Presentation given by Dr. Susan Wachter, 10.21.09

1. Greening Vacant Land
Green Infrastructure Symposium
October 21, 2009
Pittsburgh, Pennsylvania
Susan M. Wachter
Richard B. Worley Professor of Financial Management
Co-Director, Penn Institute for Urban Research
The Wharton School
University of Pennsylvania

2. Objective: Creating communities of lasting value
 From blight to hope
 Quality of life for families
 Neighborhoods with green space encourage
community interaction, create safe blocks, bring
nature to the city, promote healthy living and reduce
crime rates, social isolation and visual blight
 Learning how to do this is a work in progress.

3. Green in perspective
 fostering communities that are not just environmentally
sustainable
 economically strong and equitable
 six principles of sustainable communities outlined in the
interagency partnership among HUD, DOT, and EPA:
 increased transportation choices
 increased equitability, affordable housing opportunities
 increased economic competitiveness
 support for existing communities
 leveraging of federal investment
 value of communities and neighborhoods

4. City Strategies
 Chicago
 Mayor Daley's initiative for gardens:
 If city-owned, procedure exists to permit gardening with relative ease
 If privately owned, city assists with identifying owner and securing permission
 If gardeners intend to stay for more than three years, referred to NeighborSpace, a non-profit that
specializes in the management of community gardens and parks in Chicago.
 CitySpace Program: unprecedented agreement between the City of Chicago, Chicago Park District, Forest
Preserve District of Cook County, and Chicago Public Schools. In targeting greening projects on vacant
lots, school playgrounds, and underutilized land along the Chicago River, the cooperative effort is helping
Chicago achieve its open space goals, especially in neighborhoods where the amount of public land falls far
below local and national standards.
 http://www.afreshsqueeze.com/articleDtl.php?id=4a688243af834
 New York
Bette Midler and New York Restoration Project started in 1995 to beautify open space and promote
community gardening and expand community programs and encourage public pride
 MillionTreesNYC - started in 2007 to plant 1M trees in the 5 boroughs by 2017
 http://www.nyrp.org/Parks_and_Gardens/Community_Gardens
 City Spaces program targets NYC neighborhoods least served by the current park system. For each $1
million playground, funding is raised by Trust for Public Land matched two-to one by the Dept of
Education. TPL has created or enhanced more than 250 neighborhood parks in New York City, investing
roughly $200 million in land purchases and in the design, construction, and stewardship of parks.
 Flint, Genesee County
 http://www.thelandbank.org/

5. Penn Institute for
Urban Research
City in the 21st Century
Series: University of
Pennsylvania Press,
2008
www.upenn.edu/penniur www.upenn.edu/pennpress
•“Green InvestmentStrategies: How They Matter for Urban
Neighborhoods” – Susan Wachter, Kevin Gillen, and Carolyn
Brown
•“Transforming Through Greening” – J. Blaine Bonham Jr. and
Patricia Smith

6. Philadelphia Green
 Neighborhood Transformation Initiative (NTI): City commits
$10 million in city funds for minimum 5 years, plus $296 million
in bond proceeds
 Vacant Lot Clean-up Program (VLCP) under Office of Managing
Direct -- $4 million to clean 31,000 lots in first year with 225
staff
 Department of Licenses & Inspections certifies lot as blighted to
permit city access
 Philadelphia-based landscape contractors do the actual work
 Community Land Care, organized by Philadelphia Green,
recruits maintenance workers: great opportunity for
organizations that seek work for formerly homeless, ex-convicts,
etc.

7. Learning how to do this, a work in progress
• Stabilization/“Clean and Green”
• Costs $1.50 per sq ft. to “clean and green” a lot
• Costs ~ $2000 for an average size lot
• Maintenance
• Costs $0.17 per sq ft. to maintain a lot (14 clean-ups April-October)
• Costs ~ $200 for an average size lot
• Community Land Care Program and other programs
• Since inception, ~ 10,000 total parcels
• http://www.philly.com/philly/news/local/64889342.html
• The Genesee County model, “State Rep. John Taylor (R.,
Phila.) has introduced a bill establishing a land bank to take
moribund property from neglectful owners.”

8. Office of Sustainability

9. Philadelphia’s Challenges

11. Philadelphia Green
Reclaim Abandoned Land

19. Green-city Strategies and
Neighborhood Value
THE STUDIES
Wachter, Susan M; and Wong, Grace, “What is a Tree Worth? Green-City Strategies and
Housing Prices”, Real Estate Economics, Vol. 36, No. 2, 2008. Available at SSRN:
http://ssrn.com/abstract=1084652
Wachter, Susan; Kevin Gillen; and Carolyn Brown, “Green Investment Strategies: A Positive
Force in Cities”, Communities & Banking, Federal Reserve Bank of Boston, Spring 2008.
Available at: http://www.community-wealth.org/_pdfs/news/recent-articles/04-08/article-
wachter-et-al.pdf
Wachter, Susan M; Kevin Gillen; and Carolyn Brown, “Green Investment Strategies: How
They Matter for Urban Neighborhoods”, Growing Greener Cities, Ed. Eugenie L. Birch and
Susan M. Wachter. Philadelphia: University of Pennsylvania Press
(http://www.upenn.edu/pennpress), 2008. pp. 316 – 325.

20. Public/Private Partnerships
to Conserve and Improve Community Assets
• Problem and potential: how to realize the enormous
benefits of reinvesting in blighted lands
• Private spaces: individuals respond with their own
decisions and actions
• Public spaces: require shared governance and citizen
stewardship for community action and public/private
cooperation

21. Why the Study?
• Need to quantify impact of policy
• Deficit in hard data
• Provide evidence as a tool for advocating for
good policy

22. Quantification Methods
• Data on house sales, prices and location of
greening investment from City and
Pennsylvania Horticultural Society
• Hedonic study - before and after spatial
investment impact on house prices, controlling
for variables
• Geographic Information Systems (GIS)
econometric methods - implemented at
Wharton’s GIS Lab

23. Multivariate Hedonic Regression Analysis
With the first 3 interactive terms measuring the effects of
proximity to greenspace, then the estimated regression results are:
Pi  $45,000  $9,923  ( New Tree)  $1,164  (Bordering Park)
(3.87) (1.29)
 $10,750  (Greened Lot)  ......   K X K
(1.55)
More than 30 variables are in the regression specification including: building and
lot square footage, number of stories and fireplaces, garage, central air, type and
condition of exterior, year of sale, census tract, distance to CBD (City Hall), and
number of years since last transaction.
Adj. R2=0.60
N=70,000
This regression only used data from 2000-2005. Similar regressions using data
from 1980-2005 used over 200,000 sales records in the estimation.

24. What matters for housing prices
 Physical attributes
 more square footage;
 a larger lot size;
 better physical condition;
 the presence of fireplaces, central air conditioning, and/or a garage;
 Proximity to downtown
 State of the overall market

25. Quantifying benefits of community investments
 Commercial corridor improvement
 Vacant land management
 Neighborhood greening strategies
 Business Improvement Districts (BIDs)
 Impact on quality of life: schools, public safety,
public transit

26. Vacant land management
 Transition from abandonment to clean & green
 Adjacency to a neglected vacant lot subtracts 20%
of value
 Stabilizing lots impart an additional 17% of value to
surrounding homes

27. Impact of Public Investments
<= ¼ mile to a commercial corridor in
23% $19,021
“excellent” condition (net impact)
¼ to ½ mile to a commercial corridor in
11% $9,097
“excellent” condition (net impact)
Near a new tree planting 9% $7,443
Improvements to streetscapes 28% $23,156
Adjacent to vacant lot -20% ($16,540)
Adjacent to a stabilized and greened lot 17% $14,059
1% increase in crime index -14% ($11,578)
High-school dropout rate -5% ($3,970)
Located in a business improvement
30% $24,397
district
<=1/8 mile to a subway station 3% ($2,481)

28. Neighborhood greening
 Tree plantings, streetscapes -- container plantings,
small pocket parks
 Overall increase in house prices of 9% from tree
plantings

29. Empirical strategy: trees
 All single-family house sales in
Philadelphia
 Housing characteristics
 Exact locations of house and tree
plantings
 Exploit the variation in time & location of
housing sales relative to those of tree
plantings

30. Fairmount Tree Plantings Between Sales
controlling for tract-specific linear price trends
All (ftrees) If td500=1 (ftrees) If td1000=1 (ftrees)
-1 -2 -3 -4 -5 -6
lrprice lrpdiff lrprice lrpdiff lrprice lrpdiff
Log lagged price 0.232 0.228 0.248
(0.005)*** (0.036)*** (0.024)***
Log lotsize 0.179 0.08 0.234 0.158 0.172 0.085
(0.007)*** (0.008)*** (0.049)*** (0.056)*** (0.031)*** (0.034)**
Log building size -0.412 -0.156 -0.473 -0.301 -0.404 -0.201
(0.011)*** (0.013)*** (0.068)*** (0.076)*** (0.047)*** (0.052)***
Number of stories in the parcel -0.024 (0.004) 0.074 0.092 0.069 0.063
(0.008)*** -0.009 -0.046 (0.052)* (0.032)** (0.036)*
exterior==FRAME (0.020) (0.011) 0.057 0.048 0.047 0.057
-0.016 -0.019 -0.128 -0.145 -0.076 -0.085
exterior==STONE 0.061 0.036 0.104 0.083 (0.004) (0.038)
(0.017)*** (0.020)* -0.105 -0.12 -0.07 -0.078
=1 if parcel has a non-rectangular shape -0.034 -0.036 0.097 0.085 0.048 (0.008)
(0.011)*** (0.014)*** -0.079 -0.09 -0.049 -0.055
=1 if parcel has central air conditioning 0.143 0.135 0.213 0.029 0.170 0.004
(0.054)*** (0.064)** -0.245 -0.277 -0.236 -0.265
=1 if parcel has garage 0.106 0.043 0.091 0.045 0.066 0.020
(0.007)*** (0.008)*** (0.046)** -0.052 (0.031)** -0.035
=1 if property is detached 0.037 0.038 (0.014) 0.023 0.019 0.057
(0.013)*** (0.015)** -0.081 -0.092 -0.053 -0.059
Time since previous sale -0.073 0.308 -0.116 0.861 -0.098 0.792
(0.004)*** (0.004)*** (0.059)** (0.043)*** (0.039)** (0.030)***
pTime since previous sale 12.67 -132.491 32.852 -273.837 23.09 -267.226
(1.410)*** (1.318)*** (17.992)* (12.627)*** (12.072)* (8.832)***
Tree planting within 100ft between sales 0.134 0.092 0.027 0.003 0.038 0.020
*controlling for year and quarter fixed effects (0.038)*** (0.045)** -0.039 -0.044 -0.039 -0.043
Linear trend X census tract dummies Yes Yes Yes Yes Yes Yes
Observations 71003 71003 1994 1994 4343 4343
R-squared 0.64 0.21 0.75 0.54 0.71 0.45

31.  The visual and psychological impact of even the
simplest of streetscape improvements, such as
planting a tree or installing a sign, makes a huge
impact on creating a quality environment and
defining a place. There is no question that
streetscape improvements increase housing values
and make the public environment more appealing.
– Nancy Goldenberg
Vice President of Planning
Center City District

32. Learning How to do this: Work in Progress
Overarching Questions:
 How does the transformation occur?
 From blight to [?]
 Side lots
 Community gardens
 Open space
 Local farming
Implementation Questions:
 Economic development and land disposition?
 Land purchase or guerilla gardens?
 Who is to maintain?
 Providing for an evolving future?
But we do know that going from blight to green works!

33. Thank You
Susan M. Wachter
Richard B. Worley Professor of Financial
Management
Professor of Real Estate and Finance
The Wharton School
University of Pennsylvania
wachter@wharton.upenn.edu