Lessons for a HealthyDowntown Kirkland

Kirkland Downtown Advisory CommitteeJuly 26, 2007

LELAND CONSULTING GROUP

Kirkland DACLELAND CONSULTING GROUP

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Focus of the PresentationWhy Plan Downtown?Downtown TrendsIngredients for successTools and Tactics

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Why Plan for Downtown?

Cities are defined by the Public RealmCirculation, Open Space, and Public Buildings help define private opportunityDowntowns are the most complex part of a city

Downtown Trends

RetailResidential

EmploymentDemographics

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Retail TrendsLuxury goods are small share of total retail sales70% of retail sales in America are made after 5:30 and on weekendsEarly closing stores in downtowns strugglePlace Making: In downtown and at suburban lifestyle centersRetail is constantly changing

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Residential TrendsUrban housing resurgenceHousehold sizes are shrinkingMore people work from homeUrban housing needs:

Inviting environmentVariety of productSupporting services

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Residential TrendsEmerging Trends in Real Estate, 2007:

Coastal Metro AreasApartments, office—strong Infill, urban locations, and transit stations

Urban and suburban apartments are hottest of all development types

- Integra Realty Resources, 2007

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Household Composition

Household Type Portland Seattle Boise Spokane Kirkland

One-person 34.6% 40.8% 30.0% 33.9%

32.0%

65.9%

34.1%

100%

35.6%

Two-person 33.3% 33.8% 34.4% 36.4%

Subtotal 67.9% 74.6% 64.4% 72.0%

Three or more 32.5% 25.4% 35.6% 28.0%

Total 100% 100% 100% 100%Source: U.S. Census Bureau and Leland Consulting Group

Select Western Cities (2000)

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Just over 20 percent of America is now “Dad, mom, and two kids”

Non-traditional households are the majority

Marrying later and deferring childbirth—define themselves through live-work-shop

Rich ethnic mixKey urban housing markets:

Generation X – up and coming, seek urban excitementBaby Boomers – free, affluent, and downsizing

The ‘Typical’ Household

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Office and Employment TrendsTechnology and Services Small firmsBright young workersSeek urban places18-hour activityMixed-use environmentsSocial interaction

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Downtown Land Use Rules of Thumb

HousingLower parking ratiosSupports more retail $$Activates weekends/ evenings

OfficeHigher parking ratiosOnly 9-5, M-FMore cyclical

ButBut……

•• Rules are made to be brokenRules are made to be broken

•• Too much of a good thing isToo much of a good thing is……

•• Kirkland may be an exceptionKirkland may be an exception

What Makes a Successful

Downtown?

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Place Making“The process of identifying and revitalizing

underutilized public and private spaces that result in the fundamental transformation of community.”

Through superior public realm design, overcome hesitation and resistance to private sector investment.

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Attributes of a Healthy Downtown -Physical

Compact urban formPedestrian amenitiesSecure environmentAttractive housingClass A office spaceHotels Civic and cultural usesEntertainment Historical connection

Parking and transit access

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Attributes of a Healthy Downtown –Financial

High retail salesDiversified tax baseHigh occupancyRelatively high commercial rentsRange of funding tools

LID/BIDParkingSales TaxesHotel/Motel TaxesProperty Taxes

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Attributes of a Healthy Downtown –Organizational

An effective downtown organization

Marketing Management AdvocacyEventsEducation

Arts & cultureCity agencies

Public and private leadership

Many plans don’t get built—

Why?

Universal ProblemsBarriers

Challenges

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Universal Downtown Problems1. Attracting new development2. Attracting people downtown evenings / weekends3. Competition from

discount stores and/or suburban malls

4. Vacant/underused retail space

5. Parking6. Shortage of suitable

housing

in priority order

Source: International Downtown Development Association with LCG

Kirkland DACLELAND CONSULTING GROUP

Universal Downtown Problemsin priority order

7. Image8. Vacant/underused

office space9. Preservation of older

buildings10. Unattractive building

façades11. Crime (real or perceived)12. Traffic circulation/congestion

Source: International Downtown Development Association with LCG

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Barriers get in the WayMarketPhysicalFinancialRegulatoryPolitical

Kirkland DACLELAND CONSULTING GROUP

Market BarriersEconomySeasonalityLack of precedent for project componentsAppraisal challengesOvercoming fears of pioneering

Weak visual exposureLack of critical mass

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Physical BarriersLack of pedestrian friendly amenitiesLack of public realm elementsIncompatible land usesShape / size of areaLack of parkingWaterfront orientation

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Financial BarriersInadequate public funds for planning, property acquisition, programs, and start upHigh development costsInfrastructure costsPerceived risks investmentLow rents

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Regulatory BarriersInappropriate codes and zoningRestrictive heights, uses, stacking, etc.Inflexible code administrators—regulatory overkill Overly prescriptive design standardsOnerous permitting process –time is money!Discretionary process vs. developer certainty

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Political BarriersLack of revitalization experienceLack of true championsMissing implementation strategyNot enough communication

Political resistanceIncomplete internal consensusMissing public-public partnerships Private sector and media support is underdeveloped

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Downtown Development Challenges

More complicatedHigher land costsRegulation & reviewStrong public opinionHigher parking costsConstruction stagingNeed to overcome these barriers through joint development

Tools and Tacticsto Sustain Success

‘Getting Ready’Implementation Principles

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Don’t Let Planning be an Incomplete Thought

Do not plan for downtown aloneUnderstand the larger community contextDowntowns must integrate with other goals:

HousingJobsTransportationParksArts

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How to do it? Getting to Implementation1. Have a Great Strategy2. Many, Many Projects3. Committed, ongoing Leadership4. Supportive Government5. Public-Private Partnerships6. Ongoing Review

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Have a Great Strategy

Combine market potential with community visionGo far beyond patching problems or reacting to specific issuesInspire greatnessAuthenticity

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Many, Many ProjectsA great plan moves many projects forwardProjects are broadly defined:

Public and private BuildingsInfrastructureMarketing EventsOpen spaces

Think small

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Committed, Ongoing Leadership

Leaders desire success for the entire communityAble to motivate and organize stakeholdersGreat leadership = great projectsNo leadership = failed projects

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Supportive GovernmentProvide support for achieving standards –consultation, code enforcement, and assistanceAble to review its practices and identify and change policiesSet clear goalsChampion implementation

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Provide IncentivesTax abatementSDC policy refinementTax creditsLocal Improvement DistrictsRezoningLending poolsMarketing assistanceExpedited permitting

EducationPut out the welcome mat

Public-Private Partnerships

The most important tool in the shed

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Private Investment Follows Public Commitment

Prepare infrastructure and amenities in advanceDevelopers want long-term certaintySet the bar for quality

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Nurture Public-Private Partnerships

Most implementation is done by private sectorTypes of partnerships:

Development agreementsDevelopment RFQ/RFPDirect & indirect subsidy

Seek leverageProvide public amenities

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Nurture Public-Public Partnerships

Build public partnerships for implementationLocal, Regional, State, and Federal

Kirkland should not do it alone

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Lessons Learned Community

Goals

Successful Project

Public Private Partnership

Developer Experience

Financial Capability

Design Excellence

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Ongoing ReviewPlans are living documentsChange is constant

MarketsEconomyResidentsLandscapeVision

A downtown is never “finished”

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Bottom Line

Downtowns are complexTrends are positiveSuccessful downtowns have

Leadership and champions Public-private partnerships Good communicationMany projects at once

The process is never done…

Kirkland DACLELAND CONSULTING GROUP

LELAND CONSULTING GROUPUrban Strategists

www.lelandconsulting.com

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