These days it’s not hard to convince people to live downtown, or, for that matter, to get developers to build places for them to live. Increasingly, both millennials and baby boomers want urban amenities. They want to live close to work, parks and restaurants, and they want to be able to walk or bike to them. As a result, downtown populations have soared: 65,000 people now live in downtown Seattle, downtown Los Angeles -- traditionally not a residential area -- is home to 52,000 people, downtown Philadelphia has 57,000, and Boston has 17,000 (a 50 percent increase since 2000).
Needless to say, these cities aren’t subsidizing downtown development. In some cases, they’ve actually started to extract fees and concessions from developers to build downtown. But that’s not the case everywhere.