Could bringing premier regionally headquartered business enterprises to the Pennsylvania Avenue Corridor be key to its renewal and revitalization?

In response to the previous entry "Pennsylvania Avenue DC planning initiative" on the National Capital Planning Commission's launch of a planning initiative for Pennsylvania Avenue, what we might call a tune up of the Pennsylvania Avenue urban renewal initiative that "called it a day" in the mid-1990s, charlie offered a number of very good points, which are worth calling out into a separate entry.

The first public meeting for the study is tomorrow night.

Charlie writes:

... I think the bigger problem with Pennsylvania Avenue is all the commercial space is getting old at the same time, which means the biggest drivers of downtown office space (law firms) are bailing. And you mention, government workers don't spend enough.

In terms of your previous entry, it looks like:

1) resurrect the Pennsylvania Avenue Development Corporation or create a new Business Improvement District

2) Sidewalks are plenty wide

3) It is pretty walkable, but needs more shade

4) Not sure what you can do about the vacancy rate. There are a lot of corporations in the area (AES, Marriott, Advisory Board, Microstrategy) that could use a prestige address but clearly there are reasons they don't want to be in DC. FBI site could be good for this too, but I think we're going to get a lot of buildings torn down in the future.

5) Parking sucks there are a result of garages closing early

6) Civic / cultural anchor --big problem as well, although you have Navy memorial, archives, Newseum, two theatres. Good suggestions on your part.

7) Traffic counts -- yes, on a bike i don't like being exposed in the middle. Also shade again. Could be a world class bike track but instead it is crap.

My response:

1.  A permanent commercial district revitalization planning and implementation organization is necessary.  WRT the first point, while PADC was a good ($, focus and a commitment to action) and bad (superblock buildings, brutalist, dull) initiative, the Federal Government and elected officials focused on "shutting it down when it was done"* not realizing that commercial district revitalization is a never ending story. So yes, a commercial district revitalization organization entity needs to be there and permanently focused on the success of the district.

2.   The corridor is overdue for refreshment.  Charlie makes a great point about the "natural aging of the 'new' building stock" and the need for it to be refreshed "at the same time" and how this contributes to the high vacancy rate, although I think the urban design on the corridor is a big issue too--the street experience is uncongenial, shade being only one issue, but a big one, as he points out.

Note that the buildings becoming obsolete because of age is a similar problem for Southwest DC (Southwest Ecodistrict Plan), Maine Avenue SW, and L'Enfant Plaza.

The Wharf district rebuilding project is just getting underway, and a couple years ago, Waterfront Mall, 4th Street (pictured at left), and most of the old crappy buildings there were reconstructed and the area has become much more vital and alive, especially because of the restoration of 4th Street SW as a through street.

It's a good example of what needs to happen along Pennsylvania Avenue.

3.  The Pennsylvania Avenue commercial vacancy rate is a big problem.  I agree with Charlie and I meant to emphasize that the FBI vacation is going to worsen this considerably, because it potentially has the ability to add significantly more commercial space to a corridor that has "too much now."

Microstrategy headquarters in Tysons Corner, Virginia.  Photo by Terry Berman.

4.  Charlie makes a brilliant point, could area premier companies be recruited to new space on the corridor, to headquarter on "America's Main Street" and function as anchors for new economic activity? 

WRT the suggestion that one way to absorb the space would be to recruit from the area's premier companies (AES, Marriott, Advisory Board, Microstrategy, etc.)  and convince a couple of them to relocate to the city as part of Pennsylvania Avenue's renewal, I think you're right about the difficulty in pulling this off given current conditions.

But by making the street and the area totally great, in part by expanding the "planning district" to include the National Mall as I suggested in the other entry, and by making recruitment of business headquarters as anchors and a key element of the program, it would be possible to pull this off, including the point I made about moving the FTC (pictured at right) to one of the buildings to be constructed and giving their current building to the National Gallery of Art.

Note that in the 1990s when people argued that NationsBank should move their headquarters from Charlotte to DC when they bought various banks here, there was no compelling business reason for them to do so.

The point is that for talent and business development reasons, there is the devveloping trend of large businesses moving back to central city locations.

Revitalizing Pennsylvania Avenue in part through business headquarters recruitment is a kind of extension of the arguments I made in "Naturally occurring innovation districts | Technology districts and the tech sector."

-- Washington Post list of the Largest 200 public and private companies in the DC region

There are many examples of this around the country.  Amazon in the SoDO district in Seattle is one. The movement of various Internet related companies such as Twitter from Silicon Valley to San Francisco ("Twitter Revitalizes a Seedy San Francisco Neighborhood," New York Times), especially in the South of Market District.

Arlington offers us an example with the National Science Foundation and the George Mason University Arlington campus bracketing a goodly section of Wilson Boulevard and attracting complementary organizations.  Chicago too ("Companies Say Goodbye to the 'Burbs," Wall Street Journal).

Detroit is a great example, because comparatively speaking, Pennsylvania Avenue is the Detroit of DC's Central Business District in terms of comparative weakness

Detroit had been losing out to Chicago and the suburbs for local business headquarters for decades, abetted by business consolidation (e.g., I was weirded out a couple weeks ago to see a big Comerica building in Southern California, knowing the bank grew out of the merger of Detroit Bank and Trust and Manufacturers National Bank of Detroit, although the headquarters has since shifted to Texas).

This rendering shows what a new Campus Martius/Cadillac Square area in downtown Detroit could look like, according to plans outlined by Dan Gilbert, chairman and founder of Quicken Loans, today. Photo: Quicken Loans

But in 2002, Peter Karmanos moved his suburban-based Compuware Corporation to an in-city location.

(He followed Mike Illitch, who bought the Red Wings in the 1980s, Detroit Tigers in the 1990s, and began investing and rehabilitating property in Downtown. Illitch's wife separately has invested in Detroit casinos.)

This led to other business leaders making similar decisions, such as Dan Gilbert of Quicken Loans, who moved his firm to Detroit in 2010 ("“Dan Gilbert outlines vision for livelier downtown Detroit including Papa Joe’s, sidewalk cafes," Detroit Free Press) and while the rest of the city is not doing well, Downtown Detroit is pretty successful.

In keeping with the general theme of these pieces on Pennsylvania Avenue, Project for Public Spaces argues investment in place was the key to success in Detroit ("Detroit Leads the Way on Place-Centered Revitalization").

5.  Leveraging Downtown transit service.  One of the problems of federal agencies moving out of the core is that the value of transit proximity in Downtown DC is dissipated, which will hurt WMATA.  By recruiting some large scale businesses, the value of transit infrastructure in the core can be leveraged.

The thing about Pennsylvania Avenue is that it has not absolutely the best transit, but it's just a couple blocks from Metro Center, making it pretty well connected even if it is only served by Archives Station directly.

6.  Pulling off recruitment of high profile business headquarters to the corridor is not likely to be done by a consortium of government agencies.  I think NCPC does some pretty good planning. For example, the Southwest Ecodistrict Plan has some really good concepts.  But, reviving Pennsylvania Avenue in part by "sharing it" with businesses is not something that they are likely to push.

7.  A big problem is that the great opportunity presented by the FBI move will take upwards of 15 years to realize.  But at the same time, other developments in the area, such as the Newseum (left) moving to the corridor in 2008 and the Verizon Center on 7th Street NW as well as the significant expansion of condominiums and apartments in the area need to be better leveraged to improve the corridor more generally.

8.  Plus maybe the biggest issue of all, the Republican Congress and its unwillingness to fund federal agency construction projects in DC proper.  (They don't want to fund government stuff at all, but will fund stuff around the country.)  Improving the federal buildings on Pennsylvania Avenue will be difficult in that context.  See "Planned Homeland Security headquarters>, long delayed" from the Post.

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* In discussions recently where I've put forward the idea of a bi-county authority in Montgomery and Prince George's County as a "transportation renewal district" in association with the development of the Purple Line light rail system, one of the things that's been discussed is that in the trade "urban renewal districts" are usually created with a 20-year term, but that it takes more than 20 years (at least 30) to fully realize changes and that's if most everything goes right, and that the district needs to be managed in perpetuity.