The Economics of Building in Boston, Part 3

[czsz]

Is it troubling that such a percentage of (re)development in Boston is left to the hands of its higher education institutions? I'm thrilled that Emerson is seemingly singlehandedly revivifying this area, that MIT has spun off enough software and biotech firms to cover East Cambridge in new offices, and that Harvard will soon reclaim northern Allston from a dystopia of parking lots and light industrial outposts. Yet the local economy seems to be troublingly underdiversified. Witness: many of the MIT spinoffs are sold or see their talent fall away to Silicon Valley each year, Boston's banks and financial firms are gobbled by competitors elsewhere in the country, its retail flagships (especially Filene's) are reduced to the receivership and goodwill of the city government. Is Boston becoming a one-horse town, surviving on its universities as DC depends on the federal government?

 

[xec]

Is Boston becoming a one-horse town, surviving on its universities as DC depends on the federal government?

That's the impression I get, except I'd say a two-horse town: the universities and the hospitals. Then again, they overlap, so maybe a 1.5 horse town. Either way, that makes it all the more worrying that the "community" is doing everything possible to squash them into the ground.

 

[statler]

Is Boston becoming a one-horse town, surviving on its universities as DC depends on the federal government?

That's the impression I get, except I'd say a two-horse town: the universities and the hospitals. Then again, they overlap, so maybe a 1.5 horse town. Either way, that makes it all the more worrying that the "community" is doing everything possible to squash them into the ground.

1.75 if you count biotech

 

[czsz]

...which doesn't even seem self-sustaining in this state. Witness: desperation moves by Patrick to "woo the industry". If there's one industry that shouldn't need to be wooed to metro Boston, wouldn't that be it?

 

[lexicon506]

you can't expect an industry to remain here while other states are spending billions to woo them away. it's impressive enough that we have such a strong biotech industry even though places like CA have been trying to suck them away for a while now. biotech was self-sustaining, but other states started cheating, and Patrick is just trying to make up the difference.

 

[LeTaureau]

...which doesn't even seem self-sustaining in this state. Witness: desperation moves by Patrick to "woo the industry". If there's one industry that shouldn't need to be wooed to metro Boston, wouldn't that be it?

I wouldn't say that they are desperation moves. Other states and countries have considerably upped the ante by offering lucrative tax breaks and other perks for companies to relocate. Patrick is simply matching what others have brought to the table, something that Massachusetts has not had to do before.

Despite others on this board, I think the economy in greater Boston is quite healthy. One thing that we have on our side is the ability to innovate. Industries may grow flourish and whither, but I am confident that the state will be able to be on the cutting edge of whatever new industry pops up.

We're still leaders in biotech, education, healthcare and finance, nothing to shake a stick at.

 

[czsz]

Finance? It seems like the entire Financial District has been sold down the creek in the past five years.

I'll grant that consulting is relatively strong, thanks to the presence of HBS and Sloan, which continue to spin off firms like Bain.

 

[ChunkyMonkey]

Take the headlines with a grain of salt. The media tend to exaggerate the exodus. Despite Fidelity moving jobs out. It is still has huge presence. When Manulife bought John Hancock, they added jobs and set up their North American headquarters here. Even P&G expanded the South Boston Gillette facility. Google has set up shop in Cambridge, Microsoft is also expanding so high tech is not dead. Clean-tech, nanotech and robotics are also starting to take root here. I think Boston is well-positioned for the future. However, it needs to be proactive, not just sit on its laurels. Governor Patrick's proposal is an excellent move. Just recently, a company announced it will stay in Mass and expand rather than open a Rhode Island office.

 

[czsz]

Granted there's been investment, but whereas Boston was a headquarters city as recently as a decade ago, most of the companies you mention here are opening or keeping merely back or branch offices. It's that sort of corporate colonialism that defines a provincial city, rather than a truly sovereign, powerful one.

Much of my paranoia stems from experience - twelve years of living in Buffalo, which has been hollowed out economically more than any other American city outside of, possibly, Detroit. I watched as economic victory was defined downward - the growth or expansion or local companies on a national scale was once celebrated, but the headlines soon turned to celebrations of a mere dozen jobs locally retained. The same process seems to be stalking Boston; I bristle whenever I see a Globe story led with "300 jobs to remain in Bay State".

Another alarming parallel is the Filene's situation, which directly echoes the departure of the last local department store from downtown Buffalo. Granted, Filene's is slated to become a boutique hotel and several impressive retailers. But the fact that some of the most prime commercial real estate required the lobbying of the mayor and other officials in order not to remain vacant is severely troubling. Direct government involvement with private sector real estate, which should be self-sustaining in a district like Downtown Crossing, is a sign of a neighborhood, if not a city, approaching life support. No wonder Menino is so worried about a glut of retail on the waterfront.

Some commentators have attempted to understand what's happening to Boston and other cities in the Northeast Corridor as a "division of labor" process. Their claim is that a dense concentration of cities will trend toward different primary sectors - so, as I mentioned before, Boston becomes a center of education and healthcare, New York of business and finance, and DC of government and nonprofit agencies. Problematically, though, Boston's sector is far from exclusive. New York and DC have fine universities and hospitals which are not withering as Boston's finance and homegrown industry sectors are - and the stock of such institutions throughout the Northeast Corridor is growing. The result is that Boston's niche is eroding, and that it's not competing with other cities in their exclusive dominant sectors.

 

[sidewalks]

filene's

I think you make some fair points, but I also think you are overstating the demise and decline of Boston. And I wouldn't invest too much interest or concern in the lobbying priorities of the Menino administration. Vornado and Gale didn't spend $100 million to buy the Filene's building because mumbles convinced them that it was a good idea.

As for their concern that there might be too much retail on the waterfront...as far as I know, the only retail that is not planned for street-level development is in Waterside Place. A mixture and abundance of ground floor retail is exactly what this area needs, and what will prevent it from feeling as desolate as Kendall Square.

Lastly, while NY and DC have fine universities, they have neither the quantity nor the quality that one finds in our area. GW will not soon replace MIT, and institutions like BC, Northeastern, Emerson and Berkley are hardly watching the world pass them by.

 

[czsz]

Sure, but why was Menino then involved to begin with? To look like a proactive patron of Downtown Crossing? Is it he who's overreacting to the neighborhood's demise? From all the "for rent" signs in the windows there, it doesn't appear to be an instantaneous investment choice for retailers. Barnes & Noble pulled out, for whatever reason - and the store, which is perfect for a big box retailer, is still empty.

I agree that the Seaport area needs retail from an urban design perspective. The question is whether central Boston is supersaturated with retail space and/or whether there's slackening demand to shop there, for whatever reason (speaking of which, I'm nervous about the effect the new luxury Natick Mall is going to have on the Back Bay as well).

I wouldn't put too much stock in the relative dominance of Boston's universities, either. Their position is slipping. Twenty years ago, few would have thought twice about valuing Harvard higher than Columbia, or BU higher than NYU. That's changed. UPenn and GWU have also risen massively in reputation. The revitalization of New York has lifted dozens of institutions, like the New School and SVA, and the city now has the most students per capita in the US. Some local schools (especially BC) have risen quite a bit with the tide, but others seem to remain very locally rooted (Northeastern and Suffolk have done a lot to battle this, but, let's face it, they remain regional institutions). The playing field is more level now.

 

[vanshnookenraggen]

It has been said many times but I want to reiterate. The biggest problem facing Boston is the cost of living. Every student at every university and college in Boston is a potential employee, employer, or entrepreneur that could help build Boston. But when a kid gets out with a massive student loan coupled with the low local prospects and wicked expensive housing, they are going to look for greener pastures.

What Boston needs to be doing is incubating small local start ups to build a business with loyalty to the city, that will grow with the city. We also need to do something about the housing problems, mainly changes in zoning. That however is a sticky situation that I fear may only change once Bostons economy is too far gone. Stupid NIMBYs!

 

[12345]

Seems alright to me.

Report: Mass. economy surging
The Massachusetts economy accelerated in the first three months of the year, growing at its fastest rate since the recovery began in 2003 and nearly quadrupling the national rate of economic growth, the University of Massachusetts reported.

The state economy grew at annual 4.7 percent rate, UMass said, while the US Commerce Department reported that national economy expanded at a sluggish 1.3 percent rate.

Driving the Massachusetts economy is global demand for the state's technolgy and biopharmaceutical products, UMass analysts said. Through February, the most recent data available, exports of pharmaceutical products rose 23 percent from a year earlier, while those of industrial machinery jumped 28 percent, according to the World Institute for Strategic Research, a nonprofit research group at Holyoke Community College.

This demand has helped fuel solid job growth, particularly in technology and bioscience sectors, UMass analysts said. Job growth accelerated to average 5,000 jobs a month in the first quarter, compared to an average of about 3,000 per month last year.

All told the state added 15,000 jobs in the first quarter, while the unemployment rate fell to 4.4 percent in March, from 5.2 percent at the end of 2006 and 4.8 percent from a year earlier, according to the state Executive Office of Labor and Workforce Development. The US jobless rate was 4.4 percent in March.

UMass analyzes a variety of data, including employment, tax collections, and stock performance of local companies, to estimate the state's economic growth. UMass analysts cautioned that rising consumer prices and the weak housing market still pose risks to the expansion.

?Expected continued softness in the housing market may dampen consumer spending and in doing so weaken economic growth in the Commonwealth," said Alan Clayton-Matthews, a public policy professor at UMass-Boston. "In addition, the possibility of rising inflation and a rise in interest rates could further weigh on the state?s near-term growth prospects.?
(By Robert Gavin, Globe staff)

 

[singbat]

I completely disagree with anyone who fundamentally doubts the capacity and regenerative power of the Greater Boston and Massachusetts economies.

As I've said before, Massachusetts doesn't have much to do with old school slow moving F500 type companies. Who needs them? It doesn't matter what name is on the shingle or where the board of directors meets (or even what language they speak). What matters is high value creation -- and the ability to create high value from nothing over and over and over again. And it matters that it happens here, right down the street, not in Mumbai, Shenzhen or Hsinchu. And it matters that the whole world knows about that value added and who created it.

There is always a surfeit of "stuff" to worry about and struggle against. But the fact remains: we are THE per capita entrepreneurial and intellectual center of gravity to this country. Moreover, the region between Boston and Washington D.C. is a dense super-cluster that still moves the economic, political, and intellectual needle for the entire globe.

Now for the numbers and factoids. I apologize for slapping this together and probably misquoting and otherwise mangling the work of others...


Some Massachusetts Indicators:

population:
- ~2% of US population
- ~15% of the size of California's population
income:
- 11th of 50 states for total GSP
- MA income per capita ~$46,000
- US income per capita ~$36,000
venture capital:
- 14% of total US VC funding
- Biotech and software lead MA VC funding
- 1st of 50 in VC contribution as a percentage of worker's earnings
R&D spending:
- 2nd of 50 in R&D intensity (R&D to GSP) behind only New Mexico (home of much gov research)
- 4th of 50 in federal R&D funding (absolute $ terms, keep our % of total population in mind here)
- 3rd of 50 in overall R&D spending (again, absolute $ terms)
- 47% of MA industrial R&D in computer & electronic hardware
- 60% of MA industrial R&D in computer & electronic hardware and computer software & services
employment:
- 240,000 employed by high tech sectors
- 85 of every 1000 MA workers are employed in high tech
- > 300,000 employed by manufacturing, including high tech manufacturing
- 25% of workers work in the innovation economy sectors
education:
- MA graduated more than 1/3 the total number of engineering degrees granted in CA in 2000
- MA graduated more than 1/2 of the CA number in the category of bio-medical engineering
SBIR / STTR awards:
- 2nd of 50 in total $ and #.
- 2x higher than any other state in per capita terms.
- 4x higher than CA in $ and # on per capita basis.
- 25% of phase I awards to private start-ups
- $82 SBIR $s per MA worker vs $13 per worker nationally
patents:
- 1st of 50 in patents per capita
- chance that you (a MA resident) were awarded a patent in 2004: 1 in 1600
startups and high growth sectors:
- 24 spin-out startups per $1 billion spent in MA academia
- 12 spin-out startups per $1 billion spent in US academia
- top public high growth sectors in MA: other: 34%, software/communications: 18%, biotech/pharma: 13%, medical devices: 10%, computer hardware: 10%, industrial: 7%
foreign direct investment:
- 12% of MA manufacturing is foreign owned (i.e. its more valuable to tie up $ in MA manufacturing than it is to deploy that capital in an overseas region)
- 4th of 50 in total inbound FDI (oh, and CA is 20th)
exports:
- 9th of 50 in export earnings
- leading sectors: computer and electronic hardware, chemicals, machinery
New Economy Index 2007:
- 1st of 50, again.


a few industrial clusters you may not have considered where Massachusetts leads:

ocean science & engineering:
- WHOI, MBL, USN Deep Submergence Lab, NOAA, SMAST, MIT ocean engineering program, and dozens of startups clustered in the south east of MA
- > 50% total output exported
- > 3000 private industry jobs (i.e. not counting any of the ~4000 jobs in the organizations named above) with some estimates as high as 18,000 total jobs
- > 50% production in marine instrumentation and equipment
measurement and control instruments:
- 2nd of 50 in production
- 16,000 private sector jobs
- #1 export income sector for MA
- MA exports instruments to Netherlands (#1) and Germany (#3) (this is a 'coals to newcastle' point...)
management consulting:
- Monitor Group, HBSP, BCG, AD Little, Bain lead the sector, but the majority of activity is in startup/spinout, highly focused (e.g. IP strategy, economic forecasting, organizational development, etc.), think tank, and boutique firms
- 2x the average regional employment share (that's the north half of the bos-wash corridor)
plastics:
- 26,000 jobs at over 700 firms
- 2nd highest of 50 in terms of plastics firms concentration
- 12 of 50 in industrial production
contract R&D:
- 3rd of 50 in contract R&D income
- 13.5% of MA R&D expenditures
- ~42,000 total jobs
- ~23% of R&D done in small businesses
- led by national leaders: MITRE, Lincoln Lab, TIAX, Drapier Lab, etc., but majority of activity in small, new and highly focused firms
nontraditional energy:
- 1/3 of Photovoltaic production in MA
- 18 fuel cell development firms
- ~10,000 jobs in clean energy
- Leading R&D led power generation and management firms: American Superconductor, Beacon Power, Solectria, etc.
telecommunications
- >100,000 jobs
- 2nd of 50 in telecom software jobs with > 7% of total US employment
- 1300 equipment manufacturers and software firms
jet aircraft engines
- 2nd of 50 in employment (CT is #1 so some is likely within the Boston PCSA)
- > 11,000 jobs
- 9% of US industrial capacity in sector

and a few industrial clusters you already know about:
- higher education and workforce training
- finance (especially as a global leader in custodianship services and funds)
- document management
- robotics
- biotech
- medical devices
- chemicals and pharma
- healthcare services
- legal services
- packaged software and services
- electronics
- advanced materials and nanotech
- defense systems and services
- tourism


------------END NOTES-------------------------

Some (but not all) of the sources. Sorry they aren't more organized and properly matched and cited.

http://www.massbenchmarks.org/publications/studies/pdf/plastics00.pdf
http://www.bostonchamber.com/policy/lifinal.pdf
http://www.massmac.org/newsline/0406/article05.htm
http://www.ieee.org/organizations/society/oes/summer01/motn.htm
http://www.aeanet.org/PressRoom/prjj_cs2007_massachusetts.asp
http://www.mass.gov/?pageID=eoedsub...ts+and+Information&L2=Key+Industries&sid=Eoed
http://www.plasticsindustry.org/industry/facts/ma.pdf
http://www.masstech.org/IS/reports/clusterreport11405.pdf
http://www.neweconomyindex.org/states/1999/part2_page2.html
http://tse.export.gov/
SBIR: http://www.flcnortheast.org/Content...day/August2004_SBIR_STTR_Workshop_Kispert.pdf
http://www.nsf.gov/statistics/seind06/c4/tt04-02.htm
http://www.tbf.org/indicators2004/t...&crosscutID=325&crosscutName=Competitive Edge
http://www.agiweb.org/gap/cvd/cvd2007/State-factsheets/CVD07Massachusetts.pdf
http://www.kauffman.org/pdf/2007_State_Index.pdf

 

[LeTaureau]

Despite all the headlines with Fidelity, Finance is still one of the biggest industries in the city, and I don't see that changing anywhere in the near future. In terms of asset management, I would say that Boston is second only to New York in breadth and scope. Firms like GMO, Wellington, Loomis Sayles and dozens of smaller boutique shops share a large chunk of institutional wealth. Aside from traditional asset management firms (stock and bonds) there are a good amount of hedge fund firms, private equity managers and venture capital in the city and region as well. Who cares if Fidelity is moving jobs to Rhode Island, I don't think its the end of the industry.

Is Charlotte an exciting and remarkable place because BoA and Wachovia are headquartered there? I would say no way!

 

[12345]

I completely agree with singbat, The mass economy had slowed after 9/11 just like the rest of the country but now it is starting to catch fire with many expansions and companies expanding here when they are decreasing their workforce in other parts of the country. I would also say that cities like Detroit and Buffalo fell on such hardship because they were relying on manufacturing and did not pursue other industries, yet Massachusetts is continually ranked as the #1 new economy and the most prepared for globalization.

 

[JimboJones]

Thanks

Thank you for slapping it together. It's very informative and enlightening.

 

[nico]

czsz, I believe NU was roughly 40% international students when I was there not too long ago. At the same time it was one of the two largest private universities in the country (student population) next to BU. Between foreigners and out of state kids, I was definitely in the minority. Every time I spoke in a class I could hear my accent as being the one that stood out. I understand from friends that Suffolk may be even more geared towards international students. I'm not sure what you're comparing these universities to (and I mean that sincerely) but I would consider them anything but regional.

 

[statler]

DiMasi, city planner

By Steve Bailey, Globe Columnist | June 22, 2007

It was Rowes Wharf's signature arch that bothered Sal DiMasi.

Now, years later, Mr. Speaker is OK with the arch, which he says he helped make bigger and better. But he still doesn't like Rowes Wharf, which he says walls off the harbor from the city. "You can't tear it down now," he says.

Forget that Rowes Wharf, built by the great Norman Leventhal, is one of the best additions to the Boston skyline in two decades. I bring this up this morning because DiMasi has never fully gotten over the Legislature's decision to cede approval of development on and near the water to "faceless bureaucrats," as he might say.

DiMasi is no longer a nobody young legislator, but the s peaker. And the issue of how development near the water is governed is again squarely in front of him. What happens next matters.

The hero of the business community for his "just say no" stand against corporate tax changes, DiMasi is creating high anxiety in much of that same community for refusing to sign off on legislation that would return us, more or less, to the status quo on development before a ruling by the Supreme Judicial Court in February.

That decision, involving the vast East Cambridge project known as NorthPoint, has raised questions about the legitimacy of buildings and future projects on 3,000 acres in Boston and Cambridge alone. The court ruled that state environmental officials did not have the power to exempt NorthPoint from Chapter 91, a state law that provides for public access to property near the water. That has raised serious questions about the permits and titles for scores of current and planned buildings and projects.

Governor Deval Patrick filed legislation to fix what is considered largely a technical problem. Senate President Therese Murray is also on board. Representative Frank Smizik, cochairman of the House committee handling the legislation, says he has a bill that will work. But DiMasi has balked, saying he wants to make sure the Legislature is on solid legal footing to retroactively exempt projects from Chapter 91 requirements.

Others think DiMasi is looking to reassert legislative control, and he doesn't completely discourage that thinking. "Maybe there should be a role for us," DiMasi told me. Maybe, he says, there should be an "either/or option" for projects to go through the Legislature or Department of Environmental Protection.

Returning the Legislature to the good old days of negotiating individual projects would be a nightmare. The state's permitting process is famously difficult and unpredictable enough. What we don't need is another political back door.

DiMasi tells a story about having lunch years ago at Pier 4 with restaurateur Anthony Athanas. Mike Dukakis, then the governor, was pushing hard to move the permitting from the Legislature. DiMasi was fighting a losing battle. His question to Athanas: Wouldn't you rather be negotiating your deal with Tommy McGee (the House speaker) and Billy Bulger (the Senate president) than some faceless bureaucrat?

No doubt Anthony would. And that is exactly the problem.

Link

 

[statler]

Gabrieli: Strict Zoning Rules Should Be Given Second Look
July 9, 2007
By Thomas Grillo,
Reporter

Former gubernatorial candidate Christopher F. Gabrieli has challenged Beacon Hill lawmakers to reconsider home rule.

In a recent speech to homebuilders, Gabrieli said strict zoning regulations in the Bay State?s suburbs are driving up the cost of housing, making it impossible for young families to buy a home and forcing some to flee the state.

?Local zoning resists new housing,? he said. ?It may achieve stated goals to deal with septic tanks and roads, but it also achieves an unstated goal of little or no growth. That?s just unacceptable. We need more housing. It?s time for the state to step up and say, ?It may be good for any one community to resist growth, but it?s not good for the commonwealth as a whole.??

Gabrieli made the remarks at the Home Builders Association of Massachusetts? installation of officers at the John F. Kennedy Presidential Library & Museum in Boston. The resident of Beacon Hill?s Louisburg Square spent a record $8.4 million on his 2006 campaign for governor. He ran second with 27 percent of the vote in the primary last year to Deval Patrick?s 49.6 percent. The race was the third political defeat for Gabrieli, who lost a campaign for Congress in 1998 and for lieutenant governor in 2002.

Despite those setbacks, Gabrieli appeared to have the support of the more than 200 homebuilders in the audience who cheered when the venture capitalist said, ?Government could address the challenges facing our housing market without spending a penny, but it will take determination and leadership. You?re not looking for a subsidy to do what you do ? we need a market-based revolution. I know you can get the job done if we set you free to do what you do so well.?

Gabrieli?s remarks echoed a series of studies that suggest local zoning ordinances are the biggest barriers to home construction. The most recent study by the Pioneer Institute for Public Policy Research and Harvard University?s Rappaport Institute for Greater Boston on land-use regulation examined 187 Massachusetts communities.

Researchers found a set of local regulatory rules that mandated minimum lot size, growth caps, prohibition of irregularly shaped lots, wetland and septic-system regulations that exceed state requirements, and strict subdivision guidelines

Local officials insist that developers always will build housing that produces the greatest profits. If communities were to relax zoning regulations to allow for smaller lots that accommodate modest homes or more houses per lot, developers would still try to build the most expensive home they could to boost profits, they say. It is developers who are razing smaller homes in favor of mansions, they argue.

In an interview with Banker & Tradesman following the speech, Gabrieli stopped short of calling for the repeal of home rule. He suggested bigger financial incentives for home construction than those being offered by the commonwealth. But he did not know how much such a plan would cost or how the cash-strapped state would pay for it.

?I?m not a candidate for office or an incumbent, so I don?t have a proposal,? said Gabrieli, who serves as chairman of the Massachusetts 2020 Foundation, a nonprofit whose mission is to expand educational and economic opportunities for children. ?The challenge is immense, but so what? This is crucial for our state and it can?t be overstated.?

Gabrieli insisted that the same state to pass the landmark Education Reform Act can take similar action to jump-start housing starts. Enacted by the state Legislature in 1993, the legislation channeled billions of dollars into school districts, encouraged charter schools, set statewide academic standards and initiated the Massachusetts Comprehensive Assessment System (MCAS) tests.

?The politics is difficult, but this is about political leadership,? he said. ?Look at the [Education] Reform Act, where the state demonstrated that it is capable of bringing people together to get things done for the common good at the expense of narrow, short-term self-interests.

?We cannot afford to stand for the status quo. We need big, bold change. We need the willingness and the desire to do that. And I think that?s the same for housing.?

?Your Special Showplace?

Mark Leff, the newly elected president of the Home Builders Association, explained why the group is up to the challenge by invoking the story of his late father, Jack Leff, the state?s first secretary of elder affairs in the 1970s. The senior Leff, a former social worker, helped launch a movement to help elders stay in their homes through Meals on Wheels lunch programs and home care.

?My father believed this would be a better alternative for the elderly,? said Leff. ?It would save money by eliminating the cost of institutionalization. In short order, Massachusetts was the first state in the nation with a statewide home care system for its elderly.?

Leff recalled that his father believed a person?s identity is shaped by the home in which they live.

?The type of home is irrelevant,? said Leff. ?Whether it?s a single-family home or a townhouse, a retirement community, a vacation home or a rental apartment, the place where you live is inseparable from your dignity and your human fabric. It?s your special showplace of all that you have accomplished in your life.?

Today, Leff said, the fight is against communities who are raising the drawbridge to keep young families from attaining home ownership through overzealous regulations.

?In the name of community character, communities are discouraging school-age children,? Leff said. ?The result is we?re pushing young high school and college graduates away from the very communities in which they grew up.?

But Matthew Feher, legislative director for the Massachusetts Municipal Association, dismissed the critics by offering data reflecting the number of building permits issued in the Bay State.

Feher noted that the University of Massachusetts Donahue Institute reported that the state?s cities and towns issued 24,549 building permits in 2005, the latest data available, a 9 percent increase over 2004 and more than double the national average of 4 percent.

?These are the facts and no one can refute them,? Feher said. ?Communities are issuing permits, so I don?t understand what they?re complaining about. Builders are in it for the profits and I have no problem with that. But it?s the contractors who are not building affordable homes.?

Thomas Grillo may be reached at tgrillo@thewarrengroup.com.