A recent study by the Real Estate Board of New York (REBNY) concluded that by preserving 27.7% of buildings in Manhattan, “the city is landmarking away its economic future.”

REBNY is challenging the Landmarks Preservation Commission, arguing it has too much power when it comes to planning decisions, and that by making business so difficult for developers it is stifling the growth of the city.

Yet not three days before releasing this study, president of REBNY Steve Spinola said in an interview with WNYC that “if you ask my members, they will tell you [the twelve years of Mayor Bloomberg's tenure] has been a great period of time for them.” The conclusion of WNYC is that the past decade has actually been a period of increased growth for developers, rather than a period of stagnation.

It would be easy to echo the opinion of Simeon Bankoff, executive director of the Historic Districts Council, who believes the actions of REBNY come down to greed, even comparing its members to Gordon Gekko, the anti-hero of the film Wall Street. But is greed really what's behind this attack on the Landmarks Preservation Commission?

Architecture historian Francis Morrone provides a more balanced view, saying that the growth that was enabled by Mayor Bloomberg’s policies was part of an attempt to keep pace with other global cities. But he believes this attempt has a serious flaw: instead of improving the city, this investment is pushing up prices and forcing all but the richest citizens to leave New York altogether:

“The city is going to survive. The City is going to thrive,” he cautions, however, that “Not all the people in the city are going to thrive, or even continue living here.”

This approach begs the question “what is a city for?”

Edward Glaeser’s book Triumph of the City places people at the centre of a city’s purpose. Cities provide opportunity and prosperity to the people who inhabit them, which isn’t available in rural areas. Glaeser believes that by bringing together people of diverse backgrounds with different ideas, and placing them at close proximity in dense living conditions, cities afford chance encounters and cross-seeding of new ideas, and therefore create the innovation which drives economic prosperity.

When we look at the new global cities – most notably in China and India – we see that their explosive growth over the past decade has been fuelled by an unprecedented urban migration. Furthermore, the expansion of these cities has entailed an attitude to preservation which would probably horrify most New Yorkers.

In a city such as Shanghai, the population has yet to peak, increasing by an astounding 40% between 2000 and 2010. The population now stands at over 23 million. As a city which still has its best years ahead of it, the existing buildings are willingly sacrificed, with the understanding that their replacements will be more representative of their aspirations for the future – for lack of a more precise word, the new buildings are assumed to be ‘better’.

Because New York has already been through this process, during the industrial revolution and the earlier part of the 20th century, the numbers involved are lower: the population of New York peaked just short of 8 million in 1950 – a figure which it only returned to and finally surpassed around the turn of the millennium, now reaching about 8.3 million. As a result, the majority of its significant buildings, which form part of its cultural history, date from before the 1950s, and many of these are the jewels in the crown of the landmarks commission.

Very simply, Shanghai is at a different stage in its life cycle, and when it does finally stop expanding it could conceivably be four or five times the size of New York. For the city of New York to put such an emphasis on competing with Shanghai economically at this point would be pure vanity.

This sentiment is echoed by Michael Kimmelman in a recent article about the proposal to re-zone East Midtown: “New York can surely never win a skyscraper race with Shanghai or Singapore. Its future, including the future of Midtown real estate values, depends on strengthening and expanding what already makes the city a global magnet and model. This means mass transit, pedestrian-friendly streets, social diversity, neighborhoods that don’t shut down after 5 p.m., parks and landmarks like Grand Central Terminal and the Chrysler Building.”

For New York, whose growth is to some extent restricted by a geography, infrastructure and culture which would never support 20 million or more people, a much better plan would be to stop competing and to thrive on its own terms. How could it go about doing this?

To return to the current argument between developers and preservationists, in simple economic terms, real estate developers are on the supply side of building. In a city such as New York, which is currently suffering a housing shortage, development would be expected to decrease costs as the supply of living space increases.

Preservation, on the other hand, limits new supply and also creates a ‘cultural commodity’ of preserved buildings, both of which would increase the cost of living. How is it, then, that Francis Morrone cites new development as part of the problem, rather than the solution to rising costs?

Quite simply, the members of REBNY are building the wrong type of development: where developers do get the opportunity to build without restriction, they are too often building luxury apartments that are only an option for the super-rich. This may be good for their short-term profit margins, but it is bad for the long-term vitality of the city, as those who are not astoundingly wealthy are forced to leave – and the city becomes less diverse and less productive as a result.

The Real Estate Board is right in arguing that preservation of buildings can cause stagnation and inflation, but it forgets that preservation adds value to the surrounding neighborhood and the city as a whole. What developers need to do is make this cultural commodity available to all by building a greater variety of new buildings, particularly when it comes to apartments. This will diminish their returns in the short run, but will generate gradual yet sustainable growth in New York, in turn ensuring a more sustainable revenue stream for the members of the Real Estate Board of New York themselves – and they still have 72.3% of Manhattan to do that in.