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Jasper Ave Blues: What Does $5 Billion Get You These Days?

In Edmonton, the Downtown Business Association released a new report about potential downtown investment. It outlines 36 projects that are approved, proposed, or rumoured to be occurring downtown or in the adjacent Quarters area. Most readers will recognize that not all of these will go ahead – some will be shelved indefinitely, if not permanently and some will be scaled back. Yet, it paints a picture of what downtown might become, maybe not in 5 years (as the report suggests), but perhaps in 15-20.

I’ve grouped the probable, proposed, and rumoured projects into five categories: Commercial (office, retail, service), Residential, Major Facilities, Infrastructure, Public Space:

Commercial
This is the most problematic section. It proposes nearly 3.9 million square feet in commercial space (office, retail, and service), which seems…really high. For example, a City-commissioned report from 2009 anticipated that downtown would need an additional 3 million square feet in 2044, using baseline growth projections. In an alternative, and more positive, scenario, it projects demand to be about 4.5 million by 2044. All these projects going ahead would mean more than 85% of that would be available 5 years from now. This doesn’t add up, especially when – as our Mayor correctly points out – many businesses still don’t want to locate downtown.

(Update: DECL President Chris Buyze is more bullish on the commercial real estate market than I am. At this point, we have to agree to disagree, but he provided this Colliers report in support of greater growth).

Residential
In total, it proposes 2284 units, in addition to however many the Warehouse Incentive Program would contribute towards. Using the $10,000 per unit number from the Capital City Downtown Plan, that would mean an additional 1200 units for a total of 3484, which could translate to more than 5000 additional residents in five years (assuming roughly 1.5 residents per unit). Given that downtown grew roughly 130% in 15 years, growth of close to 40% in 5 years isn’t completely implausible. Note too that the region’s population grew by 124,924 residents from 2006 to 2011, and you can see demand for housing continuing to grow so long as the economy performs well.

Yet, the biggest threat to residential development downtown probably comes from its neighbours. Projects in Oliver continue to move ahead, drawing from much of the same pool of potential residents. Development on the City Centre Airport lands is also likely to start, providing further competition. For development in all three areas to go ahead as planned in the short term, Edmonton likely needs a huge economic boom, or a meaningful reversal of growth in the suburbs.

(Update: Buyze says the 10K grant isn’t happening. Not sure what the money will be spent on, but I can’t see this positively impacting my unit projections).

Major Facilities
The arena will go ahead, as will the Royal Alberta Museum. Based on estimated attendance, let’s say the arena will bring roughly 1,800,000 visitors; based on data from the early 2000s and accounting for growth, let’s give RAM 260,000 (if you think those are impressive, downtown Edmonton’s workforce would account for between 14,000,000 and 15,000,000 just by going to work regularly). In any case, all sorts of caveats apply when considering impact, such as that many attendees will go straight from the train or bus or their car to the venue and back, and many who do go out before or after an event already do so in the downtown area. The rest of the venues are still too much in the project phase to project well.

Infrastructure
The changes to Jasper Ave and completion of Capital Boulevard will help with beautification. The proposed enhancements are all welcome, though dependent on CRL revenue, which wouldn’t begin to be collected until at least 2015 – assuming the arena goes ahead that year and ancillary taxable development is build at the same time.

Public Space
What I said about the proposed infrastructure projects applies here as well.

What It Means for Downtown
All these projects added up provide a window into a possible future for downtown. Yet, it’s by no means assured, and not the only possibility. Many of these plans are just that – plans, with no money attached. Others are just ideas at this point. It’s likely that civic plans will once again be updated before all of these projects (or replacements) go ahead, meaning priorities may shift, if the market hasn’t led a shift already.

Citizens have to think about what kind of downtown they want, and whether what’s being proposed meets that vision. In particular, because it’s estimated that at least $2 billion of this investment (including $1.5 billion of what’s probable) will come from public funds.

For me, I see many projects I like in the report (additional residences, parks, cycling and walking infrastructure). But I also see things that are missing, such as no mention of the LRT (the downtown portion connecting the West and Southeast legs of the unfunded new line).

I will continue to hammer the point about opportunity cost, and it needs to be said again here. In particular when dealing with the public investment side, we need to consider what the money can best be spent on in order to achieve the social, financial, and development returns we hope for. I hope citizens keep that in mind when reading this report and others like it.

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A Model City? Why My City (and Yours) Might Find Inspiration in Pittsburgh

In my hometown of Edmonton, one of the biggest issues of debate over the past few years has been that of whether to build (and how to fund) a new hockey arena on the north edge of downtown. Proponents have held up a few examples of what they consider successful arena districts, but in particular have focused on Columbus, Ohio.

With the announcement this week that a builder and (probably) an architect have been chosen, the project continues to move closer to reality (all that’s missing is $100 million in funds).

Though I’ve been critical of whether an arena is the best way to increase activity in the area – and I think the promised economic benefits are overblown – if it’s going ahead, I want to see it happen in the best way possible. Again, the Columbus model was cited as one Edmonton should follow. I have two questions, or reservations, about this:

1. An arena (district) is just one part of a downtown, never mind a city, so looking at that area in isolation is limiting.
2. A ‘Made in Edmonton’ (or insert name of your city) solution is cliche, but behind it is a truth that you can only draw ideas and inspiration from other cities, you can’t replicate and expect the same result.

6th Street Bridge

Cited as another possible model for the arena itself is the new Consol Energy Center in Pittsburgh, which got me thinking – I’ve never been to Columbus, but I have been to Pittsburgh. If I know anyone who’s been to Columbus, they have certainly never felt the need to tell me about it. Meanwhile, the handful of people I know who have been to Pittsburgh all left impressed. And it’s getting plenty of accolades from academics, advocacy groups, and major newspapers, to name three places. On Sunday, I called it a seriously underrated city, which experts with more knowledge than I have concur with.

And finally, it tops multiple different lists for most livable cities in America.

Next week, I’ll be introducing a concept around how I see cities becoming successful, particularly in respect to other, potentially competing, cities. A lot of it has to do with the size of a city. Comparing major metropolises to medium-sized cities is comparing apples and oranges. For Edmonton, with a metro population of over 1 million people, I’d pick Seattle (at 3.5 million) as the starting point, population-wise, for a city Edmonton might start to have legitimate comparisons with. Of American metro areas, I’d say the 15th (Seattle) to 51st (Rochester) – all anywhere from 3.5 to 1 million residents, could be considered in some way analogous.

The purpose of this, though, is to put forward the idea that when looking for inspiration, we need to look at a more macro level. Columbus’ arena district might work for that city, but there are different macro-level considerations for mine and yours. But while we don’t need to replicate everything Pittsburgh did, every medium-sized city can draw lessons and inspirations from some of the many things it has done well. If we’re going to take best practices from other cities, that’s the way to do it best.

Jasper Ave Blues: Bright Lights on 4th

For all the talk about the challenges facing downtown Edmonton, few would dispute that there are success stories. 104th St – being rechristened 4th Street Promenade – is my pick for the biggest one. With two announcements about new tenants in the past two days, things keep looking up.

Scaffold
Workers take a break from renovating the Jaffer Building on Jasper and 104th that will soon house a 7-11 and whiskey bar.

First, it was announced yesterday that the historic Mercer Building will be renovated. Reopening this spring, it will house a tavern, coffee bar, and high-end furniture rental company. A day later, the owners of an under renovation building announced that a 7-11 and to be announced whiskey bar will be moving in.

3 blocks apart, they bookend the revitalized stretch of 104th St (further to the south, the McKay School district feels like a separate entity). The Mercer Building is across the street from MacEwan University, and the proposed future home of Edmonton’s new hockey arena). The Square 104 apartments across the street, and the new Quest condo tower one block to the west should help provide a local consumer base. The Jasper Ave project promises to add another high-end bar to the blossoming pub/restaurant scene in the area.

Astute readers will note that both developers cite the downtown arena as a reason for going ahead. While I remain skeptical about the value proposition from a public investment perspective, and think it could yield more return on investment in other ways, I am thrilled that it’s prospect appears to be boosting investor confidence in downtown.

Oddly, though, I’m most encouraged by the 7-11. One of the risks inherent in revitalization is a theme park-ization of the urban core. That is to say, the development of attractions that draw visitors, but don’t build a permanent base of residents. Arenas, concert halls, restaurants, and bars can all contribute when done well, but if everyone leaves after the encore or last call, you’re not building a neighbourhood so much as a destination – and successful downtown have to be both.

Mundane as it sounds, I see a new 7-11 as a sign that there’s a permanent population that justifies its creation (many new residences have been created on or around 104th). We want our neighbourhoods to have fancy bars and restaurants, but if they’re to be truly livable, they also need convenience stores and dry cleaners.

This week’s announcements make me think that, at least along this stretch of downtown, we’re making progress on both fronts.

Jasper Ave Blues: A Preamble

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Over the next…indeterminate period of time, I’ll be undertaking a series of posts about Downtown Edmonton. Readers will have surely noticed my interest in cities and urban environments. The urban core – in particular its downtown – is at the heart of any successful city/region.

I spend most of my time right now downtown and nearby. I work downtown, and live three blocks west of its technical boundary. When I’m home, I’m downtown at least 6 days of the week – every work day, plus at least one day on the weekend, whether it’s working out at the Y, going to a concert at Starlite or the Winspear, having dinner or drinks with friends, or of course, the market on Saturday mornings in the summer.

On the bright side, interest in downtown’s future and well-being is the highest in the decade I’ve closely followed Edmonton civic affairs. On the media front, CBC AM is in the middle of a series called Downtown at a Crossroads, and several Edmonton Journal writers (particularly David Staples) have focused heavily on downtown. City Council, the Edmonton Economic Development Corporation, and the Chamber of Commerce are all active champions. The Downtown Community League is doing excellent work, and I see a real pride among many citizens in what’s happening. On the downside, interest doesn’t automatically lead to progress. Done poorly, it could end up having an adverse effect, and there’s also a danger that boosterism and the desire to see something – anything – happen, may override due process and judgement on what is truly beneficial. This series will be my contribution to the discussion, analyzing downtown’s current state, proposals for new ideas that come forward, and putting forward my own ideas about what can make our downtown even better. I hope others will respond, engage, and contribute.

The title of this series might imply a strictly negative view of downtown in its current state. Nothing could be further from the truth (I just liked the title, thought it was catchy, and don’t have any better ideas right now). While our downtown isn’t the best, or maybe even in the top 10 downtowns I’ve visited in the past few years (to be fair to Edmonton, I’ve been to a lot of cities in that time), there are a lot of positive things happening. Edmonton’s downtown has made tremendous strides in the 15 years or so that my memory extends back. New residences are popping up, ranging from the higher-end Icon Towers to the Mayfair Village affordable housing development. 104th Street has exploded, boasting a roster of coffee shops, wine bars, restaurants, and shops that rivals High Street or Whyte Ave – in quality if not in quantity. Nothing beats spending a Saturday morning during the summer at the outdoor market on 104th. A couple of years ago, none of Moriarty’s, Tres Carnales, Corso32, or Pampa existed. Now, we have a strong restaurant scene downtown. Our downtown would be virtually unrecognizable (in a good way) to someone who left two decades ago and had yet to come back.

Anecdotally, the strongest point for downtown I can say is this. When I moved back to Edmonton 6 years ago and for a while afterwards, I couldn’t imagine I would choose to live downtown over other areas in the city. When I last moved just under 2 years ago, the downtown area was by far my preferred area to end up. That’s somewhat due to having worked downtown for the past 5 1/2 years, and having gotten to know the area better. But mostly it’s because of the improvement I’ve seen in that time. But our downtown can still be so much more. This series is one way I’m aiming to help make that a reality.

Clustering for Growth

Michael Porter, founder of the ICIC, kicked off today’s schedule with a talk about cluster-based economic development, and how these strategies can spur economic and job growth in inner cities.

Inner Cities have particular characteristics, and strategies for economic development need to reflect this. In particular, he pointed out that higher poverty rates are common (31% compared to 9% for the United States as a whole), that inner city residents often may not be able to access jobs across the region, and that inner city development needs to respect and be tailored to the particular skills and experiences of residents in the inner city. Despite the growth that many cities have experienced, in the last 10 years 82% of inner cities have performed worse than their region as a whole.

One of the key distinctions Dr. Porter talked about is that between local clusters and trading clusters. Local clusters, as the name implies, exist primarily to serve the local market (i.e. Retail, health). Trading clusters aim to serve national and international markets (i.e. Life sciences, transportation and logistics). Local clusters have demonstrated more growth, in particular in inner cities.

Clusters work best when they build on existing groups of businesses, not when a city attempts to build them from scratch. Adapting this for inner cities, it strikes me that a successful inner-city cluster and growth would build on the following

• Existing businesses (particularly small, locally-owned businesses)
• Underutilized (or unused) skills of inner city residents
• Gaps in the local and regional marketplace that align with inner-city businesses and skills of residents
• Businesses and clusters of businesses that can concentrate jobs and economic activity in the inner city area.

What can your region build upon in the inner city to start developing a cluster? This question is the starting point for spurring more inner city economic growth.