Central Business District

The central business district (CBD) is the core area of a city, where specialized business services are concentrated. The CBD is essentially an American phenomenon, initially appearing in the early 1800s and evolving over time into the high-rise skyline characteristic of many large cities today. Other terms widely used synonymously for the CBD are downtown, city center, and central city. The American CBD differs from business centers in other countries in several ways. European cities have long histories during which growth spreads outward from the center. Residential land uses are common in European city centers, where the wealthy, upper-class citizens reside. High-rise office buildings are generally built in the peripheral areas. Many American cities, on the other hand, were initially constructed with a business district in the center of the city. Residential land uses in downtown areas of most American cities are rare.

The reason for the development of the CBD lies in the high accessibility afforded by the convergence of transportation networks into the city [Page 379]center, which is central to the agglomeration economies there. This accessibility resulted in high land values as businesses were attracted to office buildings for accounting and management functions. These activities necessitated that ancillary services such as banking, finance, insurance, and law firms also be located in the immediate vicinity. Nearby hotels, restaurants, and high-end retailers attended to the needs of the professionals, their clients, and the office workers employed in the CBD.

Salt Lake City, Utah, with the Wasatch Range in the background Source: © Joseph Sohm/Visions of America/Corbis.

Several technological innovations allowed a further intensification of CBD land uses. The skyscraper and electric elevator permitted the construction of ever taller buildings, while subways facilitated the rapid movement of people into and out of the CBD. High-rise office buildings provided enormous amounts of office space on a relatively small footprint on the ground. As land became more and more valuable, the CBD actually contracted into a smaller area because of the abundant office floor space. Zoning took on a vertical orientation with the peak land values at the street level, where retailing could provide the greatest revenues per square foot.

Suburbanization has caused the CBD in many cities to stagnate as office functions decentralized and retailing migrated to distant shopping malls. The edge and the “centerless” city phenomena have also challenged CBD dominance of business services. Anchored by government offices and trophy buildings housing corporate headquarters, the CBD still remains a major provider of specialized business services. But other than a few cities such as New York, Chicago, Boston, and San Francisco, which have active night lives, the CBD has become a daytime employment destination with vacant buildings and streets at night.

The UBS Tower (above, center) is a 651-foot-tall skyscraper located at One North Wacker Drive in Chicago, Illinois. The 50-story structure, started in 1999 and completed in 2001, was the first major office skyscraper to be built in Chicago since 1992. Chicago's central business district is bounded on the west and north by the Chicago River, on the east by Lake Michigan, and on the south by Roosevelt Road.

Source: Eric Mathiasen.

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