As a firm that deeply cares about Community and Economic Development and ultimately the fate of our Cities, we are constantly grappling with ways that we can help our Cities succeed despite the tough economic times. It is extremely difficult to try to summarize the immensity and scope of the problems that different Cities face, but here are some quick observations being on the front line of the process:
The Challenge - After being wiped out from the redevelopment dissolution, many communities are strapped for resources and long-reaching fiscal challenges. All of a sudden Cities are in the business of selling property, either because of obligation to do so under the law or driven by a larger asset management strategy to put the community on the right track. We are often asked by our City Clients the same questions: “Do we need an RFP, should we advertise, go to auction, and what are reasonable business terms now that we don’t have an RDA to help make a project work? Please help!”
Our Double Bottom Line Solution - After really analyzing the challenge we developed a guiding mandate to ensure that every transaction that we are involved in: #1 - meets specific Community Development goals and #2 - is financially successful.
What does this really mean? In basic terms, it means taking into account each City’s’ goals and visions that came with the original acquisition of the property. It means enhancing the value of the property not solely on a financial basis but also positively impacting the surrounding community through job creation, low environmental impacts, pleasing aesthetics and sensible building design, a thought towards serving the surrounding community and many other principles that a City can uphold as the property owner.
Some of these problems can be tackled via a rigorous methodology; has a highest and best use analysis been completed? Have the interests and values of the local community been adequately understood? Can we carefully develop opinion of value calculations for different real estate solutions to better weigh the financial impacts of different types of projects? What terms will the City be willing to negotiate on, and what are the guiding principles that the City will not waiver on?
A Time of Hope - My final observation is that we are at the early stages of developing creative strategies to meet the unique challenges of each City Client and that in some ways we are in a new phase of redevelopment, and that’s an exciting prospect.
Written by Andrew Gee, who is a Senior Associate at RSG.