Developers edge into the park business, pitching in to deliver amenities for tenants

When cities create new urban parks, the resulting green spaces can often act as magnets for sought-after private development. Builders and investors see parks as a key amenity for new apartments, retail and offices.

But the high costs of producing new parks are daunting for cash-strapped local governments. Increasingly, they are turning to public-private partnerships with developers and nonprofit groups to get them into the ground, and once built, to maintain them.

Several case studies in how it's happening — including in the Twin Cities — were highlighted this week in St. Paul at Greater and Greener 2017, a national conference sponsored by the City Parks Alliance, an organization of city park administrators, park-oriented community groups, philanthropic donors and others devoted to keeping urban green spaces thriving.

The participants in a forum on park-oriented development acknowledged that public-private partnerships can be controversial. Grass-roots community groups and elected leaders are frequently suspicious of developers' motives and of losing control of a public amenity. The speakers, however, agreed that generally they were a good thing, so much of the discussion involved how to create such partnerships in a way that is open and has clear benefits for both cities and developers' bottom lines.

St. Paul Parks and Recreation Director Mike Hahm focused on a handful of efforts to create new parks along the Green Line light-rail transit, which has already attracted significant new private investment since it was granted full federal funding in 2011. Called "Greening the Green Line," the program marks a collaboration not with a private developer but a pair of nonprofit groups — the Trust for Public Lands and the St. Paul Parks Conservancy.

One of the first results will be the refurbishing of Dickerman Park, a 2.4-acre, linear green space running along two blocks of University Avenue between Fairview Avenue and Aldine Street. Fronting the Griggs-Midway Building and other commercial properties, the city has owned the space since 1909 but has never done much with it until now. The plans include new walkways, plaza spaces, public art and planting areas.

The $1.6 million project, funded by the city's "8-80 Vitality Fund" program, broke ground last month and is expected to be completed by next spring.

The power of new parks to attract private investment is already on display with Dickerman Park, Hahm said.

"Since we reclaimed the park and initiated this project, the YMCA has rebuilt on its site there — a $10 million project — and right next to it, the local Junior Achievement has purchased a building (at 1745 University Av. W.) and will rehabilitate it in anticipation of the park being redeveloped."

Critically for the stretched city budget, he added, Dickerman and other parks planned along the Green Line will not be operated by city staffers. Instead, private operating agreements will be struck, some perhaps with businesses near the parks, to pick up those responsibilities.

"In a lot of ways, they want a higher standard than what we can maintain in our parks system, so getting these private operating agreements is crucial for the creation of new parks," he said, adding that maintaining transparency and city oversight in such deals is necessary to earn public acceptance.

The most conspicuous example of a public-private park development effort in the Twin Cities so far has been the Commons in downtown Minneapolis, a 4.2-acre space created by developer Ryan Cos. as the city's "crown jewel" for the $2 billion Downtown East redevelopment.

Ryan's North Region market leader Mike Ryan said the many layers of that high-profile project showed the need for developers to be completely upfront with their public partners in terms of who is getting what out of the deal.

"You can talk about collaboration and partnership, but really, if you can't develop deep trust early, it won't work," Ryan said. "These projects are wildly complex so there's got to be flexibility and trust between the all the parties involved."

Don Jacobson is a freelance writer based in St. Paul. He is the former editor of the Minneapolis-St. Paul Real Estate Journal.