My hometown, where I’m on the planning commission, recently recieved an application to tear down some old, neglected buildings along our main stroad through town and convert them into a drive-through pharmacy with a disproportionately large parking lot. (The parking lot is necessary, we are told, due to the nature of the business).
I respect the fact that most people in my city will see that as an improvement. We’re taking the 1960’s version of auto-oriented development — long in decline, yet under little pressure to be redeveloped — and replacing it with a new version of auto-oriented development. And we don’t even need to use a tax subsidy! Opposing this was not a fight I would win nor a hill I was prepared to die on.
But it got me to thinking: what is financial value of moving from an old version of auto-oriented development to an updated version? If the stroad corridor continues to redevelop in this fashion, as our plans and ordinances suggest it should, how much wealthier will we become?
To figure this out, I first looked at the six core blocks of declining tax base that we see on the east side of the river. These are largely the remnants of the first generation of auto-oriented conversion along the highway corridor that was run through the middle of town. Here’s that stretch of stroad:
The buildings along this stretch are variations on the old strip mall approach. They are mostly set back with parking in front. Some have purchased neighboring buildings and torn them down for side-oriented parking. Here’s a sample:
Compare this to the six blocks on the west side of the river. West of the river is newer and has seen a lot of investment — in the form of both new construction and rehab — in the last couple of decades. The development here is all auto-oriented with large parking lots and drive-through service. Most of my neighbors would look favorably on this stretch and consider it of higher quality than what they'll find east of the river.
It’s in this part of town that we have the Walgreens, the Wendy’s, the Tim Horton’s and some banks and auto dealerships. If things work according to the current plan, this is what the core of our city will evolve into.
So, if that evolution happens — if the east side of the river starts to look more like the ostensibly more successful west side of the river — how much wealthier will the city become? The answer is not as great as might be anticipated: just 13%.
Auto-oriented development follows a predictable pattern. A single-use building is constructed. Assuming the business is successful, it is shiny and new for one or two decades. However, without rising land values — and stagnating land values are the rule, not the exception, when it comes to auto-oriented development — there is no real pressure to intensify the site once the structure starts to decline. Sometimes cash flow justifies a building rehab. But more often, the building declines until it falls so far that the cost of demolition of the existing structures can be justified, and we decide it's better to essentially start over. Often that demolition requires a tax subsidy to make it financially viable.
So, in my town, we’re getting a 13% bump in tax base from derelict and declining to shiny and new, and start that cycle over again. We should get a decade or two of on-par tax receipts, and then the corridor will start to underperform again, until it declines far enough to (hopefully) start again. That’s pretty uninspiring.
What’s the alternative?
Buried in that declining corridor on the east side of the river is a block and a half of what remains of the traditional development pattern — the stuff that existed prior to the Great Depression and the beginning of the Suburban Experiment. If we step back and examine that little stretch, we see something inspiring: a 39% increase in property tax value.
That's right: In the stretch of stroad that is perhaps the least appealing and the most mismatched for the auto-orientation of the corridor, we have a tax base that is already delivering three times what we get by developing from run down auto-oriented to shiny and new (and still auto-oriented.)
And here’s the beautiful thing: that 39% bump has a lot of immediate upside potential. Look at the buildings in this stretch. To visit some of these, customers must park along this nasty stroad and then step out into traffic going at treacherous speeds just feet away. Yuck! Living within a few blocks of this area are thousands of people who are, through design of the city’s streets, induced to drive everywhere. Slow down traffic along the stroad and take some modest steps to make the neighborhood more convenient to walk, and these places can see their demand grow intensely.
Fighting decline along a stroad is a fruitless endeavor, especially when each successive generation of redevelopment requires a subsidy or expands the parking component of the site, making it even less inviting for someone outside of a vehicle.
Make that stroad a street, and start that transition by incrementally supporting the most successful development you have: the little patch of traditional buildings that have managed to hang on, despite all attempts to undermine them.
That’s where you start working to build a strong town.
(All images from Google Maps.)