Economic Development

Downtown Revitalization During a Recovery: Great Idea or Huge Mistake?

Only time will tell if Kansas City’s unusual and possibly risky move will pay off.
by | February 2012
 

It’s an unusual story that once was fairly common. Kansas City, Mo., is celebrating the completion of one huge downtown construction project after another.

The recent opening of a $400 million performing arts center was just the latest in a series of high-profile ribbon-cuttings in the city. Over the past few years, about $6 billion has been devoted to a sports arena, a towering headquarters for H&R Block and several other large-scale developments.

They’ve all been rolled out in a period when downtown development in most cities has crawled to a halt. Nearly every city seemed to be engaged in downtown revitalization efforts just a few years ago, but the economic slowdown has put big projects on hold, while fairly fresh condos from Miami to Chicago’s South Loop are sitting vacant by the score.

Some think that Kansas City’s efforts show that the popular model of the past decade -- bringing new life to downtowns, particularly after working hours, by attracting young professionals and empty nesters with performance spaces and restaurants -- still works. “It’s a very sound approach, given the demand for a quality, walkable, urban environment,” says David Downey of the International Downtown Association. “Downtowns are becoming both older and younger all at the same time.”

As the economy rebounds, it’s likely that the focus on downtown revitalization will return, says Jennifer Vey, an analyst with the Brookings Institution’s Metropolitan Policy Program. Communities around the country have done a better job thinking about what would work in their own downtowns and have tailored their plans more carefully than they had during earlier development fads, such as building big convention centers and accompanying hotels.

Still, Vey emphasizes, downtown investments have to be part of a broader strategy within the city and the region. There have been plenty of instances in which gleaming downtowns brought little benefit to outer neighborhoods or surrounding suburbs.

That’s the challenge Kansas City faces now. The city itself spent heavily to underwrite much of the construction that’s been happening downtown. But its schools are a wreck and the murder rate is sobering.

If the tax incentives and direct financing the city poured into its downtown pay off, the new developments will generate revenue to address those community needs. But if they turn out to be boondoggles and the city is left dangling on the hook, Kansas City residents may wonder why, in the midst of a recession, the city was underwriting the purchase of furniture for fancy office towers.

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