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The Politics and Economy of Mixed-Use Planning

By Ian Van der Merwe

Example of Mixed-Use Development. Photo by author.

The consensus of planners is in, mixed-use is the name of the game! Every apartment building must have space for shops on the first floor and every redevelopment must contribute to building a denser city!

Over a century after the passing of the first US zoning laws, planners have walked back the separation of land uses, heralding the benefits of their recombination. Quick to point to the racism of redlining and the ecological harm of the suburbs, the creation of dense, mixed-use buildings has become the often realized dream of a new generation of planners, ready to pick up the torch of New Urbanism and carry it into the Yes In My Back Yard (YIMBY) camp. Today, years into this approach, we have many examples of what mixed-use development looks like, and how it functions in our cities. So we can ask ourselves; What has mixed-use development turned out to be? Who has it helped? Who has it harmed? And what kind of city is it building?

To begin, let's do a quick exercise: Think of a new mixed-use development in your town. Chances are it's a standard 5-over-1 with five or so floors of lumber construction (5) over a floor of concrete (1). The facade is an amalgamation of different finishing materials, which may or may not work well to hide the nature of the low-cost construction method used. The top five floors are likely jam-packed with studio, single-, and some two-bedroom apartments, while the bottom floor houses various commercial enterprises. This is the realization of the mixed-use dream, and the planners who support such efforts seem content with it taking this form.

Mixed-use development, as it stands, is hardly anything more than the mixing of residential and commercial space, two of the most profitable land uses for the class of landowner who profits from increasing land values. Zoning had previously delineated commercial zones from residential ones and limited the height and density of both (thereby limiting the potential rental/leasing and sales profits to be made). One of the primary effects of the recent influx in new mixed-use and density-oriented planning policy in US cities has been an increasing dominance of the real estate industry in the economy. Even nationally, real estate, rental, and leasing looms large as the largest single industry, now making up 12% of the national GDP.

The widespread acceptance by planners of YIMBY ideas has further entrenched the real estate state, and the role of planners in it. With technocratic skills, planners can rezone whole neighborhoods to welcome an influx of real estate investment, rising land/property values, increasing rents, and with it all, unaffordability for working class residents. Even public transit, an ostensible “public good” has been weaponized in this class struggle, with much mixed-use redevelopment taking place under the auspices of “transit-oriented-development,” a contradictory term since such redevelopment projects seem to spur little increase in actual transit ridership.

Understanding planning's relationship to the economy is key to understanding both the apparent successes of such new urbanist policies and their contribution to growing urban crises. The landowning class is not unified, and different classes of landowner (defined by the ways they make money from the property they own) relate differently to rising land values and, as a result, urbanism. For real estate, the more valuable the land, the better, allowing for higher rents and leases. If the area is zoned to allow for higher-density mixed-use development, it increases the profits that can be made. For manufacturing and warehousing industries, however, the less valuable the land the better; for them, land is good only insofar as it can house the machines, labor, and goods that they extract profits from, and the higher the land values, the more costly it is to function, and the less profit they can make.

In the urban struggle between these two classes of landowner, planners, guided by ideologies like New Urbanism, have chosen a side; overseeing a vast reordering of urban space to allow for the dominance of real estate. The fixation on bringing together housing and commercial rents (mixed-use) and increasing their density shows itself, then, to not be some apolitical stance taken by planners who know better, but rather a political alignment with the real estate industry, providing for them new tools and new opportunities to extract greater and greater profits from urban space. And this has not been without its harms, either. The dual specters of gentrification and homelessness haunt such redevelopment efforts. On one hand new mixed-use development displaces working class residents, driving their flight into the same suburbs so-hated by the YIMBYs (this process is called demographic inversion), and on the other, for those unfortunately precarious enough to not be able to afford even such a move, homelessness. And then, when faced with this new urban reality they’ve helped create, these prophets of density have the gall to proclaim that if only we would let the real estate industry build even more housing on their terms, then all these issues would be set right! Of course, this all being predicated on an even more massive growth in the rental industry and the concurrent growth of the forces and profits of real estate.

The basic takeaway from all this is that urban development is a zero-sum game for class. Economic growth resulting from the real-estate industry requires increasing cost-of-living for all, a move which disproportionately burdens the working classes. At the same time, real-estate oriented growth pushes manufacturing and warehousing industries away from these high-land-value areas. It would be a mistake to read this as a pro-manufacturing point-of-view, although I would be quick to point to the necessary material dependence commercial and service industries, in fact all of contemporary life, has on manufacturing. Rather, this is all to recognize what is actually happening in the metropolises of North America. The deflation of land values resulting from manufacturing and warehousing land-uses creates relative housing affordability in nearby suburbs. All those pushed out of the city by rising cost-of-living find the opportunity for housing and often even homeownership in these developing working class suburbs. The oft-cited housing crisis is therefore not a crisis of supply, but a crisis of affordability. The real estate industry, the purveyor of land, and therefore of housing, is most certainly not in a state of crisis, it is the working class homeowners, renters, and homeless who are. To miss this is to misunderstand the housing crisis.

But what then is a progressive planner to think? Surely the suburb and the lifestyles it incentivizes must still be critiqued? This is true, but not on the terms of the landowning classes, which would have us believe that the low land values, low profitability, and low growth of the suburbs is any reason to condemn them. Instead, we must point to the alienation, precarity, and segregation which exist across the entire metropolis, including in working class suburbs. By focusing on a critique of density and land uses, the planners critiqued here are able to either conveniently forget the residents of the working class neighborhoods regularly targeted for redevelopment, or worse yet, lay blame on them for the consequences of the poor design of the suburbs they are now able to afford. There are grounds to critique the design of suburbs, just as there are grounds to critique the design of urban spaces, but to miss the real actors of the urban stage, the landowners and industries which exercise immense control over all space and especially of urban development, would be to misunderstand the current urban situation, and remain perplexed by the growing crises therein.

To focus on matters of urban design, and ignore the prevailing urban economics, is to blindly follow the ideology of real estate, which would have planners set the stage for real estate's enrichment while planners busy themselves with superficial critiques of suburban space, all the while failing to look deeper at what is really happening. A common retort to this train of thought is that we mustn’t “let the perfect be the enemy of the good,” but what good is there in blind submission to the real estate industry? Planners must push back against the free-reign real estate that has been given of North American cities and recognize that to plan for real estate is to plan for urban crises. It is not that the alternative is to back the manufacturing industry, rather planners must see with open eyes the intersections between space, economy, and class. Cities are battlegrounds of class conflict, between workers and bosses, tenants and landlords, even between small proprietors like vendors and the cities which control the spaces they work. Planners must find new ways to navigate these struggles and our place within them. To continually acquiesce to the logic of economic growth is to continually find ourselves complicit in the exploitation of the city and its residents for private gain. As with all elements of the ruling classes' ideology and self-conception of themselves, the supposed benefits of private property and economic growth are seen as forgone conclusions, backed by the best in real-estate sponsored studies, which continue to claim that what is good for them is good for us all. But this is not the case, and to submit to these forces will not help make our cities better. It has been pointed out in a recent article that the way forward is to “do the right thing for the people who inhabit the space,” this remains true whether that space is rural, suburban, or urban, and regardless of how well it embodies new urban principles.

Currently, planners act as foot soldiers in real estate's conquest of the metropolis, and many planners seem eager to fill this role. Some may truly believe that real estate investors and developers can build a better city, but others may simply not see any alternative. What could such an alternative be? Real estate is not taking over because of ideology or policy alone, its power is rooted in its ownership of land. While necessary nuance exists between homeowners and landowners who derive profits from the lands they own, we can still say that moving towards forms of common ownership of land would give all residents of the city the ability to influence its development (this stands also as a non-technocratic position on the NIMBY-question). As a horizon to work towards, a new commons is as good as any, but the steps towards that remain hazy, especially for planners who remain shackled to state institutions that themselves often see upholding private property and economic growth as foundational pillars of their work. Key to waging this struggle will be the creation of an alternative consensus among planners, one which pushes against the belief that what is good for the economy is necessarily good for the mass of people also. It is in this vein of thought that this article appears in the Planners Network magazine, an organization which has long filled this role. In line with this, planners must develop better understandings of our role in society and especially of our relationship to the economy, and rigorously critique the economic-growth based reasoning used to push us towards conflating the good of the landowning classes with the good of society as a whole. Furthering and deepening this consensus and understanding should be done with an eye towards the coordination of planners down the road towards imposing a new order upon planning, one in which we stop aiding the ruling classes and instead orient our work towards the working classes. Planning our cities for those who make society work, and not those who own and rule over (and against) society, is the only way to build a city that is truly for all, which breaks free of the crisis cycles that the current state of things engenders.

Ian Van der Merwe is a graduate student and aspiring planner in the Salt Lake Valley.




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