Partnering helps communities build, rebuild infrastructure

​How can communities build — and rebuild — needed infrastructure and public use development projects when it seems increasingly costly and difficult to do so? 

We know that new real estate development projects cannot just magically occur, so how exactly do these project happen? The short answer is: Partnerships. 
According to a recent Urban Land Institute publication, the urgent need to rebuild and revitalize older portions of our urban areas and the public need to monetize underused assets have dramatically changed the rules of this game.

No longer can private capital be relied on to pay the high price of assembling and preparing appropriate sites for redevelopment. No longer can local governments bear the full burden of paying the costs of requisite public infrastructure and facilities. Planning and zoning controls are often either inadequate or too inflexible to ensure either appropriate control or enabling of desired private outcomes. 

True partnerships replace potential confrontation with collaboration and cooperation to achieve shared goals and objectives. This process requires applying far more effort and skill to weighing, and then balancing, public and private interests and minimizing conflicts. 

Today, public-private partnerships are considered “creative alliances” formed between a government entity and private developers to achieve a common purpose. Other actors have joined such partnerships — including nongovernmental institutions, such as health care providers and educational institutions; nonprofit associations, such as community-based organizations; and intermediary groups, such as business improvement districts. Citizens and neighborhood groups also have a stake in the process. 

Although each public/ private partnership project is unique in its local implementation, when real estate development is at play, most share common stages within a process bounded by legal and political parameters. 

Phase 1: Conceptualization and initiation —  stakeholders’ opinions of the vision are surveyed and partners are selected through a competitive bid process. 

Phase 2: Entities document the partnership and begin to define project elements, roles and responsibilities, risks and rewards, and the decision and implementation process. Partners also negotiate the “deal” and reach agreement on all relevant terms. 

Phase 3: The partnership attempts to obtain support from all stakeholders, including civic groups, local government
(through entitlements), and project team members. Project financing begins and tenant commitments
are secured. 

Phase 4: The partnership begins construction, leasing and occupancy, and property and asset management. However, the process is repetitious and can continue beyond the final phase when partners manage properties or initiate new projects. 

If done right, public sector entities can leverage and maximize public assets, increase their control over the development process, and create a vibrant built environment. Meanwhile, private sector entities are given greater access to land and infill sites and receive more support throughout the development process. 

As we consider some of our more difficult community projects, public private partnerships may be necessary. 

Excerpts taken from Mary Beth Corrigan, et al., “Ten Principles for Successful Public/Private Partnerships.” Washington, D.C.: Urban Land Institute, 2005. 

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Article written by Amy Greil,
​a community, natural resource and economic development educator with the Kenosha County University of Wisconsin Extension.

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