There are several compelling reasons why state and local governments should invest in revitalizing urban communities. Those investments create a ripple effect, benefitting residents, commercial real estate, and businesses alike.
Revitalization attracts new businesses and developments, boosting property values as demand rises, creating a ripple effect, and leading to increased consumer spending and a flourishing local economy. Additionally, revitalized areas become magnets for new residents and businesses, further fueling economic growth
Benefits for Residents
Revitalizing urban communities creates a domino effect of positive changes for residents. Investments often go towards improving public spaces, parks, and infrastructure, making neighborhoods more attractive and liveable. These improvements foster a sense of community pride and can lead to safer environments through better lighting and security measures, too.
This influx of resources also attracts new businesses and jobs, creating a wider range of employment opportunities for residents within their own neighborhoods. Ultimately, these improvements can increase property values, creating wealth for residents who are homeowners and business owners.
Benefits for Businesses and Real Estate
Revitalization isn’t just a boon for residents; it’s a goldmine for businesses, too. A revitalized area attracts new residents and businesses, creating a larger pool of potential customers for all commercial services, including retail stores, restaurants, offices, entertainment options, and more.
This surge in demand can become a major growth driver. Rising property values, mirroring the trend for residents, benefit commercial real estate owners also. But the benefits go beyond immediate profits. Investments in infrastructure, transportation, and beautification make areas more attractive for everyone. An improved business environment entices companies to set up shop or expand. An influx of residents (or visitors) creates a more diverse and skilled workforce, increasing the talent pool.
A Revitalization Program in NJ
The New Jersey Economic Development Authority (NJEDA) is launching a pilot program — the Urban Investment Fund Grant Program — to bolster recovery efforts in six urban centers. Funded with $38 million in federal pandemic aid, the initiative aims to revitalize commercial corridors in Camden, New Brunswick, Newark, Passaic, Paterson, and Trenton and stimulate their local economies. According to the 2023 Municipal Revitalization Index, each city ranked within the top 5% of commuter-adjusted population and municipal distress.
Here’s the breakdown of what the grant program offers:
- Eligible municipalities can receive grants to help implement their own revitalization strategy designed to increase foot traffic and revenues.
- These six municipalities can apply for at least two projects.
- Approved grants cannot exceed 80% of the projects’ total costs — including building rehabilitation projects, building reuse studies, or public space use improvements.
- Municipalities with commuter-adjusted populations of 100K+ are eligible for up to $7 million in grants. Municipalities with lower commuter-adjusted populations (less than $100K) can qualify for up to $5.7 million in grant aid.
NJEDA’s goal with these grants is to build world-class, economically thriving towns and cities across the state. NJEDA CEO Tim Sullivan, said, “The Urban Investment Fund Grant Program will promote strong and equitable economic recovery in vital commercial corridors and stimulate local economies with impactful investment.”
Governor Murphy acknowledged the harsher, ongoing impact of pandemic-related work pattern shifts on urban areas. He expressed his belief that the new pilot program, funded by federal dollars, will be instrumental in revitalizing some of the Garden State’s most affected municipalities and fostering long-term economic recovery in these communities.
Business Leaders Get Involved in Community Engagement
Revitalization thrives on synergy. When key stakeholders pool resources, goals, and a little ingenuity, they can transform struggling areas into vibrant centers for residents and businesses. The potential impact is huge. Here’s how to start.
Assess community needs
The foundation of any successful revitalization effort lies in understanding a community’s specific needs. The best way to do so? Engaging the community itself. Involve residents and other business leaders in the decision-making process to cultivate a sense of ownership and pride in the community’s future.
- Hold town hall meetings and open forums.
- Establish task forces with residents and business leaders.
- Promote volunteer opportunities to get more hands-on involvement.
- Offer educational and information workshops to keep everyone in the know.
- Leverage social media to gather input and updates.
Business leaders cannot afford to underestimate the power of community involvement. Active participation increases a business’s visibility and strengthens its reputation.
Learn from Other’s Success Stories
Don’t reinvent the wheel! Many communities across the U.S. have tackled revitalization projects and emerged stronger. Studying their successes can provide valuable blueprints for your own efforts.
Look no further than NYC’s High Line, a once-abandoned railway reborn as a vibrant public park. Or consider Savannah, GA, where the city’s historic district preservation project sparked economic growth and instilled local pride. Smaller cities like Laramie, WY, had a passionate, dedicated community that rallied to create a comprehensive plan to rejuvenate its deteriorating downtown. Now the Laramie Main Street Alliance has created a flourishing area.
Not sure where to start? The Center for Community Progress (CCP) is a fantastic resource for those seeking to transform their communities. The organization offers leadership and educational programs, including webinars specifically for residents and business leaders.
When the Rain Falls
Revitalization isn’t all sunshine and rainbows. While the potential benefits are vast, challenges are inevitable. Here are some common obstacles to anticipate and address in a strategic plan:
- Resource constraints: Revitalization efforts often face limited funding, requiring creative solutions and resourcefulness.
- Change resistance: Not everyone embraces change. Be prepared to address concerns and build consensus.
- Coordination gaps: Success hinges on collaboration. Ensure clear communication and a unified vision among all stakeholders.
- Historic preservation: Balancing development with protecting historical treasures requires thoughtful planning.
- Sustainability concerns: Champion environmental consciousness and green approaches. Incorporate sustainable practices from the outset.
Proactively anticipating and addressing these potential hurdles will help your community successfully navigate roadblocks and achieve a revitalization benefiting all.
Build a Bridge with the Local Government
Local government isn’t just a bystander in community revitalization — it’s a key partner. It offers leadership, resources, and the regulatory framework to guide your efforts. Here’s how to forge a strong relationship and explore partnership opportunities:
- Craft your vision: Develop a concise written document outlining your community’s revitalization goals, needs, and specific concerns.
- Build your team: Identify residents and other business leaders who share your vision. Work together to create a combined document that reflects the broader group’s perspectives. The document should include the community’s revitalization needs, the combined business capabilities of the group, and everyone’s shared interests.
- Engage the community: Work with your team to create a comprehensive overview of the community’s revitalization needs, which will help you present a unified vision to potential government partners.
- Initiate dialogue: Reach out to government leaders like mayors, city council members, or township supervisors. Schedule informal discussions to explore potential public-private partnership opportunities. Use this initial contact to spark additional collaboration and pave the way for a successful revitalization effort.
The Center for Community Progress and Main Street America offer robust resources to help guide you and the other stakeholders in revitalizing your community.
Urban Renewal: A Win-Win for Communities and Investors
Investing in urban revitalization isn’t just about turning a profit – it’s about creating vibrant, thriving communities. The benefits are far-reaching, impacting both residents and investors. It presents a unique opportunity for investors — a chance to create financial returns while leaving a positive social impact. From rising property values and job creation to improved infrastructure and a better quality of life for residents, the benefits are undeniable.
While careful research and due diligence remain crucial for any investment, real estate in revitalized areas offers an exciting path forward. By embracing this trend, investors can become architects of a brighter future for our cities, all while reaping significant rewards.
Are you a commercial real estate investor or looking for a specific property to meet your company’s needs? We invite you to talk to the professionals at CREA United, an organization of CRE professionals from 92 firms representing all disciplines within the CRE industry, from brokers to subcontractors, financial services to security systems, interior designers to architects, movers to IT, and more.
