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Common Redevelopment Q&A

 

By Marlon Webb, Veridus Group 

Published: May 31st, 2019 by The Veridus Group 

 

The Veridus Group has been fortunate to assist several communities across Indiana in redeveloping sites in downtown areas.  We have discovered that redevelopment in downtown areas are not the same as developing greenfields.  This can create some confusion for individuals who may not be used to the time and costs associated with development efforts in these two distinct areas.  Over our time of working with various municipalities, we have seen a few questions that come up from time to time. 

 

     1.      Why redevelopment of the downtown?

 

The millennial and baby boomer generations are leading the inversion to migrate into more urban, downtown settings.  Because of this, developers are increasingly expressing interest in building mixed-use projects in downtown areas.  Cities and towns must be proactive with development and set a plan in place in order to control what their downtowns will look like.  This also allows for a diversity of options for residents to live, work, play, and, in some case, learn in downtown environments.  Downtowns are the heart of their communities, so it is important for them to remain viable and keep up with the shifts in the economy. 

 

     2.      How will this affect my property?

 

If a resident or business owner lives/operates in a targeted area of a downtown redevelopment, the resident or business owner may be approached to sell their property.  If the resident or business owner is not located within a targeted area but is in the downtown area, their property may be affected by increases in property values, which means that their property taxes will increase.  For most residents and business owners, this would be a welcomed improvement; however, some residents that may be on fixed incomes may not be able to reap the benefits. 

 

Cities and towns should have a plan in place to address such concerns.  There are programs through the federal and state government that cities and towns can apply to offset some costs or burdens for individuals in these situations.  Cities and towns can also incentivize projects to offset costs to allow for some of the displaced individuals to find a new place of residence or assist businesses in offsetting costs incurred by increased taxes. 

 

     3.      Will the City/Town use eminent domain to take my property?

 

This is a policy decision that every community must make in order to provide transparency to their constituents.  In some cases, eminent domain may be necessary for public projects.  However, it does not always have to be utilized.  Cities and towns should use all reasonable efforts to obtain property required for any public improvement. 

 

     4.      Do I have to sell my property if a developer approaches me?

 

 Any property owner has the right to respond as they please to a developer’s request to purchase their property.  A city or town should not require its constituents to comply in favor of a project they would like to see move forward.  However, cities and towns should definitely work to educate everyone on their redevelopment efforts and explain how such projects help the community in general. 

 

     5.      Why was I not aware of this process?

 

To avoid not having a proper response to this question, cities and towns should host several public input meetings if the project is a part of a much larger redevelopment project.  These public input meetings would allow all residents and business owners the opportunity to express their concerns.  An online platform would be beneficial to those who cannot attend the public input meetings.  If it is a one-off project that will require approval at a public meeting, cities and towns should follow State law, which requires cities and towns to properly public notice of developments that require approval.  Residents and business owners should always have a way to voice concern. 

 

     6.      Will residents be displaced?

 

It is possible that some residents and business owners could become displaced due to redevelopment efforts.  Cities and towns should establish a policy to address these concerns.  There are grant programs that can be made available to assist with such issues.  Some residents could lease space in the new mixed-use developments, which is also the case for business owners should they have interest. 

 

     7.      What about the historical structures in the area?

 

Every community has a sense of identity that they would like to preserve.  That identity could be based on physical structures that are already in place.  Some structures that are in place may not be historical, but architecturally designed to look historic in nature.  This is what communities should do in order to preserve their historic identity.  Another way to preserve the historic nature would be for communities to require developers to add some component of the history to their development.  For example, rooms or building can be named after a building or person from the community, rooms could be set aside to house historic items, etc. Keep in mind that this could potentially increase the cost of a redevelopment project. 

 

     8.      How will businesses be impacted?

 

Business could have a similar impact as residents.  Some businesses may not be able to keep up with the increased cost in taxes, could be asked to sell their property, or could be affected by construction and traffic reroutes.  In any case, cities and towns should have a policy in place to help offset costs.  Cities and towns could offer tax abatements to offset potential revenue lost due to construction, offer abatements to offset the increase in taxes, negotiate with developers to incorporate some of the businesses that would have to be relocated, among other things.  

 

     9.      What is the timing of the development plan?

 

It could take years to see a redevelopment plan realized; however, there are examples of plans being realized much sooner once the first project kicks off.  Developers want to see that cities and towns are open for business before making investments into those communities.  As individual projects approach cities and towns, every community should be able to provide information on the length of the project and how residents can get around any construction affecting their commutes. 

 

     10.   How will traffic be affected by all of the new developments?

 

Cities and towns should provide construction timelines and reroute information in various places in order to reach as many residents and businesses affected by any construction.  This information should be posted in advance of any potential closures. 

 

     11.   How much will this cost?

 

Prices for redevelopment projects vary based on the scope.  Redevelopment in a setting like a downtown will cost more than building new on Greenfields.  Existing infrastructure, among other things, incur heavy costs to upgrade, relocate, or demolish.  It is important to be transparent about these costs to local constituents.  The total investment potential will not be known as projects will continue to come in to revitalize the downtown. 

 

     12.   What about parking for new developments?

 

Cities and towns should understand their parking situation.  In some cases, parking is not an issue, it’s just not where people want the parking to be located.  However, perception is reality, so parking in the downtown area can be a sensitive issue.  While parking is essential to the viability of businesses in the area, large parking lots don’t allow for the intended density within downtown redevelopment plans.  In most cases, structured parking will be considered as a viable option.  Each development will be required to include a plan which addresses their own parking needs so they don’t consume public spaces. 

 

     13.   How can I stay engaged?

 

Cities and towns should provide constituents opportunities to hear updates or voice concerns in public meetings, i.e. Council meetings, redevelopment commission meetings, etc. 

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