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Parking and planning: Lessons from a map of Portland land value

Posted by on January 14th, 2015 at 9:44 am

land-value-540

Land in dark red is worth $100 or more per square foot. Land in pale green is worth $5 or less.
(All images except the last are © Fat Pencil Studio – click through to reach a larger version)

Money isn’t everything, and neither is land value.

But if you want to know how the world works, they’re both worth understanding. That’s why the above map, created as a policy exercise by our friend Joshua Cohen of the civic graphics firm Fat Pencil Studio, is so much fun.

It’s a color-coded map of the market value per acre of the land — not the buildings, just the land — beneath every tax lot in the City of Portland.

Cohen created the map last year as a way of calling attention to a problem he sees in city government: the fact that the public sets aside so much real estate in high-priced neighborhoods for the free storage of private cars.

“What we are giving up by continuing to stick with free parking for most of our city?” Cohen asked on his company’s blog. “As a city grows and evolves, the demands on the public right of way increase. We need to use it more effectively.”

But you don’t have to be a fervent parking reformer to find interesting details in Cohen’s map, the first I’ve seen of its kind for our city and one that would probably give land-value wonks like Chuck Marohn and Joe Minicozzi a lot to nod sagely over.

You should check out the full-size image on Fat Pencil Studio’s website, but here are five details I noticed.

1) The Northwest District is the most consistently valuable part of town where parking is still free.

northwest lloyd downtown

A close-up of land values in Northwest Portland.

Why are the Northwest 20s the worst place in Portland to find a parking space? Because land along those fun, beautiful streets is in extremely high demand but (unlike in downtown or the Lloyd District) if you happen to own a car, you can store it in the street for free for as long as you want.

This automotive socialism is finally going to change, at least a little, when parking permits start being required in the area this March. But at $60 a year, those permits won’t cover anywhere close to the actual value of renting a 130-square-foot tract of land that could theoretically sell for $8,000 on the open market — which is a pretty good sign that Northwest parking annoyances will be with us for a long time.

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2) Southwest Portland isn’t worth much.

southwest sprawl

Southwest Portland and downtown.

Three of Portland’s five city council members, and much of its ruling class, lives in Southwest Portland, our quadrant of winding roads and auto-oriented Anytown USA development (as well as plenty of neglected lower-income pockets). The wealth of many residents probably makes some people here think they’re sitting on the most economically important land in the city.

Nope. The mantlepieces might be fancy, but the dirt beneath them is a tax sink. Most of Southwest, and even a lot of the tony West Hills, is worth less than Mall 205 or the strip malls along North Lombard. And the value of Southwest’s land pales in comparison to spots like Old Town or the Lloyd Center — where you might meet someone who makes some rich folks uncomfortable but you’ll also see thousands of people conducting the business of city life every day.

3) Industrial areas aren’t exactly tax gushers.

industrial areas

The Northwest Industrial District, Swan Island and North Portland.

Heavy industry can bring lots of good things to a city: exports, middle-class jobs, international transportation. But if you ever wanted an explanation for why cities are constantly rezoning industrial sanctuaries for other development, here’s why. Commercial and residential developers pay way, way more for land, because they can get more money out of it.

Side note: two of Portland’s biggest and most physically attractive factories produce a niche product — graduates. The University of Portland and Reed College have lovely grassy expanses that help convince smart people to pay lots of money to attend. But as long as their land is set aside for games of frisbee, it apparently isn’t worth much more per acre than a parking lot.

4) Cully and Brentwood-Darlington are low-cost enclaves.

cully

Cully in Northeast Portland.
southeast

Brentwood-Darlington in Southeast Portland.

There are only two big exceptions to the general rule that Portland’s most economically valuable land is the street grid between the West Hills and 82nd Avenue. The far southeast and northeast of that area have longer blocks, fewer sidewalks and far lower values per acre. In many ways, these are East Portland neighborhoods that just happen to be west of 82nd Avenue.

Why? The answer is in the final item…

5) Portland’s entire land value map is basically just another version of this other map.

annexation history

(Image: City of Portland)

What’s the second map? It’s a city record of which decade each part of Portland was annexed by the city — and therefore, generally speaking, how recently it was developed. The most valuable and economically important parts of town all fall in the red, orange and yellow areas, all of which joined the city of Portland before 1930.

In other words, the most valuable and economically important areas of town are also the ones that weren’t built to prioritize the rapid movement and free storage of private cars.

— The Real Estate Beat is a regular column. You can sign up to get an email of Real Estate Beat posts (and nothing else) here, or read past installments here. This sponsorship has opened up and we’re looking for our next partner. If interested, please call Jonathan at (503) 706-8804.

Update 1/23: Several readers felt that I went too far with the comments about Southwest Portland, and after thinking about it, I decided they’re right. I feel bad and I apologize. You can read more in the comments section.

NOTE: We love your comments and work hard to ensure they are welcoming of all perspectives. Disagreements are encouraged, but only if done with tact and respect. BikePortland is an inclusive company with no tolerance for discrimination or harassment including expressions of racism, sexism, homophobia, or xenophobia. If you see a mean or inappropriate comment, please contact us and we'll take a look at it right away. Also, if you comment frequently, please consider holding your thoughts so that others can step forward. Thank you — Jonathan

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Jeff MAdam HersteinMichael Andersen (News Editor)Alex Reeddavemess Recent comment authors
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davemess
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davemess

“In many ways, these are East Portland neighborhoods that just happen to be west of 82nd Avenue.”

Interesting that you would say this. In fact these two neighborhoods are “historically” East Portland neighborhoods, meaning they were annexed at the same time (1980’s), and face a lot of the same infrastructure issues that the rest of East Portland does. So they are kind of in a rough spot because they don’t get a lot of the “benefits” of being in East Portland, but have a lot of the same problems. We’re currently working to try to get the city to more often recognize this.

Good Primer on B-D:
https://www.portlandoregon.gov/bps/article/88596

The sad part is that while this B-D document is over 25 years old, pretty much NONE of the recommendations have been done.

These two areas are still some of the best deals in real estate in the city though. And if you want diversity (like so many claim to in Portland) there is plenty of it.

davemess
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davemess

“Most of Southwest, and even a lot of the tony West Hills, is worth less than Mall 205 or the strip malls along North Lombard.”

While this is true, you didn’t point out that many of the large lots in SW are not further developable due to their extreme topography (which is the reason OHSU was built up there, when a railroad originally bought the land sight unseen, then realized they’d made a pretty huge mistake and donated it to start the school). This is an area where using the land for parking wouldn’t even be an option.

I’d also be careful of calling certain areas “productive” over others. Many would argue that while industrial areas might not be worth as much (which will happen when you simply divide value/land size), they are plenty “productive”.

Joseph E
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Note that the yellow areas at about $25 a square foot cover much of the inner SE, N and NE area. In these areas, a standard 5000 square foot residential lot (50 x 100 feet) is worth $125,000! That may be almost as much as a small house.
In the orange areas, such as inner NW portland and a few places in close in NE and SE, the land value is $50 a square foot, or $250,000 for a standard 5000 sqft lot! In many of these areas, even a mid-sized 1500 square foot house is going to be worth less than the land it sits on.

Reza
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Reza

I find it amusing that this map includes the “paper streets” that don’t actually exist like along US 30 near Linnton and atop Marquam Hill.

Rick
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Rick

As a whole, the 52 acre site of Alpenrose dairy with the future Red Electric Trail running on the north side of the property is worth a lot. Land for parks, trails, nature, active transportation, athletic sports, housing, and jobs. It is still there.

Kiel Johnson (Go By Bike)
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kiel johnson

I argue that there is no place to find a free parking spot than the Lloyd District, the mall has the largest free parking lot in the city (maybe the state?)! The Temple Baptist Church also owns a bunch of vacant land in the Lloyd which they don’t pay taxes on and use on their big easter and christmas masses.

Jeff M
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Jeff M

I don’t see how your snarky comments about the residents of SW adds anything valuable to the conversation. We’re not royalty overseeing the goings on of the city from our mansions, while being frightened by the working class of the Lloyd District, who, of course, are the people doing the city’s good work.

John Liu
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John Liu

The map is based on tax assessment data. The assessor estimates the market value of a property, then allocates that value between land and structures. As a result, the assessed value of the land is mostly determined by the total market value of the property. The map thus largely reflects the selling prices of houses and other buildings in the area.

It also reflects lot size. The minimum land required to build the house is valued higher, by assessors, than the “excess” land (big yards, etc). So a neighborhood of $600K houses on small lots will show as having higher assessed “land value” than a neighborhood of the same $600K houses on large lots.

You can’t really compare houses to commercial, e.g. SW neighborhoods to Old Town. Commercial properties produce revenue, houses usually do not, which affects market value. A tatty commercial property can be demolished and replaced by a nice one to produce more revenue, a tatty house can be replaced by a nice one and it still won’t generate revenue.

The map showing date of annexation may coincide roughly with the map showing land values, but that mostly reflects that the older parts of Portland are the commercial center, more valuable for the reasons just explained, and the close in neighborhoods, tending to be more valuable due to proximity to downtown.

Jim Labbe
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Jim Labbe

“But if you ever wanted an explanation for why cities are constantly rezoning industrial sanctuaries for other development, here’s why. Commercial and residential developers pay way, way more for land, because they can get more money out of it.”

That is absolutely true and why the claims of some industry lobbyists that environmental regulations are the threat to industrial land and jobs are so bogus. We hear a constant refrain about a lack of industrial land and the need to roll back environmental standards to facilitate industrial development from interests who often have or will benefit from converting more industrial land to commercial or residential.

But more on point to this article, it is also true that industrial land within or closer to a denser, walkable street network- like the Inner East Side- produce way more jobs (37 jobs per acre) than sprawling industrial districts like the Columbia Corridor (6 jobs per acre) where heavy industrial uses are probably becoming even less job intensive. The proposed propane facility at Terminal 6 that is in the news this week would generate an abysmal 0.6 jobs per acre.

Jim

Geoff Grummon
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Geoff Grummon

Nice work, Joshua!

ethan seltzer
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ethan seltzer

I love a good map, maybe more than the next person, but this is a little problematic:

–industrial and commercial land are not assessed or taxed the same as residential land. The implication is that “land value” here means the same thing in all locations…and it doesn’t.
–a per square foot value doesn’t take into account lot sizes. Density is lower in SW, and since land value is associated not with square feet but with parcels, the presumed leveling effect of reporting land value this way doesn’t work.
–the market isn’t the same everywhere, and market dynamics further cloud the meaning of the map.

In other words, the colors on the map don’t mean the same thing in every location. You need to know something about history, underlying zoning, and market dynamics to decipher this, and I’m not sure, in the end, it makes the points you want to make. But hey….thanks for the map! Food for thought, as usual.

Doug Klotz
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Doug Klotz

Could the Cully and Brentwood Darlington examples be evidence that sidewalks raise property values??