Could Facebook’s Entry Into Residential Real Estate Offer a Model for Housing in Expensive Cities?
Facebook recently proposed a plan to create 1,500 apartments for employees near their Menlo Park, California campus, with 15 percent of the housing set aside for low-income families. According to Wired, “Urban planners and local developers call it a generous gesture that could bring sorely needed housing to the area.”
The company wants to construct two new office buildings and a hotel on land near its original campus to accommodate thousands of planned hires. Some people argue that the tech company getting into the property development game will actually drive up housing prices in a market that’s already one of the nation’s most expensive areas.
Tech companies like Facebook, Google and Twitter (the latter of which have offices in NYC) are shaping the way cities evolve today. In the heart of Silicon Valley, unabated demand has led to overcrowding and skyrocketing home prices; the companies have received a fair amount of the blame for this, which makes the idea of offering employee housing and lower-income housing–both of which address the problems–look like good ideas, or at least a good start.
The employee housing idea is a way to circumvent complicated zoning and development regulations that apply to residential construction. In Silicon Valley, zoning laws favor commercial development, which generates more tax revenue than apartments. In cities like New York, where market-rate housing is in high demand (though the city has its own set of zoning complications) it’s interesting to look at the ways companies like Google, whose Chelsea office is its second largest–or non-tech companies in sectors like media and finance–could contribute to the alleviation of the worsening housing crunch.
The Wired article raises the relevant point that company housing makes it easier for employees to relocate to places like NYC or Silicon Valley where housing costs are prohibitive. And it’s hard to argue with the addition of affordable housing where it’s sorely needed. Housing advocates in the bay area say it doesn’t go far enough, but “every little dent helps.”
There are, however, concerns over how much control the company will have over who inhabits the apartments: Says Ezra Haber Glenn of MIT’s School of Urban Planning and Development, “Even if it’s not earmarked for Facebook employees, it might be for the types of people they’re trying to attract.” And to some, the addition of employee and low-income housing looks like an admission of guilt for the company’s contribution to the problem itself.
In a parallel tech and finance hub like NYC, the steady stream of new employees will undoubtedly turn to new housing options like shared housing at Common and WeWork to be able to afford to live in the city and build a career, so the idea of big companies that attract these new workers getting involved in providing them with housing could be an attractive one.
[Via Wired]
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Lead image: Isriya Paireepairit via flicker cc.
