NEW YORK | LONDON – In a new report, Capturing Value and Preserving Identity, the Global Cultural Districts Network (GCDN) describes diverse tools that cultural districts can use to spur investment and create new revenue streams while protecting the local character and neighborhood identity. This report is the first consolidated source of advice on finance mechanisms, public policies, and equity-centered practices—known as value-capture tools—that can be used to recover and reinvest increases in real estate value that benefit communities as well as property owners and developers. The toolkit of proven value-capture tools, both direct and indirect, are defined, discussed, and illustrated in case studies contained in the report. Tools that include public practices such as the creation of Business Improvement Districts (BID), Tax Increment Financing (TIF), land banking, zoning and taking advantage of air rights, among others, have been used to direct revenue streams to offset maintenance costs and yield new revenue to use for public benefits that would otherwise be left solely to market forces. Additional tax incentives, such as historic preservation tax credits, can increase the flow of capital to low-income communities. These benefits allow cultural districts to take control of the development taking place in their locations and discourage the rise of gentrification.
Capturing Value and Preserving Identity explains these strategies in a way that can deepen the knowledge of cultural district leaders to understand what possibilities exist and how these strategies can be used intuitively. In recent days, the Covid-19 pandemic has revealed the economic and social disparities in cities across the globe. In the foreword written by Adrian Ellis, Chair of GCDN, he states, “the role of the pandemic in revealing the extent to which many communities lack resilience and equitable access to vital resources seem to render this topic even more timely.” Looking at examples such as London’s South Bank BID, where cultural organizations contribute £3.8 billion per year to London’s economy, the report reveals how businesses in a district can utilize value-capture strategies to help regenerate an area, improve visitor experiences, and diversify both its uses and its revenue streams. The report also reveals that the creation of public policies plays a critical role in shaping the environments in which cultural districts reside, such as the inclusionary zoning policies in New York City’s Chinatown, which have led to strong anti-demolition, anti-harassment and anti-eviction provisions to preserve the community’s unique character. Value-capture tools allow communities to reclaim a portion of the benefits generated by the increase in real estate value, which can cover the cost of providing public infrastructure to advance community interests.
This comprehensive resource will guide civic leaders to pursue the most beneficial value-capture tools available to them when seeking to redistribute public resources to navigate change successfully. For these tools to integrate properly, the network suggests leaders consider using value-capture mechanisms early on in the planning process. This will provide a holistic approach to the project that ensures a more equitable outcome.
Kiley K. Arroyo, who authored this report, is the Executive Director of the Cultural Strategies Council. For over twenty years, she has led a diverse portfolio of initiatives in partnership with entities from the arts and culture, government, civil society and academic sectors. This work has taken place in a combination of urban, rural and indigenous contexts in the United States and internationally. Ms. Arroyo has published widely on the role of culture in contemporary policy issues, equitable development, and the advancement of social and racial justice.
The Global Cultural Districts Network, an initiative of AEA Consulting, is an independent international association committed to improving the quality of urban life through the contribution of the arts, culture and creative industries. The network fosters collaboration and knowledge-sharing among those responsible for creative and cultural districts, quarters and clusters in widely diverse contexts, providing rich and rewarding opportunities for cross-fertilization and exchange. AEA Consulting is a global firm setting the standard in strategy and planning for the cultural and creative industries.READ MORE