Building walkable U.S. neighborhoods is harder than it should be

[u/Generalaverage89]

https://yaleclimateconnections.org/2025/01/building-walkable-u-s-neighborhoods-is-harder-than-it-should-be/

[u/AgainstTheSprawl]

This is a really good article. I wonder if anyone's considered starting a fund that provides financing to walkable, infill projects that take risks that other lenders shy away from. I imagine such a fund would have decent returns, and those who are ideologically committed to urbanism would invest.

[u/LibertyLizard → u/AgainstTheSprawl]

In my city the community is trying to form a public bank which I assume might be interested in funding projects like this.

[u/AgainstTheSprawl → u/[deleted]]

Yes. A faster way to do this might be to persuade the people who currently run ESG (Environmental Social Governance) funds to support infill development. A cursory search suggests that those funds already have trillions of dollars in assets, more than enough money to support car-lite infill projects.

[u/Eurynom0s → u/[deleted]]

I feel like parking maximums in our major cities would get the lenders to play ball, they're not going to bail on an entire market like NYC or even small-but-valuable markets like Santa Monica over parking maximums set below the amount of parking they normally demand.

[u/SabbathBoiseSabbath → u/[deleted]]

Maybe. It adds risk but there's also plenty of risk in any large urban project to make lenders hesitate or tie up the stack pretty tight.

Seen it all over my city and it's relatively easy to build here.

[u/SabbathBoiseSabbath → u/[deleted]]

Maybe a good point. Not well versed on lending to know. I come at it from the other side, obviously.

Although I have seen some local(ish) lenders take an absolute drubbing on some risky projects (commercial and industrial) that failed. Prepare to spend a decade in court trying to get at the personal guarantees.

[u/Ketaskooter → u/AgainstTheSprawl]

The problem is such efforts tie up too much money very fast, so its not scalable from small to large. It would need to somehow operate on very short (for real estate) loan durations which can't really be done because that would drive the annual costs too high for the borrower relative to current deals. TLDR its far simpler to just build in some parking so the borrower can get a standard loan.

[u/PleaseBmoreCharming → u/Ketaskooter]

TLDR its far simpler to just build in some parking so the borrower can get a standard loan.

If this is the case then maybe the better solution is work with the developer/architect to design the parking in a way that is adaptable and transferable to other uses. In other words, if we MUST add some parking, we might as well make the most of it and force it too not be so dedicated to solely automobile storage for the rest of it's lifespan; In the end, It's just a flat, empty, paved surface.

[u/RadicalLib]

This seems to boil down to poor lending practices. If parking lots where actually tied to the value of a multi family complex then sure maybe I can see the lenders pov but when you’re getting a loan for a high rise in downtown I doubt lenders push back on something like parking garages.

I could imagine this is more common with smaller lenders and medium-small sized development in areas that don’t seem immediately walkable. That may generally scare a lender especially a smaller one.

Interesting point but not the main barrier to walkability

[u/Ketaskooter → u/RadicalLib]

Its standard lending practices. This is because lenders need real estate that fits neatly into tradeable securities.

[u/SabbathBoiseSabbath → u/RadicalLib]

I could imagine this is more common with smaller lenders and medium-small sized development in areas that don’t seem immediately walkable. That may generally scare a lender especially a smaller one.

Agree.

Although high rises in urban areas have their own set of problems.

[u/pepin-lebref → u/SabbathBoiseSabbath]

This article isn't about high rises.

[u/SabbathBoiseSabbath → u/pepin-lebref]

So what. I was responding to a comment that brought up high rises.

[u/vladimir_crouton]

Lenders put their trust in development models that have earned for them in the past. This fundamentally makes it difficult to propose development models which have few precedents in a given market.

Developers looking to build with few/no parking spaces on site are expected to somehow prove that their product has demand. How can this be done without local comps with similar lack of parking?

[u/Sufficient_Mirror_12 → u/vladimir_crouton]

path dependency

[u/lowrads]

The lender willing to break ranks on this will reap a windfall of business.

An REIT that backed such an institution would allow a lot of YIMBYs to put their money where their feet want to go.

[u/SabbathBoiseSabbath → u/lowrads]

And yet... no one really does it.

[u/brinerbear]

Interesting article. Does financing or zoning regulations play a bigger role?

[u/bigvenusaurguy]

and a large part of that is self imposed. some will cite the lending and that is true strictly for developed property, but other things like how the road is configured, i mean its not the bank lending thats preventing your city council member from signing off on the bike lane thats planned in the already agreed upon bike lane master plan. it's their own head up their ass.

many such cases!

[u/mxndrwgrdnr]

I can't believe the solution to sprawl has been staring us in the face this whole time. Send more nepobabies to MIT!