Donjek Project: Commercial Land Trust Feasibility

“By facilitating participation in market activity, neighborhoods expand wealth creation…A healthy neighborhood is a neighborhood that performs its functions well, connecting its residents to larger economic, social and political systems.”
– Weissbourd, Bodini, and He, “Dynamic Neighborhoods,” 2009

Dating to the mid-19th century, St. Paul’s University Avenue has matched entrepreneurial people with available space, central location, ease of access, and proximity to employees and other businesses. Central location and a mix of new ideas and longstanding networks in the community continue to stimulate entrepreneurship and business development on University Avenue. Its position in the Minneapolis Saint Paul region also frames the largest public works project in the state’s history: Construction of light rail transit service that will extend from Union Depot in downtown Saint Paul, the State Capitol, down University Avenue to the Midway, to the University of Minnesota and downtown Minneapolis. Illustrated in comparable markets, LRT service is likely to elevate demand for space and increase foot traffic substantially on University Avenue. As development increases around University Avenue, opportunities arise for business owners operating there.

At the same time, increased real estate values on and near University pose a challenge to the small and emerging businesses that help give the street its character. This report summarizes an exploration of models that could create space on University Avenue for new and existing small businesses, led by the Greater Frogtown Community Development Corporation and the Rondo Community Land Trust, and made possible by funding from the McKnight Foundation. Informal survey data suggest that 10% of business owners on University own the property in which they operate. While ownership can provide long-term stability of building cost for business owners, ownership is not a uniformly high priority – or even a uniformly desirable outcome – for businesses.

The report concludes a feasibility analysis undertaken with Donjek coordination over the last year. The project set out to address three priorities:

  • Explore the need for and interest in long-term stable-price business property ownership and leasing;
  • Identify and evaluate models for accomplishing long-term cost stability for business operators; and
  • Chart a course for accomplishing these objectives without ongoing subsidy.

Innovative models that blend ownership and leasing, public with private, may have a role to play in supporting entrepreneurs on University Avenue after light rail transit is in place. The report highlights selected strategies that allow business owners to structure more stable real estate costs, either through ownership or leasing. These strategies and a more stable cost structure for small businesses allow entrepreneurs to build reserves and working capital, invest in future projects or products, and hire more employees.

@Strib: Reconnecting Minneapolis’ Seven Corners and West Bank

VoicesSM

Like many urban and rural places, Minneapolis and St. Paul each have plenty of underutilized land area.

One of Minneapolis’ most striking examples is the Washington Avenue “trench,” a 1960s-era highway that today splits the Seven Corners area, the University of Minnesota’s West Bank, and the Cedar-Riverside neighborhood. Current plans call for construction of light rail transit service through the middle of the trench, a station beneath the 19th Avenue bridge, and a pedestrian/transit mall on Washington Avenue just across the river. In tandem, these plans translate to an opportunity for fundamental rethinking of how the trench inhibits the health of the places around it.

I have posted a piece about these issues at the Star Tribune (link to that post), and I have included here at the Cents of Place, additional images created by University of Minnesota graduate students of architecture working with adjunct professor Mic Johnson, also of Ellerbe Becket. My thanks to Mic for his permission to include these images.

The view east along Washington Avenue, with the LRT station area in foreground.

The view westward along Washington Avenue.

A bird's eye view of the redevelopment scenario for Washington Avenue right of way.



Donjek Project: Picturing Value in Walkable Neighborhoods

Over the last several months, I have been working with developer and consultant Michael Lander (Lander Group) and urban designer Peter Musty (Peter Musty LLC) to develop a concise, visual statement about the prospective impact that transportation investments can stimulate. Hopefully, you’ll find the graphic product below clear and persuasive – and you can download a pdf version here if you prefer.

TOD_Graphic

Talking Infrastructure Blues, or Trading Places Part 3

Ccmap What if, during his hard travels by road and rail, Woody Guthrie had penned a song he called “Talking Infrastructure Blues”? 

Talking

In Minnesota and elsewhere, much verbal back and forth continues to be had over the high-profile and disastrous collapse of the I-35 bridge over the Mississippi River.  Just this week, conservative-turned-liberal blog magnate Arianna Huffington claimed in her speech at the University of St. Thomas that neglected infrastructure is a direct outcome of the wars in Iraq and Afghanistan.  She’s wrong.

Clearly, the wars – and the way they have been debt financed – have placed and will continue to place stress on the national budget and the dollar for years to come.  Still, it’s unfair to suggest that without American involvement in Iraq and Afghanistan, infrastructure in Minnesota and elsewhere would be the focus of long-term foresight and investment by policy makers.  In political terms, infrastructure is a more elusive issue that Huffington’s assertion suggests.

Infrastructure

It’s an election year.  I will wager very little of the coming campaign messages will (excepting mention of the I-35 bridge, of course) include calls for ramped-up investment in infrastructure.  Transportation systems of roads, rail and intermodal facilities, airports, locks and dams will be missing, as will the real estate needs of university and school buildings.  Three of the reasons why:

• The price tag for quality infrastructure gives the public sticker shock

• The benefits of quality infrastructure, while they certainly justify the investment, are dispersed among private and public parties that use it

• The cost of deferring investment is difficult to measure, though decreasingly so with evolving analytic tools.

The American Society of Civil Engineers has provided ratings of U.S. infrastructure in recent years; the latest report (2005) proffered Cs and Ds in every category, with an overall grade of D, down from D+ in the 2003 report.  Their estimate of national deferred costs is a baffling $1.6 trillion. The Urban Land Institute at the end of April released a comprehensive analysis of U.S. infrastructure that notes

2008 seemingly marks a critical juncture in a rapidly changing economic environment where new approaches to land use, infrastructure and energy efficiency will likely determine and possibly reorder the next generation of winners and losers – countries, companies, investors, and peoples.

If you would like a copy of the whole ULI report, contact me and I will be pleased to email it to you.  I should warn you, it may give you the…

Blues

Guthrie would want his song to take place in a particular place, and this being the last of three posts on particular locales, let’s return to St. Paul.  The Minnesota legislative session is required to conclude here this Monday, May 19.

Advocates including the City of St. Paul, City of Minneapolis, St. Paul Area Chamber of Commerce, Midway Chamber of Commerce and a range of transportation and environmental organizations have been laboring over the last month to restore state funding for the light rail line designed to connect the two downtowns and the University of Minnesota.  Funded with $70 million in the state bonding bill passed by the Legislature in early April, light rail was removed from the bill by Governor Tim Pawlenty.  At stake is $450 million in Federal funding contingent on the State investment.

It’s a case study of the three dynamics I described above.  Without context, a $70 million investment just sounds like a large price tag as opposed to a key step for movement of workforce, connectivity of two downtowns and a major university, and regional differentiation.  From the list of advocates cited in the preceding paragraph, it’s clear that the private and public sector each recognize the value of light rail for the region’s future, but the benefits to be gained collectively are a challenge to gauge.  And last, proponents have not succeeded in shifting discussion to the costs of failing to build light rail now, in part because they are difficult to quantify easily.

As an optimist, I am hopeful in our ability to commit to a program of modernized and well-maintained infrastructure.  It will, however, require more than a talking blues.