Commercial Corridor Redevelopment Strategies
PAS Report 598
By Luis Nunez
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What do the commercial corridors in your community look like? Are they thriving or failing? Busy or abandoned? Do they have a diversity of land uses? Are they multimodal or car dominated?
Today’s economic, environmental, and sociodemographic changes are aligning to make the auto-oriented commercial strip a less viable development form. But the challenge of planning for the long-term health and sustainability of commercial corridors is daunting. What can planners do to change the trajectory of their communities’ corridors to ensure a more sustainable course?
This PAS Report offers a comprehensive catalog of strategies grounded in a market-based perspective to inform corridor redevelopment interventions. It presents an eight-step corridor redevelopment cycle to help planners evaluate corridors, collect data for analysis, engage stakeholders and partners, identify catalysts, update regulations, leverage public investment and other financial resources, evaluate outcomes, and plan for the long term. It will help planners rethink and improve the performance of corridors and corridor redevelopment practice.
The complexity of the world today is influenced by an increasing number of disruptive forces, which makes it all the more important for local governments to address the stability and resiliency of their commercial corridors. This report will help planners attract investments to commercial corridors and leverage public- and private-sector efforts to better achieve the environmental, social, and economic goals of their communities.
What do the commercial corridors in your community look like? Are they thriving or failing? Busy or abandoned? Do they have a diversity of land uses? Are they multimodal or dominated by cars?
Imagine a corridor with dedicated bike lanes, wide sidewalks, public gathering spaces, and narrow, tree-lined streets, filled with a variety of bustling businesses offering a range of goods, services, and entertainment to families, youth, and elders who live in the neighborhood and those who visit from elsewhere. Communities strive to achieve such vibrant, successful corridors.
The reality, however, is that many corridors do not meet this ideal. They are not multimodal, do not have sidewalks, and lack public gathering spaces. Their streetscape aesthetics do not support higher levels of pedestrian activity or reinforce neighborhood character, and they are littered with retail vacancies.
Changing demographics, shifting residential and retail market preferences, dated land-use strategies, technological disruptions, and ineffective policies and responses at different levels of government to address deteriorating conditions in communities can all be identified as reasons for commercial corridor decline. The challenge of planning for the long-term health and sustainability of commercial corridors is daunting. What can planners do to change the trajectory of their communities' corridors to ensure a more sustainable course? This PAS Report seeks to help planners tackle this challenge with a comprehensive catalog of strategies to inform corridor redevelopment interventions. Though a paradigm shift is already underway in the way we plan for and design new corridors, older, more established commercial corridors may need to overcome a number of the challenges mentioned above, and planners have an opportunity to play a vital role in helping define and shape these changes.
Today's economic, environmental, and sociodemographic changes are aligning to make the auto-oriented commercial strip a less viable development form. The aftermath of the Great Recession highlighted the surplus of retail development along corridors, and vacant, underutilized, and underdeveloped properties are still too common. The growing obsolescence of strip commercial corridors, together with the underlying and unchanged commercial zoning that enabled its oversupply, presents a growing market opportunity for planners to reposition corridors for new investment. As urban, suburban, and rural disinvestment takes an alarming toll on revenue streams that were once considered a given in many communities, local governments are now more directly involved in ensuring that development and redevelopment outcomes along old and new corridors consider the economic and fiscal impacts on neighborhoods, targeted areas, and the community at large.
This PAS Report offers a full range of strategies to help planners continue to rethink and improve the performance of corridors and corridor redevelopment practice overall. At stake is restoring what many Americans consider to be the economic lifeblood of their communities — the principal commercial corridor. The report is intended for anyone interested in creating more resilient places and communities, particularly municipal planners, municipal managers, community development specialists, economic developers, designers, and engineers.
Case studies througout this report highlight how certain communities are pursuing their own corridor redevelopment interventions. The intent of the case studies, strategies, and intervention process described within this report is not merely to show what strategies planners might be able to employ in their own communities, but to encourage a deeper discussion among planners and partners on ways to continue to refine and improve corridor redevelopment practice.
As planners and local governments seek redevelopment as a solution to declining commercial corridors, understanding the characteristics that contributed to their decline, as well as their present-day challenges, are fundamental to knowing how and when to intervene. Chapter 2 of the report provides historical background and context for planners to understand how commercial corridor character has changed over time, and it identifies and examines factors that have contributed to the decline of strip commercial corridors.
THE IMPORTANCE OF A MARKET-BASED APPROACH
Commercial corridors are a critical component of property and sales tax revenue generation for local jurisdictions. Their success has a direct correlation to the success of municipalities in trying to enhance their economic positions and profiles, which is why this report underscores a market-based approach as essential to the corridor redevelopment process. A market-based approach is one that considers market demand and supply conditions to home in on realistic development opportunities. In the context of corridors with an oversupply of retail uses, a market-based approach quantifies retail market demand and supply conditions, allowing for greater accuracy in projecting future land uses and aligning those uses with zoning practice.
Planners who can capitalize on market opportunities, including emerging market trends, will have more successful interventions. To equip planners with a better understanding of market-based approaches, Chapter 3 identifies and explains four key market elements that a planner must understand to prepare for a corridor redevelopment intervention: the real estate cycle, capitalization rates, development pro formas, and commercial property type outlooks. It provides planners with knowledge on how to go about gaining a better market understanding at a more localized scale.
A COMPREHENSIVE SUITE OF STRATEGIES
It is important to think of corridor redevelopment as a continuous process. Economic and societal factors at the local and global levels are constantly changing, and a corridor that is successful today may not be 20 years from now. Planners should be proactive in monitoring the health of their communities' corridors.
Declining commercial corridors need interventions, but where to start, how to intervene, and what process to follow is not always clear. Corridor interventions require shortterm momentum and long-term patience. This PAS Report defines a "corridor redevelopment intervention cycle" to lay the framework for this process. It can help planners identify where to start with greater efficiency and how to achieve more actionable results along the way. The corridor redevelopment intervention process can be envisioned as a circular cycle representing a comprehensive suite of actions and strategies. Each is an important component of a holistic approach to corridor redevelopment. Every community will be in need of different approaches at different times based on its particular circumstances, and planners can use this framework to help identify which components of the cycle will be needed to guide redevelopment in their communities' commercial corridors.
Corridors are complex; knowing where to start is pivotal to good outcomes. Chapter 4 offers guidance to help planners working in communities of all sizes decide whether a corridor redevelopment intervention is necessary and what form it should take. A good first step is to determine the economic health of a corridor. This chapter identifies metrics, land uses, and other characteristics that indicate corridor decline. It also offers guidance in establishing defensible objectives for a potential corridor intervention, another early task in the process, and helps planners assess whether a consultant team may need to be brought on board to assist with the intervention.
The foundation of a corridor redevelopment intervention is data collection and background analysis. Gathering the relevant data and performing the right analyses are fundamental to understanding the factors at play in a corridor's performance and helping determine what strategies might be most effective in a particular context. Planners must be prepared to provide data-based analysis and insight to drive decision making around redevelopment interventions. Conducting thorough existing conditions and market analyses will steer planning efforts in the direction of correctly diagnosing problems, choosing the right paths to solving them, and measuring success with high-quality, relevant data. Chapter 5 walks planners through what is entailed in these analyses and provides detailed lists of valuable data and resources needed to help inform an intervention.
Stakeholder and partner engagement is essential to creating consensus and developing an authentic vision for the intervention. Stakeholders and partners become advocates for the intervention and are fundamental to informing, developing, and sustaining the strategy beyond the initial implementation phase. Chapter 6 offers insights about the people and organizations that planners need to involve in the corridor redevelopment intervention process, as well as the different ways that planners can engage with these groups.
An important concept in the corridor redevelopment intervention process is that of catalysts. A catalyst is a site, project, or action that supports the effective execution of redevelopment goals and objectives as defined during the public engagement process. They help spatially define the corridor and focus attention on the areas within a corridor redevelopment study area. Jump-starting redevelopment efforts with catalyst-based investments spurs further redevelopment investment and tangible outcomes. Chapter 7 guides planners in how to identify and select public and private catalyst efforts to help expedite corridor interventions.
Corridor redevelopment may be constrained by existing zoning codes and design requirements. Regulatory barriers are one of the most common obstacles to achieving intended redevelopment results, so planners must ensure that corridor interventions incorporate appropriate regulatory approaches. In Chapter 8, planners are introduced to common regulatory approaches that enable better development patterns and design outcomes and protect and promote the intended character of future corridor development. Planners will be empowered to make more effective regulatory changes and develop authentic solutions.
Local government investment is fundamental to supporting measurable redevelopment results, particularly in improving public-private partnership feasibility. Since any redevelopment project will be costly, local government investment provides the best means to mitigate financial risk to private partners and, ultimately, garner more private investment. Chapter 9 examines options for local government investments and actions to support corridor redevelopment, while Chapter 10 looks at numerous financial tools available to help minimize public and private costs associated with a redevelopment intervention. Planners can access these tools to help optimize local government investment. The key to using financial tools in an intervention is employing all relevant options and not relying on a "silver bullet" that may be susceptible to shifts in policy-related preferences.
Finally, successful corridor redevelopment requires long-term commitment. Planners must develop and implement strategies to maintain investments over time and to monitor and evaluate corridor redevelopment progress. Chapter 11 describes how constant monitoring and evaluation leads to better intervention outcomes and helps guide future intervention efforts. Evaluation helps planners revisit barriers that might undermine implementation progress and fine-tune redevelopment approaches to better achieve success. This chapter also highlights the importance of planning for the long term by considering the costs of corridor operations and maintenance over time.
COMMERCIAL CORRIDORS FOR THE 21ST CENTURY
The complexity of the world we live in today and in the future will be influenced by an increasing number of disruptive forces. This makes it all the more important for local governments to address the stability and resiliency of their commercial corridors. With vastly reduced local government budgets and a need to increase expenditures for the gradual recovery from the COVID-19 pandemic and other threats testing community resilience, such as climate change and socioeconomic inequality, how can planners attract and leverage investments to corridors in order to achieve their communities' environmental, economic, social, safety, and health priorities?
The future economic health and sustainability of communities depends on creating more authentic and sustainable corridors that can quickly adapt to unanticipated or unprecedented events. Planners have an opportunity to shape commercial corridors from auto-oriented strips into equitable places that prioritize pedestrians and drive sustainable economic growth. Future corridor redevelopment practice must focus on improvements that will benefit future generations.
This report is a call for planners to work towards more holistic, collaborative, and larger-scale commercial corridor redevelopment interventions. The goal of this PAS Report is to empower planners by providing them with a comprehensive set of strategies informed by market-based approaches to help them achieve success in their own communities. Planners have an increasingly important obligation to revolutionize corridor redevelopment practice. There is no better time to act than now.
About the Author
Luis Núñez is the director of economic development for HdL Companies in Houston. As a consultant his practice includes an emphasis on the facilitation and implementation of economic development strategic plans and comprehensive plans, land-use regulation approaches, redevelopment strategies for corridors and downtowns, and revenue optimization and tax diversification policies. Núñez holds a bachelor of arts degree in government from the University of Notre Dame and a master’s degree in urban planning and public policy from the University of Illinois–Chicago.
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The Pro Forma
Table of Contents
Chapter 1: A Comprehensive Approach to Corridor Redevelopment
Terms and Concepts
A Holistic Approach to Corridor Redevelopment
The Corridor Redevelopment Intervention Cycle
About This Report
Chapter 2: Commercial Corridor Characteristics and Challenges
Historical Background and Planning Context
Commercial Corridor Characteristics
Commercial Corridor Challenges
Case Study: Fort Worth, Texas: All Commercial Corridors
Chapter 3: Understanding Market Context
The Real Estate Cycle
Property Type Outlook by Sector
Case Study: Council Bluffs, Iowa: West Broadway Avenue
Chapter 4: Getting Started
Evaluating the Current Situation
Creating a Corridor Redevelopment Plan
Chapter 5: Data Collection and Background Analysis
Existing Plans and Studies
Existing Conditions Analysis
Chapter 6: Stakeholder and Partner Engagement
Types of Stakeholders
Public Engagement Options
Case Study: St. Petersburg, Florida: Central Avenue
Chapter 7: Catalysts
The Importance of Mixed Use
Case Study: Michigan City, Indiana: U.S. 421/South Franklin Street
Chapter 8: Regulations That Support Redevelopment
Common Regulatory Barriers
Updating Regulations to Create Character
Chapter 9: Local Government Actions
Case Study: Auburn, Alabama: Opelika Road
Chapter 10: Financial Tools for Corridor Redevelopment
Tax Increment Financing
Special Assessment Districts
Brownfields and Sustainable Development Financing
The Private Sector: Innovation Finance
The Philanthropic Sector
Case Study: McComb, Mississippi: Delaware Avenue
Chapter 11: Evaluation and Maintenance
Implementation and Evaluation
Operations and Maintenance
Chapter 12: Planning the Corridors of the Future
Trends and Future Considerations
21st Century Corridor Redevelopment Practice
Appendix A: Recommended Practices for Implementation
Appendix B: A Redevelopment Glossary for Planners
Appendix C: State Tax-Delinquent Properties Legislation