Silicon Valley and the new company towns

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Silicon Valley is embracing the idea of the company town, as even high-paying tech companies struggle with the high cost of housing.

Are tech companies going to build the new company towns? Twenty cities across America are celebrating because they have been shortlisted to be Amazon’s HQ2. Los Angeles is one of them. But here’s the big question facing LA: how would it house Amazon’s anticipated 50,000 employees?

Like fellow contenders Boston, New York and Miami, LA’s housing is very expensive and there’s resistance to building more.

“Companies like Amazon pay their creative class and tech workers like gold… and they treat their service workers like dirt. They contract that work out. They treat these people terribly, they’re subject to precarious conditions, they’re commuting an hour or two to work,” says urban theorist Richard Florida.

Florida says of companies like Amazon and Google, as well as real estate developers and corporations that consider themselves anchor institutions, “it is their economic and moral obligation to stop extracting from cities, seeing them just as a talent pool or a place to host workers or place companies, and to see them as a place to really build inclusive prosperity.”

Facebook has tapped architecture firm OMA to masterplan the new Willow Campus to house employees in Menlo Park (The original image is no longer available, please contact KCRW if you need access to the original image.)

Tech companies, it seems, are recognizing they have to look beyond the bounds of their campuses. Facebook has announced plans to build a village of 1,500 homes and a walkable retail district in the Belle Haven section of Menlo Park. That is one of the last affordable places to live in Silicon Valley. These projects have echoes of an industrial-era company town. So what can high-tech companies learn from the corporations of the last century that built housing for their workers?

Architecture journalist Zach Mortice tells DnA about lessons that can be drawn from company towns of the 19th and early 20th century, on the one hand visionary places created by “benevolent capitalists looking to make really long term investments. And on the other, dystopian end, vultures really looking to use this urban infrastructure to extract all the money and value they could out of the land and out of the people.” In a future in which Amazon might own our apartment, he asks, which way will tech companies go?

Meanwhile, an “anchor institution” in the city of Santa Monica is thinking about providing housing for its employees.

The commute for many teachers in the Santa Monica Malibu Unified School District is so draining the district is finding it harder to hold on to good staff. So the district is considering options for creating housing.

“It’s not that we would be providing free housing,” explains Santa Monica-Malibu Unified School District COO Carey Upton, “but we would help provide them something that they could afford within the budgets and the salaries that we are able to pay.”

The district has not nailed down any details. “We know that there are a couple of different options, whether it would be built by the district or it would be working on a piece of land working with a developer,” Upton says.

But they are taking cues from Silicon Valley and San Francisco, where school districts face the same challenge.

Santa Monica was itself once a company town of sorts. In the middle of the last century, thousands of residents held blue collar jobs at Douglas Aircraft Company at what is now Santa Monica Airport and lived in houses built for them around the airport.

That neighborhood is now affluent Sunset Park, regular workforce housing in Santa Monica is almost impossible to come by and now around four fifths of people who work in the city do not live there.

When the aerospace companies came in in the early 20th century and they built up along the Westside they built the housing right there near the factories so that people didn’t have far to commute. Those middle class jobs were one of the biggest political motivations to help encourage communities to allow building, explains Anthony Orlando, who is working on a PhD on housing and financial policies at USC. “Once those jobs went away it’s been a lot harder to get the housing built because they don’t have the companies pushing for the middle class housing for those middle class jobs.”