Could fewer shops lead to lower housing costs? Washington's governor hopes so

Housing in Washington state is expensive. Now, Governor Bob Ferguson wants to ease rules to bring costs down. The result could mean fewer ground floor businesses in new apartment buildings.

When developers build apartments in pedestrian-heavy areas, many cities require restaurants or retail on the ground floor. The idea is to encourage people to walk, rather than drive, to shop and dine.

But developers often lose money on those storefronts, and those costs get passed on to renters through higher housing prices.

RELATED: Austin built a lot of housing fast. Rents fell. What could Seattle learn?

So Gov. Bob Ferguson has requested a bill making it illegal for cities to require storefront spaces in new apartment buildings. Instead, developers could add more apartments, or amenities for tenants like gyms and rec rooms.

That legislation, Senate Bill 6026, gets its first hearing Friday, Jan. 16.

Why did cities require storefronts in the first place?

The idea of requiring storefronts began with Jane Jacobs' observations about urban planning in the 1961 book "The Death and Life of Great American Cities."

Repulsed by decentralized suburban developments that lacked the sense of vibrancy she saw on the streets of New York, Jacobs promoted things that contributed to a sense of community and safety to city streets. These included active storefronts — customers entering and exiting, with passersby pausing to look through storefront windows, and shopkeepers keeping an eye on the street.

Jacobs' ideas eventually led to urbanist movements across the nation, inspiring efforts to reduce suburban sprawl and revive densely populated neighborhoods by focusing on what makes them work.

RELATED: 9 families, 1 roof: Urban cohousing in Seattle

One important thinker in Seattle was Doug Kelbaugh, a University of Washington architecture professor who championed ways to bring a vibrant street life to parts of decentralized suburban communities, where the closest thing to a public Main Street was a shopping mall.

"I think most of my generation left suburbia because it was ultimately boring," he told a UW interviewer in 1984. "And it didn't have the life that the city had. And I think there are ways to urbanize suburbia that can engender real life."

A cornerstone of Kelbaugh's approach was the "mixed use building" as a core component of a healthy streetscape. It featured apartments above, and ground-level retail, restaurants, and grocers on the street level.

Over the years, cities like Seattle began integrating these ideas into their comprehensive plans, at least for small parts of the city designated as commercial nodes.

In Washington, this shift began after the state Legislature adopted the Growth Management Act of 1990 — one of the most important pieces of legislation to hit the state in the last 50 years. The new law discouraged development outside an imaginary boundary that surrounds metropolitan areas like greater Seattle, in order to protect farms and forests from suburban sprawl.

Today, that boundary stretches from Marysville to Tacoma, and Bremerton to Sammamish. With development now forced inside the boundary, cities were encouraged to grow denser, and to focus on reducing reliance on cars, whose roadway needs take up a lot of room.

In the years that followed, developers often grumbled about the requirement that they include ground floor retail/restaurant spaces in their apartment buildings. Those commercial spaces proved difficult to lease, and the construction is more expensive relative to the amount of rent the owner can get. Basically, developers were expected to shoulder the extra costs of what was seen as a public good.

RELATED: The earthquake is coming. Is old Seattle worth saving?

In order to simplify their overhead — and in order to accommodate chain stores that increasingly wanted huge footprints in urban areas — developers sought to consolidate the commercial spaces into one large space that could be leased to a single long-term tenant such as a pharmacy.

These large leases failed to fully recreate the vibrancy of more traditional commercial cores, such as Seattle's University District, where narrow storefronts allow many small mom and pop businesses to thrive on a single block.

Chains like Safeway were famous for providing street-facing windows in their new buildings to meet the letter of the law, but then papering them over, or putting obstacles in front of them, rather than keeping them open to maintain a vibrant, interesting streetscape.

But for many decades, cities failed to add new housing within the urban growth boundary as quickly as people moved to the area, and the result has been continuously rising housing prices.

What changes could be made to "out of date" zoning code?

Meanwhile, the shift to remote work has apparently permanently damaged downtown Seattle, whose office workers used to support a vibrant ecosystem of ground level businesses.

Then, there's a larger shift that brick and mortar retailers have been complaining about so long it's almost become forgotten: competition from online retailers. These have made it increasingly difficult for even the largest retailers to sustain their leases.

"We've all experienced walking past a vacant storefront, which usually has no transparency because the windows are papered over and, there's really nothing going on inside the building," said Rick Mohler, chair of the University of Washington's architecture program and a former student of Doug Kelbaugh.

"We are in a different time, with different priorities," he said. "We desperately need housing. The zoning code, as written, is out of date."

Mohler and other architects who teach classes in the department are exploring alternative layouts for mixed-use buildings that could protect some of Jacobs' original vision for life on the street, while acknowledging that lowering housing costs is among the most important problems of our time.

RELATED: Housing, trees, and parking: In Seattle, you can pick two

"You could create a courtyard building, and get some residential units on the courtyard," he said. "That would take up a lot of the ground floor space, and then you could have shallower, for example, commercial spaces along the street."

Shallower retail spaces, especially if they're also narrow, could go a long way to foster smaller local businesses that have long been shut out by larger tenants.

Mohler said developers are increasingly putting community amenities within the building — the amenities that are for use by the tenants, like gyms and rec rooms — on the ground floor.

"So they don't have to rely on that space being rented out ... and it can continue to be transparent," while also possibly contributing to a sense of life on the street, he said.

Mohler said he'd love to see more community spaces, for public gatherings or political activities, at the street level. He acknowledged it was unclear how to pay for these.

Left unspoken: This is how the best of intentions can add development costs to housing projects, which then find their way back to us in the form of higher rents.

As lawmakers consider the rent-lowering approach of eliminating a ground floor storefront requirement, they must consider tradeoffs like these — for their policies will be shape the cities of the future.