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Wednesday, October 22, 2014

8 Steps to a Vibrant Downtown

Many downtowns in America are struggling or are failing to meet their full potential.   Even wealthy communities in high growth areas of the country are not immune from lack luster performance.  There are many reasons for this phenomenon such as competition from strip centers and malls, limited parking, absentee landlords and urban blight.  Many of these factors are beyond the control of downtown business owners.  However, there are things they can do.  By focusing on the following 8 things will help develop a vibrant and profitable down town.

  1. Create and maintain a strong, and focused organization.   This should be the first and foremost priority.  Let’s face it, downtown entrepreneurs can be difficult to get along with.  They like independence and being in charge.  They are also energetic and smart.  The organization needs strong, focused leadership to capitalize on that energy and intelligence and pull those independent minds together.   The National Trust for Historic Preservation’s “Main Street” program is a good model to build on.

  2. Develop a strategic plan and stick with it.    While this sounds obvious, many organizations do not do it.  The plan needs to be strategic in nature and focused on the long term.  It should lay out what the Downtown’s goals are and the concrete steps necessary to accomplish them.  I discussed how to do this in my blog post “Goals, Plans and Responsibilities”.

  3. Develop Leaders.  Running a business is hard.  Trying to run a business and a downtown organization is REALLY hard.  Board turnover is inevitable.  But it does not have to be a negative situation.  By taking the time to develop leaders, organizations can ensure that turnover is a great opportunity to bring in fresh ideas and new energy.

  4. Know your market.  Knowing market capacity is vitally important.  You must learn which customer demands are being met and which ones are not, referred to as leakage. This knowledge should be used to recruit businesses to fill unmet demand.

  5. Develop a succession plan.  Businesses and building ownership will change over time. By planning ahead for it and using market knowledge, the organization can recruit the types of businesses they want ahead of time.  The same goes with building ownership.  Leaving this to chance can have disastrous results for the downtown, especially if there are a lot of absentee landlords who don’t care who their tenants are, they just want the rent money.

  6. Make impactful infrastructure improvements.   Working with the local government to make improvements that positively affect the downtown is vitally important.  High on the list are wayfinding systems, parking, and place making improvements. 

  7. Remove blight.  One run down building or overgrown lot can negatively affect an entire block.  The organization should first try to address the issue with the property owner and tenant.  If that fails, then enforcement action by the local government may be necessary to remedy the problem.

  8. Make parking easy and free.  In many communities, there is little or no public transportation, especially in small rural towns.  That means that people will need to drive and then park their automobiles.  Good signage is imperative to getting people to available parking spaces, especially if people are traveling from out of the area and therefore are unfamiliar with the layout of the downtown.  Walmart, your direct competition, doesn’t charge for parking and neither should Towns.  However, there should be parking limits and enforcement.  This is necessary to keep business employees and others from parking all day in spots needed by shoppers.


  1. Tracey Shiflett makes some great suggestions to help make downtowns more vibrant and successful. I would like to add a one more:

    Most downtown businesses are renters. Absentee landlords who charge ever-increasing rents for buildings of deteriorating quality can be a big drag on downtowns. Even a business that is drawing in lots of customers can be doomed if rents are unrealistically high. A lack of building maintenance combined with rents that are too high can lead to empty storefronts and blight.

    What’s particularly galling is that if “impactful infrastructure improvements” are made (paid for out of public taxes), landlords will start charging businesses higher rents to locate near the infrastructure that their taxes have already paid for. Thus businesses end up paying for infrastructure twice – first through taxes and a second time through rent premiums to landlords who control prime sites.

    Fortunately, some communities have rectified this situation by modernizing their property tax. These communities have reduced the tax rate on privately-created building values and increased the tax rate on publicly-created land values. The lower tax on buildings makes them cheaper to construct, improve and maintain. (This is good for residents and businesses alike.) Surprisingly, the higher tax on land value helps keep land prices and rents more affordable as well. This happens because the land tax reduces the profits from land speculation, thereby reducing the speculative demand for land and moderating its price.

    Thus, without losing any revenue, simply by shifting the property tax off of privately-created building values and onto publicly-created land values, communities can help make both land and buildings more affordable for the residents and businesses who want to locate there.

    For more information, see “Funding Infrastructure for Growth, Sustainability and Equity” at http://media.wix.com/ugd/ddda66_d46304b5437c178e2f092319a6f30364.pdf

  2. Thanks for sharing this information Rick.