Let's see ... new office developments cause no new demands on housing, traffic, or other resources in their vicinity, because their occupants to be have been in the area all along, employed, fully housed, driving around the building area, consuming educational, water, electricity, food, and waste disposal resources.

That is a fantastic revelation indeed. Its logical conclusion is no new development, housing or commercial, is necessary in the Bay Area. Everybody is taken care of now. Thank you, Steve.

Actually, all buildings initially create jobs for one of the largest and oldest industries: construction. Millions of people have worked on buildings, cathedrals, bridges, fortresses, roads, airports, harbors, tombs. Tens of thousands of men worked on the Great Pyramids of Giza which are just tombs, no occupying business.

Buildings themselves also require a certain amount of ongoing/periodic maintenance: cleaning, landscaping, maintenance, painting, sometimes security, etc. Depending on the building, there might be property management, real estate agents, title companies, mortgages, alarm companies, and others involved.

Reader,

You are correct of course. Buildings do have jobs associated with their construction and operation.

The point I am making is that these buildings are supported by the tenant demand. They are the ones and the people and business who want the goods and services produced by the tenants who are the reason for the jobs that are created.

If there is not underlying demand a temporary oversupply of buildings will soon be corrected until demand catches up.

This is why building falls off in recessions. You could build more office buildings during a recession if you believed they created jobs for the tenants but, in fact, when jobs decline, vacancies rise and new office construction takes a pause.

Steve, isn't there a major third implication to...ie "land zoned for revenue producing commercial activities."

OK, there will be boom and bust cycles for these commercial properties. Some developers, especially established companies, cut their risks. Others speculate. But you point out eventually markets correct and properties are occupied.

Third implication is that in the long run there are more workers who need housing somewhere. Zoning for housing has quite a lag for political and practical reasons. There is legit reason to debate NOW quality of neighborhoods, cut thru traffic, park availability, future school sites, size of school playgrounds, densities, heights and what our two, very small downtowns should be. Regional office park and destination restaurants are the worse option. It is time for downtown development moratorium until all the parties come together and reboot old development decisions.

IMO, there is a greater development implication. And it is the lag for public funding of infrastructure..water, roads, trains and issues as small as Palo Alto's woefully under-funded, under-managed TMA.

I'd like to read a column with more info on Vallco.

They are adding housing to a former shopping center.

Cupertino, not Palo Alto, but the developer has four projects here as well.

deleted, the blog is about commercial developments and who creates the jobs sited in the buildings and has nothing to do with Edgewood Plaza local issues, which are real but have many existing Town Square threads to post on.

Neilson,

There is a large and growing shortfall of housing relative to the recent and ongoing population growth.

And no matter what any specific small city or cities do, there is much more zoned commercial space in the region than will ever be filled realistically so there will always be sufficient supply somewhere in the region.

And you are certainly spot on that the past and future growth calls for more infrastructure investment, particularly in moving people and goods around with the least impact on traffic and parking.

although it is not a topic in the blog, thank you for your ongoing efforts to calla attention to the opportunities from fully funding the TMA.

I haven't commented previously because, while I believe your assertion is correct, I don't think I understand its implications.

Nevertheless, your response to Neilson prompts me to observe that building spec commercial space can have consequences. For example, a property with newly-constructed commercial space is probably less likely to be converted to housing, schools, transportation terminals, or other much-needed uses than a property with older structures that might be replaced at lower cost (with rezoning if needed).

There's some value in not building until you can predict what you need to build.

The factor left out: Google is experimenting for the future; what about ROBOTICS and ROBOTS REPLACING FORMER HUMAN JOBS? This includes Drones, vehicles, security ( including building security ) automatic building cleaners, FAST FOOD EMPLOYEES ( kiosks are here NOW for both fast food and parking meters ) Who is going to hire a worker for $15.00/hr when a robot can do the same job? I've worked in Robotics for many years; AGVs and parolee tracking systems that use GPS before it became popular and built into your hand held devices.

Japan knows the aged will need robots to help them live; ASIMOV was just the start. The treat their aged with far more compassi
on than we do. Japan already has a fully robotic restaurant.
Now tie today's computing power to the robotics used now.
That will change the game of housing and business for now and in the future.

If developers construct buildings that don't fill up or have failing tenants, then their space becomes vacant, supply increases and rents fall... and they build less.

If developers construct buildings that fill up with successful tenants, then there is less space available, supply decreases and rents go up... and they build more.

Developers don't invest in these projects as an academic exercise. These are very expensive ventures designed to make money.

Popular wisdom holds that building freeways brings more cars. That is almost, but not quite, true. Building freeways _enables_ more cars to move about and therefore promotes car travel, as building commercial developments enables additional employment in the area and therefore promotes local job growth. People do not usually set up their desks on the streets, sidewalks, and park benches.

Commercial and Residential Construction definitely creates jobs!... For about 90 days for each subcontractor. Then, unless there is even more development, those guys are unemployed. Sunnyvale and Santa Clara still have oceans of empty office space left over from the Dot.com boom. No one wants the office space as decent housing is far, far away. Spurious construction to "create jobs" is a taxpayer rip-off.

The comparison is made between Vallco and the Cinderella City Mall and the Cinderella Drive-In. The history shows that this was the Largest Mall built west of the Mississippi River. The Mall was not keeping businesses, it was too old compared to others. The City of Englewood had a long term growth plan in case this happned. The City Government renovated and moved into the former mall.
The Cinderella City Drive-In was at a crisis point; they had to buy $500,000 of digital projection equipment because film was no longer how movies were sent out to Dive-Ins.
So now, as part of the long term growth plan, 4 story housing now sits where the Drive-In was.

This is an example of managed growth by a city. U.S. Highway 285 runs right through Englewood and an RTD Light Rail station is within walking distance. Downtown Denver or the DTC ( Denver Tech Center ) is serving the working population. When the population gets old, Swedish Hospital is 4 blocks away from U.S 285.

This is one example of managed growth which is flexible to job growth i the Denver area. BTW, Sports Authority had it's HQ there. Is that loss of jobs affecting Englewood? Not as much as you would think. Business comes and goes but the city remains.




NO, Commercial Development does NOT create jobs. Proper City Planning DOES!

Everyone knows that the government is the real creator of jobs. Private commerce is a simply a leach on true social progress and justice can only be achieved collectively by each man subordinating himself to the standards of the majority. I feel it is my duty to offer you my advice despite what Hank Rearden may think.

Steve, this is one of the worse blogs I've seen you write. This is not an attack, I appreciate your thoughtfulness. But you are mixing companies with global products, mostly in terms of software or services with local impacts. The larger companies you mention are concentrating physical assets in our suburban communities- people, vehicles, buildings while their output has much lower utility locally. So there local cost far outweighs their local benefit. While the demand for commercial construction, because of a desire to concentrate a technically proficient workforce centrally in the SF Bay Area has the effect of bringing more and more jobs to our area without limit.

If we were talking about manufacturing there might be physical limits to how many workers should be located nearby. But software is eating the world AND eating Palo Alto.

Steve,
This really is an odd posting that seems focused on a semantical distinction rather than the real issues that we face as a city and region.
While it is true that commercial zoning does not create jobs, commercial zoning and resulting commercial development does result in jobs occurring locally and those jobs result in the need for corresponding housing. Less commercial development reduces the rate of job growth and greater construction increases job growth, both direct jobs in those buildings and the significant job multiplier effect of tech positions.
That is the issue for Palo Alto and communities on the peninsula where we have high rates of job growth and a transportation system that has not been close to able to accommodate that growth. If peninsula cities slow their rates of job growth they can begin to correct their severe jobs/housing imbalances while addressing transportation challenges. That seems to be a more appropriate discussion rather than a "buildings don't create jobs" argument.
A more meaningful set of questions might be, does Silicon Valley need to capture and retain such a high proportion of the emerging tech jobs? Would other regions benefit from receiving a greater proportion of the tech jobs (and their job multipliers) that are being created?

Buildings don't create jobs? It's the consumer demand for products and services??

What an ignorant concept. In actuality, most of the local job growth comes from the PERCEPTION of POTENTIAL DEMAND from consumers BY THE INVESTMENT COMMUNITY!

The investors own the companies and they decide how many people should be hired in particular market segments and companies.

The other important point to make is that since the business effectiveness of tele-commuting and remote collaboration has fallen well short of its potential, the leading companies have remodeled themselves to minimize it. As examples, Google, Facebook and Apple continue to build up at their HQ locations and many companies have followed suit. Companies that choose the less effective remote models are surviving by monopoly, being in a niche market or are simply treading water.

That is the reality. Address it or this region will be wall-to-wall company campuses.