1. 1 Economic Life of Buildings in a Large City Tzu-Chin Lin National Chengchi University, TAIWAN ERES Eindhoven 18 June 2011

2. 2 Outlines Taipei- Taller, Faster Supply of New Space Economic Life of Buildings and Land Recycling Concluding Remarks

3. 3 Taller and Faster City - where economic activities, trading and manufacturing, take place - urban growth constrained by durable physical fabric but frequently ignored in theories - it matters if buildings are able to supply in response to the changing demand

4. 4 Taipei - 2.6 millions - 271.8 km2 - 9,593 / km2 Taiwan - 23 millions - 35,759 km2 - 69% mountains

5. 5 5

6. 6 6 “Snail without Shell” demonstration in 1989 and 2010

7. 7 Potential harms to a city if the housing supply is falling behind demand (Glaeser 2006) - worsening housing affordability - declining population - greater housing price volatility - shrinking employment and income - less diverse demographic mix (a small elite group) - Manhattan as an example Is Taipei moving towards that direction?

8. 8 Supply of New Space Housing Price, New Floor Spaces, and Household Units over Time

9. 9 Through years 2001 to 2009 Chang et al. (2009) - Taipei housing price has been overvalued by 38% (price/income) and 27% (price/rent) housing price has more than doubled - but accumulated inflows of floor spaces have only reached 20% - the new households continue to form up to the present - an inelastic housing supply is suggested Data Analyzed - official record of permits to demolish and to construct - between Jan 2001 and Sept 2009

10. 10

11. 11 Districts200120022003200420052006200720082009total Shilin 2251922723531291021435611991881039652599653163222510111900664 Datong 116372624034891415778667629764110415240537419419971982 Daan 1651621019211685682314252675752046921207473428512507851853730 Zhongshan 2444292628944384404911075151911803164398412721553964283240804 Zhongzheng 1481631534761257011429361151831533471384573290721909731497312 Neihu 9452139190775195914616785550024269416020058420766950245966611 Wenshan 148034147995203026811661610241772542690882171152427121647419 Beitou 1866671653141570352243231794242182362624122980061932461884667 Songshan 326765371606719662311979866614537378502371952279721589247 Xinyi 178048239942416174297076130050203504233034885472001561986537 Nangang 63679107096244930271094385852534271115293795322663481736224 Wanhua 39187111425553301073794105743654881779455043300624062 Total 278691729155072578783269872723677122208356270791432579653377380 Annual Net Additions of Floor Spaces across Districts ( m 2 )

12. 12 New Additions of Floor Spaces over Locations Distribution of Assessed Land Values across Taipei City in Year 2010

13. 13 locations of demolished buildings Economic Life of Buildings and Recycling of Land

14. 14 Building Teardowns and Construction over years 2001-2009 Districts Accumulated new development projects (A) Redevelopment on the same sites (B) Projects built on the same sites (B/A) in percentage Average years between knockdowns and development Shilin42210524.882.74 Datong2236026.912.72 Daan46440988.153.12 Zhongshan47110822.932.55 Zhongzheng32913741.643.07 Neihu742304.042.63 Wenshan366215.742.55 Beitou3865815.032.77 Songshan1672313.772.74 Xinyi183189.842.46 Nangang1792011.172.71 Wanhua1363122.793.48 Total/average 4068102023.912.8

15. 15 Location of demolished buildings Datong and Wanhua - old neighborhoods - aged buildings Zhongzheng and Daan - pricey neighborhoods - most desirable residential areas Driving forces behind building demolition - physical deterioration - economic demand

16. 16 Ages<5 6- 10 11- 15 16- 20 21- 25 26- 30 31- 35 36- 40 41- 45 46- 50 51- 55 56- 60 Total Concrete8231933436952301310273 Reinforc ed-brick 620151832968863181330 Brick110281021816113072 Wood10012621220017 Total165323487710516713689221692 Age Distribution of 692 Demolished Buildings

17. 17 Structure materials Annual depreciation (%) Physical life (years) Salvage value (%) Concrete1%6040% Reinforced brick1.2%5237.6% Brick1.4%4635.6% Wood2%3530% Law-specified Annual Depreciation, Physical Life and Salvage Value

18. 18 overall - the majority of buildings were torn down at the age of between 26 to 45 - one-fifth of the buildings were even less than 25 years old concrete buildings - none reached their physical end - 40% did not even reach half of their physical life - waste of resources and disjoint between urban plan and market reality brick and wooden buildings - a respective 19% and 29% of them have passed physical end when torn down - redevelopment did not move as smoothly as hoped - obstacle to urban regeneration

19. 19 Concluding Remarks The majority of new buildings occur in the outer areas on raw land Areas of high-end markets also have seen a modest new supply through recycling of land Few new spaces are supplied to the inner-city deteriorating areas where redevelopment is in urgent needs

20. 20 Both physical and economic factors are operating at determining the life of a building Discrepancy between physical and economic life of buildings suggests a potential inefficiency of land use

21. 21 Thank You for Your Attention!