Strategic Neighborhood Redevelopment: Part 2 – Waking up the Marketplace – A Macro Approach

By Ian Colgan | Redevelopment & Revitalization | Jul 12th

Successful neighborhood redevelopment requires a broad macro approach.

This article is Part 2 of a four part series titled “Strategic Neighborhood Redevelopment.” This series provides the considerations involved in formulating a meaningful neighborhood redevelopment strategy. From Development Concepts Inc.’s 19 years of redevelopment experience, we’ll explain what is involved in establishing redevelopment strategies that produce sustainable private investment.

You can find Part 1 here.

Micro vs. Macro Responses

Given the impediments described in Part 1 of this series, it is surprising that there have been few comprehensive attempts to organize dysfunctional neighborhoods to better respond to the marketplace. One likely reason is the lack of an agreed-upon, systematic, “macro” approach to address the impediments and prepare distressed areas for market investment.

In many cities, the approach for neighborhood redevelopment has been predominately on a parcel-by-parcel basis.  Public sector and not-for-profits are the primary catalysts for change. Their mission, due to limited resources, has been to incrementally reinforce selected parcels of real estate. It is clear the pervasive impact of the impediments described in this section make a “micro” approach ineffective in creating a substantive impact able to capture the attention of the marketplace. While some good comes from a targeted reinforcement approach, it does not reset the real estate context in a manner that responds to today’s market requirements.It is clear a “macro” approach is necessary to engage America’s more distressed urban real estate. The marketplace and private investment must see opportunity in order to recapture its attention. Several small parcels or a few acres in the midst of disinvested property will not be an attractive investment opportunity for those private sector parties with the resources to make a difference. Nor will it be much of a catalyst for economic change given wide-spread disinvestment in the neighborhood.  Much like a surgeon removing disease from the body, a successful recovery depends on removing all, not just a significant portion of decay.

The marketplace and private investment must see opportunity in order to recapture its attention.

Waking up the Marketplace

As a redevelopment strategy is assembled, it is important to understand the importance of “reclaiming” the attention of the marketplace, as the market (in terms of private sector investment) generally prefers the path of least resistance. With this in mind, there are critical components of the redevelopment strategy that lead to successful implementation and outcomes.

The first part in the Planning stage is to develop a series of engaging, focused, and well researched goals for a community applicable at a local level. Such a set of goals, and the strategies which are developed to implement them, require three primary components of understanding. First, regardless of the size of geography, the involvement of the public is paramount throughout a planning process. The public is not only essential in providing key local information, but engaged citizens and stakeholders can greatly assist in sheparding redevelopment priorities forward. Second, an understanding of physical conditions assesses the local landscape in terms of the existing context of infrastructure, road network, and buildings. It also allows an understanding of the physical impediments that may be driving away the market. Third, both the public and private sector must have a thorough understanding of what development, building, and services are possible in the context of what the local or regional marketplace can support. Redevelopment projects initiated without full knowledge of what is possible via the market can be as damaging as doing nothing. From this Strategic Plan, the redevelopment strategy moves into an Implementation Phase. The key to this phase is a public-private partnership allowing a project to be successful. The public sector’s responsibility includes use of its “toolbox” to assist or initiate redevelopment activity, while the private sector is responsible for development outcomes such as physical construction and tenants.

Tags: Macro Approach, Marketplace, Neighborhood Redevelopment, Neighborhoods, public-private partnership