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City Values Vacant Land Higher than Land With Buildings

As a REALTOR® I tend to have some basic assumptions about the real estate market. One of those is that a building and land is worth more than the land without a building. Even if the building is in poor condition, it still holds some value in my view. But apparently the people at the St. Louis Development Corporation — the entity that is responsible for property the city owns — thinks differently. Here is how they describe themselves:

The Real Estate Department of the St. Louis Development Corporation (SLDC) documents, manages, maintains, markets and sells agency-owned vacant and abandoned buildings and property.

In some St. Louis area neighborhoods, it will cost you more to buy a vacant lot than it will to buy a lot with a building. Let’s compare a two-family building in poor condition on a 25ft x 125ft lot with a similar 25ft x 125ft lot that happens to be vacant (with the intent for new construction). Oddly enough, the vacant lot is more costly than the building and lot in some cases. For example, based on SLDCs price list, the example building and lot in Benton Park would be $3,000 while the vacant lot (of the same size) would be $4,687.50 — 56% more than the same size plot of land with a building! Their for sale list turns up one vacant building but 19 vacant lots (of various sizes) in Benton Park. In Benton Park West the prices are quiet a bit less at $2,000 for a two-family and only $1,562.50 for a 25ft frontage lot.
If we head up to the north side of the city where many lots are vacant we see a similar situation.  In the Hyde Park neighborhood the two-family would be $1,000 while the same size lot sans a building is $1,250.   Over in The Ville the two-family will cost you the same as Hyde Park but the lot is only $937.50.  In the St. Louis Place neighborhood, where Mr. Paul McKee has purchased quite a bit of private property, the two-family would be $2,000 while the vacant lot $2,343.75.  The building prices are per unit so a single family house on the same 25ft wide lot would be half as much as I indicated above.  So in St. Louis Place a single family home owned by SLDC would only be $1,000 but the land of the same size would still be $2,343.75.

Their price list was last updated in March 2006.  Maybe SLDC has a formula based on the availability of land vs buildings?  Perhaps the idea, and a good one, is to price buildings attractively to encourage their reuse more rapidly than of vacant land?  I just wasn’t expecting to see vacant land with higher selling prices than land and a building.  Given this practice, I can see why some people might favor demolition —- they get the impression from the city it increases the value of their land.


Alderwoman Argues Against Modern Zoning, Prefers Piecemeal Approach

Last night I attended the forum regarding the state-wide tax bill and the likely beneficiary, Paul McKee (see post about event). As at prior events, the Alderpersons continue to talk about plans — community driven plans and Paul McKee’s secret plan. Ald Davis indicated a million bucks was spent on a plan(s) in the 19th ward to which she was recently elected. Davis indicated they involved “stakeholders to make sure that we knew what everyone wanted, how that community was going to look, we paid for the best technical assistance, and that plan was approved and is a part of the development process with SLDC, but you know something, somebody made a decision that it didn’t matter.” So on one hand they are saying we’ve spent time and money listening to the community and determining what is desired yet at the same time bitching because we don’t know what McKee’s plan is about.

During the question and answer portion, following the grand standing, I had to bring up the issue of these plans. Basically a bunch of time and money is spent in meetings, a document is created, it is adopted by the Planning Commission and Board of Aldermen and sometimes it gets referenced during negotiations with developers. However, the existing zoning for an area prior to a plan remains the only legal requirement. Given how completely out of date our zoning code really is, nearly everything now requires a variance. This is how aldermen derive any sense of power!

Below is a short video clip with my question and a response by 5th Ward Alderwoman April Ford-Griffin. My apologies for the video quality — you get a nice view of my shorts pocket while I am asking the question. Below the video is the transcript of my question and her response.


My name is Steve Patterson and I am a former resident of the 5th Ward, actually in the early nineties. And my question to the two aldermen is…one I am glad that you’ve done plans in the neighborhoods but unfortunately neither one of those plans has any teeth to them, uh, the zoning has not been changed and the 5th ward plan was adopted in 2002 called for some zoning changes to give the plan some teeth of law — right now the Board of Adjustment and the Planning Commission actually, uh, ignore the plans when they are making decisions on variances and things. So my question is when do you plan to introduce legislation to change the zoning?


Actually, there have been lots of zoning changes. You don’t go in and change the zoning of the whole ward because my plan for the 5th ward that we have in place is not so specific. One thing about a plan you have to leave some flexibility. So there is flexibility where it is not so specific where you come in and say on this block right here in the 1500 block of Hebert its got to have homes that they’ve got to look like this. So you have to leave some flexibility and at the Board of Aldermen we always have the power to change zoning. So when this happens is…as you see the development boards and you see the different things that have happened, most of those had to have some type of zoning changes, street changes, name changes, just you go down the list of changes. Also, that is the only thing that makes most of the developers come and talk to us. If we did everything that it took for the development they wouldn’t have any reason to come and talk to us. Once we talk about a development, once they have shown us what they do, once they talk about minority participation, once they talk about inclusion, once they talk about jobs, and all the other things that I make sure I am committed to asking them. And it seems like something that would be good for us and falls within the realm of the plan. and then we talk about doing the things that they need. but you’d be shocked at how many people go out here and spend money on doing things then call us and say ‘oh I’m gunna put a such and such at this address.’ And they only call because they didn’t have the zoning and zoning says you need the support from the alderperson. So if we went out there and tried to guess what would go on every block and zoned it [???] they wouldn’t have to come to us. Therefore we would not be able to even know what they are doing before they’re doing, which not all of it has been good for us. So actually that is another way to get them to come and talk to us, come to the community meeting and present to us. so we don’t want to go and just do a flat blanket of zoning where people are [???] if they a number of other things that we could go out there and do tomorrow we wait until we see the project and make sure that it is what we want then we do the things that are specific that is required for that very project and for that property to happen.

I was completely dumbfounded as were others. I mean, I’ve known this is the twisted control view of zoning that they had — I just never thought I’d actually get one of them on video espousing as much. Ald. Marlene Davis was behind Ald Ford-Griffin nodding her head in agreement.

So here is their logic:

1) Spent time and money on a feel-good community plan.

2) Get said plan “adopted”. Place plan on shelf, dust off when necessary.

3) Use zoning power to be included in development process.
4) Ignore that someone could buy property and build new construction based on existing and outdated zoning — thus bypassing plan.

I don’t want to get into a Zoning 101 lecture but what was described is exactly the opposite of what we should be doing. Zoning is a very powerful too — a police power — that cities have to set forth what the community wants. Zoning controls many aspects of development on private land such as the building’s relationship with the street and adjacent properties, heights, parking, and so on. Use zoning, which we still have, refers to the zoning focusing on the specific uses to be contained within a structure (residential, retail, industrial, etc…) whereas form-based zoning has a primary focus of looking at the building form while accepting the internal use might vary. For example, I don’t really care if a car dealership exists in a commercial zone if the form based code calls for 3-story buildings with street-level storefront windows and all surface/garage parking hidden in back. Thus, the form of the building is more critical than the use in this case. Hybrid variants exist.
Creating a community plan without going forward with zoning changes to uniformly enforce the desired affect is a useless exercise. So when these alderwoman get up and complain about not knowing McKee’s plan for their area I have no sympathy in that regard. They have the ability to create a solid uniform guide via zoning for these huge swaths of land. They could actually provide some real leadership on envisioning what is to happen in their wards. But instead they are doing development St. Louis style — sitting back and waiting for the developer to knock on their door and ask for a letter to grant a variance. Or maybe they are not sitting back, they are going out and finding developers but the visioning for the area is still done on a project by project basis.

Zoning is the most powerful tool cities have to determine the outcome of development within their jurisdiction. Throughout the city this power has been parceled out to 28 fiefdoms. As long as our old zoning code remains in place our elected representatives will continue to advocate a piecemeal approach based on the desires of developers.


McKee Land Banking Controversy Continues with Forum Tonight at Vashon HS

The hot topic of developer Paul McKee and his large land holdings, many occupied by crumbling buildings, continues tonight:

The neighborhood impact of vacant properties and rebuilding our community

A public forum will be held in the auditorium of Vashon High School at 3035 Cass Avenue on Thursday, August 30th at 6 p.m.. The forum is co-sponsored by Alderwoman April Ford-Griffin (Ward 5), Alderwoman Marlene Davis (Ward 19), Rep. Jamilah Nasheed (District 60) and Rep. Jeanette Mott Oxford (District 59).

This forum will be an opportunity for residents, business owners, developers, neighborhood stabilization officers and other city services workers, and state and local elected officials to come together to discuss development in the community. Topics will include:
• concerns over large numbers of vacant buildings and parcels being held by developers, including the reported 40 acres owned by Paul McKee
• ways area residents can influence state and local laws and policies, including the “distressed areas land assemblage tax credit” being considered in Special Session by the General Assembly
• and ways to make each block a safer and more pleasant place to live

The goals of the evening are:

1) To give area residents an opportunity to voice their concerns
2) To make progress toward a consensus on how to improve neighborhood safety, stimulate the local economy, and rebuild the community

It will be interesting to hear the perspectives of a broad range of those in the area, although I doubt those that have sold out to McKee will be there to speak in favor. Doubtful to is someone from the Mayor’s office speaking on behalf of their support of McKee’s secret plan. I hope that copies of the 5th Ward plan are available to the public at this meeting. If not, you can read it online.

Meanwhile, from an article in the Riverfront Times this week:

McKee’s purchases don’t make up a single, contiguous tract, but most are adjacent to lots owned by the city’s Land Reutilization Authority (LRA), an agency that owns thousands of vacant buildings and lots. In one instance, McKee’s VHS Partners owns the northeast and southeast corners of Cass and Grand avenues, a busy intersection with a bus stop. The LRA owns the northwest corner. Farther north, different McKee-backed entities and the LRA own all but one sliver of a lot in the vacant northeast block of Jefferson and St. Louis avenues.

Given the vast quantities of land the city owns via the LRA, I’d say it would be rather hard for anyone to buy property in this area not adjacent to LRA property.


What Local Control Gets Us In St. Louis

Yeah, Rep. Rodney Hubbard saved the day by requiring local control over any development receiving a huge state tax credit (at least in the version passed by the state house). So, if passed by the Senate and signed by Gov Blunt then Paul McKee will have to make political contributions to aldermanic campaigns, not just those of the Mayor and President of the Board of Aldermen. With contribution limits back in place it really shouldn’t cost him much. For all 28 aldermen that is less than ten grand. Pocket change.

And for anyone that thinks that magically the development we’ll get will magically be better due to local control think again. Here are a few reminders of local control in St. Louis:

truman_parkway - 04.jpg

New sidewalks between residential areas and mass transit lacking street trees.


Massive parking lots but no ADA access route. … Continue Reading


Bus Tour of Dilapitated McKee-owned Properties Ignored Other Issues

This past Thursday morning I attended, as did many others, the press conference and bus tour relating to 500+ properties owned by Paul McKee through various companies in his control. For those of you living under a rock for the last year, McKee had quietly bought hundreds of properties mostly in the city’s 5th ward through companies with names like “Blairmont Associates, LLC” and “Dodier Investors LLC” (see list). Blair and Dodier are both street names in the area. In the last Missouri State legislative session McKee’s attorney Steve Stone wrote a tax credit bill worth $100 million for anyone that assembled large acres of land in distressed areas. All sounds good so far, right?

… Continue Reading