• Share
  • Email
  • Embed
  • Like
  • Save
  • Private Content
Back to Basics: Downtown Development Strategies That Work
 

Back to Basics: Downtown Development Strategies That Work

on

  • 769 views

Back to Basics: Downtown Development Strategies That Work. Digitally Scanned Analog Edition. Published in the Proceedings of the 2002 American Planning Association National Conference. Authored by ...

Back to Basics: Downtown Development Strategies That Work. Digitally Scanned Analog Edition. Published in the Proceedings of the 2002 American Planning Association National Conference. Authored by Susan Winterberg and Sean Bender

Statistics

Views

Total Views
769
Views on SlideShare
769
Embed Views
0

Actions

Likes
0
Downloads
2
Comments
0

0 Embeds 0

No embeds

Accessibility

Categories

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Back to Basics: Downtown Development Strategies That Work Back to Basics: Downtown Development Strategies That Work Document Transcript

    • Backt aSICSSusan J. Winterberg & Sean P. Bender
    • Introduction At the heart of every city economic forces that are alreadylies a market. Cities that suffer at work in the city. Experiencefrom disinvestment do so because has shown that successful plansthere are common barriers to and planners are those thatinvestment that prevent the capitalize upon those forces tomarket from developing. This create new opportunities forpaper describes seven urban reinvestment By focusingprinciples that explain why on the basics and applying theurban revitalization projects seven principles, city revitalizationwork while others fail. These strategies are transformed fromseven principles may not an abstract phenomenon into aencompass every imaginable clear and understandable processdetail of every successful that can happen anywhere.place. However, they form a In this paper we will firstreasonable model from which identify ahandful ofcommonwe can begin to not only barriers to revitalization, and thenunderstand revitalization, but we will explain the sevenalso make it happen. principles of successful The Seven Principles For many cities revitalization followed by of Successfulrevitalization has become complimenting case studies. In itsmerely facade building. Such closing this paper will leave you Revtilizationsolutions give the appearance with the pitfalls ofthe Respect the citys hierarchyof economic health without revitalization process and of needsever addressing the llllderlying methods on how to avoid them.causes of disinvestment. While Address old before newthere is no "one size fits all"formula for revitalizing a city, Assemble a critical massthis paper offers a strategicframework to help leaders Use streetscaping andcritically analyze their ideas to aestheticsdetermine whether or not aproposed project is 1ikely to Allow the market to workattract large seale privateinvestment. We identify Capitalize on the cityscommon themes in successful unique assets andprojects and common themes in opportunitiesprojects that were notsuccessful. Develop and follow a "Back to Basics: strategic planfocuses on the social and 2
    • The Barriers of Revitalization Creating a revitalization The efforts, when compared to estimated to cost 200 million dollars.project that is able to attract the results, are dumbfounding. Since (4)reinvestment into a city first requires 1 960, public investments have built In most, if not all ofthethat existing barriers to investment highways cormecting the downtown aforementioned efforts thebe identified and removed. Such to the entire region and super-region. governments right to take propertybarriers can come in a variety of The City has built three stadiums; the for public investments has weighedforms including impractical zoning latest two will cost two billion dollars heavily . Over the past forty yearsregulations, rigid building codes and when paid for. The City has a] so built, City, County or State govermnentsproperty tax structures that and expanded, a downtown have come to consume as much asencourage disinvestment and land- convention center, and is currently fifty percent of the property inhoarding. Sometimes projects considering yet another expansion downtown through purchase or theimplemented with the intention ofrevitalizing a city can themselvesbecome barriers of investmentthrough the excessive use of public The Distortion of the·CBD Real Estate Marketsubsidies and eminent domain. Eminent Domain as a Barrier Eminent domain has been awidely used tool ofplarmers and the"reformers" of our nations cities for over a half century now. UrbanRenewal, interstate highways, sportsstad.iwns and a multitude of otherconunon urban redevelopmentprojects have depended heavily uponthe forceful taking of private propertyfor implementation. The implicationsof the widespread use of eminentdomain are incredible, as can be seenby taking a closer look at the city ofCincinnati. Since 1960, downtown ..Cincinnati has seen billions ofdollars in public investments throughhighway developments, stadiumsprojects, and other significant Reads & Hl~BVSeconomic development schemes_ Atthe same time, the downtown area P~v o-~r-r::d IW Go~t~t. r.~,· .or, ar ft:ro,!f Df tl by .has seen tremendous losses in every I;Mittqnl~category of private enterprise. Even BL •itdtrt{r.ifurther, downtown population hasdeclined by over 55 percent since 1960, from over 12,600 persons tojust tmder 5,000 persons in 2000. (15) From "Some Proposals to Energize our Community"
    • use of eminent domain. Some of the businesses and residences that cases in downtown Cincinnati,property was taken for despite compensation closed down government agencies have paid anredevelopment purposes and has or relocated outside of downto"W!l average of over 1.5 million dollarsbeen recycled into the market, while a or the City. In the case of the per acre for seized properties. large percentage remains in public stadiums and highways, thousands Those same properties had anhands for purposes as parks, of properties were taken, while in average pre-seizure market value ofhighways, and stadiums. some of the "smaller" efforts entire just over 63 7,000 dollars per acre. The demographic analysis blocks have been cleared. In the With such a large economic forceof downtown Cincinnati shows that case of more than one development, consmning properties at abovethe aforementioned investments, and property has been taken twice or market rates in a concentratedthe use of eminent domain as a tool more through eminent domain. location, an artificial, if notfor their implementation, have not Even further, the widespread monopolistic, condition is createdimproved the CBD. Since 1960 use of eminent domain bas thus destroying the markefs abilitydowntown has lost 420 of 595 drastically impacted property to operate without furtherretailers. It has lost 118 restaurants, values in Cincinnatis CBD. Since government involvement.30 hotels, and hundreds of other 1960, as much as 50 percent of the The use of eminent domain,small enterprises, industrial outfits, land in the CBD has been owned, in corn bination with Cincinnatis bigand professional practices. Even purchased, or forcefully taken by ticket revitalization efforts has ledfurther, it has lost close to 8,000 City, County, or State governments. to fruitless results. Smallresidents. ( 15) Often, the properties In a dozen recent eminent domain businesses struggle for existence,claimed by eminent domain contained with hundreds disappearing from the downtown. Larger businesses have seemingly grown dependent Attrition in Downtown Cincinnati upon subsidies and other governmental assistance, often threatening to leave the downtown if their demands are not met. Type of Use Year Downtown Cincinnati has incredible access to super- 1960 2000 highways, state of the art sports complexes and arts venues, a major ·1 an u f:v.: lurmg & 113 14 convention center, dozens of high rise towers containing over ten V ~!rehousing million square feet of office space, Vhole~ale Supphers 16f1 1-l and thousands of hotel rooms. Retail _:C)) )75 However, the overall demographic Food Retail data suggests that it is anything but .._..., I 37 ~"..;: Restaurants & Bars 24~ 114 an economically or socially vibrant place. Despite over two billion Emert~untnent 30 1) dollars in public investments in the Hl)tels ~2 1::: CBD over the past half decade, TrJnsponmion I J2 qg City leaders continue to struggle Commercial Sen·ices -iX6 210 with maintaining and improving the Finnncial Sen ices (;Js 3(}3 economic and social vibrancy of the downtown. (4) Proressi,mat Sen·ices 745 5(}7 Source: Some Proposals to Revitalize Our Community
    • Business Subsidies the 1980s half of a city block riverfront. Financed with a containing a department store and combination of corporate and cityas Ba.rriers offices was cleared for a new high money, the Renaissance Center was rise mixed use development. Several designed with the intentions of Many public leaders assume portions of the mixed use high rise creating a renaissance in a city that the reason the urban core is fell through due to low demand for was plagued with riots, racial tension, disinvested is because govennnent office space and the project was uncontrolled arson and vandalism subsidies are required to bring halted for nearly a decade. In the mid and among the highest rates of investors to the city. To this end, 1990s theprojectfmally came to abandonment and suburban flight in cities have poured billions of dollars fruition as a three story facility the country. into subsidies to attract and maintain containing Lazarus, Tiffanys, Brooks The project cost $3 57 businesses in the downtown. Brothers and a restaurant. (20) Million in 1977. During its first fiveCincinnati, for example, recently Other cities have tried the years it ran at an operating loss ofpushed a plan to subsidize subsidy approach to attracting $130Million(9). Now, twenty-fiveNordstrom Department Stores to investment back into downtown and years later, and after the city has built locate within the CBD. Within this have been met with similar numerous other attractions includingplan the city offered nearly 60 million ambiguous, if not disappointing a new opera house, a people moverdollars of subsidies to develop and results. The City of Detroit has also (an elevated monorail built aroundmaintain the store for an invested billions in taxpayer dollars downto111), and two new stadiums,undetermined number of years. In over the last three decades in an Detroits population is still declining.addition, the City cleared half a block attempt to revive their downtown. In Further, the city still remains among(containing a 15 story tower and 1977 the city embarked on what was the highest rates of abandonment,garage filled with offices and lower to become the epitome of failed crime, and poverty in the nation, andscale retail) and paid millions to revitalization attempts with their among the lowest in downtownrelocate numerous existing investment in the Renaissance property values.businesses. Ultimately, N ordstrorn Center, a complex oftubular officepulled out of the deal due to market towers and retail space on the Detroitconditions and the City still has anempty block near its most vital CBDproperties, and is in the process ofclearing part of another block torelocate a displaced drug store. (17) Cincinnati has developed atrack record of subsidies that stretchbeyond the Nordstrom fiasco. SaksFifth Avenue, across the street fromthe failed Nordstrom site, wasrecently granted 6.6 million dollars torefurbish the interior of its not quite20 year old facility. The latestsubsidy also restructured previoussubsidies originating from 1996 andthe early 1980s when the store wasfirst constructed as a part of a largerdevelopment. ( 17) Across the street from thefailed Nordstrom site is the infamousFountainPlace West Development. In 5th & Race Streets Cincinnati, site ofthefailed Nordstrom project
    • Sports Stadiums as businesses aroWid them (a few bars and restaurants~ souvenir shops, aBarriers hotel or two). (23) However, their total economic impacts appear to Almost every major city in have been grossly overestimated. AAmerica has built a "renaissance 1997 study conducted by thecenter" of their own with the promise Brookings Institution titled Sports,of a magical transformation of an Jobs and Taxes examined theabandoned and largely under utilized proposed economic impacts of newdoMltown into a bustling twenty- stadiums in cities across the countryfour hour community with new includingBaltimore,NewYork, Twinplaces to shop and places to eat. Cities, Cincinnati and Cleveland andDuring the last decade, one of the their actual results. The research teammost common forms of these found that reports commissioned by"renaissance centers" has been the cities or sports teams intended tonew sports stadium. However, the persuade public opinion on theability of such a project to attract construction of new stadium facilitiesinvestment into nearby have incorporated a variety ofneighborhoods is highly methodological discrepanciesquestionable. including equating new spending With increased pressure from with spending diverted from otherteams to relocate if their host city did locales within the city, attributing allnot provide them with newer and out-of-town spending as beingbigger facilities, cities across related to the sports stadiumAmerican have scram bled to win regardless of the reason of the visit,over public support, levy taxes, and as well as a number of manipulationsissue the debt necessary for the in calculating the multiplier effect,hundreds of millions of dollars ignoring the opportunity cost,required to provide sports teams with additional infrastructure costs andtheir new facilities. In an effort to negative effects of applying the taxesraise public support, studies were to the stadium.commissioned indicating that After considering the variousinvestment made on the new facility studies, the Brookings Institutionwould be recovered multiple times concluded that sports stadiums didover by increased jobs and towi.sm. not significantly promote theFurther, as was claimed by many economic development of astadium supporters, and most metro}X>litan area, did notrecently by supporters of the new significantly assist in maintaining theYankees stadium that was to be built vitality of an urban center, nor didin the Bronx neighborhood ofNew they promote micro-enterpriseYark, the stadium when combined development within a small defmedwith other large city investments district of the city. In fact, thesuch as the expansion of a nearby overwhelming consensus of theseconvention center, would serve as a studies revealed that «the localcatalyst for reinvestment in the economic effect of a sports facility isnearby neighborhoods (23 ). between nonexistent and extremely It is true that sports stadiums modest." (18)do attract a certain number of new
    • Large Investment residence in the urban center or invest in property Olllership there.Total Impact These projects are typically designed to cater to loyal suburban dwellers, On the whole, large public some of whom, research bas revealedinvestments have proven to be an have a fear of the city ( 11 ) . Theseineffective method to revitalize a city. attractions target suburban visitorsHowever, this should not be by providing them a drive·ininterpreted as building such projects controlled environment divorcedis wrong, or that cities ought not from the rest of the city.prioritize the building of stadiums and A true revitalization project,other fonns of entertainment or retail in contrast, raises the livability of avenues if it is the voters will to do city as well as the economicso. Rather, such evidence indicates attractiveness of investment there.that claims that these large public While what one might call a drive-ininvestments will attract people to live attraction certainly does add value toin the city and spark large scale a city, it cannot, by its merereinvestment into dilapidated presence, transform a neglected andneighborhoods is illlproved. abandoned downtown into aThere is clearly a significant degree desirable place to live. Theof popular support for the public challenge then becomes developing afinancing of stadiums, retail and method by which leaders will be ableoffice complexes, and other public to evaluate whether a proposedprojects as can be inferred from the revitalization project will becomewide scale political support and only another drive-in attraction or aproliferation of such projects across project actually capable of bringingthe coillltry. However, while citizens investment back to the city.may support the use of their taxdollars to finance such projects, itappears these projects do not providea sufficient economic incentive forthese same individuals to relocatetheir residence or to invest in theareas surrounding the project in theform of property ownership andmicro·enterprise development. Here a distinction arisesbetween what is merely a "drive-inattraction" and what is a truerevitalization project. A drive-inattraction is a development that mayattract individuals to visit the city afew times a month or a few times ayear (for example, to see a sportsgame or a play or to shop at aparticular retail center) but carmot byits own merit entice a significantnumber of individuals to locate their Foutain Place West, Downtown Cincinnati
    • The Case for Revitalization Revitalization and economic businesses are now able to locate selection was "quality of life." The development are two terms that are virtually anywhere they choose, free primary considerations of quality of frequently used interchangeably. of the typical constraints of life companies were seeking (and While there are many overlaps geography. (8) This has meant new hence their potential hires were between the two concepts, there are opportunities for vast wealth creation seeking) were good housing options, some clear differences that must be in certain areas of the country, able to easy commuting, and overall visual understood before attempting to attract these high paying jobs attractiveness of the place.evaluate a revitalization project. including most notably the Silicon Secondary factors under quality ofEconomic development is the Valley/ San Francisco Bay area, the life were access to public institutionsprocess of building upon and Research Triangle of North Carolina such as libraries, museums and sportsexpanding the economic base of a and Boston. Many other cities have venues (19).city. While economic development is launched campaigns in an effort to Iterns such as housingcritical for the long-tenn health of attract these types of companies. options, quite naturally, varyany metropolitan region, it must be Some have been successful, while depending on the individualsunderstood that the economic many others have not. It appears that preferences, his income, and thedevelopment process cannot be the over all quality of the living needs particular to the current stageequated with the revitalization of the experience in the city itself plays an of his life. For some employees goodinner city. Increasing the number of important role on a citys ability to housing options may mean suburbancompanies located in the downtown, attract these new forms of economic style housing. For othersthe number of jobs, or even development. (particularly young new hires whoattracting higher paying jobs to the In a 1997 study conducted by the company is trying to target withdowntoTI is no guarantee that the the Real Estate Research Institute, their location) good housing optionscity will experience increased information age companies from may mean rental or condominiumlivability or reinvestment in the form across the country were interviewed style housing in an urban setting (8).of property ownership. Such a and asked to describe the process In any instance, a boarded-upparadigm of revitalization can be they use in making site selection downtown is not an attractive sellingseen in the all too common "office decisions for their company. Among point for any potential relocation.slums in American cities that the factors they considered were Thus new strategies are needed tobecome abandoned after 5 p.m. and typical economic factors such as address the decaying core of the city.on weekends. While increased local property taxes, income taxes,economic development may not be a cost of office rents, and cost andreliable method to revitalize a city, availability of land. However, thethere is evidence to suggest that most important criterion in siterevitalization can play a significantrole in increasing a citys potential foreconomic development. In recent years the economy While increased economichas gone through a transformation development may not be a reliablefrom being focused onmanufacturing and production to one method to revitalize a city, there isthat has been focused on the setvicesector and on knowledge-based or evidence to suggest that revitalizationinformation age products.Subsequently, business location is can play a significant role in increasingbecoming less dependent on the localgeography, on the availability of a city,s potential for economicnatural resources, waterways and development.pools of cheap labor. Instead 8
    • Getting Back to Basics At the heart of every city particular the local residential market.lies a market. Cities that suffer from Leaders must come to accept that thedisinvestment do so either because city is not the most desirable livingthere are barriers to investment that arrangement for many people.prevent the market from developing, However, there is a market for cityor because the private sector has not living. It is those people that liveyet discovered an opportunity to outside the city, but show an interestdevelop profitably in the city. Most in city living that should be targetedoften, these two scenarios find their with revitalization initiatives.basis in a lack of understanding Marketing firms that researchabout the city, in the basic social and trends for real estate developers useeconomic forces already at work a statistical tool called lifestylethere and in a lack of understanding cluster analysis in identifying marketof the potential to capitalize on these opportunities for urban housing. Thisforces to create surplus value. technique, which involves conducting market research onThe Market Based individuals who live outside a citys urban core, but show a strongStrategy affinity for the urban environment (a gee-demographic group termed The market is the lifeblood of "suburban urbanites") identifies whatthe city. Whether it be a market for the determining factors were forhousing, a market for commercial these clusters of the population tospace, or a market for goods and choose to live outside the city.services being offered by the citys Research in variousentrepreneurs, a successful and metropolitan regions has revealed thebalanced marketplace is both what choice was based on factors such askeeps a city going and what makes it easy availability of parking, security,attractive to potential residents and and increased privacy (11 ). Havingpotential new sources of business. gained this type of information Yet policy geared towards the specific to their own region, realeconomic revitalization of a city is estate developers and policy makersoften divorced from this basic are then able to target their productsprinciple. Elected officials in City and their initiatives based on the realHalls often vote on appropriations to market potential of their city.developers and retailers without anyreal consideration for whether amarket exists locally for suchproducts or whether their policyinitiatives will be an effectiveattraction for further investment inthe city. Revitalizing a city is acomplex process, but it is based onbasic principles of economics andsociology. Before attempting toconstruct a revitalization program,leaders must first have a solidunderstanding of the local market, in
    • The Seven Principles of Revitalization needs are met, it must offer a feeling economically healthy habitats for of safety and then have a variety of Once the citys demographic their individual human beings. Citiestrends and potential market places for people to work and e~opportunities have been identified, it that are abandoned, and have money. Then. it must have a vanetyis then necessary to find ways in experienced serious disinvestment of entertainment options and bewhich to capitalize upon these are suffering on the lowest levels of aesthetically pleasing. the hierarchy . When one approaches Just as we as individualsopportunities. Aga~the city is a the problems of the city in thecomplex envirorunent. Yet its cannot pursue our need for highcomplexity derives from a few basic context of revitalization and aesthetics or entertainment ifwe attracting residents and other lnck more basic needs like food,social and economic principles. For investment back to the city, he must shelter, and safety so is a city not anthe purpose of evaluating a proposedrevitalization program, the following begin where the city currently is on attractive habitat if it has only these the hierarchy and work upwards. higher level needs present. Citiesseven principles may be used as a When approaching that have experienced revitalizationguiding framework for identifying revitalization projects, it is important have targeted their policies andopportunities to capitalize on the to keep in mind that while luxuriesmarket potential in the city. their financial resources towards like new stadiums and cultural addressing these more basic needsRespect the Citys centers can add value to a place that first, such as reuse ofthe salvageable is already a great place to live, theyHierarchy of Needs cannot, by their own accord, make a abandoned housing and places of business, and incentives for starting city a desirable place to live. The small consumer-directed businesses In the 1950s, psychologist reason is simple. For a city to beAbraham Maslow developed a such as grocery stores, small shops livable, it must have the basic and restaurants as well astheory about hwnan motivation. In necessities we need to live. It mustMaslows theory, all humans are implementing strategies to reduce have a variety of housing options. It crime. Ifthis can be accomplished,motivated by general categories of must have easy accessibility to food the natural market will take care ofneeds that can be arranged in a markets and restaurants. Once thesehierarchical pyramid. On the base ofthe pyramid was the need for basicphysiological survival such as foodand shelter. On the next level wassafety, followed by social belonging.On the higher levels include suchneeds as the pursuit of esteem,entertainment and high aesthetics.Ones ability to be motivated byhigher level needs is ftrst dependenton his lower level needs being met.Thus, one who is starving, lacksshelter or is constantly running awayfrom a~als threatening his life willhave no time or interest in learningabout golf or abstract art. A city is nothing more thana society of individual humans. Andlike individual humans, cities toohave a hierarchy of needs they mustadvance upon over the course of time The Urban Socitrpsychological Hiearchy of Needsif they are to become strong
    • Address Old Before developers fmding buyers and businesses fmding a large enoughNew customer base is highly uncertain. There is an old saying that An investors ability to earn athree things matter when it comes to reasonable return and hence hisinvesting in real estate-location, willingness to invest in the project islocation, and location. Yet there is a dependent almost entirely on thetendency when thinking about property values around him risingrevitalization to focus only on and the neighborhood coming backgetting new buildings built and to The Detroit Opera House & the as a whole. If one person goes into acompletely ignore the "location," Ruins of the Madison Theatre (By dilapidated neighborhood of 100that is the condition of the existing Lowell Boileau) buildings and purchases one bui Idingproperties in the city! and rehabilitates it, the chances of Tax credits and other market values! New construction can the value of the building ever risingsubsidies will be provided for new be subsidized, but if the condition of enough for him to recover hisconstruction, while everything else is the buildings around it are in such a investment are slim. Similarly aleft to rot. This may seem hannless state of disrepair, ultimately, the housing initiative implementedon the surface, but for most cities, value of the new building will be without taking care ofbusinessthis ends up being their fatal flaw. brought back down. owners needs or a corrunercialDespite the widely held belief that Successful revitalization district revitalization planmatters relating to urban vitality are takes advantage of the "location" implemented without a housing planthe responsibility of elected officials, source of value of real estate and to provide customers can quicklyrevitalization happens primarily by targets existing buildings frrst. If it become a recipe for disaster. Thisinvestment from the private sector, can be made feasible to bring back "spot revitalization" approach doesand the role of the public sector is what is existing, then the area as a not work. A critical mass ofreduced to a bare minimum. To make whole will become desirable and investment in both residential andrevitalization successful, one has to investors of new construction will commercial properties must bebe able to think like private sector come of their own financial interest. established at one period in time toinvestors and understand their bolster confidence in other investors that their investment will beinterests and effectively address Assemble a Critical worthwhile.them in the planning process. Investors in real estate are Mass Consider the case of twolooking for opportunities to increase Cincirmati streets shown in the Real estate development inthe value of their properties. Real pictures below. The street on the left dilapidated neighborhoods is a high-estate derives its value from two is Vine Street. A sole entrepreneur risk business. Rehabilitation costs ofsources. A bui Iding derives value has purchased this solitary building existing buildings can greatly exceedfirst from itself-its materials, its and rehabilitated it. It is surrounded acquisition costs many times overdesign quality, its size. Yet a by dilapidated buildings and tax- and the probability of residentialsignificant amount of its valuederives from what is around it, its"location" and the amount residentsor businesses are willing to pay tolocate themselves where that buildingstands. Obviously. identicalbuildings in uptown Manhattan andin a dilapidated Detroitneighborhood do not have similar Vine Street - No Critical Mass Main Street- Critical Mass
    • foreclosed properties. Just two city became no longer able to blocks east is the picture on the right, subsidize the insufficiently profitableMain Street. The buildings on Main entity or it reprioritizes its allocations Street were once in a very similar elsewhere. In most instances, their condition to the buildings on Vine investment was lost almost totally Street. However, in the mid 1990 s a lost. In addition to being ineffectivegroup of local developers worked in revitalizing the city, this approachtogether to buy out entire blocks of has proven quite costly both to thethe street at one time. The taxpayers and to the developer. ( 17)rehabilitated building shown in the Successful revitalizationpicture of Vin~ Street has an assessed utilizes the most powerful economicmarket value of $30 per square foot force in existence-the free market.after its rehabilitation. The remainder City and private investment isof the buildings on the block have an new urbanism commwrity of Seaside, targeted towards helping newaverage value of $16.77 per square Florida, aesthetics plays a powerful businesses get started and existingfoot. In contrast, the average value of role in raising the desirability of a businesses expand. However, thea building on that same block of place and in increasing property choice of what these businesses are isMain Street just two blocks east is values_ left for the local marketplace to$56.75 per square foot(22). Investors who Wlderstand the decide. The burden of understanding Critical mass can make or economic power of aesthetics realize the market, and making the strategicbreak a revitalization attempt both in the difference that simple business decisions about what typesterms of making a project financially investments such as burying utility of goods and seiVices should befeasible and in terms of making an lines, planting new trees, narrowing offered is transferred away fromarea of the city feel safe and be an streets, planting medians in policy makers in City Hall, and intoattraction to potential customers and boulevards and successfully the hands of individual entrepreneursresidents. designing the zoning and design who will ultimately bare the guidelines for infill construction canUse Streetscaping and make on the success of a city. accoWl.tability for the success or failure of the business. SuccessfulAesthetics revitalization is not an effort to create an artificial market, but Good aesthetic treatment of Allow the Market to instead to help stimulate a marketthe surrounding spaces is one of theeasiest ways to boost the desirability Work that does exist and that will be able to exist on its own in the futureof an area. Whether it be the gracious Many public leaders assume without further public subsidy.squares and towering oaks lining the that subsidies are needed to attractnarrow streets of Savannah or the businesses to locate in the city. Tointeresting street furniture, lamp this end city governments haveposts, and sidewalk designs of the subsidized high end retailers, shopping malls, and other commercial entities in an effort to compete with suburban shopping centers. Often times, these appropriations are made as a result of political pressure with no real consideration to whether a market actually exists for the businesses being subsidized. What normallyWaterplace Park, Providence happens in the long run, is that the(Before) (By Sandor Hobo)
    • Use the Citys Unique city is revitalized or not depends on investors to evaluate for themselves the ability of leaders to find these or to present to their stakeholders toAssets and opportunities and work together in a boost their confidence that theOpportunities timely fashion to act upon them. neighborhood really will come back. Strategic plans are needed to jump-start investment efforts, but Successful revitalization is Develop and Follow a long term, they wi11 also prove to be not a result of any one formula but crucial to a citys continued success. instead of taking advantage of the Strategic Plan Everything in the city is unique opportl..Ulities present in one interconnected in a giant jumbled given place. Cities that have had Revitalization is a many step web. If some aspects of the city are successful revitalization projects process, however there is no faster able to be brought back up, whilewere able to identify unique way to guarantee failure than to take others are weighing it back down, opportunities for investment in their a step-by-step approach. ultimately, the city as a whole willcommunity such as unmet housing Implementing individual projects come back down. If dwing yourneeds for demographic groups that (small business loans, housing plans, revitalization process you displacehave an affmity for city living- aesthetic improvement plans, etc.) large numbers of people into worseyoung people, the elderly, although they may be good projects, conditions, or if you have a poorimmigrants, artists, small business cannot be successful when school system, or poorowners. Projects are selected based implemented sporadically and environmental planning, all of youron market research and local without the guidance of an overall other efforts can be brought backdemographic trends rather than long-term plan. down.speculation about who might be The objective of all The plan helps youinterested in living in that particular revitalization planning must be to prioritize your efforts as your workcity and what that groups needs are. attract a large number of private your way up the hierarchy of needs. Further, successful sector investors. To do this, a critical But it also serves the purpose ofrevitalization requires utilizing mass must be established and integrating everyones interests intoexisting resources and existing stores individuals must have their one picture. Cities without theseof leadership talent unique to a confidence boosted that entire types of plans in place can becomeparticular city. Successful neighborhoods where their property easily fragmented as special interestneighborhood revitalization efforts would be located will come back. groups compete for political powerhave been led by for-profit There is no worse message to send and resources without any realdevelopers, mayors, city council investors seeking to decrease the consideration ever given to themembers, citizen groups, and historic amount of WlCertainty in their return quality of the urban environment as apreservation non-profits alike. Who than random city appropriations. whole. The planning process, whenis leading the efforts is not so With no long term plan in place, properly done, brings these specialimportant as the ability of those investors cannot feel confident that interests together and causes peopleleaders to leverage talent and the commitment to bringing the to see them selves as interconnected,resources where they already exist, neighborhood back is there for the and understand their groups successand bring leaders from public and long haul. Such random acts on the as being dependent on the success ofprivate organizations together to part of city government send a others. Having strong political andwork towards common goals. Every message to private investors that says citizen support for a revitalizationcity has unique opportunities for revitalizing that area is yet another project is crucial for its success, andreuse of the downtown and existing one of their many current ideas, and the strategic plan is the documentstores of leadership within its stock that next year they might very well that demonstrates how everyone is aof elected officials and organizations reprioritize to focus on something stakeholder in this process.that can coordinate activities and act else and leave them hanging. Further,on these opporttmities. Whether a there is no strategy in place for
    • The Seven Principles in Practice All successful revitalization revitalization efforts have been led by Oregon has been particularlyprojects have multiple aspects to private or non-profit groups. and successful in its efforts to create athem and involve partnering with leaders from city government were customer-setvice oriented culture.numerous public and private brought in as partners in the planning The city began its effortsinstitutions. While no single template and implementation process. The with a competition to develop a mottocan guarantee success anywhere, most important principle that must be for the city government. The winningcertain principles can be extracted on kept in mind, regardless of who is motto, "The City that Works," washow to best integrate the many leading the efforts, is that city then plastered onto every city vehicleaspects of the planning process and government must be treated as a and other publicly visible items. Towhat roles each partner needs to partner in the revitalization process, live up to their new title, the cityplay. A variety of innovative and and not as the sole provider of continually encourages individualcreative solutions-far too many to funding, ideas, and other resources. departments to develop newdescribe in detail in a report of this When the revitalization efforts initiatives to slash red tape andsize-have been developed by city are being led outside City Hall, improve customer service. The goalsgovernments, non-profits, real estate public leaders need to be approached and results of the departments aredevelopers, and citizen groups alike from the earliest planning stages to published every year in a documentthat have been able to lift the barriers gage what type of political and other available for all citizens and otherof investment in their city and bring fmancial support might be available city employees to review (5).back residents and large scale to supplement the privately led The most critical successinvestment into the urban core. efforts. Effective advocacy and factor for city governments leading Developing a successful public education of the project also revitalization programs though hasrevitalization program requires that play an important role in gaining the been including private sectorleaders are able to construct a political support needed to gain city· investors in the revitalizationrevitalization partnership of multiple backing of the efforts. planning and decision makingorganizations and develop roles and When the revitalization efforts process. The political process,responsibilities for each of the have been successfully led by elected particularly as it relates to matters ofrevitalization partners. Effective officials then several key changes economic development orsolutions for each of the main usual1y have been implemented in revitalization, has a tendency topartners of govenunent, for-profit the organizational culture of the city become easily divorced from the realand not·for profit leadership are government. The most effective of issues and needs of the private sectordescribed in this section along with a city governments tend to operate developers and businesses. To helpdescription of a few citys successful more like private organizations than alleviate this tendency. cities need torevitalization programs and the like the government services create initiatives to include theprinciples that can be attributed with monopolies that they are. They have feedback of local business owners,their success. visions and mission statements, property owners and developers into along with specific goals, plans and the economic development decision- timetables for achieving those goals making process to ensure that theEffective Uses of City and clearly defmed accountability steps the city is taking are indeedGovernment (See Case Study: Transforming City lifting current investment barriers Hall). (24) and are facilitating private The role that city government Such cities also tend to have investment back into the city.plays in the revitalization process customer service high on their list ofvaries from city to city. In some priorities. For city leaders this meanssituations the mayor or city council fmding ways to slash red tape andmembers have spearheaded create an organization whose culturerevitalization efforts, implementing is entrepreneurial and focuses onthe stages through the operations of attaining quality outputs as well asthe city government In other places, reducing costs. The city of Portland,
    • Case Study: the City were based off local to shut down drug houses and resell demographic trends and market them to frrst time homebuyers.Transforming City research. Further, to ensure his By basing their initiativesHall policies were meeting the needs of on facilitating private investment, private sector investors, Menino complemented by having a clear set This case study established a Mayor)s Advisory ofpriorities with a market-drivendemonstrates how changes in the Panel of local developers and other strategy and implementation planmanagement philosophy and private citizens who advise him and for achieving their goals, Boston hasorganizational culture in city his staff on how city policy can better been able to bring life back to allgovernment can help facilitate facilitate private investment in twenty-one of the city sprivate investment in a city. Boston. Facilitating private neighborhoods, has reached a thirty investment remained a: top priority year crime low, and has become one When Mayor Tom Menino throughout the various programs of the top places in which to Jive andtook office in 1993 he found himself implemented by the City and city locate a business in America (14).faced with the same problems that employees were continuallyaffect most major cities including encouraged to find new ways todecaying neighborhoods and crime. attract private investment throughMayor Menino began his their initiatives.administration by establishing a few To help minimize thesimple priorities that were to guide ineffective use of revitalizationevery decision that is made by the funding by non-profits> propertyCity of Boston including: reviving owners and developers, Bostonneighborhoods and business districts. minimized its use of direct subsidiesensuring that the public schools can and instead focused on makinggive each student the education he matching grants and helping propertyneeds and deserves, creating more owners and businesses achievehousing working people can afford, fmancial sustainability. Rather thanand building quality of life (16). subsidizing unprofitable entities, the These priorities then City helped establish a network oftranslated into specific action plans twenty -one neighborhood Mainwith overall and intermediate goals. Street non-profit organizations thatTo avoid the inevitable delays in provide technical assistance to smallimplementation, reasonable deadlines businesses and make grants andwere set for each phase of a project loans for fa~ade improvements andto be completed. For example, in the rehabilitation. Homeowners andcity )s three year housing plan one property owners seeking citylong term goal was defined to be to fmancial assistance are either offeredcreate 2100 units of city-assisted low interest loans or are required toaffordable housing. An intermediate raise matching funds through othergoal was set to have all 2100 units sources in most programs before theyidentified by June 30,2001 and the are eligible to receive city funding.long-term goal for completion was set Boston has also developedfor June 30, 2003. Further, a person several programs to find new uses forwithin the department was (dead assets) including anestablished as being accountable for aggressive marketing campaign formeeting the goals (12). the private sale of city-owned Housing and economic abandoned properties and a programdevelopment programs designed by
    • Effective Uses of that moved in as a result of the downtoMl coming back. It was a win-Public Policy win situation for all involved (3). Making effective use of For public policy to be an public policy requires that electedeffective tool in revitalization, it and city officials leave their officesmust be enacted within the context of and go out and meet the citizens,a strategic market-based plan. The business owners, and real estategoal of public policy as it relates to developers and learn about theirrevitalization is to facilitate the needs. There is no greater expertprivate sector in making investments about what the city needs to improveinto the community. 1bis requires than the people who live there andthat policy makers have an have invested interests there already.understanding of what investors Sometimes there are barriers toneeds are, and how existing investment that public policy canlegislation can be modified and new relatively easily overcome such aspolicies can be enacted to better modified building codes forserve their needs. rehabilitation, zoning changes, or Yet public policy can itself new sources of gap financing. Otheralso be considered an investment. times far more collaborativeMayor Vincent Cianci, while solutions will be needed beyond this,speaking of the revitalization of as was the case in Providence. In anyProvidence, Rhode Island described situation, engaging current andthe approach to policy he has used potential investors, and fmding waysduring his two and half decades in to work together towards mutualoffice as a strategic investment of goals is where effective public policypublic funds. In the revitalization of begins.Providences downtown core,officials had passed legislationexempting artists living in thedowntown area and om.ing galleriesthere from paying state sales andincome taxes (See Case Study:Creating a Critical Mass of PrivateInvestment). On the surface such anexemption might have seemedarbitrary. However the move wasstrategically calculated, and whencombined with the citys otherrevitalization programs, became acatalyst for the citys transformation.For each dollar the city Jost in taxrevenues from the artists, the Mayorcalculated, they would get backmany times over from the resultingboost in hotel taxes, restaurant taxes,and other sales taxes from tourism,conventions, and new businesses
    • Case Study: Creating Preservation Society, also started a the best places to live in America in revolving loan fund from a less than a decade.a Critical Mass combination of city and private funds to help developers acquire and This case study describes rehabilitate abandoned properties.how public policy can be used to The result was the Downcitycreate a cn"tical mass ofprivate Arts District. The artists beganinvestment in a disinvested urban moving into the newly renovatedneighborhood in a manner that is galleries and upper floor loftable to attract other outside apartments. The critical mass wasinvestment. then established. Seeing that the area was becoming a chic and artsy place Once a thriving and wealthy to be, other residents, as well as19th century seaport, Providence fell restaurants and other places ofinto a state of decay in the post- business soon moved in.World War II era like many other Providence also took greatU.S. cities. In the 1970s and 1980s care to ensure that the streetscapingProvidences downtown was largely and public spaces in the city were ofabandoned. Then in the early 1990s, the highest quality. In 1995, a localcity leaders realized they had a great architect was hired to uncover theopportunity. The city was home to citys two rivers that had been buriedone of the nations fmest design beneath pavement for the last 50schools: the Rhode Island School of years. They built small archingDesign, and culinary schools, bridges over the river and landscapedJohnson & Wales University. Many walkways the length of the riveryoung people who were graduating throughout the downtown area. Justfrom these schools chose to stay in five years later, dol!ltownthe Providence area. However, there Providence has risen to an 89%was a lack of suitable housing for rental occupancy rate and propertythem. values are still rising (21 ). In 2001, Realizing that young people Money Magazine awardedstarting out, in particular artists, liked Providence with the title "Best Placeinner city living, the city realized it to Live on the East Coast." The cityhad an opportunity to bring back its is currently implementing itsabandoned downtown. In 1996, aggressive marketing plan to competelegislation was passed exempting for corporate relocations with nearbyartists living in the downtown area Boston, whose office rents are two tofrom paying state income tax and three times higher. By targeting cityfrom paying sales tax on the sale of and state legislation towardstheir artwork in downtown attracting existing demographicgalleries-quite a nice incentive to a profiles with an interest in the inneryoung, starving artist! They also city, and creating an environmentoffered a generous 30% state tax that was not only financiallycredit on top of the 20% federal tax attractive to private investors butcredit to developers willing to also aesthetically pleasing and safe,purchase existing buildings and Providence has been transformedsignificantly rehabilitate them. A from an old industn"al town to one ofnon-profit group, the Providence
    • Commercial Disctrict Over 1600 comrn unities across America have Main StreetRevitalization Programs. Main Street has become one of the most successful economic Creating a successful development models in the nation, commercial district, like any other leveraging on average $3 9.22 in new aspect of revitalization, is dependent investment for every dollar of on assembling a critical mass of comnnmity investment. (2) Most investment. This includes both participants in the program are smallcritical mass of other businesses as to-115, however, the program has Street Four Point r·.~ainwell as critical mass of customers. been used successfully as part of a Commercial District Creating strong commercial comprehensive plan for revitalization Revitalization Strategydistricts is essential to the health of in larger cites. The first City toany city. Yet in a time of increasing implement a city-wide Main Street Organization: Bu:lc ,....;gcompetition from big-box suburban Program was Boston. Boston Main consensus and c.ooper at1onretailers, small businesses face an Streets is a city-initiated program that anx.1r1g put·lrc: and pr vate gr:)upsenorrnous number of challenges just is implemented locally through non- and rndiviclua:s. Jnd idt:nrifylnpto survive. Having a doVntOTI profit organizations in each of the sources of fundmg f:xcommercial district that is successful citys twenty-one neighborhoods. re·/it;:;~>izatlon activ·::iesrequires that business owners have a The program began in 1995clear plan for how to compete in the with a citywide competition in which Design: Ennancmg the d1stnct"slocal market and that their businesses four districts were selected to receive physical appeat·anc:e thrcugr--;can become sustainable over a short funding for the program. Each district bLJildin:;; tehabilitat;on. cornpatt1ieperiod of time without subsidiest. received technical assistance and ne•V construc:ion, ;::;ublic: Forming the critical mass intensive training from both the City imprO:ernents. and designneeded to sustain a commercial of Boston Main Streets Office and mana·;Jetrlen: systerr1sdistrict often requires collaboration the National Main Street Center in theamong small business o-1lers and four-point economic development Promotion: r,/arketin;] heother public and private groups in the strategy and in non-profit commercia distl1c:t throu~ni eventscity. One model for commercial organizational management. Each and advertismg to attactdistrict revitalization that has yielded Main Street organization then hired a custot:1ers, potenta: rn-...:estcrsgreat results is the National Trust for full time Executive Director, raised ne,.-,,. businesses residents. andHistoric Preservations Main Street matching funds, incorporated their v1srtorsProgram. organization and implemented its Main Street Programs all use program according to an annual work Economic Restructuring:the same four-point strategy for plan. Districts selected in the Strengtlenin~ the a~str·ictscommercial district revitalization that competition received six years worth economic base anc cr·eatng neNincludes forming collaborative of city funding to help start their opportunities tnrough CcHefulpartnerships among the public and organizations. The program expanded nalysrs and aprxcpr1ate mixed-private sectors, expanding the over the next five years to include use de.:e·rop;nentdistricts existing economic base by twenty-one Boston neighborhoods.helping current businesses become Programs are managed locally instronger and recruiting new individual neighborhoods but allbusinesses, improving the physical twenty-one programs are overseenappearance of the commercial by the citys Main Streets Office,district, and promoting the district to which facilitates the exchange ofcurrent residents, investors, and information and ideas among thevisitors. organizations.
    • The program focuses on Successful commercial revitalizationhelping small, usually sole proprietor is not a result of big ticket publicor family owned businesses by projects, but instead a result ofmaking grants and loans for starting minimizing city investment to theup, building restoration, and fayade level of gap financing, improvingimprovements. They also sponsor overall aesthetics and infrastructureseminars on starting and managing and creating an environment fuat issmall businesses, as well as a number favorable for private entreprenems toof district promotional events such as create and expand their businesses.festivals and historical tours. Theprogram is funded largely throughcity money and federal grants, butincludes a Corporate Buddiesprogram, to encourage largecorporations in Boston to becomefmancially committed and involvedwith improving the quality oflife intheir city. Corporate Buddies arepartnered with a Main Streetneighborhood organization andcommit $10,000 a year for a four-yearperiod towards that organization soperating expenses as well asproviding technical assistance andresources such as office equipment(1). During the programs firstfive years of existence from 1995-2000,356 businesses were created orexpanded, 2555 new jobs weredirectly created, 203 storefronts wererevitalized, and 349 businessesreceived technical or designassistance. The truly amazing partthough, is that the City only spent$7.5 Million of public money and anadditional $1.7 Million of privatelyraised money to make it happen (2). One of the most commonmyths about revitalization is thatincreased economic impact is directlyproportional to the amount spent inrevitalization projects. Yet as Boston,and the more than 1600 communitiesnationwide that have experiencedsuccessful commercial districtrevitalization have demonstrated, it isthe opposite case that is true. Boston Main Streets (Courtesy of Boston North End)
    • Housing & Like all good investment HomeCenter, a one-stop organization ftmd, revolving funds must have for homeowners and home buyersRevitalization strategic investment criteria used offering courses and information on when evaluating potential projects. financing and how to purchase aMarket Rate Housing Many revolving funds invest only in home in a Boston neighborhood. the rehabilitation of existing Market rate housing buildings. Further. they usually limit development, whether for Similar to successful the geographic area they will invest rehabilitation or new construction,commercial revitalization, for a in at one time to one particular needs to be based in local marketmarket-rate housing plan to be neighborhood of a city to help researc~ and cities must learn tosuccessful, cities must learn to avoid establish a critical mass of resist the temptation to directlythe tendency to directly subsidize investment. and increase the subsidize housing developers.developers and instead work on desirability of investment there for Instead, financing should be limitedfmding new ways to stimulate the other private investors. Further. they to gap fmancing after all otherlocal market In many cases, limit their investment to a certain potential funding sources have beenadditional incentives have been percentage of total funding sources exhausted, and even then, the cityneeded either to attract interest in to maintain a minority stake in the should be a very small stakeholder ininvesting in the city or in making project. any given project. If local publicprojects financially feasible. In such Investment decisions are funds are going to be allocated tocases~ cities have successfully made by a committee of usually 6~10 housing developers, the mostassisted by providing gap financing. people including neighborhood successful method has been toGap ftnancing is a fmancing of last residents, and local professionals channel the money through a fundresort though, and developers must with expertise in real estate, that combines funding from otherprovide proof that they have architecture, law, and banking/ privately raised sources. Allocationsexhausted additional fundraising fmance. The organization employees of funding should be made on theefforts through lending institutions, one executive director, and basis of a set of strategic criteriaequity investors, federal grant and depending on the size of the fund, a which seek to raise the attractivenessloan sources and tax credits. small staff. Cities as diverse as of an area of a city to private Perhaps the most successful Providence, Pittsburgh and investors to such a level that ftntherand widely used method for Charleston have successfully used public investment will no longer beproviding gap fmancing is the revolving funds as a part of a needed.revolving fund. A revolving fund is a comprehensive strategic plan tofund nonnally held by a non-profit successfully revitalize entirecorporation that may combine several neighborhoods.revenue sources including privately Numerous other successfulraised funds, corporate gifts, and city programs have been established toappropriations. The fund may be help current homeowners improveused as equity or as low cost debt for their property and new homeownersa project that othetwise would be to fmd a suitable home within thefmancially infeasible. Some city and fmance it. The City ofrevolving funds also purchase Boston Homeworks Program, forexisting buildings, contract out the example, offers low cost loans andrehabilitation~ and then sell the grants up to one third of the total costbuilding to a private owner. In all for homeowners to make exteriorinstances, the proftt earned from the improvements to their home andinvestment is revolved back into the property that will have a positivefund and is reinvested into other visible impact on the neighborhood.projects. The City also operates Boston
    • Affordable Housing, housing stock into below-market rate rehabilitation becomes a more viableGentrification & housing provides a substantial means for affordable housing.Displacement challenge to developers. Even with In the mean time, several gap fmancing sources and other solutions have been developed at the Affordable housing is a federal subsidies such as the Low local level to successfullycritical part of any citys revitalization Income Housing Tax Credit, many incorporate affordable housing intoplan. In the past, affordable housing other factors can outweigh the rapidly appreciating neighborhoods.has been ignored during revitalization rehabilitation of existing buildings for In many places, the need forplanning and was left to be the large scale new construction. The subsidized affordable housing is aproblem of the federal government overall cost of construction of units result of zoning restrictions thatand local slumlords outside the is often greater in rehabilitation prohibit market-driven affordableboundary of interest. What often projects than in new construction living arrangements (1 0). Under theresulted was cities with areas of high where the construction can be asslUllption that permittingconcentrations of poverty, standardized. Developers that seek affordable living arrangementsinterspersed with highly gentrified rehabilitation projects for affordable decreases neighboring propertyareas. housing also report difficulty values, many cities have outlawed To avoid future blight and obtaining the Historic Tax Credit such affordable arrangements asdisinvestment in neighborhoods and because of the failure of their project boarding houses, single roomfuture flight from areas being targeted to meet the "economic substance" occupancies, subdividing single clause for the credit in the IRS code family homes into apartments andfor revitalization, low income housing (13). other owner-occupied rentalneeds to be acconnted for from the Further, affordable housing arrangements like basement andbeginning stages of the revitalizationprocess. There are two general rules projects that involve rehabilitating garage apartments. However, suchfor making affordable housing a existing structures are more difficult arrangements, in addition tosuccessful part of the citys to attain critical economics of scale. decreasing the need for housing Rehab projects are usually much subsidies, provide numerous otherrevitalization process. First, it must smaller in scale, are less predictable, benefits including decreasing thebe deconcentrated, and dispersed have more stakeholders, and require concentration of low-incomeamong middle and upper income more administration and property housing, allowing people of limitedmarket rate housing. Second, it needs management, all of which adds to the means to live in clean, safeto be similar in appearance to nearbymiddle income housing to decrease costs of the developer (13). A recent neighborhoods as well as providing study published jointly by the income to homeowners whothe stigmatism and resultingdisinvestment that is created from National Trust for Historic otherwise may not be able to afford Preservation and the U.S. the mortgage payments on theirlow income housing (6). Department of Housing and Urban horne. Affordable housing is also an Development titled Barriers to the Successful city or housingimportant tool for helping current Rehabilitation of Affordable authority projects have used a similarresidents prevent nnwanted Housing discusses these challenges strategy of reducing thedisplacement in neighborhoods in further detail and proposes concentration of affordable housingprone to gentrification and massive changes in policy at the federal level units. Stanley Lowe, Director of therent escalations. When properly to encourage the rehabilitation of nationally respected Pittsburghstructured, affordable housing affordable housing and reduce Housing Authority described the keyoptions can also be used to help unwanted displacement during the to successful affordable housing aspeople of modest means become neighborhood revitalization process. being individual choice. The poorhomeowners and build wealth. Several key changes will be have the option in living in Developing affordable necessary in federal housing policy practically any neighborhood ofhousing in blighted neighborhoods and in the tax code before Pittsburgh that they like. However,has proven problematic in manyplaces though. Converting existing the number of units in any given area
    • is determined by the housing an inspiration to other civic authority (14). Pittsburghs leaders across the country, Housing Authority also and its revitalization models seeks opportunities to create developed in the 1950s value in neighborhoods became the basis for many throughout the city by more recent plans redeveloping "white Charleston had its share elephants" into affordable of problems though. The housing units. (7) city, like so many others, has Revolving funds have suffered from generations of also proven to be useful racism and austere social tools in providing affordable class segregation. During the housing in middle income 1950s revitalization, the neighborhoods. By citys poor, large]y black leveraging funds from population, was uprooted from their private fundraising and city homes in what would become multi- appropriations, as well as negotiating million dollar town homes and moved with banks, and attracting some into housing projects on the outskirts volunteer labor, non-profits have of the historic districts and into other played a powerful role in significantly highly distressed once middle class reducing the purchase price of historic neighborhoods . What rehabilitated structures and reducing resulted was a city ofvery highly unwanted displacements in rapidly priced homes next to disinvested gentrifying neighborhoods (See Case poor communities, and almost no Study: Balancing Revitalization with middle class housing. Community Gentrification and Displacement). leaders wanted to fmd a way to Above all else, for affordable provide opportunities for middle housing to be successful it must be income residents to live inincluded it in the early planning Charleston, while at the same timestages. If affordable housing is not improving the condition for the citysaddressed as a priority from the current lower income residents. beginning, after the local housing The result was a new usemarket begins to take off, it can become considerably more of an old project caned The challenging to make such projects Neighborhood Impact Initiative.feasible. A local non-profit organization, Historic Charleston Fotmdatio~Case Study: Balancing had a then twenty-year-oldRevitalization revolving fimd for the purchasing While the rest of America was of distressed buildings. They used This case study describes how busy razing their neighborhoods inrevolving funds can be used to the ftmd to acquire a building, Urban Renewal projects during theencourage private reinvestment in 1950s, Charleston was fighting to contract out the rehabilitation,low disinvested neighborhoods, and would then sell the building in save theirs. What resulted in thewhile preventing displacement andhelping low-income residents decades that followed was one of the the ever~appreciatingCharleston most desirable ten blocks of real housing market and reinvest thebecome homeowners and build estate in America. Charleston becamewealth. profit back into their fund. (26)
    • HCF saw a unique opportunity to Citizen Participation are located and also where theuse their fi.md for another pur- biggest problem areas are. How to engage citizens in the During the exercise, thepose-to stabilize low-income plarming decision-making process session leader noticed that onecommunities, prevent unwanted and to what extent to include their abandoned building kept gettingdisplacements, and help people input is an issue of much debate. For marked bad credit. He asked theof modest income become the purpose of implementing a participants why they had marked successful revitalization plan in a that particular building a bad credit,homeowners and build wealth. disinvested neighborhood, having and they explained how that wasThe foundation moved into a citizen support for the project is where one group of drug dealersmoderately abandoned, highly absolutely essential. Yet often times, would often hang out. Havingdistressed low-income cormnu- finding a consensus among citizens learned this information, they werenity and began acquiring build- about their neighborhoods priorities then able to contact the police and and long term goals can prove quite have the problem eliminated.ings. To prevent displacement, trying. There is usually no one whothey placed a stipulation that the Such was the case for one knows a neighborhood better thanperson who would buy the Pittsburgh community development the people who live there and 011building from the foundation corporation, who when trying to property there. While the averagewould have to be a current conduct sessions on creating goals citizen may not be overly concerned for improving their neighborhood, with city-wide issues and long termresident of the neighborhood. To discovered that most people only plarming decisions, one would behe] p reduce the purchase price of wanted to complain about very hard pressed to fmd a group ofthe buildings, the foundation did localized issues pertaining to their residents who doesnt have aprivate fimdraising, partnered own property what was immediately complaint list a mile long for theirwith local banks, worked with a surrmmding it (14). own immediate area of interest. An Rather than let such localized effective session with neighborhoodlocal building crafts school for the concerns and personal issues hamper residents can teach plannerscarpentry and required their their efforts, the group was able to important information about thebuyers to invest "sweat equity" take that feedback and use it to solve social dynamics of the city that theby painting, and completing other some of the citys most serious best of research efforts cannot.work on the building. problems. Citizens participating in By engaging people where the sessions were given a map of the their interests already are, and asking The foundations presence in city and were asked to produce a them to provide feedback and takethe neighborhood was the critical credit report. The participants were action on issues that are alreadymass needed to attract other given two markers of a different important to them, people can feelinvestors to develop other buildings color. In one color the participants personally invested in andinto market rate middle income were asked to color in areas they subsequently supportive of thehousing. Further, the city got believed to be good credits for the revitalization efforts.involved to help with general city. In the other color, they wereaesthetic improvements of the asked to fill in areas they believed toneighborhood. By reducing urban be bad credits for the city.decay, and improving the Credits can be interpreted in aopportunities for residents of modest variety of ways, for example wheremeans, Charleston has made what you feel safe walking by yourself.was already a great place to live even Common patterns among thebetter. participants can reveal where the citys greatest assets and sources of personal ownership and investment
    • The Pitfalls of Revitalization Revitalization is by its very The strategic plan for created as it relates to the citysnature a comprehensive process. It is revitalization is comparable to a current needs. Other perfonnancealso a complex process, with factors business plan for a private measures commonly used byimpacting its success or failure organization. It lays out who the successful revitalization planscoming from many organizations as partners are in the revitalization include the amount of privatewell as by constantly changing social process, and what each partner has investment leveraged, the number ofand economic conditions. In addition committed to do. It describes what new business (small or family-owned)to the aspects just discussed of city the funding sources are for the created or that received teclmicalgovernment management, public efforts and in what manner they are assistance, the number of storefrontspolicy, commercial districts, market to be spent. Most importantly, it lays revitalized, increase in buildingrate and affordable housing and out the strategy for the revitalization. occupancy rates, and increase incitizen involvement, many other It details local market trends and the property values.factors must come together in a specific opportunities the While high quality of life istimely and cohesive manner revitalization efforts will target. It the end goal, cost analysis plays anincluding education, transportation, provides a timetable for how the important role in making decisionsand public safety before a efforts will be strategically that are realistic and fmanciallydisinvested city can be transformed implemented. Efforts or other feasible. Every program has a priceinto a place that is attractive to spending should not be diverted from and those creating the strategic planresidents and private investment. the strategic plan. If circwnstances should consider their options to see if Because revitalization is a have changed, then the plan itself the same goals can be met by a lesscomplex process, sometimes what needs to be revised and new efforts costly method.may seem to be relatively minor should be incorporated into the longissues can easily bring down years of term perspective with an explanationefforts. Leaders who have of why this is now the more desirable Pitfall: Non-profits who do notsuccessfully led revitalization efforts route. follow through with projects afterin communities across the country The goal of the revitalization receiving city financial assistancehave described several common process, ultimately, should be to Remedy: Require matching privatepitfalls that can bring do11 or improve quality of life. Because high funds far city appropriations to non-significantly delay the revitalization quality of life means something profits and make the processprocess, and the remedies that can be different to different people, having a competitiveused to avoid these pitfalls. city that has an overall high quality of life means there must be a Cities that have hadPitfall: Unfocused revitalization diversity of options available (3). persistent problems with their non-efforts Housing options and shopping profits not following through withRemedy: Strategic plans with cost- options must be able to serve a projects in an effective or timelyanalysis diversity of income levels and tastes. manner need to find ways to make Further, the city must be their appropriations process more The easiest trap leaders fall accommodating to car owners and competitive and results-oriented.into when making decisions about non-car owners alike. Require organizations to raiserevitalization projects is to lose focus This need for diversity must matching funds from businesses andin their efforts and believe that also be incorporated into the private donors to receivebecause they are spending large performance measures for the efforts. appropriations. The organizationsamounts of money in the name of For example, a revitalization will be forced to demonstraterevitalization that they are somehow program should not measure its desirable results to attract privateimproving the livability of the city. success merely on the number of charitable donations from a pool ofThe remedy for such a tendency is to new jobs or the number of new many other environmental and socialhave all their efforts grounded in a housing units created, but also on organizations. (For example, themutually agreed upon strategic plan. the diversity of jobs and housing Boston Main Streets Program, which
    • requires their non-profits to raise certain zoning regulations make good government Public leaders mustmatching funds before getting their business models impossible or know what their city governmentsoperating funds money from the impractical rehabilitation codes drive core competencies are, and knowCity.) Another effective method for costs up too high. when the most efficient or effectivedealing with appropriations is to Citiesthathavelong way to deal with an issue would bechannel it through an intermediary histories of unfocused revitalization to delegate it to another partner inlike a revolving fund. The revolving efforts may also encounter the revitalization process. Most cityfund, which may be open to for- skepticism by investors to the citys governments will find that their coreprofit and not-for-profit interest in them. They may believe competencies lie in the areas oforganizations alike should have clear (and with good reason) that the citys providing certain public services (24).project selection criteria. The intentions are not real, and that the They may fmd that while they areProvidence Revolving Fund, for city may change political hands or quite good at providing water serviceexample, has applicants compete on reprioritize their projects next year and maintaining city parks, that theirthe basis of how their specific project and abandon their needs. Building staff and their organizational culturewill become a catalyst for further the trust of investors is critical before is ill-equipped to run a successfulinvestment in the city. Such criteria any real change can start to happen. real estate investment ftmd. In theseforces developers to become more If past city policy has been a cause of situations, leaders must have thecreative in their methods and focus investment baniers then plans to savvy to recognize that this taskon overall neighborhood quality to correct such activities must be made would be best handled elsewhere,obtain government money for their clear in the strategic plan_ and delegate it to be theprojects_ Make investors a central responsibility of another part of city policy_ Form a mayor organization_Pitfall: Hesitant investors advisory panel where investors needsRemedy: Consistent show ofinterest are directly considered in all relevant Pitfall: Long delays in the planningin their needs and actions that assist policy decisions. Most importantly, processthem the city must regain its credibility Remedy: Only invite people capable with the private sector_ If a few well of making the decision to the table Often times when large known, successful developers can beconcentrations of buildings remain convinced to get on board, other The revitalization plarmingvacant or in a persistent state of developers as well as individuals will process requires partnering withdisrepair, it is because there are have their confidence levels raised in multiple government offices as welleconomic or legal barriers present the potential for success of the as with mnnerous non-profitEngage current property owners in project and will be more willing to agencies and developers. Thethe neighborhood as well as other get involved. planning process can easily get tieddevelopers who have considered up for extended periods of timeinvestment there and gather an Pitfall: Inertia in City Hall while one partner is trying to get aunderstanding of their reasons for Remedy: Outsource certain activities decision approved through the manynot investing or not making layers of bureaucracy in hisimprovements to their property_ If it It must first be noted that organization_ Therefore, it is criticalis more profitable for current owners activities related to the planning and that the people who sit at theto leave their property in its current implementation of revitalization planning table are in a position ofstate or if potential investors efforts have been successfully led by power to make the decisions for theirdetermined they could not make a non-profit groups and other organization that need to be madesufficient return on property there, arrangements outside of the city (14}then try to understand why that is the government directly. Even when thecase, and develop specific remedies most motivated and capable leadersto tip the scale in the other direction are in office though, inertia can stillfor them. For example, perhaps be enconntered within the city
    • Pitfall: Conjlict3 qf interest among are being tested by cities and manyrevitalization partners more exist that are well establishedRemedy: Lookfor a win-win and proven models for revitalization.situation The challenge to explain these revitalization methods~which are Whenever dealing with often highly case specific, in generalpeople from multiple organizations economic terms that can be appliedwith different interests and limited to cities everywhere remains anresources, conflicts are inevitable. At important challenge to leaders in thetimes. the partners may fmd revitalization and communitythemselves in situations where there planning fields. The persistentseems to be no solution. One creativity of the many citizens andtechnique for resolving such organizations that considersituations is to first describe a themselves stakeholders in thesituation that is win-win for alL Once quality of the urban environment,the group is able to articulate what combined with a renewed love forthis Win-win situation looks like, city living offers much promises tothen go back and fmd ways to utilize American cities in the twenty ftrstyour resources or leverage new century.resources in such a manner thateveryone ends up better off (14).Concluding Remarks Revitalization is inherently acomplex process that requirescooperation across multipleorganizations. No single model orsingle formula can be guaranteed towork for every city. However,having a fum understanding of thebasic social and economic forcesalready at work in the city and beingable to effectively identity currentbaniers of investment and potentialsfor new opportunities and addressthem in a timely and constructivemanner can help leaders makedecisions that will lead towardsreinvestment in their city. Many models, as well aslegaJ and financial tools have beendeveloped by cities across thecountry to effectively addressneighborhood and downtowndisinvestment issues. Beyond thosejust discussed, several other methods
    • Bibliography1. "Boston Main Streets: Revitalizing Bostons Neighborhood Business Districts," City of Boston Website, http:// www.cityotboston.gov/mainstreets/, January 25. 2002.2. "Celebrating Five Years of Collaboration and Partnership Boston Main Streets 2000: Building Vibrant Neighborhoods by Creating Healthy Commercial Districts," report, City ofBoston, 2000.3. Cianci, Vincent, "Providence: A Renaissance and Review," speech, The National Trust for Historic Preservation National Conference, Providence, Rhode Island, October 16, 2001.4. City of Cincinnati. Capital Improvements Plan(s): 1960-2000.5. "City of Portland Service Efforts and Accomplishments: 2000-200 I." report, City of Portland City Auditors Office, 2001.6. Duany, Andres, Elizabeth Plater-Zyberk, and JeffS peck, Suburban Nation: The Rise of Sprawl and the Decline of the American Dream, (New York: North Point Press), 2000.7. "Housing Selection Guide," publication, Housing Authority City of Pittsburgh, 2001.8. Kotkin, Joel, The New Geography: How the Digital Revolution is Reshaping the American Landscape, (New York: Random House), 2000.9. Kunstler,JarnesH., The Geography ofNowhere: The Rise and Decline of AmericasMan-Made Landscape, (New York: Simon & Schuster), 1993.10. Kunstler, James H. Home from Nowhere: Remaking our Everyday World for the 21st Century, (New York: Simon & Schuster), 1996.II. Lang, Robert E., James W. Hughes, and Karen A Danielsen, "Targeting the Suburban Urbanites: Marketing Central City Housing," Housing Policy Debate, Vol. 8, Issue 2, 1997.12. «Leading the Way: A Report on BostonsHousing Strategy FY 2001-2003," report, City ofBoston, 2000.13. Listoken, Barbara and David Listoken. «Barriers to the Rehabilitation of Affordable Housing, Volume IT: Case Studies," report, U.S Department ofHousing and Urban Development Office ofPublic Policy Research, 2000.14. Lowe, Stanley, "Empowering and Challenging Non-Profit Leaders," speech, The National Trust for Historic Preservation National Conference, Providence, Rhode Island, October 16, 2001.15. Manley, Robert E. "Some Proposals to energize our Community,"Manley, Burke & Lipton LPA, 2001.16. "Mayors Priorities," City of Boston Website, http://www.cityotboston.gov/priorities/default.asp, January 25,2002.17. Mrozowsk:i, Jermifer. "Heimlich wary of giving Saks $6.6 Million: Dovmton development focus all mong," Cincinnati Enquirer, June 18, 2001.18. Noll, Roger G. and Andrew Zimbalist, ed. "Sports, Jobs, and Taxes: The Economic Impact of Sports Teams and Stadiums," report, The Brookings Institution, 1997.19. OMara, Martha, «Strategy Location and the Changing Corporation: HowlnformationAgeOrganizations Make Site Selection Decisions," report, Real Estate Research Institute, 1997.20. Peale, Cliff. New Lazarus on Square Opens," Cincinnati Enquirer, November 5, 1997.21. "Providence Neighborhood Profiles: Downtown," The Providence Plan, http://www.provplan.org/nprof/ dom1town.html, Novem her 21, 2001.22 "Property Information," The Hamilton CoW1ty Auditors Website, VWw.hamiltoncountyauditor.org, January 20, 2002.23. Stem, Sol. "No to Sports Stadium Madness," City Journal, Vol. 8 No.4, 1998.24. «The Entrepreneurial City: A How-To Handbook for Urban Innovators," report, The Manhattan Institute Center for Civic Innovation, 1999.25. United States Census Bureau. Cincinnati, Ohio Population & Housing Indices, (1960 - 2000).26. Weyeneth, Robert R., Historic Preservation for a Living City: Historic Charleston Foundation 194 7-1 997, (Columbia, SC: University of South Carolina Press), 2000.Special Thanks to Robert E. Manley; Manley, Burke & Lipton LPA; and our many supportersthrough this initial endeavor.