A new spin on bad housing news | The genius running Gannett into the ground | New look for one of Boston’s classiest pair of towers | Healey faces big ed decisions | Quick hits | About Contrarian Boston |
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Can Boston vanquish the housing crisis by building less? The Wu administration appears game to try
It’s a major shift in direction on possibly the biggest crisis facing Boston. And it comes with prices and rents hitting ever more insane levels amid a dire housing shortage.
As she shakes up how development is done in Boston, Mayor Michelle Wu hasn’t set any new housing construction goals with headline grabbing numbers, which has been the norm now for years with city mayors.
And by any conventional standard, the numbers are not looking too hot right now. As we first reported here on Jan. 1, approvals of new housing units in Boston fell sharply in 2022.
The Boston Planning and Development Authority gave a green light to roughly 60 percent fewer homes, condos, and apartments in 2022 compared to the year before.
But, no matter. Rather than acknowledge a shifting market, the Wu administration has been touting a very different metric.
Shaking things up in Boston: Mayor Michelle Wu
Subsidized/affordable condos and apartments now make up the highest percentage of overall housing approvals by the city in a decade, or 44 percent of the total, the BPDA noted in a Jan. 4 press release.
Great. But in reality, with total housing approvals down by a lot, all that means is that affordable units are now a larger piece of a much, much smaller pie.
In reality, we are talking about less housing for everyone. And at least when it comes to the housing market in Greater Boston, less is definitely not more.
Spinning the bad news, Part II: Wu administration says drop in new housing approvals doesn’t tell whole story
A pair of top city officials is taking to Twitter to push back against criticism of Mayor Michelle Wu’s revamp of housing development in Boston.
Tiffany Chu, chief of staff to Mayor Michelle Wu, and Sheila Dillon, the city’s housing chief, both posted rebuttals of recent media coverage of the big drop in the number of housing units approved by City Hall.
“Let's make sure we use the right metrics to track housing production,” Chu tweeted.
Contrarian Boston rang in the New Year on Jan. 1 with a scoop, reporting that city approvals for new housing in Boston plunged in 2022.
CB based its story on the numbers the BPDA routinely touts and publishes on its website.
However, Chu and Dillon, in separate tweets, contend that the media has been looking at the wrong numbers.
Instead of looking at approvals of new housing units by the BPDA, a step that can come months or even more than a year before a developer starts construction, we should be looking at building permits issued by the city for new housing units, which is a more immediate measure of activity, the top Wu administration officials contend.
And yes, when you take a look at permits - which developers don’t typically pull until they are actually ready to start building - the overall picture does look more rosy, with an increase for 2022.
But when you look a little closer, you see that city officials issued the overwhelming majority of those housing permits in the first half of 2022. There has been a dramatic fall off since then, with just 700 permits in the second half of 2022. That, in turn, amounts to only a third of the condos and apartments that developers broke ground on in the second half of 2021.
You can certainly blame a combination of surging interest rates, high construction costs, and a highly uncertain economic environment on spooking some developers.
But is it just pure coincidence that the pullback has occurred as the Wu administration ramps up demands on developers, with heftier fees and demands for more subsidized units?
Seems unlikely.
Wow! Gannett’s $7.7 million man is even dumber than we thought
That would be Mike Reed, the underwhelming and grossly overcompensated CEO of Gannett, the national chain that has been slashing and trashing venerable local newspapers across the country, including more than a few here in Massachusetts.
Reed spent $1.2 million buying up shares of Gannett, which have plunged from $5 apiece to just $2, according to a story in Guru Focus, a publication focused on stock tips.
The newspaper chain was on track to have slashed $200 million in “fixed expenses” -that is, reporters, editors, and printing costs of shuttered papers - by the end of 2022.
In some cases, the cuts have been so deep that they have left what amounts to zombie papers in thriving cities and towns like Cambridge and Medford, with no dedicated reporters, no print editions, and online pages filled with stories from other local Gannett papers.
The Guru Focus piece cites Reed’s $1.2 million stock purchase as a sign of confidence in Gannett’s plans for its sinking local news empire.
But from our vantage point, it looks like an act of supreme stupidity given all the damage Reed has inflicted.
Can downtown Boston’s office market be saved? Long time Boston developer bets $100 million that it can
That would be Don Chiofaro, the developer of International Place, which for more than three decades has been one of the most distinctive office addresses on Boston’s skyline.
On Wednesday, Chiofaro unveiled plans for a $100 million makeover of the pair of 46- and 35-story towers overlooking Boston’s Financial district and Boston Harbor.
The decision to reinvest in the towers comes as developers and commercial office property owners across the city scramble to find ways to entice tenants to stay amid a shift to remote work.
The entrances to the two towers will be spiffed up, while Two International Place will also get a restaurant that will overlook the adjacent Greenway.
Meanwhile, according to Chiofaro’s press release, the “Fort Hill Plaza entrance will be completely rebuilt as a 32-foot-tall and 80-foot-wide ‘window’ into the complex centered on the redesigned exterior plaza.”
Hmm. Not quite sure what Chiofaro’s public relations team was trying to say there, but sounds pretty fancy!
Want economic development and social equity? Well then education could use some immediate attention, Gov. Healey
By David Mancuso
Our new governor sounds like she and her administration will be wisely focused on the economic long-term wellbeing of the Commonwealth and its residents. State House News Service reported Healey as saying, “We have untold wealth in the Commonwealth. But record public revenue does little good when families can't pay the rent, buy a house, heat their homes, or pay for childcare. Our health system is the envy of the world. Yet our hospitals are desperate for staff." She added, "Our companies are eager to expand, but they can't find workers with the skills they need.” Healey has also said in recent interviews that addressing inequity in our schools would also be a priority for her administration.
A recent Stanford University Hoover Institute report would suggest that to achieve her goals, education might be a good place for the new governor to focus, and sooner rather than later. The report takes a detailed look at the cost Covid-19 pandemic-related student learning loss will have on personal and state economics. And, it does not look good for Massachusetts.
Big challenges ahead on education for Gov. Maura Healey
According to the report, Massachusetts and its future labor force are among those to experience the greatest pain in the nation if our education system doesn’t get our students back on track quickly. Covid-19 learning losses impacting Massachusetts students will cost them as much as 7.5% of their lifetime earnings, and the Commonwealth more than $400 billion, or 2.5% of GDP over the course of this century.
For some context, consider the biotech industry. In 2021 the Massachusetts Biotech Council observed that “industry employment is 3.6 times more concentrated in Massachusetts relative to the national average … reflecting a highly ‘specialized’ industry concentration.” In the same report, the biotech council went on to say that “extrapolating from historical employment growth leads to an increase of approximately 5,000 new jobs each year through 2024, adding 20,000 employees for a total expected employment of over 109,000 by the end of 2024.” And that’s only until the end of next year. How will the industry fuel that sort of growth in years to come? Will Massachusetts’ students be prepared to fill that sort of employment pipeline in one of the most lucrative industries we have?
That’s up to the Department of Elementary and Secondary Education (DESE) and our schools to ensure. DESE is has been discussing how to address Covid-19 learning losses for months, and has yet to propose any concrete plans on how schools will help students achieve recovery, or be held accountable if they don’t.
The Hoover report acknowledges the magnitude of the challenge schools are facing, but it also clear where the buck stops. "The losses cannot be pinned entirely on the schools, even if they contributed to them. But the responsibility for recovery from these losses necessarily falls on the schools.”
The report also warns that “just returning to the norm will leave the losses as permanent.” The report also includes the commonsense reminder that “schooling quality, not quantity, is the most important policy response.” That’s a point that Healey, newly appointed Secretary of Education Patrick Tutwiler, and DESE Commissioner Jeff Riley should take to heart as decisions are made.
Observing an uncomfortable truth, the Hoover report also states “that the United States punishes those without skills more than other countries,” while “those with lower achievement see larger impacts on their lifetime earnings.” Nowhere should that perspective be of greater concern than in a state like Massachusetts, with its rich but specialized economy driven by knowledge and education, and where everyone is demanding equity in our education system and the results it produces.
The question on the table for our leaders and our schools isn’t just about how long it might take to recover from Covid learning losses, it’s about how fast we can do it. Teachers will need significant support. Schools will need resources. All will need to own the responsibility, heavy as it might be, knowing that the decisions being made today have repercussions not only for our students, but for our entire economy and the future of Massachusetts itself.
David Mancuso is a veteran communication, public affairs, business strategist and founder of Mancuso Communication Strategies. Mancuso has served as a pro-bono consultant to a number of non-profit organizations, including the Massachusetts Business Alliance for Education where formerly served as a member of the board of directors.
Quick hits:
Healey not particularly forthcoming after new governor’s first meeting with State House leaders; free community college on table: “Big Three gather but provide few details on talks” CommonWealth Magazine
Tough times ahead: “Index: Recession Fears Push Biz Confidence Lower” State House News Service
Oops! "Second Biden search yields additional classified documents” Washington Post
With downtown offices still less than half full, time to hit the panic button: “U.S. cities are failing to address the remote-work revolution” Washington Post
Second Biden search yields additional classified documents
What is Contrarian Boston?
I have fielded emails over the past couple weeks asking what Contrarian Boston is about.
Here’s a link to our mission statement – you can find it in the “about” section.
For a more prosaic, nuts-and-bolts description, read on.
An online newsletter, Contrarian Boston publishes every Tuesday, Thursday and Saturday. In Contrarian Boston you’ll find analysis of the day’s news, and original reporting as well.
Our focus is:
· Politics and all levels of governance, good and bad, with an emphasis on state and local, with some national mixed in;
· Economic growth and business, especially real estate, housing and new development projects;
· The media and why it does what it does;
· Education, from school board spats to the doings of multibillion-dollar university endowments;
· And whatever else catches our fancy.
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