The Skyscraper BoomIn 1885, the Home Insurance Building was completed in downtown Chicago. At 10 stories high, it was then the tallest building in the world. At once, the race was on to build taller and taller buildings, and it seems that the allure of skyscrapers has never really worn off.
There have been boom times and bad times over the decades since then. The last big boom in high-rise construction came in the 1960s and ‘70s, when the Sears Tower went up in Chicago and took the crown as the tallest building in the world from the World Trade Center in New York, which had been completed just two years earlier. But the Sears Tower now stands in fourth place, and all its rivals are in Asia, the Pacific Rim, and the Middle East.
The Burj Tower in Dubai, scheduled for completion in 2008, is rumored to be 160 stories tall, but its builders are so determined that it will claim the title as the top skyscraper that they are keeping its actual height a secret.
The design is such that they can add more floors at the last minute if a challenger appears on the horizon.
Although there are buildings near that height proposed for Moscow, Seoul, and Katangi in India, the next tallest building that is actually under construction is the Freedom Tower being erected on the site of the World Trade Center.
Scheduled for completion in 2011, the plans call for it to be a patriotic 1,776 feet tall, more than 300 feet taller than the Sears Tower. And the tallest existing skyscrapers are now, in this order, Taipei 101, at 1,671 feet; Petronas Towers One and Two at 1,483 feet each; and the Sears Tower at 1,451 feet. The next tallest building in the U.S. is still the 1931 Empire State Building at 1,250 feet.
There is no question that there is a global boom in skyscraper building underway, and although not all builders are vying to erect the highest buildings, they are nevertheless putting up some impressive towers. About 40 percent of the tallest structures have gone up since 2000, according to the Economist.1 And in that same period, more than 40 buildings that are at least 50 stories tall were built or planned, according to an Associated Press report.2
The 124-story Fordham Spire in Chicago will overshadow Donald Trump’s 92-story hotel and condominium tower to become the tallest building in North America. With living space costing a record $1,000 per square foot and the penthouse going for $20 million, the Fordham will be the most expensive piece of real estate in Chicago.
The question remains, however: Do such projects make sense? Or are they simply displays of vanity for people with lots of money? The truth may involve a bit of both.
There’s no shortage of big buildings that go bust. But Trump’s new building is already 75 percent paid for through the sale of condos. Even so, residential skyscrapers are a big financial risk.
Many companies build their headquarters in tall buildings for symbolic reasons or to consolidate all their workers in one location. For example, Goldman Sachs is building a new world headquarters in lower Manhattan. But it’s a modest 43-story building, appropriate to a financial firm. And while many companies have relocated to lower-rise facilities since 9/11, working in a skyscraper in a large city is still seen as a viable way of doing business.
While residential or mixed-use towers are generally speculative, and single-occupant towers are considered a cost of doing business, some of the most spectacular skyscrapers are funded by governments and aren’t expected to make money. The Burj Tower in Dubai is one of many examples where the government is footing the bill largely for reasons of prestige.
Many newly wealthy nations are willing to pay the price to erect such status symbols. But, the most extreme example of hubris is probably the 105-story Ryugyong Hotel in Pyongyang, capital of the impoverished Communist state of North Korea.
In fact, as the “Main Report” pointed out in a recent Health and Wealth Letter,3 mostskyscraper projects are not driven by rigorous economic analysis. They’re all about being noticed. That pattern continues to be as true today as it was in the 19th Century.
This reality is borne out by the fact that builders are still vying for the honor of having the tallest building in Europe. The latest entrant, according to the BBC News Online,4 will be a mere 52 stories and just 560 feet high, making it something of a dwarf among today’s great skyscrapers. It’s specifically designed to be just six feet taller than Beetham Tower, the current European champion. Meanwhile, as reported by the Russian newspaper Izvestia,5 Russia’s Vneshtorg bank is pushing to build a 1,400-foot, 85-story monster in Moscow.
But while there appears to be no limits to the egos of the developers of skyscrapers, are there physical limits to how high a high-rise can be?
The truth is that every time someone puts a limit on how tall a structure can be built, new technologies come along to defy it.
New advances in materials have allowed walls and floors to be made thinner by using high-tech insulation material that was originally designed to carry human blood. Faster elevators and new HVAC technology make the infrastructure of extremely tall buildings increasingly manageable. And, engineers now believe that increasingly exotic materials mean that there may be no structural limit to how tall a building can be.
Given this trend, here are the five developments we foresee:
First, the worldwide boom in tall and super-tall buildings will continue for at least the next decade. The global economy will provide the means, and human aspiration will provide the motive. Even as Burj Tower rises over Dubai, structures more than 1,500 feet tall are either being built or planned in South Korea, Taiwan, Shanghai, Hong Kong,mainland China, and of course, Chicago. The highest buildings in the next 10 to 15 years will appear primarily in Asia and the Middle East for three reasons:Asian and Middle Eastern governments are likely to fund such buildings, while any skyscrapers going up in the U.S. are strictly in private hands.
Because of the ambitions of the local governments, developers can largely ignore the kinds of regulations that would limit the height of buildings in American cities.
The booming economies in those locations will encourage governments and businesses to make bold symbolic statements, including competing aggressively to own the world’s tallest buildings.
Second, such grand building projects should serve as warning beacons for smart analysts looking for signs of economic trouble ahead. It is typical for enormous buildings to be started at the height of economic booms, when a natural cyclical contraction is about to occur. For example, the Empire State Building was started just before the stock market crash of 1929, and the World Trade Center was started just before the onset of the rolling recessions that defined the 1970s. Expect some of the Asian and Middle Eastern economies to overreach and experience a period of contraction in the wake of extremely expensive and ostentatious building sprees. In places such as China, where local prestige and favoritism have already resulted in overcapacity, don’t be surprised to see cities winding up with some very large “white elephants.”
Third, despite the anticipated crises in the coming decade, the trend toward taller buildings will continue. Throughout history, whether people have built pyramids, totem poles, or skyscrapers, it seems to be human nature to build as tall as possible given the technology and the economic resources available at the time. We are now on the verge of breakthroughs in materials science that will make it possible to construct buildings that will dwarf those of today. In the next 15 to 20 years, look for buildings to top 3,000 feet and present some very unusual shapes on our global skyline.
Fourth, the biggest technological challenge for those building the tallest buildings will be managing the elevators. No matter how efficient the technology is, people have to wait for the next car to take them up or down. One innovative solution is being tried by KONE, a Finnish company. Its elevators will send text messages to occupants as they enter the building, telling them which elevator bank to use. Expect innovative technologies in this area, with the prize going to the company that can set the standard for moving people around ever-taller skyscrapers.
Fifth, by 2050, the global skyline will have been transformed by the advent of nanotechnology and green skyscrapers. J. Storrs Hall, author of Nanofuture,6 predicts that, from a technical standpoint, the tallest towers could exceed 60 miles in height or higher. And, they won’t just be big. They’ll be chemically and biologically active parts of the environment, taking in pollution and putting out clean air and water, as they process pollutants into their component chemicals for reuse. Even today, the new Bank of America tower in New York is cleaning air and using the heat produced by people, computers, and lights ? not to mention sunlight ? to make ice, which is then used to cool the offices the next day.
References 1. The Economist, June 3, 2006, “The Skyscraper Boom: Better Than Flying. ” ⓒ Copyright 2006 by The Economist Newspaper Limited. All rights reserved. 2. Associated Press, June 25, 2006, “Skyscraper Projects Booming in Chicago, Where the Term Was Born,” by Don Babwin. ⓒ Copyright 2006 by The Associated Press. All rights reserved. 3. The Week, May 26, 2006, “The Skyscraper Boom.” ⓒ Copyright 2006 by The Week Publications, Inc. All rights reserved. 4. For information about the tallest building in Europe, visit the BBC website at: news.bbc.co.uk 5. Bizekon-Russica Izvestia, May 5, 2006, “Europe’s Tallest Skyscraper to Be Built in Moscow,” by Olga Sobolevskaya. ⓒ Copyright 2006 by Russica-Izvestia Information, Inc. All rights reserved. 6. Nanofuture: What’s Next for Nanotechnology by J. Storrs Hall is published by Prometheus Books. ⓒ Copyright 2005 by J. Storrs Hall. All rights reserved. A summary of the book Nanofuture is available from Audio-Tech Business Book Summaries. Ask for Reorder #2062.
