Swelling of Urban Structure Axes harms São Paulo’s urban policy objectives

The Strategic Master Plan of São Paulo (“PDE 2014”), in the form of Municipal Law 16.050/2104, established an urban regulatory framework to guide the development and urban transformation of São Paulo in a manner aligned with public interest objectives and the Right to the City, with the priority aim of seeking to promote universal access to the benefits of urban life, such as goods, services and opportunities.

The pursuit of these goals of reducing socio-spatial inequalities involved encouraging the concentration of land with greater construction potential around the expansion of public transport axes, favoring the creation of new centralities.

To this end, by establishing the permission for higher utilization coefficients in specific locations3, the 2014 PDE sought to encourage the real estate sector to promote densification in strategic areas of the Municipality through new real estate developments. These priority densification areas, therefore, are those that concentrate the land with the greatest potential for transformation.

These priority densification areas are made up of: urban restructuring project areas and areas along the Urban Transformation Structuring Axes (“Axes”), so that increased production is coordinated with the use of existing infrastructure, reduced car use, and expanded employment and service offerings beyond the central regions.

In other words, we assume as a reference point for the present discussion the importance of the connection between construction densification and qualification of the transport infrastructure.

Thus, it is clear that the Urban Structuring Axes proposal includes multidimensional objectives, which place the promotion of the expansion of real estate production within a framework aimed at reducing socio-spatial inequalities.

However, through the PDE review process, initiated in 2021 and approved in June 2023 in the form of Municipal Law 17,975/2023, a redirection of the densification guideline was carried out through the prediction of “swelling” of the Axes, which created new incentives for the real estate market regarding real estate production and its location.

This enlargement proposal was already presented within the scope of the
processing of PL 127/2023 before the City Council, with limited opportunities for informed debate before society.

Given the significant nature of this change, the study aims to assess whether the option made in the review of the urban framework is consistent with the original urban transformation guidelines of the 2014 Master Plan to reduce socio-spatial inequalities.

Therefore, the study addresses the issue of
need, at the present time, to increase the number of areas with transformable potential in the municipality.

To this end, the examination seeks to compare two quantities: (i) the quantity of land areas with transformable potential created by the rules of the 2014 Master Plan (i.e. the quantity of land areas that the real estate market could mobilize for new developments in priority densification areas); and (ii) on the other hand, the quantity of areas from this stock of transformation potential effectively consumed by the real estate sector, since then, for new developments.

To construct this analysis, we will first provide a brief presentation of the 2014 PDE regulations (section 2), followed by comments on its implementation, identifying the total number of lands with transformable potential established in 2023, in the scenario prior to the review (section 3).

From this, we will present the trends in consumption of transformation potential by the real estate sector and what this reveals in terms of projections for the availability of transformable land in 2029, in the scenario in which the approved legislative review had not occurred (section 4).

Consolidating this first scenario, we move on to present the revision proposals presented during PL 127/2023 and approved in the format of Law 17.975/2023 (section 5) and, finally, we identify how this legislative change affected the amount of land with transformable potential in São Paulo, both at the present time and in the projection for 2029 (section 6).

With these results in hand, in the conclusion (section 7), we advance in the criticism regarding the need for swelling (widening) of the Urban Transformation Structuring Axes, due to their lack of alignment with the objectives of reducing socio-spatial inequalities predicated on the extension of the transport network.

Complete Study