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A hundred years ago it was completely normal for American buildings to allow both commercial and residential uses - even in the smallest towns. For example, this is a ~1920 example from Keystone, West Virginia, population 176. Offices on the first floor, apartments above. 2/

This loose regulation also enabled the worst excesses of the tenement era. For example, these are cigarmakers rolling cigars in their homes in the late 1880s in New York City. This is full-on industrial production. It's a far cry from the type of remote email jobs you see today. 3/

Part of the reaction to these horrific tenement conditions was to physically separate industrial, residential and commercial uses by establishing zoning laws, which is the norm today in America. 4/

One way to juice this would be to penalize (tax?) ongoing empty commercial space so that landlords are forced to drop rent/divest vs book losses on space that they can't command usage of. Lit tons of underutilized CRE that rots because it's held by ppl who've no idea what to do with it.

Land zoning however isn't why home bars don't open (tho pvt bars exist if one knew a city well enough), but liquor being a huge state monopoly is. The state, and existing sellers have a perverse incentive to control the flow of alcohol.

In theory, allowing publ facing CRE because you put a shed or lean-to up next to your house solves one of the big modern CRE issues which is structural costs relative to pop/cust density relative to chosen economic use. It doesn't solve the significant existing CRE overhang.