Introduction
Getting a mixed-use development approved (let alone completed) is notoriously difficult. Zoning can be hard to change, parking regulations will dictate the size of a building’s footprint, and anything can change at the drop of a hat. Still, when a plan comes together, its impacts reach far beyond the property line. Here is a mixed-use development project that followed the long and winding road to success, what made it work, and what you can take away to apply to your own development process.
Investment & Impact
The Tennessee State Fair has survived several incarnations since its 1855 inception. It left its first site (now Centennial Park) to later be reborn in Nashville’s city limits in 1906. It bounced back from interruptions in its annual celebrations during World War II, the Great Depression, and two devastating fires. In 2010 it faced a new challenge: financial stability. Davidson County, the Fair’s custodian, leased the operations of the event to the then newly-formed Tennessee State Fair Association, giving the event organizers the flexibility to relocate the State Fair to more profitable venues.
This latest step in the fair’s evolution left the city of Nashville and Davidson County with a new challenge of their own; what’s the best use for a 100-year-old fairground?
The city worked with Conventions, Sports and Leisure International (CSL), Venue Solutions Group (VSG), and Convergence Design (Convergence) to develop a 2-phase Fairgrounds Master Plan. Phase 1 of the Master Plan dove deep into all the possible ways in which the fairgrounds could be used. Researchers outlined 4 potential scenarios for the fairgrounds:
- “As Is”, No Physical Changes
- Operational Adjustments, Basic Repairs
- Fairgrounds Redevelopment at Current Site, With or Without Existing Racetrack
- Fairgrounds Redevelopment at “Greenfield” Site (lands unused by the fair but that are adjacent to the property), With or Without Existing Racetrack
Here’s what Phase 1 of their analysis found:
Summary of Estimated Annual Metro Government Costs and Nashville/Davidson County Benefits
| Current (with state fair as tenant) | Scenario 1: No physical changes | Scenario 2: Operational Adjustments, Basic Repairs | Scenario 3A: Fairgrounds Redevelopment at Current Site, With Racetrack | Scenario 3B: Fairgrounds Redevelopment at Current Site, Without Racetrack | Scenario 4A: Fairgrounds Redevelopment at “Greenfield” Site, With Racetrack | Scenario 4B: Fairgrounds Redevelopment at “Greenfield” Site, Without Racetrack | |
| Annual costs to Metro Government | $300,000 | $400,000 | $1,000,000 | $8,100,000 | $7,700,000 | $12,400,000 | $17,700,000 |
| Annual Incremental Tax Revenue to Metro Government | $400,000 | $300,000 | $500,000 | $800,000 | $800,000 | $900,000 | $1,300,000 |
| Annual Economic Output | $12,100,000 | $11,100,000 | $15,900,000 | $25,900,000 | $24,700,000 | $28,000,000 | $38,600,000 |
| Annual Employment Impacts (Full- and Part-Time Jobs) | 151 | 139 | 198 | 323 | 308 | 349 | 482 |
What Makes it a Success?
Phase 2 of the Fairgrounds Master Plan defined, categorized, and evaluated the economic and social impacts of possible fairground uses. This gave the city leaders a rubrik with which they could evaluate development proposals for the available real estate in and around the fairgrounds. This, in some cases, saved city managers time and the cost of conducting independent analyses for each proposed new project. The results of the 2-phase Fairground Master Plan provided a litmus test to see at a glance whether development proposals appeared realistic compared to the city’s own analysis.
Not only did the Fairground Master Plan pave the way for mixed-use development projects, it also led the city to approve a project which included a Major League Soccer venue alongside designating 12 percent of residential units as affordable housing, 4,000 square feet for a childcare facility, and 4,000 square feet of retail space in the mixed-use development for a micro-unit incubator for artisans and small businesses.
Idea to Steal
Nashville, Davidson County, and the consultants they hired to evaluate all potential land use scenarios produced several presentations and reports based on their findings to educate local citizens’ groups about the potential economic benefit the area might see as a result of all of their development options. This made voting citizens as educated as city leaders when it came to evaluating proposed projects and generated a healthy amount of community buy-in before they broke ground.
Hungry for more?
See how other companies used the economic modeling techniques described above as well as a few other clever tricks of their own. Click on the links below to read more:
IMPLAN
Economic input output
modeling application, data,
and solutions.
