As we saw with Amazon recently in New York City, making a deal on a location doesn’t mean that facility will ever get built. That’s a lesson large space users have had to learn over and over in recent years, as social media — and its power as a communications platform — has empowered community activists to wage sophisticated campaigns to kill projects.
A project may be carefully planned, overwhelmingly beneficial to the community at large, and it may even have initial support from high-ranking politicians. And it can still be derailed by a relatively small number of well-organized people with a narrow focus and short-sighted — or self-interested — perspective.
Understanding Community Dynamics
When a company takes months to go through an exhaustive process of narrowing down a short list of potential locations, negotiates with property owners and government officials, finally comes to a decision it believes in, announces it, informs its employees, and begins to plan the logistics of the move — only to find the project fall through — it can be a huge blow. A company like Amazon has many options and can afford to walk away when unpleasant challenges appear, but for most companies, it’s more complicated.
That is why it is important for companies to understand a community’s dynamics and engage developers from the outset about their ability to navigate whatever approval process will be necessary and to support efforts to obtain any incentives that may be available. Navigating the public approval process for large-scale, transformational real estate projects can be challenging; moving through this process effectively can mean the difference between a project being perceived as a great community asset, and being fast-tracked, or being viewed as insufficiently sensitive to community needs and never getting off the ground.
Credibility and Transparency
Having worked to build large-scale projects in many communities, we’ve learned a few lessons that may be valuable to executives considering both locations and development partners.
The key to success is credibility. Credibility is built by demonstrating not only commitment to the vision behind the project, but respect for the opinions of local residents and government agencies. That doesn’t necessarily mean doing everything they want — but it does mean showing that you take their opinions seriously and engaging in good faith discussions — based on facts, data, and market research — before coming to any conclusions. And, of course, transparency is crucially important.
When a company takes months to go through an exhaustive process of narrowing down a short list of potential locations, negotiates with property owners and government officials, finally comes to a decision it believes in, announces it, informs its employees, and begins to plan the logistics of the move — only to find the project fall through — it can be a huge blow.
It’s not unusual for a company with plans for a new office headquarters to find a perfect location only to find the community wants affordable housing on that site. Or, if green space or other recreational space is included in the plan, the community might want public access — and a voice in where the access points are located and how they are designed.
A local development partner needs to have deep roots in the community, a knowledge of community needs and key leaders, and the ability to conduct due diligence on any such requests expeditiously. If a developer can go back to the community and demonstrate that they’ve taken the requests seriously and can make community leaders feel invested in the decision-making process, it will go a long way toward demonstrating respect and building consensus.
Also, don’t assume that community members can’t become assets themselves. Don’t be afraid to view them as partners and allies. You might be surprised; perhaps community representatives have ideas about sources of funds from foundations or government programs that would actually improve the project and enable you to offer the community some of the amenities it wants.
It’s also important to know that your development partner is well known and respected among government agencies, enabling the developer to move quickly and smoothly through the approval process. Some community members tend to approach new developments and new corporate neighbors with the mindset that they can make unbridled demands, because they believe that developers and corporations always make huge profits and should, therefore, shoulder the burden of solving community needs like traffic control, parking, and infrastructure or the creation of affordable housing. They fail to recognize all the tax dollars that are ultimately going to flow into government budgets as a result of a company decision to locate and build a new facility in their community. That’s on top of the transformative effect a large project can have in stimulating other development nearby and supporting secondary businesses that generate additional tax revenue.
In essence, corporate executives need to think not only about the business implications of their location decisions — access to markets, transportation networks, pipeline of talent, cost of doing business, etc. — but also about the need to adopt an externally collaborative outlook, getting community residents and leaders invested in their plans.
Public issues like infrastructure and urban decay are in play because government investment across the country has lagged for years and poverty-stricken communities have taken the worst of it. But these should be issues for the public sector, and communities should think about how they can help companies and their development partners shoulder that burden through incentives, supportive regulations, and identifying and securing sources of funding that encourage investment in the region. But when that’s not the case, and government officials or community organizations remain unrealistic — as they were in New York City in Amazon’s case — the company and the developer need to work as a team and go directly to the community, with town hall meetings and other forums that lay out the project plans and build support among the people who actually live in the community and are going to be most affected. Earning and leveraging their support is key to making inroads with naysayers trying to stonewall the project.
In essence, corporate executives need to think not only about the business implications of their location decisions — access to markets, transportation networks, pipeline of talent, cost of doing business, etc. — but also about the need to adopt an externally collaborative outlook, getting community residents and leaders invested in their plans. By doing so, they’ll pave the way toward positive partnerships that will not only lead to successful projects at the outset, but also potentially to longer-term benefits down the line.