So we’re going to look at design again this week, but from the perspective of city planning. The tech magazine Wired published a critique of Apples new headquarters recently, and it makes some interesting points about how global companies interact with the physical places their offices are in, and how the architecture they build helps or hurts the community around them. What I’d like to know is if the situation in California correlates to situations with industrial park developments in Taiwan, for instance in Hsinchu or the more recent development in Nangang. Are things working as intended in terms of helping businesses contribute to the economy? But I also want to talk about what you think Taiwan is getting right or wrong in terms of transportation and housing as well. So let’s talk design!
The context of a building is just as important as the building itself
You can’t understand a building without looking at what’s around it—its site, as the architects say. From that angle, Apple’s new HQ is a retrograde, literally inward-looking building with contempt for the city where it lives and cities in general. People rightly credit Apple for defining the look and feel of the future; its computers and phones seem like science fiction. But by building a mega-headquarters straight out of the middle of the last century, Apple has exacerbated the already serious problems endemic to 21st-century suburbs like Cupertino—transportation, housing, and economics. Apple Park is an anachronism wrapped in glass, tucked into a neighborhood.
Problem: Housing
Between 2010 and 2015 the San Francisco Bay Area added 640,000 jobs, with more than a third of that growth in tech. But the region didn’t add nearly enough housing; with the exception of a spike during the boom years leading up to the 2008 recession, the number of new housing units built in the city of San Francisco has trended steadily downward, and the same is true for other Bay Area cities. Here’s what happens when supply fails to meet demand: The median price for a home in the Bay Area has climbed to $800,000. It’s even higher in Silicon Valley.
That’s starting to change. San Francisco has 62,000 units in the pipeline, and San Jose is adding thousands every year, too. (To be clear, those numbers are still far lower than places like Houston and Atlanta.) But the towns along the 101 and 280, the homes of companies like Apple, Google, and Facebook? Nope. Cupertino, Mountain View, and Palo Alto all have tens of thousands of workers in the tech business, adding more and more all the time, but those cities have been reluctant to build new houses or apartments.
Problem: Commuters
In its HP incarnation, the site had about 5,000 workers; the new Apple complex will more than double that. Just 10 percent of them live in Cupertino, but according to an Environmental Impact Report on the project that an Apple spokesperson sent me, that still means that demand for Cupertino housing will increase by 284 percent. Apple is paying a “Housing Mitigation Fee” to the city. It’s based on overall square footage, but it turns out Apple is only adding about 800,000 square feet of building over what used to be on the site. So the company agreed to double the usual fee. But since the city had already halved the fee, so Apple is just paying … the fee. It’ll be about $5 million.
You can do math: Ten percent of people working in Cupertino means that 90 percent of the people in the Spaceship will commute. Most of them live in San Jose (10 miles east) and San Francisco (45 miles north). The lack of a cohesive regional transportation network in the Bay Area privileges cars, which is why Google and other tech companies started fielding their own buses in the last few years. (In 2014, San Franciscans angry about gentrification met Google’s buses with resistance.)
Apple has shuttles that range the entire peninsula and into the East Bay and has committed to raising the number of trips to its headquarters not in single-occupancy vehicles to 34 percent. According to the EIR, just 1.5 percent of commute trips to Apple’s existing facilities are on public transit; by that calculation, the company says, the public bus system’s plenty robust enough. That logic is as circular as the building; if you don’t build it, they won’t come.
Solutions: Commuters
Still, though...Apple has $250 billion in cash. Against that, these community benefits feel small. The company could have chipped in to double the frequency of CalTrain’s commuter rail. It could have built a transit center in Cupertino, which, unlike Mountain View and Palo Alto, has none. “Apple could have done anything. Money was no object,” says Allison Arieff, editorial director for the San Francisco Bay Area Planning and Urban Research Association and lead author of its recent report on corporate campuses. “They want to be innovative in everything, and they’re not innovative in this thing.” Apple is instead making significant improvements to roads and highways. “If the intractable problems of the region are housing and congestion, they’re giving the finger to all that,” Arieff says.
Solutions: Commuters
The main building of the cloud storage company Box, for example, is across the street from the Redwood City CalTrain station, and the company lets people downtown park in its lot on weekends. “The architecture is neither here nor there, but it’s a billion times more effective than the Apple campus,” Arieff says.
Problem: Taxes, public space, parking, water and electricity services
“Apple’s obviously very important to the city, and when they came in with that plan, we understood this wasn’t going to be just any development,” says Aarti Shrivastava, Cupertino’s assistant city manager. “They had certain needs.” Heightened sensitivity to security was one of them, which meant no public access—and even closing a major road.
In the early days of the project, reports suggest Apple wasn’t willing to participate in “community benefits,” financial or otherwise, and Cupertino’s city council didn’t seem too willing to push one of the city’s biggest employers and taxpayers. The mayor at the time tried to propose higher taxes on the company, but the city council didn’t support the move.
Over time, though, Apple committed to giving the city some money to help with traffic and parking. “We had to bring them into our world. They don’t do urban design. They don’t do planning. We needed to talk to each other,” Shrivastava says.
Because part of the new campus subsumed what was going to be public space, Apple paid $8.2 million so Cupertino could build a park somewhere else. And the company agreed to help address the community’s major concern: traffic. Cupertino already had big plans for walkability and bikability; Apple is paying for a lot of those efforts around its campus. It ponied up $250,000 for a feasibility study on improving one of the nearby intersections, and an extra $1 million for another. Recognizing that not having enough parking for everyone on site meant that people were going to park in nearby neighborhoods, Apple is paying $250,000 to Santa Clara and $500,000 to Sunnyvale in parking restitution. “We worked very hard with both cities to figure out what amount would be OK, and Apple was very open to that,” Shrivastava says.
Oh, and two big ones: Apple is one of Cupertino’s biggest sources of tax revenue, but the city used to forgive all of Apple’s business-to-business sales tax. Now the city will get 65 percent of it. And the company built, at a cost of around $5 million, a system to bring recycled water from Sunnyvale to hydrate the new landscape. That’s not a direct community benefit, but developments at two more sites, the Hamptons and the old Vallco Mall, will also use that water if and when they get built.
Problem: Property Taxes and Paying for Public Services
The problems in the Bay Area (and Los Angeles and many other cities) are a lot more complicated than an Apple building, of course. Cities all have to balance how they feel about adding jobs, which can be an economic benefit, and adding housing, which also requires adding expensive services like schools and transit. Things are especially tough in California, where a 1978 law called Proposition 13 radically limits the amount that the state can raise property taxes yearly. Not only did its passage gut basic services the state used to excel at, like education, but it also turned real estate into the primary way Californians accrued and preserved personal wealth. If you bought a cheap house in the 1970s in the Bay Area, today it’s a gold mine—and you are disincentivized from doing anything that would reduce its value, like, say, allowing an apartment building to be built anywhere within view.
Meanwhile California cities also have to figure out how to pay for their past employees’ pensions, an ever-increasing percentage of city budgets. Since they can’t tax old homes and can’t build new ones, commercial real estate and tech booms look pretty good.
Problem: Globalised companies are not locally invested
When those companies are transnational technology corporations, it’s even harder to make that case. “Tech tends to be remarkably detached from local conditions, primarily because they’re selling globally,” says Ed Glaeser, a Harvard economist who studies cities. “They’re not particularly tied to local suppliers or local customers.” So it’s hard to get them to help fix local problems. They have even less of an incentive to solve planning problems than California homeowners do. “Even if they see the problem and the solution, there’s not a way to sell that. This is why there are government services,” Arieff says. “You can’t solve a problem like CalTrain frequency or the jobs-to-housing ratio with a market-based solution.”
Problem: aligning the interests of capital with the interests of government
It takes even longer, though, if businesses are reluctant partners. In the early 20th century, when industrial capitalists were first starting to get really, really rich, they noticed that publicly financed infrastructure would help them get richer. If you own land that you want to develop into real estate, you want a train that gets there and trolleys that connect it to a downtown and water and power for the houses you’re going to build. Maybe you want libraries and schools to induce families to live there. So you team up with government. “In most parts of the US, you open a tap and drink the water and it won’t kill you. There was a moment when this was a goal of both government and capital,” Mozingo says. “Early air pollution and water pollution regulations were an agreement between capitalism and government.”
