The following is the second installment of a four-part series entitled, “Re-defining the Three-Legged Stool: Placemaking as a Component of Economic Development.”
The previous installment explored placemaking’s role in business attraction as it improves the quality of life of a community and the marketability of a place. This installment considers how placemaking influences business attraction and retention.
Defining Business Retention and Expansion
Business retention and expansion (BRE) is different than business attraction because it focuses on helping existing businesses already in the community to prosper and grow. Typically, the main tool of BRE is a yearly survey of businesses that economic developers send out to (or make appointments to work through in-person with) businesses in their communities. In cases where businesses are seeking to expand, economic developers can provide access to financing, in the form of revolving loan funds, grants, and other loans, or by providing access to municipal or state resources.
Mixed Uses Contribute to Improved Usability
But, even if they aren’t aware of it, economic developers are also likely engaged in business retention and expansion activities that overlap with placemaking. For example, businesses that are multi-use, such as breweries with attached tasting rooms or small-scale food manufacturers with attached kitchens, often do not fit into one zoning category — though their mix of uses is what makes them unique, and contributes to a lively neighborhood. This can make expansion difficult, and lead to cumbersome zoning negotiations, causing businesses to lose both time and money. If economic developers work with city planning staff to assist business owners in these cases, then they are helping to create more vibrant places with improved usability.
New Uses for Older Properties
As real estate tides change, economic developers will need to be creative about new uses for old properties. Retail outlets and office spaces are being repurposed for apartments, maker spaces and incubators or are being converted into space for existing businesses to expand. The success of these new uses depends on a vibrant, transit-linked, pedestrian friendly environment to attract the kind of young talent that populate these spaces.
Creating nodes of activity in centrally located, pedestrian, and transit-accessible areas can also assist with regional business retention. As shown by the Brookings Institution’s research shows, more and more companies are choosing to move from suburban corporate campuses to areas where economic, networking, and physical assets are more accessible, contributing to a rise in what has been termed “Innovation Districts.” These districts combine small businesses, bars, and restaurants with startups, institutions such as banks and universities, and large companies. The diverse mix of tenants leads to more collaboration and an attractive environment for knowledge workers.
Attracting a Quality Workforce
From assisting businesses with zoning issues to encouraging innovation districts, business retention and expansion efforts are improved when viewed through a lens of placemaking. However, the most important determinant for keeping businesses in a community and helping them to expand is a talented and plentiful workforce. Creating a place with a higher quality of life attracts more people to communities and engenders a strong bond that helps retain populations. Smart companies understand this and locate themselves where their workforce wants to live. Placemaking is part of a larger business retention and expansion effort, and offers an advantage that should be used by economic developers.