Today, thousands of developable sites lie fallow across the country. A stagnant economy and uncertain market conditions leave otherwise prime properties without interest from buyers or investors. Owners, unwilling to sell at depressed prices, are sitting on the sidelines until normal market conditions return. During this period of inactivity, what can they do to prepare their properties for when the tide comes back in?
A group of industry experts offered an answer to this question during a ULI advisory services panel sponsored by the city of Suffolk, Virginia, on February 25. The city, located at the confluence of the James and Nansemond rivers in the Tidewater region of Virginia, is home to a 445-acre (180-ha) waterfront site that is often referred to as “the best property in Hampton Roads.” The large site has only two owners: the Tidewater Community College (TCC), which owns 389 acres (157.5 ha), and the city’s Economic Development Authority (EDA), which controls the adjoining 56 acres (22.6 ha). The codevelopers, aware of the site’s potential, asked ULI for advice on the property’s highest and best use.
The panel, which spent a week studying the site and interviewing stakeholders, recommended that the developers capitalize on the site’s historic character and waterfront location, creating a walkable mixed-use community with a significant amount of public open space. But before this vision can be realized, the owners must lay the groundwork—literally: “The bad news is the market isn’t ready for the site. The good news is the site isn’t ready for the market,” said panelist Donna Lewis, planning director for Mercer County, New Jersey and ULI member.
A number of physical issues on the property must be resolved, including environmental remediation, shoreline restoration, utility and infrastructure construction, and demolition of existing structures. And to attract investors, the city must develop financial vehicles to fund and encourage development, address entitlement issues, and create a plan that allows for flexible uses that can adjust to market changes over time. Once the site is “shovel ready,” the owners must market it regionally and nationally, partner with their local economic development agencies, and monitor federal facility needs. Regional assets that add value for prospective investors—workforce quality, access to markets, regional research activity, for example—should be quantified and readily available.
Careful and thoughtful planning and preparation are essential for capturing the opportunities that will arise in the Hampton Roads area over the next five to seven years. “This is not going to happen overnight,” said Alex Rose, the panel chair and senior vice president of Continental Development Corporation in El Segundo, California. “It may not begin to happen physically on the ground for three to five years. But this is your planning window and opportunity,” added ULI member Rose.
The panel left the city with a framework to establish the well-positioned waterfront site, but it remains up to Suffolk to carry it out. “They’ve laid out a good program for us, and now it’s up to us to implement it,” city manager Selena Cuffee-Glenn told the Virginia Pilot.
ULI advisory services panels provide strategic advice to sponsors on land use and real estate development issues. Panels link developers, public agencies, and other sponsors to the knowledge and experience of ULI and its membership.