|A graffiti-covered roll down gate|
|Lauren Collins, Executive Director of the Church Avenue BID
at the press event for “Uncover Church Avenue”
|A graffiti-covered roll down gate|
|Lauren Collins, Executive Director of the Church Avenue BID
at the press event for “Uncover Church Avenue”
|Bicyclists on Valencia Street in
San Francisco are a common sight
With the inaugural run of NYC CitiBike well underway, Nicole Leighton, LOA’s newest staff member, takes a look at how bike lanes and other bike infrastructure can help drive retail sales for local businesses.
By Nicole Leighton
I recently returned from a trip back to my home city of San Francisco. While I’m there I typically bike much, much more than I do in New York. I bike almost daily to do errands, go shopping, and meet up with friends or family. While much of this difference can be attributed to New York’s comprehensive subway and bus system that usually makes it the most convenient choice, another main reason I love biking so much is San Francisco’s welcoming bicycling environment. The City offers cyclists the infrastructure and the culture that make cycling fun, easy and convenient. While NYC has been adding tons of great improvements to its bicycle infrastructure, the culture has some catching up to do with SF.
Having worked at LOA for many months now, I couldn’t help but apply a retail lens to my cycling habits. Every time I ride my bike somewhere, I end up spending money—sometimes planned, often not. Sometimes I ride my bike to go grocery shopping, while other times I’ll just take my bike out to enjoy the weather, and end up stopping at a store with inviting window displays. I knew I knew I couldn’t be the only one who does this, and found a few studies that reinforce the linkages between cycling and spending habits.
One study in 2003 surveyed 27 businesses randomly chosen along Valencia Street in San Francisco, a corridor that I often frequent. After bike lanes had been added to the street, 37.0% of respondents said sales were better and none said sales were worse. Of respondents, 55.6% reported a positive effect on area residents shopping locally, and 44.4% reported an increase in new customers coming from outside the neighborhood. A similar study was released more recently by NYC DOT, which studied the effect of the protected bike lanes on local businesses in the Chelsea neighborhood. The study reported an up to 49% increase in retail sales for locally-based businesses on 9th Avenue from 23rd to 31st Streets–compared to a borough-wide average of 3% for the same period!
Anecdotally, I know that walking or biking by stores makes people much more likely to shop on a whim than when in a car (or on the train). Especially with the launch of the bike share system here in NYC, it will be increasingly important for commercial corridors to consider all modes of transportation and users of the street when creating an inviting shopping environment, including cyclists. This doesn’t only mean bike lanes, it can also include smaller amenities like bike racks or perks like discounts to customers with helmets. (Tip: anyone can suggest a location for NYC DOT to add a free bike rack here.) With the launch of Citi Bike, I’m really hopeful that an increase in bikes on the road will create a more prevalent and welcoming biking experience here in my second home city.
Nicole Leighton is a recent graduate of Barnard College with a degree in Urban Studies. She has been with LOA since Sept. of 2012 and currently serves as a Summer Associate.
Can you imagine the owner of a regional mall forgoing maintenance and improvements to common areas? With so many shopping options available to customers, shopping center owners know that keeping up with customer expectations requires a steady and on-going investment in public and communal spaces. Ignoring the impact that these spaces have on the customer experience is one of the quickest ways to lose customers and ultimately tenants. There is a reason why shopping centers charge Common Area Maintenance (CAM) fees to tenants. The funding stream allows the shopping center owner to address maintenance on behalf of their tenants – who benefit from happy customers and more foot traffic. CAM charges typically go towards a mix of security, maintenance, promotion and marketing, although some shopping center owners keep a separate Marketing Fund that is managed directly by the merchants.
|Successful commercial districts often
require a higher level of maintenance
than is offered by local government entities.
You’ve probably figured out where I’m going with this. BIDs are the traditional commercial district version of CAM charges. When BIDs work well, they are a tremendous asset to businesses, property owners and residents. Yet BID critics continue to suggest that downtown’s don’t need BID services and they can do just fine without them, thank you very much.
The typical arguments that many critics use often reflect a libertarian world view that casts aspersions on cooperative public-private partnerships. Yet we’ve been down this road before. When independent actors act rationally according to their own self-interest, the outcome is not always in everyone’s best interest. The attitude that “someone else” will pay often means no one does – or that those who do bear an unfair burden that should be shared among all beneficiaries. The origin of Business Improvement Districts is based on the premise that shared responsibility through an obligatory contribution to a shared fund is required to prevent free loaders.
SHOULDN’T THE PUBLIC SECTOR PAY FOR THESE SERVICES? Let’s look at the Shopping Center example again. Shopping Center owners pay taxes like any other property owner, yet they also require their tenants to pay CAM charges. In most cases those tenants do so because they understand that the additional services they get are what makes their shopping center an attractive and safe place for shoppers. And ultimately, more shoppers translates into more sales. The idea is that the increased sales pay for themselves, and then some. CAM charges are an investment that should generate a return to the investor, in this case the tenant.
Another issue at play here is that in some communities, governments struggle to provide even the most basic of services. And even when they do provide those services, they might not be robust enough to meet the needs of a successful commercial district. Consider a local government that picks up trash daily. For a community blessed with high visitation, even daily trash pick up may not be enough. Regularly – and even hourly – litter removal may be required to ensure that customers have a high quality experience. Businesses may not want to take the risk that the City’s basic services will not meet the needs of their districts – and they want to pay a little extra for the services that will ensure that customers have a pleasant shopping experience and ultimately return for more.
The ability to control funds at the hyper-local level has its benefits. With local control comes more flexibility in resource allocation from the exact people who know local conditions and can respond more quickly to issues and concerns.
AREN’T BIDs A FORM OF TAXATION WITHOUT REPRESENTATION?
Quite the contrary. BIDs offer a more direct form of control over the distribution and use of resources than regular tax levy dollars. Consider that a typical City budget is allocated based on the input of many elected officials. Those elected officials are often beholden to constituencies outside of the downtown that vote them into (and out of) office. This can become a challenge to ensuring that downtown districts get the resources they need to remain competitive. One community I worked in was an extreme example of this competition for public resources. Since local business owners did not vote (or contribute) to local elected officials, their was little incentive on behalf of public officials to fix the underlying tax system – which overtly overtaxed commercial properties in an effort to keep residential taxes artificially deflated. One by one businesses were moving out of the community to nearby areas, further undermining the tax base. If these businesses had a way to control their own resources – enabling much needed aesthetic enhancements, advocacy, as well as marketing and promotion, the business environment might have resulted in higher profits and caused them to stay put.
WON’T THE BID ASSESSMENT HURT LOCAL BUSINESS?
One could argue that a BID assessment takes away from the bottom line and therefor hurts business profitability. But then those are probably the same people who refuse to invest in their buildings and businesses in the first place. As the old adage goes, “it takes money to make money.” Maintaining public space is not a luxury – it is an important asset management tool that if left neglected will undermine the viability of a commercial area. Sophisticated property and business owners know this. That is why they are often the ones spearheading efforts to develop Improvement Districts. Ultimately, these property owners know that the Improvement District will give them a mechanism that creates the administrative capacity and the required funding stream to manage and improve the public experience. The efforts spearheaded by BIDs may differ by place, but they typically include the enhanced maintenance of streets, sidewalks, public parking lots, etc. that make a place a compelling place to visit and shop.
CAN’T THIS MONEY BE RAISED THROUGH FUNDRAISING OR THROUGH VOLUNTARY METHODS? In some communities, voluntary efforts are enough, but in others, a steady and consistent investment is required to maintain and manage common area elements and district amenities. It should also be stated that BIDs typically do fundraise for downtown through everything from events to sponsorship. It is more common than not to see BIDs leverage funds that would not otherwise have been invested in downtown. But the biggest benefit of a BID is that it offers a steady and regular flow of funds that allows for the hiring of professional staff. If I have learned anything over the years it is that the success of a BID is directly correlated to the expertise of its staff. And let’s be honest, if a BID manager had to spend all of his or her time raising money, the tasks of marketing, promotion and general management would be significantly more difficult, reducing the impact of BID outcomes – the exact opposite of what any contributor wants to see!
WON’T THE BID RESULT IN A REDUCTION OF THE CITY SERVICES I HAVE COME TO EXPECT?
While the answer to this question is not the same in every community – the fact is that effective BIDs actually leverage more investment than a community might receive without a BID. Consider my friend and colleague Ralph DiBart, Executive Director of the New Rochelle Business Improvement District, a bedroom suburb just outside New York City. He has spearheaded numerous grant proposals to the State that have resulted in nearly $1 million dollars of storefront, streetscape and development grants (not loans!) from the State of New York over his tenure as Executive Director. Without a dedicated staff person focused squarely on downtown, these funds would not have been secured and the downtown would not be seeing the benefit of this incredible investment.
Are BID’s the panacea for every urban ill? Of course not. But used correctly and in the right context they are a powerful tool for successful economic development.
|Downtown or Mall? Hard to tell…
Caruso Development’s “The Americana at Brand”
mimics the downtown environment.
Although I have been going to Providence for nearly two years for a client, amazingly enough this was my first visit to WaterFire (why oh why did I miss Prof. Frenchman’s class trip during grad school over a decade ago?!). It was an incredible experience that only served to reinforce the power of thoughtful planning and infrastructure investment. For communities considering investments both big and small in public space, WaterFire provides an example of how public space, when designed correctly, can offer artists a “stage” for their creativity and enliven a downtown with activity and visitation that creates some serious economic impact. In this case, the “stage” took the form of the daylit, and previously buried, Providence River. The project to bring the river back took ten years and nearly $60 million dollars, and included the removal of bridges and roadways that has obscured the river for decades. While daylighting was not done precisely for WaterFire, it might as well have been. The river and its surroundings we perfectly positioned to served as an inspiration for a piece of performance art that is credited with significant economic impact on downtown businesses.
|WaterFire, Downtown Providence, RI|
For those who don’t know what Waterfire is, it is a live performance and art exhibit and the brainchild of Barnaby Evans. During the evenings in warmer months from April to November, a series of floating bonfires burn in the middle of the river. These fires are continually fed fresh wood by black clad volunteers in small gondolas. The event began in 1994 to celebrate First Friday’s in downtown Providence.
My tour guide for the evening was friend and colleague Frank Latorre, of the Providence Downtown Improvement District, whose efforts to keep downtown lush, planted, green, clean and safe have also played a significant role in the downtown renaissance As we walked, Frank bumped into some friends and colleagues (the benefits of small city living!), including Barnaby Evans, the creator of WaterFire, and his head fundraiser, Bronwyn Dannenfelser. Chatting with Bronwyn about the event offered me unique insight into what makes WaterFire so special – and perhaps more difficult to replicate than many might think. The proximity of the bonfires to the river paths create a dynamic interplay that touches every sense – visitors are close enough smell the burning cedar and smoke, hear the wonderful international music that wafts through the air, see the visuals of volunteers calmly stoking the fires on still waters and the reflection of the flames. The exact public infrastructure that lends itself so well to WaterFire is difficult to replicate elsewhere without tweaks to the concept. That said, it works in Providence and the restaurants and bars that line the River could not be happier. Visitors now come to Providence from near and far to see the extraordinary event and spend their money at hotels, stores and dining establishments.
The main lesson here is perhaps less about WaterFire than it is about the absolutely transformative effect, and sometimes unexpected but wonderfully creative outcomes, that emerge from a well designed public space. Communities far and wide should look to create not just any open space, but open space that creates economic development opportunity by offering a dynamic interplay between public space, arts activities and local businesses.