Cities and Factories

Mark Fruin (@CYimby)

Recently the Chicago Department of Planning and Development (@ChicagoDPD) announced that it was going to allow for residential use of an area that was previously a planned manufacturing district (PMD):

This is great news. The West Loop is in high demand with new apartment and office developments popping up seemingly every week. This is a great thing for Chicago as a whole as it allows residents to live in a dense area near the core job center. This means shorter commutes and less vehicle miles traveled for new residents.

The transition from manufacturing to residential zoning in cities makes a ton of sense for a number of reasons.

  1. Pollution. Air pollution is damaging to our health. The less heavy traffic and metal shredding (#Denythepermit) in dense population centers the better.
  2. Housing. I might sound like a broken record, but pre-pandemic Chicago was adding thousands of $100k+ jobs a year. These folks need places to live. My concern isn’t for the wealthy, but for the poor folks that might be displaced by them. If the wealthy want to live near downtown in new apartment buildings, the city should let them. Apartments near downtown require less infrastructure and their tax dollars can be used to support city services.
  3. Space. When Henry Ford made his assembly lines, the factory had ~200 square feet of space per worker. Now, after decades of automation and other improvements, a factory will have 2,000 square feet of space per worker. This isn’t because the factories are larger, it’s because the factories have 10% the number of workers than they did 100 years ago. Large factories with few employees are not compatible with dense cities. Chicago is very large and not all of it is dense. However, the area the DPD identified is very near the loop. It doesn’t make sense to have jobs that require 2,000 square feet of space per worker to operate so close to the city center.
  4. Jobs. The size of the economy that requires factories has shrunk dramatically and the service industry has taken it’s place. In 1940, about 37% of the economy was goods-producing; today, it is only 14%.
Chart shows the rise of service employment and the fall of goods-producing employment

Cities should not try to retain manufacturing jobs though zoning. This a a poor use of scarce space in the city. Instead, cities should follow Chicago’s example and identify the areas that would be better used for housing.

I’m glad that the DPD has made this change. Furthermore, this area sits in the Near North Side ARO pilot area. This means that 20% of the units constructed need to be affordable. It is great that an area in high demand can be leveraged to support ARO. Furthermore, the city plans say it will use its resources to support affordable housing for developments in this area with the goal of reaching 30% affordable units. I really think this is a great idea and I look forward to seeing the departments tools in action to add 10% more affordable units to these projects. I anticipate this will work well and bring much more housing to the Near North Side. Hopefully this can be a model transitioning other PMDs to residential or mixed use.

Here is a link to the city’s report:

Here’s a map of manufacturing districts in Chicago. Which district do you think should allow more residential or commercial development? Answer on Twitter and tag @CYimby .

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