This class introduces fundamental concepts of urban and real-estate economics related to the design of the built environment. Beginning with an overview of basic concepts of demand and supply in capital and space markets, the course unfolds around five core themes relevant to architecture and urban planning:
1. land values
2. Location choices
3. Spatial externalities
4. development densities and economically optimal FAR
5. design flexibility and future options
The underlying theory for each theme is introduced in two classes, accompanied with hands-on real-world problem sets and a final group project. Both of these assignments – problem sets and final project – constitute a critical part of the learning experience in class. Problems sets are to be completed individually, but we encourage learning groups and discussions among students working on problem sets. Each problem set is given a week to complete. The final project is done in groups of five students over a period of two weeks.