Wednesday, January 30, 2008

Public vs. Private Investment: One Hand Washes the Other

What comes first? The Chicken or the Egg? This has been a question asked for centuries by every great philosopher. Every one can have a valid argument for each side. One can't find an answer. Keep in mind I'm not a great philosopher and I don't want to try to debunk the theory myself.Now we come to Baltimore,which has its own version of the chicken/egg argument. Public and private investment which comes first? There are many instances in the gentrification of Baltimore where one or the other has come first. The question still remains for neighborhoods that have yet to be gentrified, which will come first for Baltimore in the future, public or private dollars?As always lets first examine the past. Charles Center began with a group of Civic Leaders on the private sector headed by none other than James Rouse who formed the Greater Baltimore Committee. They came up with the Charles Center plan and presented it to the City. The City then paid for the acquisition and demolition of the buildings at the sight. Then the land was sold to developers who built the buildings known as Charles Center.
Next came the Inner Harbor, this started at the public sector with the promenade lining the waterfront, The Convention Center, the National Aquarium, and the Maryland Science Center. The first brick for the waterfront was barely laid when the private investment began pouring in. Rouse built the Harbor Place and the Gallery mixed use projects. The old Power Plant building was transformed into retail and hotels were being built by the dozens. Meanwhile on the residential side public investment began in the way of homesteading and the famous $1 row home in hopes of attracting private investors. It worked like a charm, after all this is Charm City and neighborhoods like Otterberin Federal Hill and Fels Point were transformed from gritty industrial wastelands to upscale rehabbed homes shops, boutiques, restaurants, and bars. Plans for Inner Harbor East were beginning to surface but that will be discussed later.While the Inner Harbor began thriving ever since the opening of Harbor Place many neighborhoods to the north west were not. One that stood out most was Sandtown Winchester. In 1987 upon Kurt L. Schmoke's election Sandtown was on the top of his agenda. The Enterprise Foundation and B.U.I.L.D., a charities that took interest in this distressed neighborhood were able to funnel $60 million in public and private dollars. They took a Comprehensive look at every thing in the neighborhood housing, education, employment, retail, crime, and health of the residents. Not surprisingly the whole neighborhood suffered from deep rooted problems in all departments. Some 21 years later the neighborhood has seen its share and successes and hardships which I will discuss in a post dedicated to it.
Then came the westside of Downtown. It didn't get the same renewal and attention that the Harbor and Central Business District did. It came at first in the form of Stadiums. First it was Oriole Park at Camden Yards then it was M&T Bank Stadium. Both were public/ private ventures where the government paid to have the sites and offered enormous tax breaks to the developers and owners of the teams. Although these were great additions to Downtown they didn't help the Westside that much. The Schmoke administration came up with the Westside Master Plan that involved tearing down almost every building in the district. Historic preservationists lobbied against this and the plan was scrapped. That didn't mean renewal didn't start on Baltimore's once thriving retail and shopping district it just came in the form of reusing existing historic buildings. I don't believe that the stadiums were the catalysts for change in the Westside. The renovation of Lexington Market and the Hippodrome Theatre brought in the big bucks to the Westside I believe. New development and investment of note on the private sector include the Stewarts Building, The Hecht Company Building, Centerpoint, Bank of America Superblock, and the Zenith. Public investment of note include the expansion of the University of Maryland Campus and the 757 Hilton Convention Center Hotel with a "Green" roof.
Another pet project of the Schmoke Administration was Inner Harbor East. The Inner Harbor East Urban Renewal Plan was set up before Schmoke took office as well as the purchasing of the land that would become Inner Harbor East by John Paterakis. The majority of the planning and financing on both the public and private sector happened during the Schmoke years. Most of the physical construction took place during the O'Malley years and will continue through the Dixon years. Inner Harbor East brought a hodgepodge of upscale restaurants and bars, a whole foods, two hotels of the Marriott brand, office space Legg Mason will be moving there, and apartments and condos like Spinnaker Bay, Inner Harbor Lofts, and The Promenade at Inner Harbor East to name a few.
Some projects were never meant to have private investment. The projects in question are HOPE VI. HOPE VI was the brain child of Maryland Senator Barbara Mukulski which ear marked federal grants for distressed public housing developments mainly high rises to be torn down and rebuilt as mixed income communities consisting mostly of town homes. The ink barely dried on the bill before Baltimore received grants for its distressed high rises. The finished products were for the most part a huge success albeit suburban in nature. When President George W. Bush took office HOPE VI funds were slashed almost to the point of no return. Baltimore then took the place of the feds and began tearing other distressed public housing developments and coming up with mixed income neighborhoods to take their place.
At the turn of the century Baltimore elected Martin O'Malley as their mayor. O'Malley brought a number of new ideas that used public funds to encourage private investment. First there were SNAP or Strateic Neighborhood Action Plans which took six clusters of neighborhoods mostly on the outer edges of the city. These clusters were in decent shape but were just starting to show signs of slipping. The SNAPS were publicly funded and used market forces and highlighted the neighborhood attributes to funnel in private dollars and eliminate blight that was just begining to appear. Another is Area Master Plans or AMPS AMPS were designed for neighborhoods that are more in the inner city and have suffered from blight, crime, and poor living conditions much worse and much longer than their SNAP counterparts. Much more intense intervention is needed to turn these neighborhoods around, mainly redevelopment and displacement. Another one which superceeds the two is porject 5000 in which the city aquires 5000 vacant properties and sells them to investors for $5,000. The investor must in turn spend an undetermined amount of money to rehab the property based on its condition and either live in or sell it to a home owner.
Now the year is 2008 and Baltimore's waterfront is on the verge of being built out. Canton transformed itself on its own with little outside help. That didn't stop Canton Crossing, a new mixed use development from being built. Now we come to Westport. Developer Patrick Turner will develop the vacant middle branch waterfront into yet another high density mixed use development. The difference between Canton Crossing and Westport is that Canton has already experienced a rebirth while Westport remains blighted. But if history is any indicator existing Westport will make a strong comeback after its waterfront's $2 Billion make over. Now we come to the Biotech Park. Johns Hopkins, Baltimore's largest employer has decided to build a biotech park in the blighted Middle East neighborhood just north of its hospital. Along with the Biotech Park 1200-1500 new and rehabbed mixed income homes are on tap for Middle East and its neighbors. Upon its completion all of East Baltimore will be transfromed and thriving. The majority of the money will come from private investment but the city will pay for the relocation of residents and te demolitin of the blighted units, yet another public/private partnership.So there you have it transformation can take place in all different ways. Mostly it starts with a little public investment and if all goes right a lot of private investment. It's true that one hand washes the other. (This was a long post and I know I left some examples out)

No comments: