Written By Zane Willman, Associate Advisor | CCG Real Estate Advisors
This morning, I found myself going deep down a rabbit hole about the history of American cities. What started the development of cities, why people originally moved there, and what lessons could come through their history.
I noticed a cycle.
Here's what I found.
Why people started moving to cities in the first place
Before the mid-1800s, factories had to sit near rivers or ports that's where the water power and shipping access were. The steam engine broke that constraint.
Suddenly factories could locate wherever the labor was, and labor moved to wherever the jobs were. Combine that with waves of immigration escaping famine and persecution in Europe, and you get one of the fastest population shifts in American history.
New York is the prime example. The city had about 60,000 residents in 1800. By 1850 it had crossed 500,000. By 1860 it was over 800,000. That's a roughly 13x increase in sixty years, almost entirely driven by industrial jobs and immigration.
The first boom, and how messy it actually was
Of course, there was growing pains. As population continued to increase, other aspects, like health records, lagged. Cholera swept through the city in 1832 and killed more than 3,000 people in about three months. That accounts for roughly 1.5% of the entire population, gone in a single season. It hit again in 1849, killing over 5,000.
Streets were shared by an estimated 100,000–200,000 horses, each producing around 24 pounds of manure a day, on top of tenements with no plumbing, no ventilation, and no regular trash collection. This wasn't unique to New York it was the standard condition of rapid, unplanned industrial-era growth in basically every major American city at the time.
The fix, and why it created the "golden age" reputation
Have you ever heard of the "Golden Age" of Cities? I did through books and movies and such. But what was it actually? The actual turnaround came around the 1890s through the 1920s, once cities started catching up to their own growth. New York's 1866 Metropolitan Board of Health cut cholera deaths to about 1,100 in that year's outbreak. Down from over 5,000 in 1849, despite a much larger population.
The 1901 Tenement House Act mandated real windows, light courts, and bathrooms in every unit.
Chicago's 1893 World's Columbian Exposition inspired the City Beautiful movement, and Daniel Burnham's 1909 Plan of Chicago became a template other cities copied. Subways, sewer systems, and clean water infrastructure got built out across the country in this period.
This is the era that earns the "golden age" reputation, not because of the population growth, but because cities finally solved the problems their own growth had created.
Proximity = Opportunity
Once cities fixed their basic infrastructure, density became an economic engine. Dense, walkable cities are efficient in ways sprawl doesn't replicate: shared infrastructure costs spread across more people, labor pools employers can draw from without anyone needing a car, and more income-producing use per acre of land. An 20-story apartment tower in the heart of Manhattan does more economic work per square foot than the same footprint ever could in a low-density subdivision: more rentable units, more foot traffic supporting ground-floor retail, better transit and amenity access supporting stronger achievable rents. Proximity compounds. That's been true since roughly 1900, and it's still the core logic behind why infill multifamily outperforms.
The "Bust"
This part of the story gets interesting: for roughly 30 years, cities were fixing themselves then got gutted, largely by policy.
The GI Bill, cheap FHA-backed mortgages, and the 1956 interstate highway system subsidized the middle class moving out of urban cores entirely. Car ownership in the U.S. roughly tripled between 1945 and 1965. Highways were routed directly through established neighborhoods to enable suburban commuting.
Detroit peaked at 1.85 million people in 1950 and had fallen to under 640,000 by 2020, more than a 60% decline. St. Louis peaked near 900,000 in the 1950s and sits around 280,000 today, a drop of about 65%. Cleveland peaked at over 900,000 in 1950 and lost more than half its population by the 1990s, driven partly by manufacturing job losses. One report from Case Western Reserve found a third of Cleveland's manufacturing jobs disappeared by the 1980s alone.
The Comeback
Things changed. We'll use New York again. Murders peaked at 2,245 in 1990 and fell to roughly 300 by 2019 (85% drop). Citywide crime fell 49.3% and murders fell 69.3% between 1993 and 1998 alone, according to figures released by the Mayor's Office at the time.
Researchers still debate how much credit belongs to policing changes versus the 1990s economic boom versus the waning crack epidemic — an NBER study found the city's falling unemployment rate and rising minimum wage each played a measurable role also. But whatever the exact mix of causes was, the result was a city people wanted to move back into.
And they did, but not evenly. A widely cited study of the 2000–2010 period found that college-educated professionals aged 25–34 moved downtown faster than they moved to the suburbs in 39 of the 50 largest U.S. metro areas. This was a sharp reversal from every prior decade since World War II. (Source)
Those neighborhoods were the same walkable, transit-connected, architecturally distinct areas built or preserved from that turn-of-the-century "golden age".
Cycles all the way down
The more I sat with this, the more it started to look less like a unique story about cities and more like a specific case of something that shows up everywhere. The cycle. Real estate has its own well-documented version of this (the classic four-phase market cycle — Recovery, Expansion, Hypersupply, Recession). Business cycles follow a cycle also. Even at a personal or organizational level, growth phases tend to overreach before they correct and stabilize.
What the 200-year city version adds is at a little bit of a larger scale: the "correction" phase for a city can be as extreme as a 60% population loss that plays out over three decades.
What this means for investing today
Two hundred years of this cycle point to one constant: proximity has never stopped being what people pay for.
That's the whole thesis. Invest in proximity.
It's the one thing that's held its value through every single cycle in this story, and there's no reason to think this one's different.
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Sources:
- Brennan Center for Justice, 2025 Trends in Crime and Safety in New York City (murder trend 1990–2024)
- National Bureau of Economic Research, What Reduced Crime in New York City (NBER Digest)
- Bloomberg, Why Young College Grads Returned to American Downtowns in the 2000s (2016)
- Couture & Handbury, Urban Revival in America, 2000 to 2010 (working paper, University of Chicago Becker Friedman Institute)
- Jordan Rappaport, Federal Reserve Bank of Kansas City, U.S. Urban Decline and Growth, 1950 to 2000
- 24/7 Wall St., city population decline analyses (Detroit, St. Louis, Cleveland, 1950–2021 Census data)
- Case Western Reserve University, Encyclopedia of Cleveland History, City Beautiful Movement entry
- NYAM Center for History / Columbia Climate School, Density, Equity, and the History of Epidemics in New York City
- Missed History, New York City Was Drowning in Filth (1858 sanitation crisis)
- Khan Academy, The Development of the Suburbs (2026)
