Form Follows Function: On theInteraction between Real Estate

Finance and Urban Spatial Structure∗

David S. Bieri†

Urban & Regional Planning, University of Michigan, Ann Arbor, MI 48109,USA

Winter 2013

THE CONNECTIONbetween the spatial de-velopment of cities and

�nancial markets has receivedlittle attention from eitherurbanists or economists. Tobe sure, Marxist theories of∗Published in CriticalProductive,

v2.1 special issue on the Post-CapitalistCity. I am grateful to the editor, Mil-ton Curry, and an anonymous re-viewer for helpful comments on anearlier dra�. The usual disclaimersapply.†Corresponding author: A. Alfred

Taubman College of Architecture andUrban Planning, University of Michi-gan, 2000 Bonisteel Boulevard, AnnArbor, MI 48109-2069, USA. Email:bieri@umich.edu (David Bieri)

urban development recognizethat capitalism has to urban-ize to reproduce itself, thussuggesting a link between cap-ital accumulation and space(Lefebvre, 1970; Harvey, 1978,1985). Yet, while Marxianurban theory views the city,above all, as the spatial locusfor the accumulation of �xedcapital via the built environ-ment and infrastructure, thisschool of thought o�ers noexplicit framework for analyz-ing the spatial consequencesof �nance. In an attempt to �llthese theoretical lacunæ in ur-ban theory, I attempt to lay the

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groundwork for spatializingthe analysis of �nance in thetradition of Keynes (1930) andSchumpeter (1939). Within thepurview of a larger researchprogram on “money and thecity”, this work thus empha-sizes the hitherto neglectedlinkages between the insti-tutional evolution of money,credit and banking and urbanspatial structure.1

In this essay, I argue thatpart of the post-crisis re-covery is predicated on amultifaceted understandingof the subtle causal linkagesbetween �nancial �ows andurban morphologies. I spec-ulate about the key channelsthrough which the dialecticalrelationship among capital, itsregimes of accumulation, andits unequal spatial distributiona�ects the design of the urbanfabric. I identify two interde-pendent economic processes

1In a companion paper (Bieri,2013), I highlight the importance ofMinsky’s work on �nancial instabil-ity (Minsky, 1977) and monetary non-neutrality (Minsky, 1993) for under-standing the dynamics of urbaniza-tion under capitalism. This work paysspecial attention to the role of the �-nancial sector as a source of �uctua-tions in the real sector and the spatialstructure of cities.

that de�ne the nexus of real es-tate �nance and urban systemsin capitalist economies: (1) theprocess of �nancial global-ization and deregulation, and(2) the post-Fordist forces oforganizational fragmentationthat have altered the role ofarchitecture.

The process of �nancialglobalization and deregulationhas been instrumental to the�nancialization of real estatein a broad sense. In this con-text, “�nancialization” refersto the increase in the size andsigni�cance of �nancial mar-kets and �nancial institutions– from lending institutionsto investors, such as real es-tate investment trusts (REITs)and pension funds – in themodern macroeconomy.2

To be clear, the productionof both commercial and res-

2In the U.S., for example, the 50largest real estate investment trust(REITs) had a combined market cap-italization of around $580.7 billion in2011, accounting for approximately3.5 percent of GDP. By comparison,the largest pension fund in the U.S.,the California Public Employees’ Re-tirement System (CalPERS), currentlyhas more than $18 billion invested inglobal real estate – approximately 8percent of the fund’s $228 billion in-vestment portfolio.

Finance and Urban Form 3

idential real estate has alwaysrequired capital and land asintermediate factor inputs ina capitalist economy. Butover the past forty years, far-reaching institutional changesin �nancial markets have in-creased the role of �nancialmotives, �nancial actors, and�nancial institutions in creat-ing real estate credit and inoperating domestic and inter-national real estate develop-ment processes. At the sametime, the organizational prin-ciples of real estate develop-ment have become more com-plex, more decentralized, andmore standardized. As a result,capital and the spatial con�g-uration of cities have becomemore integrated.

In addition, the post-Fordistforces of organizational frag-mentation and layered insti-tutional inconsistencies – allkey components of the post-modern paradigm – have al-tered the formational princi-ples of real estate developmentand the fundamental role ofarchitecture and urban design.Because form, space, money,and the design of real estate areall intricately bound up withone another, increased capi-

tal �ows in real estate havebrought about profound fail-ures of design at all spatialscales.

Financial Functionand Institutional Form

IN LIGHT of the legendarywastefulness of Em-peror Nero’s architectural

projects, or the cost over-runs of architect Frank LloydWright’s Johnson Wax Build-ing in Racine, Wisconsin,or, more recently, of archi-tects Herzog & de Meuron’sill-fated Elbe PhilharmonicHall in Hamburg, Germany,it might be argued that thetension between �nancial in-terests and design interests isan age-old architectural real-ity.3 But the intuitive appealof regarding this con�ict asimmutable masks the chang-ing nature of the politicaleconomy within which realestate is being produced. Fo-cusing on the nexus betweenwhat economists refer to as“real” and “�nancial” variables,I contend that the changing

3I am grateful to a reviewer forhighlighting this point.

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nature of real-�nancial link-ages in real estate is intimatelyconnected to the transforma-tion of design and the spatialstructure of urban areas. Assuch, my argument is part of awider discussion about the po-litical economy of regulationand the process of buildingcities. A central element ofthis discourse maintains thatarchitecture is fundamentallyin�uenced by the noncodi-�ed regulations of its broaderpolitical-economic context(see Jones, 2009).

In the context of real estate,real variables are, for exam-ple, the demand for housingservices, the total factor pro-ductivity of the constructionindustry, or – focusing on ar-chitecture – qualitative aspectsof urban spaces and the designof the built environment. Bycontrast, mortgage rates orcredit supply to householdsand �rms are considered�nancial (or “nominal”) vari-ables. For the purposes ofthis essay, I adopt a narrowinterpretation of the term“real-�nancial linkages” as itpertains to the relationshipbetween real estate �nanceand the built environment.

Although the orthodoxy of theclassical dichotomy ascribesno economic importance tothe interaction between realand �nancial variables, post-Keynesian and monetaristthought counts functionaland institutional variation asamong the most in�uentialpathways for change in real-�nancial linkages. From anhistorical perspective, �nan-cial functions appear to bemore stable than the institu-tional form of the �nancialsystem (Merton, 1995). Yetthe link between the �nancialsystem’s most basic function– to facilitate the allocationand deployment of economicresources across time andspace – and its institutionalform remains an issue ofmuch debate (Dixon, 2012).Thus, institutional form doesnot necessarily determine�nancial function. But chang-ing institutional form mightinduce qualitative adjustmentsin the relationship between�nancial function and theallocation of capital, which inturn a�ects spatial outcomes.

The latter e�ect and its im-plications for the design-formnexus are perhaps best illus-

Finance and Urban Form 5

trated by considering the roleof iconic architecture acrossdi�erent regimes of capital-ism.4 The early architecturalicons of the Gilded Age of U.S.capitalism, from the BiltmoreEstate to Fallingwater, were theinspiration behind suburbia aswe know it today (large tractsof quotidian design), as if topass on some of the success oftheir sponsors to the broaderpublic. Yet these emblematicsites do more than just cele-brate the achievements of theirpatrons; they also embody thenature of real-�nancial link-ages of a bygone era in realestate. The Vanderbilts didnot take out a home equityline of credit to complete allof Olmsted’s grand plans inthe Great Smoky Mountains ofNorth Carolina. Nor did mag-nate Edgar Kaufmann utilizea jumbo adjustable-rate mort-gage with a “teaser” rate to�nance the daring cantilever

4The role of iconic architecture inglobalizing cities has received sub-stantial attention from urban theo-rists. This literature pays particularattention to the transformation in theproduction and reception of iconicbuildings, as well as the role of thetransnational capitalist class and new�nancing mechanisms. See Sklair(2006a,b) for good overviews.

designs at Fallingwater on hisBear Run site in Pennsylvania.Even the Empire State Build-ing in New York City – unlikemost of its modern contem-poraries, including the mostrecent generation of high-risebuilding from Taipei 101 (for-merly known as Taipei WorldFinancial Center) to London’sShard – was not �nanced bycomplex multinational REITs,but relied on straightforwardprivate equity.

In much the same way, thearchitecture of the centralbusiness district of the mono-centric, industrial Americanmetropolis accommodatedthe structural codes of theprevailing form of industrialorganization of its era: Tay-loristic principles of scienti�cmanagement conjoined withthe city grids, quasi-linearfunctions, and formulaic land-use regulations that governedthe built environment. In thisuniverse of clearly discerniblecapital-land substitution,architectural practice was�rmly embedded within theconventional institutionalguidelines of the day. In theera before the onset of thecurrent wave of globalization

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(roughly pre-World War II), itwas what Willis (1995) labels“city vernaculars of capital-ism” that shaped the skylinesof central business districtsin unique ways from localland-use patterns, munici-pal codes, and zoning.5 Thearchitecture of this regimewas inextricably linked toaesthetic con�guration andthe functional design of ex-ternal spatial relations. In theU.S. this lasted until the earlypost-war boom, when, withthe �rst signs of �nancializingreal estate, “the di�erences inskyscraper design and urban-ism in New York and Chicago,and everywhere diminishedin response to the forces of�nance, market values of de-sign, and prevailing theoriesof urbanism” (Willis, cited inSklair, 2009, p.2706).

5In related research, Sklair (2005)highlights that the production andrepresentation of architectural iconsin what he terms the “pre-globalera” were mainly driven by thosewho controlled the state or religion,whereas the dominant forms of ar-chitectural iconicity for the global eraare increasingly driven by those whoown and control the corporate sector.

Urban Spatial Struc-ture and the Geogra-phy of Finance

THIS EMERGENCE of anew kind of capitalismcoincided with the ad-

vent of new forms of indus-trial organization during theearly post-war period. Accom-panied by large-scale automa-tion in manufacturing, glob-alizing capital �ows began tofacilitate a recon�guration ofthe built environment alongthe principles of postmod-ern, multidimensional narra-tives. The combination of �-nancial globalization and shi�sin industrial organization in-duced substantial shi�s in theurban spatial patterns acrossU.S. metropolitan areas. Theparadigm of monocentricity asthe dominant urban form waswidely challenged by morpho-logical and functional poly-centricity.6 Between 1950 and2000, the average densitiesof U.S. cities and the density

6Urban economists have long ar-gued that the evolution of urbanstructure is closely tied to the lo-cation and internal decisions struc-ture of �rms (see Rossi-Hansberg andWright, 2007).

Finance and Urban Form 7

gradients of urban areas gen-erally declined (Kim, 2007).Across the nation, intense ac-tivity in the real estate sector,in both residential and com-mercial construction, began toreplicate, reproduce, and en-trench the edgeless, polycen-tric city as the de�ning trait ofAmerican (sub)urbanism.

With double-digit growthrates and large-scale sub-urbanization during theboom years a�er the war,U.S. metropolitan areas rep-resented a fragmented andmultinodal mixture of em-ployment and residentialsettlement, with a fusionof suburban, exurban, andcentral-city characteristics.With these new, primarilysuburban settings in place,the reorganization of indus-trial processes gave rise tothe corporatization of land-scapes. These landscapes ofsleek o�ce parks and park-ing lots emerged from ahistorical moment when cor-porations reconceived theirmanagement structures anddispersed into low-density,auto-dependent spaces onthe peripheries of their re-spective metropolitan regions

(Mozingo, 2011). At multiplephysical scales, changing ur-ban spatial forms have gener-ated physical and social land-scapes that re�ect the shi�s inthe political-economic struc-tures. Aesthetically, these sitesare largely ones of excess anda�ect, what Knox (2005) hascalled “vulgaria.” The mostlysuburban settings of vulgariaare perhaps best visualized bythe vast tracts of prefabricatedhomes with �oor plans that,over time, grew to be bothmuch larger and ever morestandardized. Indeed, themedian size of a single familyhome increased from 1,535square feet in 1975 to 2,169square feet in 2010, only 5percent below its historic peakin 2007. At the peak of the Mc-Mansion boom in 2005, nearly3.9 million homes in the U.S.had 4,000 or more squarefeet of space, an increase of35 percent since 2001 (U.S.Census Bureau 2012).

The monotonous, stereo-typical post-war Americansuburb would not have beenpossible without the uniqueevolution of federal creditprograms that underpin theAmerican mortgage system.

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The rapid process of post-warsuburbanization was mirroredby the increasing real-estate-related indebtedness of U.S.households.7 From the 1949Housing Act to the 1992Government-Sponsored En-terprise Act and the large-scaleforeclosures that followed therecent collapse of the housingboom, �nancial and govern-mental interests in the U.S.have engendered a structurethat is not sustainable for realestate and the constituenciesthat rely upon it. Perhaps ona par with federal transporta-tion policy, real estate �nancehas been playing a pivotalrole in shaping these post-wargeographies of urban spatialstructure.8 As the circuits ofthe globalized �nancial systemcontinue to move the leversof real estate markets, it is

7Mortgage debt was 18 percent ofU.S. GDP in 1950, but rose to 28 per-cent of GDP by 1970, and 41 percentof GDP by 1990, before reaching itshistoric peak at almost 75 percent ofGDP in 2009 (Board of Governors ofthe Federal Reserve System, Flow ofFunds Accounts of the United States,last accessed July 2012).

8The role of post-war federaltransportation policy in the processof suburbanization is discussed in(e.g. Baum-Snow, 2007).

unlikely that this role willchange.

By the early 1980s, theprocess of market-based glob-alization was accelerating indirect response to the reg-ulatory liberalization thatemerged from the collapseof the Bretton Woods system.Propelled by both �nancialinnovation, such as the secu-ritization of mortgages, andthe ambitious policy goals ofa federally sponsored home-owner society in the U.S., thehousing �nance revolutionaligned insatiable demandfor physical real estate withlarge-scale supply.9 At thesame time, it promised attrac-tive investment opportunitiesfor global investor classeswith excess savings in theirsearch for yield; these oppor-tunities were based largelyon government-sponsoredenterprises or private-labelresidential mortgage-backedsecurities and collateralizeddebt obligations. Both atits very core and at the pe-riphery, this real-estate-led

9For more discussion of the inter-play between federal housing goalsand post-war suburban morpholo-gies, see Chaves et al. (2011).

Finance and Urban Form 9

expansion of the �nancialsystem has since transformed�nancial markets and theirinstitutions and processes atunprecedented rates. In com-bination, these developmentsfed into the vicious circleof “irrationally exuberant”expectations for perpetuallyrising real estate prices andrapid credit growth facilitatedby deteriorating lending stan-dards, eventually culminatingin the global �nancial melt-down that led to the collapseof the U.S. housing market.

Under the current regimeof globalized capitalism, whathas fundamentally changed inthe production of space isthat the real estate �nancialsystem has revolutionized ac-cess to credit. Overcomingthe constraints of a spatialmismatch between borrowersand lenders, di�erent real es-tate stakeholders have neverbeen more geographically dis-persed, which can have sev-eral types of consequences. Onthe one hand, the operationof global �nancial entities inlocal markets means that �-nancial risks taken in one re-gion can have consequencesfor another. Decisions made

in suburban households in theU.S. could, for example, jeop-ardize teachers’ pension plansin a small Icelandic municipal-ity. Undeniably, the recent dis-locations in the housing mar-ket have highlighted the para-dox that �nancial innovationcan lead to a concentration,rather than a diversi�cation,of risks among market partic-ipants (Bieri, 2010).

On the other hand, the stan-dardization of real estate de-sign – in parallel with thestandardization of its modesof �nancing – has permittedan ever-increasing di�usion ofreal estate capital from cen-tral cities to the suburban ar-eas. As with any mass produc-tion, technologically inducedstandardization plays a piv-otal role in the process ofcommodi�cation; in the con-text of real estate �nance andmass-produced suburban realestate, it seems highly prob-able that standardized archi-tectural design for residentialand commercial structures fa-vored real-estate-oriented �-nancial innovation, which inturn engendered more stan-dardization of the built envi-ronment. Indeed, all aspects

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of real estate �nance rely heav-ily on standardization. With-out a standardized approach todetermining the value of realestate collateral, for instance,neither simple credit creationnor the originate-to-distributemodel of securitization wouldbe possible. Consequently, thesystem of real estate �nancehas emerged as an importantfactor in advancing the ho-mogenization of architecturaland urban design.10

Although the integration ofthe global �nancial system isproceeding despite a tempo-rary slowdown in the wake ofthe recent �nancial crisis, I ar-gue elsewhere that increasedglobalization does not meanthe “end of geography” for �-nance Bieri (2009). Rather, itimplies a di�erent kind of ge-ography; it is no longer the“old” geography with compet-

10Interestingly, from the U.S. Trea-sury’s OCC regulation that governsreal estate appraisal rules to HUD’sconforming loan limits for residen-tial mortgages, government agenciesplay an important role in the stan-dardization process of real estate �-nance. Thus, perhaps somewhatunexpectedly, public sector activitymight actually end up undermin-ing heterogeneous design outcomesacross space.

ing nation-states and clear ur-ban hierarchies as the key spa-tial units of interest. Instead,a new geography is emerging,where globally dispersed cred-itors and debtors are the mainactors.

Within this new geography,the traditional roles and in-teractions between real estateborrowers and investors arebeing reconstituted with re-gard to both their spatial andtheir institutional organiza-tion. At the same time, thesenew con�gurations are mir-rored and reinforced in therecurring patterns of mass-produced suburban housingand standardized o�ce parksand towers that dominate thepastiche of polycentric em-ployment centers outside ofthe traditional central businessdistrict.

Spaces of Speculation

FROM THE PANIC of 1837to the recent �nancialturmoil, land specula-

tors have been at the centerof a varied and colorful his-tory of U.S. real estate mar-kets. Although early instancesof land speculation are usually

Finance and Urban Form 11

tied to narratives of the West-ern frontier, the earlier tran-sition to capitalism along the“�rst Western frontier” – landto the west of the AppalachianMountains, north of the OhioRiver and east of the Missis-sippi River – was regularly ac-companied by real estate spec-ulation (Dunaway, 1996). Agood case in point is the his-torical trajectory of real estatein the state of Michigan, whereland speculation and the pro-cess of urbanization were –and still are – actively inter-twined. In fact, less than adecade before the state capitalwas moved north from the cityof Detroit in 1847, the city ofLansing had been the settingfor a 105-acre fraudulent realestate deal. More importantly,Michigan provides a uniquebackdrop against which to as-sess the widely acknowledged,albeit little understood, role ofland speculation and its inter-action with the morphology ofcities.

In Detroit, the spectacularrise and decline of real estatecycles remains closely tied tothe activities of prominentindividuals, such as legendarybanker and speculator Charles

Trowbridge during the 1830sor his modern-day counter-parts, who are positioningthemselves ahead of the muchanticipated re-emergenceof the Motor City from thevortex of shrinkage, disin-vestment, and tax foreclosureabandonment. Figure 1 por-trays the qualitative dynamicsof land rent extraction andspatial redistribution that canbe mapped directly onto thepresence of speculation inreal estate. This process is stillvery much in place today andwithout much modi�cationcan be generalized to othermetro areas in the U.S., in par-ticular cities in the Rust Belt,from Bu�alo, New York, andCleveland, Ohio, to Pittsburgh,Pennsylvania, and also to thelarger cities in other maturemarket economies that haveexperienced a signi�cant spa-tial recon�guration of capital.Willis (1995) emphasizes theimportance of speculative de-velopment and the impact ofreal estate cycles on the formsof buildings and their spatialdistribution. In the context ofthe recent great housing boomand bust, Kumino� and Pope(2013) identify substantial

12 CriticalProductive V2.1

Figure 1: Decentralisation of Capital Flows in Detroit

Sources: Reproduced with permission from Bunge ([1971] 2011).

heterogeneity in the evolutionof the market value of landand structures within U.S.metropolitan areas. Surpris-ingly, lower-value land at theurban fringes of metropolitanareas experienced the mostprice volatility during themost recent boom-bust cycle,largely as a result of specula-tive housing construction.

In parallel with speculativeactivity, urban design andurban form have also beencodetermined by more elusive

forces associated with theincreasing �nancialization ofboth residential and commer-cial real estate markets. The�nancialization of the builtenvironment has come to betypi�ed by the sharp diver-gence of �nancial interests anddesign interests with regardto real estate and the builtenvironment. There is a latentneed to systematically uncoverthe close interactions amongurban spatial structure, thedesign of the urban fabric, and

Finance and Urban Form 13

speculative real estate activityin much more depth thanis possible here – a projectthat I am pursuing elsewhere.Pushing beyond the imme-diate example of Detroit,this work will complementsimilar e�orts that documentthe dynamic interactions be-tween real estate �nance andphysical structures at di�er-ent scales as well as historicpatterns of movement, landuse, ownership or control, andoccupation (see Soja, 1980;Brenner, 1998).

Towards a New Syn-thesis? Real EstateFinance, Organizationand Urban Form

IN A PERIOD of rapid yetspatially segmented �nan-cial development in the

U.S., the postbellum mort-gage market holds many cluesto a systematic understand-ing of the contemporary in-terdependencies between realestate �nance and urban de-velopment, including its spa-tial patterns. Although mort-gage lending expanded at un-precedented rates during the

last two decades of the nine-teenth century, an underly-ing lack of �nancial integrationimpeded urbanization e�ortsin the Frontier West (Snowden,1988). These structural andinstitutional �nancial marketimbalances conferred initialurbanization bene�ts to bor-rowers in the New England andalong the Atlantic seaboardthrough preferred access to�nance for both commercialand residential real estate.

Economic historians havelong provided signi�cant ev-idence that social elites mayrestrict �nancial developmentto limit access to �nance, atrait we traditionally associatewith the institutional ar-rangements of less-developedeconomic systems. Yet the�nancial history of UnitedStates in the early twentiethcentury provides ample evi-dence that credit rationing byland-owning elites can pre-vail on a large scale, even incountries with well-developedpolitical institutions (Rajanand Ramcharan, 2011). Therecent burst of urban eco-nomic (re)development, inAsia in particular and in LatinAmerica to some extent, high-

14 CriticalProductive V2.1

lights that these forces areglobal in character, even iftheir local typologies mightvary commensurately with theidiosyncrasies of institutionaland organizational structuresof developing economies.

The conduits of linkagesbetween �nance and designdiscussed in this essay permittwo simple hypotheses aboutpossible future scale-speci�ctrajectories of urban formand �nancial function. At amacro level, more globalizedmarkets for real estate �nanceare acting as centripetal, dis-agglomerating forces in space,which produce, all else equal,more fragmented, polycentricurban forms. Because realestate is the quintessentialdurable good – it can be builtquickly, but disappears slowly– urban decline is not themirror image of growth. Infact, these asymmetries inurban development imply that“too big to fail” also applies toreal estate markets. Given thesystemic importance of realestate to all aspects of overalleconomic activity, large-scalenegative externalities are likelyto emanate from failures in

real estate markets.11 As aconsequence, governmentsregularly provide bailouts tothe real estate sector in timesof crisis. During the GreatDepression, for example,major federal initiatives to re-duce foreclosures and reformmortgage market practicessaw the creation of the HomeOwners’ Loan Corporationunder the New Deal. In thewake of the recent housingmarket �asco, the U.S. gov-ernment has deployed aneven broader array of multi-agency measures to prop upvarious elements of the realestate sector. These measuresrange from the Home A�ord-able Modi�cation Program,which assists homeownerswith loan modi�cations ontheir home mortgages, to

11Before the great housing bust in2005, housing services and residen-tial �xed investment accounted foralmost 19 percent of U.S. GDP. By2012, this share had plummeted tojust below 15 percent. Indeed, Leamer(2007) shows that, of the componentsof GDP, residential investment o�ersby far the best early warning sign ofan oncoming recession. A large liter-ature debates the e�ects of �nancialand housing wealth in the determina-tion of consumer spending (see Bosticet al., 2009).

Finance and Urban Form 15

the inclusion of commercialmortgage-backed securitiesin the Federal Reserve’s TermAsset-Backed Loan Facilityand the Neighborhood Stabi-lization Program, which helpslocal governments addressthe neighborhood e�ects ofconcentrated foreclosures.Invariably, the regulatoryrhetoric of �nancial stabilitythat accompanies such actionsis anchored in a logic of con-tainment, with the promise tominimize potential contagionof large-scale fallouts to othersectors in the economy. At thesame time, however, the roleof the “lender of last resort” israrely well de�ned and quiteo�en ad hoc.

At the micro level, the �-nancialization of real estateis accelerating the commodi-�cation of design and archi-tecture. In turn, facilitatedby overregulated land mar-kets that accentuate the im-pact of speculation, these de-velopments reinforce the logicof standardization, architec-tural monotony, rapid depre-ciation, and disjointed urbandesign. To critical urban the-orists, the main justi�cationfor contemporary urban de-

sign practices is that they maskthe spatial aspects of real in-ternal inconsistencies of cap-italist economies, particularlyin the United States (see Gun-der, 2011). Rather than cam-ou�aging the spatial �ssuresof globalized real estate cap-ital, visionary urban designshould become the unifyingpost-crisis protocol of urbandevelopment.

In light of the interdepen-dent processes of �nancialreorganization and post-modern spatial fragmentation,I argue that urban form,its �nancing mechanisms,and its design principles re-main very closely linked totheir economic function. Ac-companying this �nance-ledsplintering of urban space,the role of architecture hasbeen transformed and hasbecome largely disconnectedfrom the quotidian reproduc-tion of the urban fabric. Theorganizational disintermedia-tion of architecture from thespatial relations of real estatepresents one of the most press-ing challenges for an emergentpost-crisis paradigm. As Saari-nen reminds us, “much of theplanning work of today must

16 CriticalProductive V2.1

deal with the correction ofearlier mistakes, which – let’sput it frankly – are the result ofa serious neglect of one of thenation’s most vital problems”(Saarinen, 1943, p.141).

The dislocations of the post-crisis environment provide aunique set of opportunities tore-develop grand narratives,visions that are capable ofintervening at the �nance-design node within a broaderreformulation of the urbanproject. Above all, design-and policy-related actors-from architects and urbandesigners to planners-shouldbe encouraged to recast the“form follows function” dual-ity in terms of an emergenturban re-envisioning whereby“structure follows strategy.”

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