Good development involves everything
BY JOSH KOSS
There is no formula that reveals what makes a development “good.” Developers can of course estimate development costs, model cash flows and the like. But underwriting’s ability to capture the future community impact of converting an idea on paper into a living product is limited. By starting not with configurations of dirt, brick and mortar, but rather with people, New York State Representative Patricia Fahy and the Albany Riverfront Collaborative have turned an erstwhile far-flung fantasy into a model for pre-development groundwork.
Distilled, Fahy and the ARC have proposed a reimagination of I-787 that would reconnect the people of Albany to the Hudson River. Focusing on community engagement—in particular, the needs of the people who live around the site—the movement has enjoyed a recent groundswell of support culminating in the State of New York committing $5 million to an engineering feasibility study.
One possible redevelopment plan when getting rid of I-787 and the South Mall Arterial.
The coming months will be the most crucial to the proposal’s long-term viability. Having earned community buy-in, ARC and its contributors must demonstrate the capacity to covert that support into results. As General Counsel for a national mission-driven development company and a full-time resident of the Capital Region, I have a few ideas on what might contribute to the movement’s success:
Zoom in. ARC has made a compelling case for transforming 92 acres from the perspective of a master developer. We now need to conduct a parcel-by-parcel analysis regarding site control, land use and zoning while continuing to inform and receive feedback from stakeholders and the community writ large.
Welcome interest from outside Albany. Development catering primarily to historically marginalized communities in Albany is a win for the entire region. Furthermore, it is the Capital Region as a whole that is garnering comparisons to markets such as Atlanta, Austin, Phoenix and Las Vegas. A project of this scale needs the type of institutional capital interested in emerging markets such as these.
Line-up third-parties early on. You will have a wider array of partners to choose from if you invite participation in the planning process from those with proven success on similar projects. Explore engaging the private sector in an advisory capacity. Furthermore, whether a potential partner dialogues up-front functions as a litmus test. Those willing to do so should receive close consideration for expanded roles further down the road.
Be patient. A project of this magnitude will likely be conducted in phases. Earlier phases should be less risky and act as proof-of-concept for later phases.
Let the national capital markets be part of the solution. The capital base of Vecino Group (my place of work) includes multibillion-dollar institutions with divisions exclusively focused on investment in transformative developments such as that discussed here (indeed, Vecino has received expressions of interest in partnering on such projects in the Capital Region specifically). Innovative financing solutions and an acknowledgment of ESG’s core business impact has produced a marketplace for whom equitable development is not merely preferred but a prerequisite. Capitalize on the investment world’s renewed interest in deals that make a difference by focusing on affordable housing.
The easy answer—but difficult undertaking—is that good development involves everything: community engagement, responsible stakeholders, government support, prudent underwriting, disciplined execution and ultimately community support. As for support, Fahy and ARC can add this writer’s name to its fast-growing list. •
Josh Koss is General Counsel for Vecino Group, a mission-driven, vertically-integrated real estate development company devoted to development for the greater good.