The Problem of Asynchrony and the Wedge
By Mark Smith —
Low-density development is often result of the match between local market conditions and the financial feasibility determination for a building or project. Most instances of new construction occur in what Pario calls low activity, low value markets. Low value markets produce low revenue to developers, and low revenue does not support sufficient density to yield productive urban neighborhoods.
This is a primary cause of sprawl and it is too little understood.
If a one or two story building is constructed, its economic and environmental characteristics and performance are relatively fixed. See the green area in Exhibit 1.
Asynchrony Grows Over Time.
The problem is that losses from asynchrony can begin shortly thereafter as the market begins to evolve but the building and site can’t adjust–the asset cannot coevolve with the market. Losses grow over time. See the orange area in Exhibit 1.
More to follow on the problem of asynchrony, and solutions for it.
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