COMMUNITY INFILL AND REDEVELOPMENT. Shared Impact and Benefits. What is it? Costs

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1 COMMUNITY INFILL AND REDEVELOPMENT What is it? Infill development the development of vacant or under -utilized community sites located in established localesis an important component of community revitalization efforts. Infill and redevelopment can happen on vacant properties, abandoned strip malls or industrial sites or properties where the value of the land has exceeded the value of the structure on it. Communities that target specific areas for infill generally offer funding or incentive programs to encourage redevelopment. However, special attention must be paid to the barriers facing small lot and infill development. Costs The costs of infill development and the incentives needed to attract redevelopment vary widely. Some neighborhoods redevelop without incentives simply due to market conditions. Other areas require considerable incentives and/or public investment with offices or other development to succeed. This Action Item can be implemented as a POLICY ORDINANCE PROGRAM Shared Impact and Benefits One study completed by the Bay Area Council found that about a third of that region s expected population growth can be accommodated by infill development The State of Washington Research Council published a study documenting the benefits of infill development finding that: Infill provides housing opportunities Infill is less auto-dependent It may be less costly for governments to provide services Infill encourages community revitalization A study in SC found that a low-density development scenario consumed eight times more open space, and generated 43 percent more runoff, four times more sediment, almost four times as much nitrogen and three times the phosphorous as compared to more compact, town-centered development (SC Coastal Conservation League). The Regional Travel Demand Model baseline data, assembled in 2003, identified a number of acres of potentially developable or redevelopable land within existing urban areas in the SEQL region. Strategic development of this area could create more walkable, transit friendly communities, as well as creating a better tax base for existing municipalities. When infill projects are done in a manner that respects the context of the community and includes both housing and commercial opportunities, they can stimulate fix up of existing structures and help to turn around fragile neighborhoods. The Bottom Line Communities need to take an active role. There are barriers to infill redevelopment which are unique to each community and need to be understood and addressed. Policies alone will not succeed. Programs and possibly zoning changes may need to be in place to encourage infill development. In some areas, private developers and market demand are driving the redevelopment process. Interested? Read on!

2 PAGE 2 COMMUNITY INFILL AND REDEVELOPMENT Action Steps 1. Review the city s regulatory framework to ensure that it encourages rather than discourages infill development. Assess the impact of current zoning and code restrictions. 2. Provide for prompt processing of regulatory approvals and permits needed for infill development. Delay adds to the cost of infill projects. 3. Assess the real estate market for targeted areas. 4. Determine if first suburbs have special needs for redevelopment. 5. Make public investments and provide services that support infill development. 6. Gain community acceptance for infill development. 7. Catalogue the vacant parcels available for infill development. Know their market value and zoning, ownership and proximity to infrastructure. Publicize the information. 8. Develop a citywide approach to redevelopment. Prioritize areas to determine appropriate actions. Include provision for pocket parks and urban open space as appropriate. 9. Implement neighborhood plans in partnership with community stakeholders. Publicize the results. 10. Create marketable sites. Assemble smaller parcels into a larger marketable tract. 11. Determine if financing assistance is needed. Determine the need to offer incentives to attract investment and developers. 12. Market the historic or natural amenities as part of a marketing campaign. 13. Create partnerships to support the infill program and promote educational and marketing campaigns to show the positive impacts of new development. 14. Become familiar with the financing resources available in the region that support redevelopment. FAQ S Q: What are common ways communities encourage infill? A: Communities are using many different tools to accomplish the goals of infill: Community development corporations seek market solutions to maintain housing production. Philadelphia has used Business Improvement Districts (BID) to promote housing rehabilitation and new development. Communities have used by supply side incentives to developers, as well as demand side incentives to homeowners (low interest loans) to encourage housing markets in targeted neighborhoods. Q: What are the challenges to doing infill? A: Infill development can be a difficult process. Researchers have identified barriers to infill that fall into four categories: financial, social, market resistance and regulatory. Resources The Urban Land Institute completed a series of publications on issues and perceptions affecting land development. One, Urban Infill Housing, Myth and Fact, provides solid background information. The American Planning Association (APA) and the NC (ordinance) replacement/maintenance cycle. The NC Department of Commerce offers a variety of programs that support infill: State Development Zones, Main Street Program, and the Community Development Block Grant. SC Textiles Communities Revitalization Act provides for the renovation, improvements, and redevelopment of abandoned textiles mill sites located in South Carolina. (S.C. Code of Laws (1976, as amended) Sections ).

3 COMMUNITY INFILL AND REDEVELOPMENT PAGE 3 Basic Information Cities are dynamic. Communities are constantly faced with change. Not only does the physical structure of the city change, but neighborhoods age, lifestyles of city residents change and family incomes fluctuate The requirements businesses place on city roads, utilities, etc., change as well. As a result, families move and business districts and neighborhoods evolve. Regulations and local policies are hard pressed to stay current with the ever-changing demands of the real estate market. The impact of static regulations colliding with dynamic markets results in parcels of land that cannot be profitably developed, vacant buildings, and incompatible uses. However, given the impact of the Internet on work and home as well as the upcoming changes in demographics, communities in the SEQL region now have a window of opportunity to stimulate infill development. Urbanists have postulated that the Internet stimulates centralization and decentralization at the same time. Studies show that the impact of the Internet has been to strengthen cities and to create a system of networked smaller cities surrounding a core urban area. However, in addition to traditional urban cultural amenities, the new city residents also want to enjoy nature, landscapes and outdoor recreation not too far from home. Existing center cities could exploit these new trends and benefit from carefully developed policies of renovation and infill. National demographic trends are predicting new markets for housing in more urban environments. In its publication Urban Infill Housing: Myth and Fact (ULI, 2001), the Urban Land Institute notes that a back-to-the-city trend is energizing he housing market in many cities and describes the new residents as single professionals, childless couples, empty nesters, and immigrants. A recent survey (October, 2005) completed by the firm of Robert Charles Lesser& Co, LLC, for the City of Charlotte further described the changes in demographic trends across the nation that impact locational decisions and housing preferences. The trends are: an aging population with new location choices, the growth in smaller households, many Gen-X ers putting off household formation coupled with a massive growth in singles and couples with no children, and the growth of empty nesters. These flexible households represent a significant part of the market that is interested in housing located in more urban environments. In addition to housing, there is a need to create pockets of urbanity featuring pedestrian walkways, parks, and shopping opportunities. All in all, a market ready to push for the development of city centers and close-in neighborhoods. However, traditional barriers can stall the redevelopment process. Barriers to Infill Development Financial: Typically, pulling together an infill development project is time consuming and labor intensive. Land parcels are smaller. Permitting processes take longer since each project is individually designed.. Many times local housing and building codes do not fit the smaller scale of the redevelopment project. The process is more uncertain, which adds costs to the project. The uncertainties coupled with the added risk associated with rezoning make the project expensive to finance since lenders will increase interest rates and offer more restrictive terms to offset the uncertainties. In response to these considerations, local communities often offer financing incentives to reduce development costs, attract private lenders, and ensure that the resulting development is affordable to the target market. Local incentives plus private financing can be packaged with historic tax credits, low income tax credits, state economic zone credits, and other programs to reach the desired internal rate of return for the project. Social: Research and experiences from across the country indicates that nearby neighbors often resist proposed changes to vacant or under-utilized parcels that border the neighborhood. Local residents are concerned about overloading neighborhood streets with increased traffic, increasing crime and changing neighborhood dynamics. Market resistance: When surveyed by Fannie Mae (1993), a majority of American households preferred a single family detached unit with a yard. However, as noted in the recent real estate report from Charlotte, demographic trends are changing. Smaller families, the growing number of empty nesters, and people interested in urban amenities are good markets to penetrate. (Continued on Page 4)

4 PAGE 4 COMMUNITY INFILL AND REDEVELOPMENT Who needs to be involved in implementation? Municipal managers, county managers and department administrators Business leaders including chamber of commerce when public input is gathered Planning board or commission Developers Citizens and community development corporations Lending institutions Basic Information (Continued from page 3) Positive demographic trends are encouraging, but infill development can face significant barriers from deteriorating infrastructure to lack of retail opportunities. Localities must undertake a comprehensive community assessment prior to developing an infill plan. Regulatory: Local governments, over time, have compiled zoning, building and subdivision regulations to direct the development of subdivisions. Fewer regulations directly address the special issues surrounding redevelopment; i.e., smaller lots, existing infrastructure, etc. Researchers note that the review and permitting process, impact fees, and ancillary concerns like undifferentiated impact fees are barriers to infill development. Brownfields present a special category of regulatory issues for redevelopment. Developers are generally required to assume full liability for any potential contamination on the site or caused by run-off from the site and thereby face another layer of regulation. South Carolina recently amended their brownfield laws to reduce the potential liability from third party claims deriving from the redevelopment of a contaminated site. North Carolina encourages the safe reuse of abandoned properties that have some measure of environmental impairment. Intersecting Interests CONNECTIVITY Older neighborhoods are frequently more connective than newer ones, making it easier for traffic to move around. Infill in these connective areas takes maximum advantage of a good street network and also makes maximum use of exiting water/sewer infrastructure. URBAN OPEN SPACE Infill needs to be done with an eye towards preserving adequate green spaces. Urban open spaces, including pocket parks can help make higher density infill more accepted. Proximity to parks or greenways can also be a major stimulus for redevelopment as the Little Sugar Creek Greenway has shown. BROWNFIELDS Infill often depends on adequate tools to deal with brownfields some of the best infill may be adaptive reuse of old industrial sites. Rock Hill s Old Cotton Factory is an excellent example. PEDESTRIAN FRIENDLY STREETSCAPES Infill with sidewalks and street trees helps create pedestrian friendly streetscapes. No one wants to walk past vacant lots or abandoned buildings to get to a destination, but pocket parks, town homes, as shops create a great walking venue.

5 COMMUNITY INFILL AND REDEVELOPMENT PAGE 5 Redevelopment efforts of all sizes and shapes can be found in both the Carolinas. The City of Charlotte has comprehensive neighborhood plans that support redevelopment programs: i.e.; the Third Ward Vision Plan and the South End Pedscape and Station Area Plan. Descriptions of both plans can be found at departments/planning/home.htm The City of Charlotte offers assistance to land owners and developers through its Economic Development Office, supporting the redevelopment of distressed business districts, vacant big boxes and brownfields. Program descriptions are found at Home.htm Who s doing this? Mooresville, NC, used relatively new brownfield regulations to spur the redevelopment of the 39 acre Burlington Mills textile-manufacturing complex in The abandoned facility was filled with asbestos. Soil and groundwater had been contaminated around the 100 rear old mill. Cherokee Investment Partners and the Town of Mooresville created a redevelopment to fit into a comprehensive downtown redevelopment effort and re-invigorate the core area. The completed project will offer over 700,000 square feet of multitenant flex, retail and commercial space. In June 2005, SC expanded the protections afforded developers of brownfield sites by excluding third party liability of non-responsible parties. To save land for industrial or commercial redevelopment, Chicago created six enterprise zones that prohibit residential units. Rock Hill, SC, has completed the Textile Corridor Master Plan for the redevelopment of a over 1.5 million square feet of vacant underutilized space in the Old Town area of Rock Hill. Wilmington, NC, after analyzing redevelopment efforts in other cities, refined them to apply to local situation. The Downtown Rehabilitation Loan Program concentrates several financial tools in targeted areas including the central business district. The City offers construction and permanent financing, commercial rehabilitation loans, and mixed-use rehabilitation loans to qualifying projects. See for details. In January 2005, the Textiles Communities Revitalization Act became effective in SC. The new law, targeted to abandoned textile sites, provides property tax credits or other income incentives to offset rehabilitation costs for redevelopment of former textile manufacturing sites. Salisbury, NC, became a participant in the NC Main Street program in 1980 and has used the four point program development by NC Main Street Approach to revitalize its downtown CommunityPlanningAssistance/NCMainStreetCenter/ How long does this take to implement? Implementation of infill and redevelopment is a longrange project. It can take several years to develop the plans, incentive programs, financing arrangements and codes that enable to e desired type of development. Market conditions will also be a factor. However, the payoff is a vital community that people want to come to. For More Information Community and Economic Development Director at Centralina COG Charlotte Economic Development and Planning Charlotte ULI District Council Community Planning Assistance/ NCMainStreetCenter/ Street-SC.aspx Tracking Progress Let CCOG know when you have implemented these actions by calling Prepared by Centralina Council of Governments in collaboration with Catawba Regional Council of Governments, 9/2007, updated 8/2010.