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February 27, 2014

Five ways city government can encourage development

Special to the Journal


Cities can foster commercial and residential projects by being an active partner in economic development. Rather than simply zoning for the right type of development and hoping for the best, cities can shift their focus toward public-private partnerships and use smart infrastructure investments to encourage more real estate development activity. Here are five ways cities can show developers we are open for business.

Assemble key commercial properties

Local governments can assemble key commercial properties as a tool to catalyze new downtown investment. When this is done with strategic precision and in a limited, conservative fashion, cities can acquire under-performing properties and turn them back over to the private sector with conditions for new development.

Image courtesy of Digital Imaging Studio [enlarge]
MainStreet Property Group is building Spencer68 as part of Kenmore Village, a key project in downtown Kenmore.

This land assembly approach has seen mixed results over the past 10 to 15 years. Cities that have taken a conservative approach with reasonable expectations are seeing success. Assembling land gives the public and private sectors a stake in the success of the project. As a result, cities like Kenmore and Bothell are seeing new investments that far outweigh the cost of assembling the land. For example, Kenmore's close-to-break-even cost for downtown property assembly is on the verge of yielding more than $30 million of new investment on those properties.

Make smart, proactive infrastructure improvements

Cities can set the table for real estate development by building critical infrastructure. Bothell's visionary Crossroads project — re-aligning State Route 522 and extending connecting streets — is providing the transportation infrastructure needed for the future and as a result, significant new downtown development is underway or in the queue. In Kenmore, the city re-aligned a key downtown street and installed new on-street parking, sidewalks and streetscapes.

Cities can use civic buildings to bring new life and activity to core commercial areas. During the recession, the city of Kenmore, King County Library System and the Northshore Fire District took advantage of the favorable bidding climate to construct new buildings in the heart of downtown. These new buildings set a high bar for design downtown and brought more people to the neighborhood.

Use what makes cities unique

Every city has attributes that set them apart, and cities can use these assets to encourage development and attract new businesses. Cities on the water can do projects that focus on public access and recreation. Waterfront improvements make cities attractive to investors and create a signature gathering place in the community. Cities with colleges and universities can use the strengths and specialties of higher education institutions to foster industry clusters, like the surging biotech industry in Bothell. These partnerships create opportunities for attracting new businesses and strengthening existing ones.

Streamline permit processes

Knowing that predictability and certainty are like gold in the world of real estate development, cities can work to speed up and reduce unnecessary steps that encumber the permit process. A city with a solid reputation as a fast and reliable permit processor will get the attention of developers and their investors.

Help local business

Cities need to embrace homegrown businesses and help them thrive. Last year the city of Kenmore used assembled downtown property to give Kenmore Camera the opportunity to triple its footprint. The specialty camera retailer is a local, family-owned business that has been around since the early 1970s and held its grand opening in its newly acquired space in February. Kenmore Camera is now an anchor tenant in Kenmore Village, a mixed-use project in downtown Kenmore with planned office and retail space as well as 220 residential units.

Local governments should encourage economic growth by investing in infrastructure, cultivating public-private partnerships, streamlining permitting processes and taking advantage of their assets. With an emphasis on partnership and collaboration, cities can influence project design, encourage new investment opportunities and build connections between public and private partners to create a stronger, more vibrant community.

Rob Karlinsey is Kenmore’s city manager. He has more than 20 years of experience in local government and last worked as city administrator of Gig Harbor.

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