Influence of lot size and shape on redevelopment projects

Analyses on the economic effects of living environments provide a useful tool for evaluating the planning policies of urban redevelopment. In Japanese cities, an important issue in redevelopment projects where residents contribute some land for public services such as roads and parks is whether small lot size and poor shape prevent the residents from acquiring sufficient social benefits to compensate for the sacrifice of land. This paper analyzed the influence of lot size and shape on the externalities of local environments using a hedonic approach and applied the results to examine several situations of broadening a road in a densely built residential block. The analyses showed that the benefits of the projects were significantly influenced by the size and shape of the lots. To get adequate benefits to compensate for the land and the additional costs of the projects, the involved lots should be larger than a certain limit and satisfy certain requirements on their shapes. The analyses also revealed that, because of the influence of lot size and shape, relaxing the planning controls on floor-to-area ratio (FAR) for the redeveloped areas does not necessarily create incentives for residents to be getting involved. These results suggested that appropriate considerations for lot size and shape are indispensable for the expedition of redevelopment projects.