ECONOMICS UNIQUENESS

140 ■ THE ECONOMICS OF UNIQUENESS
to come from the private sector. Th e private sector is far more likely to make
an investment in an area with rising property values than one with stagnant
or declining values. Further, as property values increase, the amount of public
resources required as subsidies or incentives decreases.
Th e sustainable preservation management of historic urban fabric starts
when heritage buildings are fi rst identifi ed and then protected, when there is
a comprehensive approach in public policy toward safeguarding of heritage
assets along with strategic investments made to upgrade public infrastructure,
and when private-sector investment in those buildings is captured.
Where these elements are in place, the economic value of heritage places is
being demonstrated around the world, confi rmed by a robust and growing
body of research.
Notes
1. As was noted earlier, the total economic value of a heritage building is its use value plus
its non-use value(s). Th is chapter only deals with the direct use value.
2. A relatively low-cost approach to track building condition is to simply take digital photographs
of the exteriors of every heritage building on a regular basis—every 6–12 months.
While not a precisely measureable indicator, at least it is relatively easy to determine if
general physical conditions are getting better or worse. If building conditions are improving,
that inherently implies that someone is making an investment in the buildings, and
investment itself is both a cause and an eff ect of enhanced property values.
3. Using this approach it is important to identify any capital improvements that may have
been made to the property between the two selling dates, as that, rather than simple
appreciation, may be the cause of the higher selling price.
4. Th e exception is if the owner of the property is the federal government itself, or if federal
government funds are being used as part of the project. Even this exception doesn’t
guarantee that the property will not be razed, but it does mean there will be a rather
extensive review process and a consideration of alternatives before the demolition can
be taken.
5. http://www.merriam-webster.com.
6. Th ere is an exception to this general principle: when a “vacant” building is actually occupied
by those who have no established legal right to be there and may be paying no rent.
In some situations the political, regulatory, or social processes of emptying the building so
that redevelopment can take place can be both expensive and burdensome.
7. Rising property taxes can be a diffi culty for low-income housing owners. But this
is a cash fl ow problem, not a wealth problem; their underlying asset is appreciating
in value. Th erefore a relatively simple solution can be implemented by allowing the
property taxes to simply accrue until the property is ultimately sold or transferred to
younger family members, at which point the deferred taxes can be collected.
8. Th e third sector is usually defi ned as including nongovernmental organizations as well
as philanthropic and voluntary activities.