Business Planning for a 21st Century Park System
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HR&A Associate's June 21-22 parks development overview presentation to the Minneapolis Riverfront Development Initiative (MR|DI)

HR&A Associate's June 21-22 parks development overview presentation to the Minneapolis Riverfront Development Initiative (MR|DI)

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Business Planning for a 21st Century Park System Presentation Transcript

  • 1. Business Planning for a 21st Century Park System June 22, 2011
  • 2. RiverFIRST: an economic development strategy Population, City of Minneapolis 600,000 500,000 400,000 300,000 200,000 100,000 0 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 2
  • 3. RiverFIRST: an economic development strategyHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 3
  • 4. RiverFIRST: an economic development strategyHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 4
  • 5. RiverFIRST: an economic development strategy Racial Composition, City of Minneapolis 2010 2000 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% White Alone Black Alone American Indian Alone Asian or Pacific Islander Alone Some Other Race Alone Two or More RacesHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 5
  • 6. RiverFIRST: an economic development strategyHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 6
  • 7. HR&A experience Central Delaware, Philadelphia London Olympic Park Anacostia Riverfront, Washington DC The High Line, NYC Brooklyn Bridge Park South Street Seaport, NYC Governors Island, NYC Don Mouth, Toronto Daniel Island, SCHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 7
  • 8. HR&A experience in the Twin Cities Peavey Plaza Great River ParkFord Site Open Space Planning The Union Depot, Saint Paul Bottineau TransitwayHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 8
  • 9. RiverFIRST | A Perspective on Revenue Identification
  • 10. Great ideas, great designs and strong leadership attract capital.HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 10
  • 11. Following decades of resource challenges, cities are increasinglyturning to a range of private sector funding sources. General Special BID Charge Food & Events & Parking Corporate Real Estate Fund Levy Beverage Promotions Fees Philanthropy Sponsorship Proceeds Public Earned Income 501(c)(3) PrivateHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 11
  • 12. Real estate is often the most significant potential revenue source. Legacy Amendment Funding? Tax Increment Financing? Quantity & timing Improvement District? Development pro forma Public capacity Development / Parkland ability to support to fund parkland concessions parkland Other public benefits? Privatized Public Space? Corporate Sponsorships? Philanthropy?HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 12
  • 13. Typically, new parks systems rely on phased revenue streams. Real Estate Development Events & Programming Revenue Scale Government Funding Sponsorship & Fundraising TimeHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 13
  • 14. RiverFIRST | Stories from the Front Lines The South Brooklyn Waterfront
  • 15. History of a working-class industrial waterfrontHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 15
  • 16. History of a working-class industrial waterfrontHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 16
  • 17. More than two decades of master-planning through engagementHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 17
  • 18. The public sector committed to funding park capital costs. PANYNJ/NY State ~36% City of New York ~60% Borough President & City Council ~2% Private Donors ~2% Secured Funding $233 million Planned City Supplement $55 million ~$355 million total development costsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 18
  • 19. Elected leadership made a policy decision to leverage ownedlands for real estate development to sustain park operations. 75 acres of public space 10 acres of developmentHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 19
  • 20. Marine infrastructure and the inclusion of an appropriate capitalreserve became significant cost drivers. EIS Projection 2004 $ Landscape O&M $4,475,000 Security and Recreation $2,682,000 Staff Utilities and Insurance $1,037,000 Administrative Expenses $1,380,000 Marine Infrastructure $3,600,000 Vehicle Replacement $202,000 Capital Reserve $1,820,000 TOTAL: $15,200,000HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 20
  • 21. Real estate development value potential was calibrated againstongoing project costs, with considerations for parkland activation. Maintenance Budget $15.2M Annual Land Value per SF ÷ $12-15 Required Development = 1-1.3M SF Absorption & activation considerations Development Program Residential Units 1,210-1,240 New Construction 710-740 Adaptive Re-Use 500 Retail SF 400,000 Hotel Rooms 170-225HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 21
  • 22. ResultsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 22
  • 23. ResultsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 23
  • 24. A mission to bring New Yorkers to the waterfront and support thegrowth of burgeoning residential neighborhoods in BrooklynHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 24
  • 25. Results TODAYHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 25
  • 26. A mission to bring New Yorkers to the waterfront and support thegrowth of burgeoning residential neighborhoods in BrooklynHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 26
  • 27. Programming: …and for all New YorkersHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 27
  • 28. $3M provided / $15.2M neededResults: One Brooklyn Bridge ParkHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 28
  • 29. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 29
  • 30. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 30
  • 31. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 31
  • 32. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 32
  • 33. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience |
  • 34. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 34
  • 35. RiverFIRST | Stories from the Front Lines Hudson River Park
  • 36. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 36
  • 37. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 37
  • 38. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 38
  • 39. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 39
  • 40. Restrictions on development program have prohibited success.Pier 40: 2 failed development attemptsPier 57: 1 failed development attempt, with second selected during the great recessionChelsea Piers: a pioneering tenant secured a great deal after multiple workoutsShort of changing legislation, two alternatives remain:• A proven, politically challenging source: special levies on upland real estate• An unproven source with recessionary risk: Transitioning the Friends from an advocacy organization to a major source of philanthropyHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 40
  • 41. RiverFIRST | Stories from the Front Lines Rose Kennedy Greenway, Boston
  • 42. Rose Kennedy Greenway: building open space through a tunnelproject to reconnect downtown to its waterfront.HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 42
  • 43. Mission: a string of parkland to support downtown developmentthrough new amenities and connections.HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 43
  • 44. Design & Programming: 4 different segments reflective of 4different neighborhoods with 4 different development targets. North End Wharf District Amenitize residential Attract visitors Dewey Square ChinatownHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 44 Retain & attract businesses Build on cultural assets
  • 45. Whereas capital sources were part of the “Big Dig” project, operating sources lack long-term government commitments.$4,500,000$4,000,000$3,500,000$3,000,000$2,500,000 ?$2,000,000$1,500,000$1,000,000 ? $500,000 $- FY2010 Future Year Massachusetts Dept of Transportation Mass Development Philanthropy & Sponsorships Event Revenue Other HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 45
  • 46. New development parcels made available as part of the “BigDig” project were planned for civic use, not revenue generation. 75% of reclaimed land dedicated to “public open space” Parcels unsuitable to parkland or on the fringe were dedicated to civic uses: • YMCA • Boston Museum • New Center for Arts & Culture • Horticulture Society “Garden Under Glass”HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 46
  • 47. All development plans have failed.HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 47
  • 48. Value creation on adjacent properties is a long-term proposition,as buildings redevelop to face the Greenway.HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 48
  • 49. RiverFIRST | Stories from the Front Lines Central Delaware River Waterfront, Philadelphia
  • 50. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience |
  • 51. Create a truly Philadelphia waterfrontHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | building Philadelphia, PECO
  • 52. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience |
  • 53. Total Property 1,129 Acres Total Land 930 AcresHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience |
  • 54. Washington Penn’s Landing Spring Garden Development Park Penn’s Landing 1,200,000 sf 18.1 ac Spring Garden 2,600,000 sf 6.5 ac Washington 1,940,000 sf 18.9 ac Subtotal 5,740,000 sf 43.5 acHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience |
  • 55. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience |
  • 56. HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience |
  • 57. RiverFIRST | FIRST Impressions
  • 58. General Special BID Charge Food & Events & Parking Corporate Real Estate Fund Levy Beverage Promotions Fees Philanthropy Sponsorship Proceeds 501(c)(3) Public Earned Income PrivateHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 58
  • 59. Resource identification NOT Downtown NOT affluent neighborhoods + NOT a city projected for significant near-term growth LIMITED real estate value creation (total $) LIMITED corporate interest LIMITED philanthropyHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 59
  • 60. Distinct contexts suggest distinct strategies for North & Northeast North NortheastHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 60
  • 61. North riverfront: an established industrial district Active light industrial district with significant “green” business Tensions between industrial and residential land uses Inefficient “Port of Minneapolis” with uncertain future for barges Highly constrained access from disadvantaged neighborhoodHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 61
  • 62. North riverfront: an implementation strategy? Strengthened/Rebranded North Washington Jobs Park • Next generation trails, providing neighborhood access, commutation & industrial tourism • Port consolidation for efficiencies & potential long-term phase-out • Fabulous wetlands restoration park  increased commercial value Potential mixed use enclave bounded by rail lineHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 62
  • 63. North riverfront: revenue implications? 1. In-kind management / Commercial assessment district 2. Land disposition 3. Philanthropy 4. Environmental mitigationHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 63
  • 64. Northeast riverfront: established & emerging community Residents, artists & neighborhood retail Limited connections to the river Mostly multi-party, small-plot, private shoreline ownership. Fantastic waterfront uses – boat launches, Psycho Suzie’s, distinctive housingHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 64
  • 65. Northeast riverfront: an implementation strategy? Focus on Scherer, Boom & Nicollet, major publicly-owned sites Leverage development for parkland activation & funding. Consider relative benefit of: • Major employers’ expansion • Mixed use • Community facilitiesHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 65
  • 66. Northeast riverfront: revenue implications? 1. Land disposition(!) 2. Special assessment district 3. Events & concessions 4. Parking 5. In-kind management 6. Environmental mitigationHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 66
  • 67. Prerequisite of phase I: demonstrate the vision can be realized• Bring all Minneapolitans to the river• Foster advocacy for plan completion• Secure media attention• Demonstrate public sector ability to conclude transactionsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 67
  • 68. Prerequisite of phase I: demonstrate the vision can be realized• Bring all Minneapolitans to the river• Foster advocacy for plan completion• Secure media attention• Demonstrate public sector ability to conclude transactionsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 68
  • 69. Phase I: Green Port?  Activation  Advocacy  Attention  TransactionsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 69
  • 70. Phase I: North Washington Jobs Park?  Activation  Advocacy  Attention  TransactionsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 70
  • 71. Phase I: Farview Park Extension?  Activation  Advocacy  Attention  TransactionsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 71
  • 72. Phase I: West River Road North?  Activation  Advocacy  Attention  TransactionsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 72
  • 73. Phase I: Downtown Cultural Connections & Spirit Island?  Activation  Advocacy  Attention  TransactionsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 73
  • 74. Phase I: Scherer Park District?  Activation  Advocacy  Attention  TransactionsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 74
  • 75. Phase I: East Bluff?  Activation  Advocacy  Attention  TransactionsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 75
  • 76. Phase I: Trails?  Activation  Advocacy  Attention  TransactionsHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 76
  • 77. Next StepsQ: Where is HR&A’s value-add?A: Where is the revenue-generation potential?HR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 77
  • 78. Next Steps Scherer Park District Downtown Cultural Connections Green Port North Washington Experience Trails Farview Park Extension East Bluff West River Road NorthHR&A Advisors, Inc. Minneapolis Riverfront Development Initiative | HR&A’s Experience | 78