Video Killed the Neighborhood Disamenity

A blog about business and economics.
Oct. 11 2013 12:12 PM

Video Killed the Neighborhood Disamenity

151165457
Baltimore is losing its historic Apex Theater, but the surrounding neighborhood could benefit.

Photo by Jared C. Tilton/Getty Images

The Apex Theater in Baltimore is a historic house of pornography. It's also closing:

The theater was converted from a bowling alley in 1942. Andrew Billig of A.J. Billig and Co. Auctioneers is overseeing today's auction, one that will likely result in the Apex becoming something different yet again. "People in the neighborhood would probably not mind seeing it used for something different," says Billing. So far, he's gotten inquiries from developers hoping to turn it into anything from an art house cinema specializing in Hispanic films, a venue for live theater, a warehouse space, housing, and even a church.

Hat tip on that belongs to a friend who tweeted the link with the remark that someone should write a book about how VHS porn (and of course later the Internet) contributed to the cleaning up of America's cities. But why write a book when you can write a blog post? On the commercial side of things, entertainment and nightlife venues broadly construed are generally better to locate in central city neighborhoods than in peripheral suburbs. And a key driver of residential real estate value in urban areas is the presence (or absence) of appealing local amenities. Some of these amenities are non-commercial likes parks or good schools or a nice view. But many people will pay a premium to live near a movie theater or a good restuarant or an interesting shop.

Yet you do have a handful of businesses that can be commercial successful while also serving as neighborhood level dis-amenities. Many people do not want to live near a porn theater. And many of the people who do want to live near a porn theater do not want to explicitly articulate that preference during an intra-household discussion of where to live.

So when technological change causes these disamenities to close and be replaced by amenities (art house cinema, live theater, church) or neutral uses (housing, warehouse) the whole surrounding area benefits. The process is further spurred by the fact that there aren't great complementarities between porn theaters and other local businesses. You don't go out to "dinner and a movie" at the Apex, or meet up with your friends for a few rounds of drinks before the show.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.