Brad Segal & Rena Leddy, Progressive Urban Management Associates Kraig Kojian, Downtown Long Beach...

Brad Segal & Rena Leddy, Progressive Urban Management AssociatesKraig Kojian, Downtown Long Beach Associates

California Downtown Association Annual Conference 2012

Beyond Redevelopment: New Tools & Toolboxes for California Downtowns

http://www.ecoronado.com/photo/downtown-coronado-island-3/next?context=popular

Trends Benefitting Downtowns…Updated Global Trend Analysis…

Trends Benefitting Downtowns…Updated Global Trend Analysis…

New Tools & Toolboxes for California Downtowns

Global Trends Conclusions

Overall, trends favorable for vibrant downtowns? America growing, younger &

older, more diverse Increasingly connected &

competitive world Resource-intensive lifestyles increasingly expensive and not sustainable Innovation and investment will be city-driven

Global Trends Conclusions

Overall, trends favorable for vibrant downtowns? America growing, younger &

older, more diverse Increasingly connected &

competitive world Resource-intensive lifestyles increasingly expensive and not sustainable Innovation and investment will be city-driven


Downtown Development Framework

Organizing for Each Phase of a District’s Growth Cycle…


Organizing for Each Phase of a District’s Growth Cycle…


District Lifecycle General Conditions

Stagnant Challenged, with high vacancies, underutilized properties, uninviting public realm and poor regional image

Growing Up and coming, with a sprinkling of new businesses, pioneering new investments and an image of a district in transition

Mature Established, with a strong mix of retail, restaurants and jobs, inviting public realm and strong regional image




Stagnant Districts

Private Sector Champions?

Several local leaders motivated to change the district, but high levels of apathy and cynicism among stakeholders

Program Priorities

• Attract new investment & stabilize the environment• Create confidence among local stakeholders• Combat regional stigma

Organizational Options

• Appointed commission• Community development corporation• Local TIF through ordinance• Main Street™ program

Tools & Resources

• Tax increment financing• Local government support, both money and services• Charitable grants• Earned income from development

Community Development Corporation (CDC)

Non-profit community organization with public/private orientation…

Oriented to advance real estate and business development

Provides planning and project development services

Facilitator and problem solver for otherwise challenging projects

Funding Source: Contributions, grants, fees and earned income

Community Development Corporation (CDC)

Non-profit community organization with public/private orientation…

Oriented to advance real estate and business development

Provides planning and project development services

Facilitator and problem solver for otherwise challenging projects

Funding Source: Contributions, grants, fees and earned income


Successful Strategies: CDCs

Cincinnati Center City Development Corp 501(c)3 CDC formed in 2003 Manages equity funds capitalized by corporations New Market Tax Credit manager $200M in total investment Focus on downtown & two adjacent neighborhoods


Cincinnati Center City Development Corp 501(c)3 CDC formed in 2003 Manages equity funds capitalized by corporations New Market Tax Credit manager $200M in total investment Focus on downtown & two adjacent neighborhoods



Denver Civic Ventures► 501(c)3 CDC formed in 1982► Has evolved over time to address variety of civic needs 1986, 2007 Downtown Plans 1980s Multi-bank loan program 1990s Housing development 1990s Project development 2000s Planning 2011 Public Market?


Denver Civic Ventures► 501(c)3 CDC formed in 1982► Has evolved over time to address variety of civic needs 1986, 2007 Downtown Plans 1980s Multi-bank loan program 1990s Housing development 1990s Project development 2000s Planning 2011 Public Market?


Finance Tool: Community Capital

Mobilizing Local Capital & Resources…

Variety of ownership models – community-owned corporations, cooperatives, investment fund

Local incentive for small business development, marketing Provide both equity and debt

Funding Sources: Individuals, banks, institutions, foundations

Finance Tool: Community Capital

Mobilizing Local Capital & Resources…

Variety of ownership models – community-owned corporations, cooperatives, investment fund

Local incentive for small business development, marketing Provide both equity and debt

Funding Sources: Individuals, banks, institutions, foundations


Successful Strategies: Community Capital

The Mercantile, Powell WY► Community-owned, for-profit store► $500 shares sold to 800 residents► Retains spending and local jobs► Help revitalize downtown► Customer service & special orders


The Mercantile, Powell WY► Community-owned, for-profit store► $500 shares sold to 800 residents► Retains spending and local jobs► Help revitalize downtown► Customer service & special orders



New Haven Grocery Co-op Community owned business; developer sponsored 1200+ members in first year Highest first year of sales of any food

Co-op in the US ($10m) First urban grocery store financed with a

USDA loan guaranty Largest private sector job creation in New Haven in 2011 Catalyst for economic development, expansion of existing business and leasing

vacant storefronts


New Haven Grocery Co-op Community owned business; developer sponsored 1200+ members in first year Highest first year of sales of any food

Co-op in the US ($10m) First urban grocery store financed with a

USDA loan guaranty Largest private sector job creation in New Haven in 2011 Catalyst for economic development, expansion of existing business and leasing

vacant storefronts





Growing Districts


Core group of vested property and business owners, with energy from new entrepreneurs. Motivated to explore public/private approaches to improve the district.

Program Priorities

• Attract new businesses & market the area to consumers• Beautify and improve the public realm• Provide meaningful participation for new owners and businesses• Convey a new emerging image


• Membership organization• Business improvement district• Downtown development authority• Foundation or 501(c)3 subsidiary

Tools & Resources

All of the preceding plus:• Property or business assessments• Revenue generating promotions and special events• Membership dues

Business Improvement Districts (PBIDs/BIDs)

Quasi-public special district governed by ratepayers…

Provides funds to manage, market and maintain the downtown environment -- “CAM” fee for downtown

Self-governed, self-imposed, accountable Need:

1) private sector champions;

2) supportive local government;

3) staff and financial resources;

4) tradition of public/private partnership


Quasi-public special district governed by ratepayers…

Provides funds to manage, market and maintain the downtown environment -- “CAM” fee for downtown

Self-governed, self-imposed, accountable Need:

1) private sector champions;

2) supportive local government;

3) staff and financial resources;

4) tradition of public/private partnershipNew Tools & Toolboxes for California Downtowns


Key messages during the Great Recession…

Ability to stabilize & manage the environment Now is the time to strengthen competitive advantages Unified downtown will make us more influential Ability to leverage resources, challenge and lead Accountability Something we can control in an uncertain and changing economy


Key messages during the Great Recession…

Ability to stabilize & manage the environment Now is the time to strengthen competitive advantages Unified downtown will make us more influential Ability to leverage resources, challenge and lead Accountability Something we can control in an uncertain and changing economy


Successful Strategies: PBIDs/BIDs

Bayside District - Santa Monica, CA 3rd Street Promenade, successful downtown New PBID raises $3.5 million Services include clean, safe

and marketing Created following strategic

planning process that clarified public/private roles, overcame lingering lack of trust


Bayside District - Santa Monica, CA 3rd Street Promenade, successful downtown New PBID raises $3.5 million Services include clean, safe

and marketing Created following strategic

planning process that clarified public/private roles, overcame lingering lack of trust



Figueroa Corridor – Los Angeles• Formed in 1998 by private and non-profit property owners such as

USC, Exposition Park, Orthopedic Hospital • Created because of perceived heavy crime and businesses and

institutions were experiencing significant declines in business and considering leaving the corridor.

• Non-profit and public sector pay almost half of the assessments• Clean, Safe and Marketing, annual budget is $1,085,000• More than $1.5 billion of investment poured into the district since


Figueroa Corridor – Los Angeles• Formed in 1998 by private and non-profit property owners such as

USC, Exposition Park, Orthopedic Hospital • Created because of perceived heavy crime and businesses and

institutions were experiencing significant declines in business and considering leaving the corridor.

• Non-profit and public sector pay almost half of the assessments• Clean, Safe and Marketing, annual budget is $1,085,000• More than $1.5 billion of investment poured into the district since


Downtown Development Authorities

Can often combine advantages of TIF & PBIDs/BIDs…

Colorado and Michigan models are instructive for California Most allow TIF and an assessment TIF often limited to local sales and property tax, negotiated agreements

with other taxing jurisdictions Generally must implement a downtown development plan, one per

community Does not have power of eminent domain

Downtown Development Authorities

Can often combine advantages of TIF & PBIDs/BIDs…

Colorado and Michigan models are instructive for California Most allow TIF and an assessment TIF often limited to local sales and property tax, negotiated agreements

with other taxing jurisdictions Generally must implement a downtown development plan, one per

community Does not have power of eminent domain





Mature Districts


Experienced core group of vested property and business owners with a history of being organized and participating in public/private partnerships.

Program Priorities

• Retain & grow businesses• Market the area to consumers• Keep organization fresh to keep stakeholders engaged• Strengthen a positive image


• Entrepreneurial holding company• Parking districts• Events production company• Transportation management organization

Tools & Resources

All of the preceding plus:• Parking revenue• Local improvement bonds• Merchandising the district

Successful Strategies: Bonding

Cherry Creek North BID, Denver 16-block retail and restaurant district, 320 independent businesses Generates approximately $3 million in annual revenue Passed $18.5 million bond issue to streetscape entire district BID issued bonds in 2009

Successful Strategies: Bonding

Cherry Creek North BID, Denver 16-block retail and restaurant district, 320 independent businesses Generates approximately $3 million in annual revenue Passed $18.5 million bond issue to streetscape entire district BID issued bonds in 2009


Successful Strategies: Parking Districts

Downtown Tempe Community, Inc. – Tempe, AZ Management, marketing of all public, some private parking in downtown

Tempe (8 lots/garages in total) Contract with the City – 6% of parking revenues, management fee All parking managed by DTC

part of “Park-It Program” including First Hour Free, validation program

Successful Strategies: Parking Districts

Downtown Tempe Community, Inc. – Tempe, AZ Management, marketing of all public, some private parking in downtown

Tempe (8 lots/garages in total) Contract with the City – 6% of parking revenues, management fee All parking managed by DTC

part of “Park-It Program” including First Hour Free, validation program


Holding Company StructuresHolding Company Structures


Brad Segal & Rena Leddy, Progressive Urban Management AssociatesKraig Kojian, Downtown Long Beach Associates

California Downtown Association Annual Conference 2012

Beyond Redevelopment: New Tools & Toolboxes for California Downtowns

http://www.ecoronado.com/photo/downtown-coronado-island-3/next?context=popular

Brad Segal & Rena Leddy, Progressive Urban Management Associates Kraig Kojian, Downtown Long Beach...

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