Economic Development News & Insight

logo-horizontal

The Higher ED Blog: Reversing the downward spiral of your downtown

Michelle Madden / September 14, 2015

Tags: , , , , , , , ,

The Higher ED Blog: Reversing the downward spiral of your downtown

This article is the second in our Downtowns: Onward and Upward series, which explores downtown revitalization issues and strategies.

Municipalities have been working on downtown revitalization strategies for many years, and one of the biggest challenges is reversing the downward spiral that many cores get caught in. Patrick McConnell, a Financial Analyst at the Ontario Ministry of Community and Social Services, realized that even the hardest hit downtowns have continued to act as employment centres. Unfortunately, the office workers tend to drive in and drive out. The driving question behind Patrick’s paper submitted to the Economic Development Program was how to get those office workers to engage in activities and businesses during and after business hours. His proposed solution: follow London, Ontario’s example and invest in major activity generators.

Tax incentives and regulatory simplification are useful tools for encouraging geographically-specific development, but they are not enough on their own. To really spur revitalization, the downtown needs to be seen as a desirable place to go and successfully attract people. Once there is sustained activity, then developers will be more willing to invest. In other words, municipalities have to make the first move and invest in ways to drive traffic in the core.

The Downtown London Millennium Plan

Downtown London’s decline began with the construction of three suburban malls between 1970 and 1985. A retail exodus followed and the downtown’s reputation deteriorated. The city put a suite of financial incentives in place, which had some success but not enough to generate significant change. A major turnaround didn’t come until the 1998 Downtown Millennium Plan, which invested $110 million primarily in a downtown arena, market, and new central library.

Budweiser Gardens

Before moving downtown, the London Knights hockey team resided in a smaller arena on the outskirts of the city, where it struggled to fill the stands. Thanks to the Millennium Plan, they moved downtown to the new Budweiser Gardens, where their games are often sold out. A local basketball team is also doing very well and the venue has successfully attracted major sporting and concert events too. The venue drew 675,000 people to 147 events in 2013. It’s important to note here that there is little evidence showing that public subsidization of professional sport venues is a worthwhile investment. However, there are cases (like Budweiser Gardens) where they have successfully revitalized deteriorated areas. Municipalities should carefully weigh the benefits and risks before committing money to these types of projects.

Covent Garden Market

Covent Garden Market is rooted in history. The architectural design evokes the memory of a market established 150 years prior on the same site. Today, it’s a popular lunch destination thanks to the variety of merchants and restaurants that have set up under its large roof. Outside, the adjacent plaza changes with the seasons, hosting a farmers market in the summer and a skating rink in the winter. The market averages 25-30,000 visitors per week and made $15.9 million in sales in 2013.

Central Library

The new Central Library, poetically, occupies the space left by The Bay when it moved from the downtown Galleria Mall to a suburban mall. Like the other two projects, the library has been a major traffic generator, attracting 900,000 visitors in both 2012 and 2013 (who borrowed 1.5 million items and attended 3,000 community programs). Additionally, a 400-seat theatre within the space is booked most nights by community organizations.

The broader impact

The three projects described above are impressively well used and have made a real difference in activity levels in downtown London. The projects are credited with attracting lots of new investment, including restaurants and two new condo buildings that brought well-off young professionals into the core. In fact, the underused financial incentives established before the Millennium Plan became much more popular after downtown traffic was increased.

To be sure, $110 million difficult for many municipalities to come by, but the Downtown London Millennium Plan shows that a focused investment can catalyze change and reverse a downward spiral. Since 2001, London has seen $3 of private investment for every $1 of public funding. It’s hard to argue with an ROI like that.

 

About the authors

Michelle Madden is the editor of Higher ED. She is also the Outreach Manager for the Economic Development Program and a graduate of the LED master’s program.  She has authored a number of the articles in this series on behalf of the students, and has published several of her own blogs on economicdevelopment.org as well.

Patrick McConnell lives in London, Ontario where he is a Financial Analyst with the Ontario Ministry of Community and Social Services and Ministry of Children and Youth Services.  Patrick has a Bachelor of Science in Economics and a Bachelor of Arts in Political Science from the University of Tulsa and a Master of Arts in Economic Policy from Boston University.

About the series

Higher ED: Insights for the Next Economy is a platform for students, guest speakers, staff and faculty of the University of Waterloo’s professional and graduate economic development programs to share knowledge with the field at large. The series takes works destined for an academic audience and reworks them into a fresh, easy-to-digest blog article.

Established in 1988, the Local Economic Development program is the only master’s program in Canada devoted solely to local economic development. It offers a balance between theory and practice by combining coursework, a major research paper, an internship, and weekly seminars featuring guest speakers. Students are prepared for careers in local, community, or regional economic development.

The Economic Development Program is a nationally-accredited provider of professional training. It delivers certification programs and seminars that offer a deep understanding of the Canadian context in a convenient block format. Peer learning is combined with informative lectures and practical case studies to provide dynamic instruction that is beneficial for junior and senior-level practitioners.

Comments are closed.