Who Does It Take To (Physically) Build A Neighborhood?

By U Cast Studios
February 1, 2023

Who Does It Take To (Physically) Build A Neighborhood?
South Bend developers pose inside the historic Lafayette Building. (Source: Marty Mechtenberg.)

Who does it take to build a neighborhood? I mean physically build one.

In contemporary America, we’ve almost universally outsourced this job to large developers, with a well-honed business model and seemingly infinite money. But what we’ve seen, time and time again, is that too many places are left behind entirely by a go-big-or-go-home development model.

This article was written by Daniel Herriges and originally published by Strong Towns.

All over America are existing urban neighborhoods with history and character, where nobody’s built anything new of significance in 20, 30, 40 years. These “no-build zones” are often places where there is plenty of need: for more and higher-quality housing, space for local entrepreneurs to operate, or “third places” for community members to gather. But there isn’t enough of a financial return available to mobilize the big developers, and if they do show up, it’s to do transformative, rapid redevelopment that shuts the existing community out of the gains.

Who’s going to do the work in these places? Successful, bottom-up models for neighborhood revitalization are hard to find, and harder still to replicate outside of the initial success. Most often, efforts at neighborhood revitalization take the form of philanthropic initiatives, which do some real good here and there but don’t scale, and which wither if and when the grant money dries up.

If you’re looking for an alternative model—for bottom-up revitalization that can scale—I’ve been shouting from the rooftops for a couple years now: you have to look at South Bend.

In South Bend, Indiana, a cohort of dozens of small developers, who are linked by a vibrant social community and professional network, are collectively the largest developer in the city. This group is representative of the diversity of South Bend, including many women and people of color. And they are working mainly in neighborhoods with a history of redlining, a lot of vacant buildings and lots, and persistently low property values. In other words, the neighborhoods where most big developers won’t work.

A financial analysis published in CNU Public Square found that in one 10-block pocket of South Bend (the incipient business district of Portage Midtown in the Near Northwest Neighborhood), distributed efforts of small-scale developers would produce a greater return to the public coffers ($15 million in new tax base) than a single large development, for only a small fraction of the public subsidy, and it’d begin paying those dividends 15 years sooner.

This hasn’t happened by accident. The story in South Bend, which I wrote about at length in 2021, is about the deliberate cultivation of a social and economic ecosystem to support small-scale development. It’s still in its early stages. It’s something that can grow and—most importantly—replicate.

Who Does It Take To Build a Neighborhood? Everyone.

“If it takes a village to raise a child, it takes a whole community to build a building,” says Monte Anderson, who has built a career out of both practicing and teaching an approach to incremental development that draws on the most important assets a place has: its people.

Successful incremental developers aren’t lone heroes or gutsy bootstrappers. They are successful because they embed themselves in a place to which they are deeply committed—over a lifetime, not a couple of years—and they cultivate deep relationships in that place, with all of the people involved in making development work: city planning staff, architects, contractors, lenders, property managers, community leaders and activists, entrepreneurs. Moreover, they create long-lasting relationships with tenants and buyers for their buildings, who will in turn help lift up the community and create the long-term value that makes the next development project possible.

Anderson lives and develops property in the South Dallas, Texas, area, but through his former work with the Incremental Development Alliance (IDA), he helped catalyze this virtuous cycle in South Bend. But he doesn’t take credit. That credit, he says, belongs to locals who took the insights from the IDA’s development trainings and “boot camps” and built a community to share those insights, pass them along, and help solve each other’s problems along the way.

Crucially, in South Bend, city hall has been deeply involved in supporting and sustaining this community. Planning director Tim Corcoran spearheaded an effort to simplify regulations and eliminate barriers to incremental infill. The city abolished its parking mandates, a key such barrier, in 2021. The city offers a $20,000 sewer hookup fee waiver to qualifying infill projects. In 2022, South Bend introduced pre-approved building templates for infill housing and commercial structures that would fit into its existing neighborhoods and meet its zoning codes.

Just as important as all those policy changes, though, is the city’s embrace of its small developer ecosystem. South Bend’s Department of Engagement and Economic Empowerment has worked as a convener for this community, taking over the sponsorship of the regular informal small-developer meetups and seminars that were already occurring under the umbrella of its Build South Bend program.

A New Initiative to Create More Town Makers

Now, South Bend incremental developer Mike Keen, one of the pivotal figures in nurturing the city’s development community, has partnered with Anderson and others to launch a new initiative: an organization called Neighborhood Evolution.

Their goal is to take the successful model that is beginning to prove itself in places like South Bend, and seed it elsewhere. I’ve described these sorts of teachers as “pollinators” before. The goal is not to copy a program from the top down in city after city, but to spread the seeds of a way of doing things. Neighborhood Evolution has developed a year-long series of trainings and seminars, and is currently delivering them in several cities including South Bend; Lafayette, Louisiana; and Kansas City, Missouri.

Unlike the Incremental Development Alliance, whose programs focus on training small developers in hard skills (selecting a site, designing a project, doing a pro forma financial analysis, and so on), Neighborhood Evolution takes a broader lens. It’s about the ecosystem, the people Monte Anderson calls “town makers.”

“You don’t have to be a small developer to go to these meetings,” says Anderson. “You can just be interested in your community being better. Not everybody’s gonna be a developer.”

Bernice Radle presents on the fundamentals of incremental development. (Source: Facebook/Monte Anderson.)

The Neighborhood Evolution program as currently constituted includes three in-person seminars focused on the fundamentals of incremental development: Farming, Finance, and Form. This is followed by a year-long series of virtual sessions, aimed at providing a broad overview of development basics. This is broad, not deep, by design, says Anderson. The seminars will address questions such as, “Who do you get to look at your financials? How do you find a CPA and an attorney? How do you interview a bank as a rookie, to find out if they’re a good fit for what you need? How do you set up your construction management system? How do you find a property manager?”

After that year, the local group of participants takes over having monthly meetups and commits to ongoing learning. They are equipped to continue to cultivate a community of those who can help each other with every step and hurdle of the development process.

“Farming,” one of the three fundamentals listed above, refers to concentrating your development efforts on a very narrow geographical area where you can build deep ties within a community. In incremental development parlance, this is your “farm,” and it’s crucial to have one.

Bernice Radle, an incremental developer from Buffalo, New York, and now a cofounder of Neighborhood Evolution along with Anderson, Keen, and Jim Kumon, tells of a recent experience that reaffirmed the value of this approach for her. When Buffalo was hit by a crippling snowstorm the week of Christmas 2022, the occupants of Radle’s 27 properties were beset with problems: freezing pipes, cats that needed feeding, owners that couldn’t get back into town. Because Radle’s “farm” is geographically small, she knows all of her tenants, and they quickly banded together to help each other out with these needs at a time when formal institutions were overwhelmed.

Bearing Fruit

In South Bend, Mike Keen’s “farm” is Portage Midtown. And it is coming along. Keen and partners continue to work on the renovation of the Ward Baking building into a large space for entrepreneurs, recently cutting the floor out to allow light into the basement. Soon, they anticipate opening the first 13,000 square feet out of a total of 56,000. Across the street, the Botany Shop, which began as a pop-up business, has set up its permanent home.

Elsewhere in South Bend, Cinco, a Mexican restaurant, occupies a space rehabbed by a small developer. A food hall, the Dainty Maid, provides space and a shared kitchen for four restaurants. Neighborhood Evolution is helping the city and local developers find a way to rehabilitate the historic Lafayette Building, a five-story office building downtown built in 1901. Such buildings pose a particular challenge in the wake of the pandemic and weak demand for office space.

These efforts are transforming the city from the bottom up, not the top down. They are locally inspired and led, but they provide a model that communities across North America can learn from and replicate.

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