they are spending a larger proportion of the time they have left on earth in traffic jams – and wondering whether this is the best use of their remaining time!)
So what does this mean for housing in the Commonwealth and especially in Greater Boston between now and 2020?
The market supply of existing traditional suburban single family homes is going to expand as baby-boomers sell these units and move into smaller places. At the same time, market demand for larger homes is going to weaken as the number of older prime age households — those who have opted for this housing in the past — declines. That means traditional suburban home prices are going to continue to stagnate. At current rates, they may not return to their 2005 peak until sometime early in the 2030s.
Simultaneously, the demand for multifamily apartments and condos is going to soar as young millenials at one end of the age spectrum and aging baby boomers at the other both search for smaller housing units in village and town centers and some in the central city where there are close-by amenities and access to mass transit. Unless we build a lot more of this type of housing, condo prices and rents are going to skyrocket.
And here is the rub. Over the years, many of the suburban communities around Boston have enacted zoning that severely restricts the ability of developers to construct multifamily housing in village and town centers. Some of this stems from the fear that people “unlike” those living currently in their communities will move in to take advantage of more affordable housing in these developments.
But the demographic shift means that these communities are zoning not against “those” people, but against their own residents, many of whom have lived in their communities for decades — the community’s aging baby boomers and their millennial kids.
Unless these communities are ready to jettison their long-term residents, they need to get on with the task of rezoning sections of their communities for smart growth, transit-oriented, village and town centered, multifamily housing. If they are wise, they will use the state’s Chapter 40R program which will not only encourage developers to construct precisely this type of housing, but the communities themselves can get an extra dollop of local aid in the bargain which they can use to help keep their municipalities from going bankrupt.
BLUESTONE REPORT: More Cambridge housing needed
By Erin Baldassari | The Cambridge Chronicle and Tab | November 28, 2012
As Baby Boomers age and the region continues to attract students and young professionals, the types of housing that renters and homeowners demand will change – and the pinch on housing in Cambridge will only tighten – according to a recent report on housing in the Greater Boston Area.
The report, by the Dukakis Center for Urban and Regional Policy at Northeastern University released Nov. 14, predicts the five-county region around Boston may need to double or triple its housing production to meet demand through 2020. Dukakis Center director and lead author of the report, Barry Bluestone, himself a Cambridge resident – said that the problem in Cambridge is particularly acute precisely because the city saw barely a blip in demand despite a housing crisis that crippled parts of the country.
“Home prices have fallen very little because of the tremendous demand for housing from young professionals and workers,” Bluestone said. “This is a hot market in real estate, even in a recession.”
According to the Cambridge Community Development Department, the median price for a one-bedroom apartment increased from around $1,400 to $2,000 a month from 2000 to 2011 – a 43 percent increase. For three-bedroom apartments, median rents increased from roughly $2,000 to $3,000, or 33 percent, in the same time period.
Across the region, slow housing production since 2005, a historically low vacancy rate (when compared to the national average), a strong and growing economy that is attracting new workers all conspire to drive up rents, the report argues.
While Bluestone admits that in Cambridge especially, rents and housing prices are not likely to decrease – barring natural or economic catastrophes – he argues that the rate of increase could be slowed if coupled with a commensurate increase in housing production.
“We can increase the amount of housing to the point where rents won’t come down, but they won’t rise as fast as they’ve been rising either,” Bluestone said.
Beyond building more housing across the board however, the report argues the region needs to build more of the kind of housing its changing population will want: “Fundamental structural changes in the age composition of the region’s population; in the income, wealth, and debt distribution of the region’s households; and in generational differences in consumer behavior will almost certainly alter the types of housing we will need over the next decade, as well as the places within the region where that housing will need to be located.”
Taller, denser, smarter.
Using demographic statistics from the Metropolitan Area Planning Council, Bluestone and his fellow researchers created projections to anticipate changes in demand. While the trends hold true for the entire region, some are already underway in Cambridge, which has seen a growth in population along with rising incomes, an aging Boomers’ population, and an influx of young professionals and workers.
What do young professionals have in common with aging Boomers? Both have shown a preference for alternative-living arrangements, including group homes and micro-unit developments, and living next to transit hubs, Bluestone said.
“Lots of Baby Boomers who fueled the suburban boom of the 60s and 70s are thinking about whether we want to keep their large five- or four-bedroom homes particularly as we age,” Bluestone said. “That will put tremendous pressure on the city for multi-family housing for seniors who want to age in place but not necessarily stay in the same home and are not ready for a nursing home.”
Cambridge Community Development Department (CDD) Housing Director Chris Cotter agrees. The recommendations are right in line with trends the city has also been studying both through its Kendall and Central Square Advisory Committees as part of the K2C2 Planning Study by consulting firm Goody Clancy and through its Silver Ribbon Committee, which is expected to release a report soon on the needs of the city’s swelling senior population.
Among the Central Square Advisory Committee’s draft recommendations, they call for eliminating barriers to so-called “micro-unit” apartments, or units that are between 250- and 500-square feet. The draft plans also call for heights up to 140 feet in Central Square and 160 feet at Lafayette Square Park with uses above 80 feet limited to housing only.
“The focus on denser communities and transit-oriented communities with people wanting to be in central cities – to me that’s reflected in a lot of what’s happened in Cambridge over the last few years, and that’s because Cambridge really is one of those types of communities,” Cotter said. “We’ve heard from a lot of people who are looking for different housing models, and it’s a discussion that’s happening in a lot of communities. If you look at the demographics, this is the right time to be talking about that.”
Who lives where?
But who exactly is going to live in those apartments and where is a concern of Bill Cunningham, an affordable housing advocate and representative of Newtowne Court residents on ACT’s 38-person board.
For Cunningham, the only way to control rising housing costs is rent control.
“You can’t control rising prices without putting a ceiling on costs,” Cunningham said. “The more subsidies you give, the higher the floor goes.”
Cambridge had rent control in place from the 1970s until 1994, when a state referendum eliminated the power of municipalities to keep the controls in place. Affordable housing advocates have argued that since then, Cambridge has lost its middle class because families can no longer afford to stay in town.
In a recent survey by CDD, Cotter said over 90 percent of middle-income families – defined as 80-100 percent of area median income or roughly $78,240-$117,360 in annual income for a family of four – cannot afford a three-bedroom home in Cambridge.
With federal and state subsidies dwindling, the report recognizes a decrease of over 50 percent of American Reinvestment and Recovery Act funds, along with a steady decline in state funds – meaning money to support affordable housing is coming from a shrinking pool. Middle-income housing rarely qualifies for federal or state assistance, which often caps qualification at 80 percent area median income, making that target all the more difficult to hit.
The solution Cotter sees however is a provision already in the city’s zoning called the Inclusionary Zoning Ordinance. Passed in 1998, the ordinance has helped create more than 450 units of affordable rental and ownership housing as new developments have cropped up across the city, according to CDD’s website.
The ordinance applies to new residential developments or buildings converted to residential use, which will create 10 or more new housing units or over 10,000 square feet of residential space and requires that 15 percent of the base units in the building be affordable.
“The clearest way to incent middle-income housing is to do it across the board so you have that there in the zoning and you’re ensuring that the offer for additional density is there for everyone to consider and take advantage of,” Cotter said.
The Central Square Advisory Committee is looking into offering density bonuses beyond what is allowed in the inclusionary zoning ordinance so long as “at least 20 percent of the bonus floor area approved be devoted permanently to middle-income housing.”
In addition, the committee is now considering a recommendation that would make the sale of the city’s parking lots contingent upon the creation of middle-income housing by prioritizing the sale to non-profit affordable housing developers, or requiring that at least 20 percent of all units developed under the allowed base density be permanently designed as middle-income units.
But Cunningham fears that won’t be enough to stop the atrophy of low- and middle-income families from leaving Cambridge. A small minority of units are built within each development as part of the inclusionary zoning ordinance, but the provision itself does little to preserve the affordable and middle-income housing that exists now in Cambridge.
“Building more housing is only part of it, the other part is the preservation of the affordable and middle-income housing that we have,” Cunningham said. “We have to start thinking of how to protect the residents who live here instead of building for people who have yet to even come to Cambridge.”
The Kendall Square Advisory Committee’s recommendations on housing in Kendall Square are now being vetted in the Planning Board. The Central Square Advisory Committee’s recommendations are scheduled to be finalized over two meetings this week.
Micro units: Perfect pad, imperfect price
By Renee Loth | The Boston Globe | November 24th, 2012
AERON HODGES is a small woman, but if she stretches out both arms she can embrace the whole kitchen in the compact “innovation unit” Mayor Menino is promoting to attract young workers to Boston’s newest neighborhood. Designed by the architecture firm ADD Inc, the apartment is sleek and sculpted, with cool features like convertible storage and a wall mount for the inevitable Geekhouse bicycle. It’s likely to be popular with young, single employees of the biotech and financial companies coming to the Innovation District, and with retirees looking for an urban pied-à-terre. What it is less likely to be, regrettably, is affordable.
A full-scale model of the micro unit — all 300 square feet of it — was on display recently at the Boston Convention and Exhibition Center. Hodges and her colleagues built the model in conjunction with Menino’s “ONEin3’’ initiative (named for the 30 percent of city residents who are between the ages of 20 and 34). “The most exciting part of the process is the collaborative nature of the construction itself,” she said, perfectly summarizing the culture of this demographic.
Over several months, the ADD Inc team asked young professionals what they would sacrifice to afford living downtown. Few wanted granite countertops or hardwood floors. Only 30 percent said they thought 300 square feet was too small; most would trade space for a shorter commute. They wanted to be close to public transit, hip restaurants, and their jobs.
These “creative economy” pioneers are redefining the relationship between public and private space. They want privacy for the essentials — bed and bath — but beyond that they are willing to share. The city is their living room. The local bistro is their kitchen.
ADD Inc principal Tamara Roy likens the micro unit to the Smart Car or Mini Cooper: products the auto industry recognized would appeal to people looking for affordability, good design, and a lighter environmental footprint. “Kudos to the mayor for encouraging developers to do a different housing model,” says Roy. “It increases supply and diversifies the market. But it’s not going to answer the affordability question.”
The units — often so small that Menino needed to exempt them from city codes — respond to changes in demographics and consumer attitudes. According to the annual housing report card by the Dukakis Center at Northeastern University, 12,000 new units a year are needed to meet projected population growth in metro Boston, and much of the demand will be in the city core.
The study’s author, Barry Bluestone, said housing starts will be driven by two groups at opposite ends of the demographic spectrum: older retirees with significant assets looking to downsize, and recent college graduates with significant debt. Both could be attracted to the new micro units. But one group can pay a lot more.
Fifty mini units, which are closer to 450 square feet, are planned for the residential tower on the former site of Anthony’s Pier Four. There are no cost controls; the units will command whatever the market will bear. No one knows for sure, but estimates range around $1,500 a month. Reasonable? You’d need to earn $72,000 a year for that rent to be 25 percent of gross income, the usual goal.
As always with real estate, the issue is location, location, location. Land in the Seaport is expensive; construction is costly and difficult. “We should be thinking more broadly, beyond the waterfront,” said Bluestone. For now, however, the micro units are only approved for the Innovation District.
Before the housing crash in 2008, Boston’s political and business communities were united in pushing for affordable housing. The Chamber of Commerce listed high housing costs as a top impediment to economic growth. Then the collapse of the market gave some a false sense that prices would “normalize” in Boston. But they didn’t. According to Bluestone’s report, only New York and San Francisco outpace Boston in rental housing costs.
Just increasing supply won’t be enough. What is needed is a recommitment by government and the private sector, with cross-subsidies or direct housing stipends, if necessary, to keep the micro units below $1,000 a month. Otherwise the city’s hottest new neighborhood will be very small place indeed.
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