SKY’S THE LIMIT

Evening Star, Issue 19772, 24 January 1928, Page 2

SKY’S THE LIMIT

HEW YORK'S FUTURE Skyscrapers seventy-five storys high and costing 42,000,0U0d0l to erect may ho expected in the future in some of New York’s leading business districts. Thin will be the minimum height if the builder expects to obtain a fair return on Ids investment. As the income will bo greater at ninety storys, it is natural that the builder who can gather 42,000,U00d0l and ,plans a seventy-five-story building will not hesitate to pile fifteen more on top. Studies which have been completed by leaders in the various lines of construction, management, and renting have decided that to erect a structure of fewer storys in the leading business zones would not be economical unless the present tax structure is altered and the level of land values adjusted, which is not probable. The American Institute of Steel Construction some time ago asked AY. S. Clark, economist, of S. W. Shaw and Co., to build a hypothetical building that would solve all the evils of the skyscraper which meant much more than running up a structure. Mr Clark called upon a well-known firm of skyscraper architects to assist him. in the planning, and thou asked the assistance of the Muilding Manager and Owners’ Association to see that the building met all the. requirements of tbo city ordinances, and would be profitable to the builder. A block in the Grand Central section was selected, and on this was erected the hypothetical structure.

When the studies were begun sevontytivo storys was the height arbitrarily selected by Mr Clark and his collaborators as beyond the probable maximum of height to secure the greatest economic efficiency for this specific site. Much to their surprise, however, the studies showed that at seventy-five .storys the curve of economic efficiency was still mounting upward, and, had the survey continued, a height of eighty-five or eighty-seven storys might have been found to be even more profitable than seventy-five storys.

' Sane regulation of building heights in the interest of public health is to be desired, but any attempt to put into effect a flat level restriction of eight or ten stories will result inevitably in a severe deflation of land values and a complete disorganisation of the whole tax .structure.” Mr Clark’s report says: “ Moreover, despite frequent claims to the contrary, the deflation ~of land values in the. central business districts will not bo offset by a corresponding appreciation of values in the outlying sections, for the decentralised city will bo found to be not only a loss efficient but a more expensive mechanism for carrying on commercial and certain types of industrial activity. “ Jn the case of certain plots of very large size and appropriate location, the most economical development may involve snaring a structure skyward to the height of seventy-five or more stores. For the normal plot, of moderate size, even in the central business section of New York, the principle of diminishing returns usually sets an economic limit considerably below this giddy height, while the average plot in the city as a whole will still probably find its most economical utilisation in a. structure of perhaps four to ten or twelve storvs.”

“ The hypothetical development of a solid block in the vicinity of tho Grand Central Terminal was chosen, partly hccau.se under tho Xcw York zoning law tho really fall building gets a fair chance only on a very large site, and also because it was believed that tho trend ot the future i.s towards this type of development. Preliminary analyses of-the data obtained indicate that op a plot of 200 ft x 105 ft, with land value approximat- I ing 20Qdol a square foot, the most i economical development was the building rising 917 ft K)in from the sub-basement floor, and with a tall central tower representing- 1 in itself _ a. large building of approximately ideal proportions. Increased cost of steel, elevators, mechanical equipment, etc., increasing wastage of ne 1 ' rentable area for tile various building utilities (particularly tho elevators, every added one of which wastes a • considerable plot of otherwise rentable area, on every floor) and the mounting burden nl “ carrying charges ” upon the huge investment during the lengthening construction period, brought what the economists are wont to call “ diminishing returns ” as tho building soared. These increases, however, were less rapid than had been expected, because of the large size of the building, and were also in part offset by the improved light and air and the superior efficiency nl rentable space on . the higher floors. Tlio estimated net return upon the 42,000,000d0l investment involved in tho seventy-five-story structure was 9.X per cent, ns compared with 8.8 per cent, for the sixtythree-story building and 8.4 per cent, for the fifty-story building. Tbc heavy burden of taxes m d interest charges upon the laud reduced the, net income of tho eight and fifteen-story buildings to 2.8 per cent, and 4.9 per cent, respectively. It is obvious that on a smaller plot the economic limit would have been reached at a. lower level. The smaller the plot the more rapidly will the principle of diminishing returns accomplish its result, and the sooner will the true economic height be reached. Each city pint, presents an individual problem, and its most economical development must he determined in each case by a careful consideration of all the governir- factors. In addition to size of plot numerous other factors hear upon the problem, such, for instance, as the shape of the plot, character of the location, the type of impovement, the efficiency of tJie architectural and engineering plans, the value of the land, and tho level of construction costs, of rents, and of interest, rates, etc.

“This is by no means a blanket endorsement of tall buildings,” says the report. “Some tall buildings, existing or proposed, arc doubtless justly characterised as ‘ freak ’ structures, but, the attempt to further height restriction legislation by the contention that the tall building is an economic' fallacy should be roundly condemned.”