Since upzoning is being planned for San Francisco, Here's a few sentences from p. 16 of the Terner Center report on why inclusionary housing doesn't work:
Here's the relevant quote from p.16:
"The TOC (LA's Transit Oriented Communities) incentives allow an 8-story, 100,000 square foot building. If construction and materials for this building are $300 per square foot (psf), the total construction and materials cost is $30 million. If allowable density and floor area increases by an additional 50 percent, the developer could build a 12-story, 150,000 square foot building. However, the increased height boosts construction costs to at least $360 psf, meaning the total cost of construction rises to $54 million. Density increased by 50 percent, but costs grew by 80 percent."
The Terner Center uses these numbers to explain why density bonuses sometimes can't compensate for the costs of inclusionary zoning. Yet the same logic applies to upzoning. Allowing taller buildings with upzoning will also increase per square foot costs, meaning that upzoning requires more expensive apartments to cover the cost, not less expensive apartments. I've never heard the Terner Center argue against upzoning on these grounds. Funny how these facts are used against inclusionary zoning, but not upzoning.
A former colleague (a shout out to Matt Stoler and his Substack)) sent me the article at the link below. It's important, and worth your time (it is long). But it is grimly fascinating:
https://www.thebignewsletter.com/p/messing-with-texas-how-big-homebuilders
The article links to this companion article:
https://www.thebignewsletter.com/p/its-the-land-stupid-how-the-homebuilder
The first article includes a link to this website:
https://www.builderonline.com/land/local-leaders-list/2024/
This website shows what percentage of new home building is controlled by the top 10 firms in various regions. You can check previous years, too. For LA in 2024 it was 90 percent. For the Bay Area in 2023, it was 68 percent.
