Five Tips to Designing a Great Facade Grant Program

Façade programs are popular in part because they provide immediate and substantial impact that is visible to the public. As effective as these programs are, the field is littered with façade programs that are poorly designed and therefore go underused. The literature suggests that effective façade improvement programs include some or all of the following characteristics:

• Be sure you are providing at least a 50 – 75% match - the higher match is necessary in districts where business owners are struggling and may lack the capital necessary to meet their match requirements.
• Because most public programs are set us a reimbursements - it can sometimes be difficult to get facade money out the door. Property owners simply do not have the capital necessary to front the entire cost of the renovation and then wait to be reimbursed after the fact. In cases like this, patient capital is critical. A bridge loan or revolving loan program can help to address the lack of capital for property owners unable to front renovation costs. Non-profit lenders and community development intermediaries might be good partners in exploring these kinds of loan products.
• If there are significant reporting requirements that cannot be simplified, the match has to be significant enough to make the application and paperwork worth it. Otherwise, most business owners won‘t want to deal with the hassle. The amount considered significant will differ by community, but the literature suggests anything form $25 – 50k is generally sufficient. And the smaller the individual grant, the easier they should be to use (read: minimal paperwork!)

• If there are vague or no design guidelines, the program should include pro-bono or low-bono design services. When improvements go unsupervised are lack some sort of quality review, it can be difficult to determine when and where façade improvement dollars were used, rendering the overall impact on the shopping district negligible.




Blade signs along Atlantic Avenue in downtown Brooklyn, NY,
funded by micro-grants to local businesses


• If funding is limited, consider micro-loan programs for signage only. For $2,500 - $5,000, you can fund attractive signs that make a significant difference to the overall look and feel of the district. I just love these blade signs along Atlantic Avenue in Brooklyn (see photo above). The local merchants association provided microgrants to businesses for these wonderful blade signs. Pedestrian can easily tell what stores there are from a distance - and they look great!



Getting Commercial Brokers on Your Side

Not every community has an active commercial brokerage community. In some communities, property values and rental rates are so low that the brokerage community might be nonexistent. There just isn't enough value to justify putting the time into making a deal. In these cases, the only way to drum up retail prospects and fill vacancies may be for district managers to actively prospect for new retail themselves. That includes working with property owners and showing retail spaces to prospective tenants of YOUR choosing. But more on that another time...

This post is not for the district manager who has no brokers to work with. This post is for those district managers who have a decent brokerage community and need to figure out ways to harness that community for the benefit of the district. The first step is to understand how commercial brokers work. There are two kinds of commercial brokers. There are those that work for property owners in search of tenants, and then there are those that represent tenants looking for space. And of course, there are brokers who do a little bit of both - but let's keep it simple. Your job as a district manager is not to meddle with this system - the last thing you want to do is be perceived as competition to your local brokers. Instead, you want to make sure they see you as a partner in their efforts, rather than competition for clients. So here are a few pointers:

• Make it easy: brokers get paid when the deal is done, regardless of whether the lease is signed by a check cashing agency, or a cute boutique. If the property owner doesn't care who rents a space, then neither will the broker. So half of your job is to make it easy for the broker by providing leads for businesses that YOU want in the district. If you stumble across a retailers or restaurant that you think would be a great addition to your district, talk to the owner, ask them about their expansion plans, and then offer them a tour of your district. Coordinate that visit with local brokers so that the owner can see as many spaces of possible that fit his or her criteria.
• Map your district: Brokers like maps. Retailers like maps. Create a compelling map of your district that shows where all the major traffic generators are. By traffic I mean PEOPLE. What major businesses or venues attract people? Are there hotels or offices that attract visitors or employees? Is there a Post Office or Library that brings people to the district. Take the time to map - and if possible - estimate how many visitors go to that destination a year. While you are at it, include major retailers and their logos on your map.
• Market your district by telling a 'market data-based' story: Brokers market their spaces very well. They create 'sell-sheets' that provide basic information about the retail space. What they often don't have is very compelling district marketing material. In this day and age, this doesn't need to be printed en mass, you can print marketing material as you need it, or better yet, create a nice PDF that includes your district map, some compelling market data, and a clear statement describing the kinds of retail that you want and need.
• Keep a prospect list, grow it and selectively share it: Make your prospect list a resource that is available to brokers when they need it. Over time (and these things do take time to build) identify a wish-list of local retailers - sometimes the best place to find these are other similarly situated districts), include contact information and site selection criteria. If brokers know you are keeping this list, you will be their first stop when they sign a client and start prospecting for tenants.
• Know your market better than the brokers do: Collecting market data is all well and good, but the problem is that most market data is based on census data - which only tells the residential story. If your district includes a significant number of visitors or daytime employee, gathering information about the customer quickly becomes cost prohibitive for any individual broker to compile for any individual site. A better thing to do is to commission a detailed consumer survey at least every few years. Use this survey to collect information about where your visitors and employees work and live, how much they spend, where they shop and what other retail and restaurants they would like in the district. Turn this survey data into a report that can be distributed to the brokerage community - and include tidbits that help you build your story in your marketing material.
• Develop relationships with your brokers: The world is built on relationships. Keeping up with your brokers and property owners will ensure that you have the inside scoop, and can ultimately help influence, their tenant decisions. But this only happens when you have developed a trusting relationship over time and they have come to value your judgement.

By serving as a repository of useful information, and a source of easy leads and deals, you will transform your brokerage community from a force that works against your district vision to something that helps advance your district vision.

Tsotchkes Galore



Some random BID marketing tsotchkes



 I love free marketing gear, don't get me wrong. I'll take a free t-shirt (ladies size please!) or pen anyday, but sometimes you have to wonder what kind of marketing tsotchkes really make sense, particularly these days when every marketing dollar matters. The image to the right shows two interesting examples of free marketing goods distributed by two seperate BID's in New York.

So, does a maraca really make you want to shop in the Fashion District? To be fair, the Fashion District BID also distributes cute little tape measures. Now the tape measures make alot of sense, but maracas? They might be a good choice for Mexicotown in Detroit, where a maraca would be in line with the district's identity, but in New York's uber stylish Fashion District? I'm not so sure.

And what about the jar opener? I could see that thing falling to the bottom of my utensil drawer and never seeing the light of day again. So before you spend any of your precious marketing dollars on useless tsotchkes, think about how they reflect your district's brand and identity and whether they will really drive retail traffic to your district before you buy.

What the strangest (or best) free marketing goods you've come by?

Boston welcomes it's first Business Improvement District

After a bruising battle that the saw a number of downtown property owners 'opt-out' of paying the BID assessment (Massachusetts is the only state to include a 30 day opt-out period in its BID enabling legislation), it seems the organization is ready to get on its feet and celebrate the inaugural season.

The BID collects approximately $3 million in annual fees from commercial property owners and most of the funding is going towards supplementing existing city services, keeping the district clean and safe, and helping drive downtown traffic through event marketing. This summer the BID will host a summer series called Stepping Up Downtown!.

As BIDs continue to face scrutiny nationwide, the success of Boston's first BID will likely help determine whether other areas of the City will follow suit. Only time will tell - but we wish them the best!

How to screw up event marketing

What happens when your district is not generating foot traffic to sustain your existing retailers? The impact is twofold: 1) your existing businesses struggle, and 2) you also have a heck of a time attracting new retailers to your district. When retailers visit a district and they see vacancies and struggling stores, all they see is risk. Retailers are like sheep. They like to follow other retailers, and in their mind there is nothing riskier than opening in a district where every other store is struggling.

For districts that are challenged, traditional advertising in form of newspaper ads is often not effective, because really, if you have a poor selection of stores, what are you going to market in the first place? Your goal should instead be to have an impact on existing stores and generate traffic, and ultimately RETAIL SALES. The only way to do this is with "event marketing". Event marketing is about planning and executing specific shows that bring people into the district on a regular basis. The goal is to ensure that visitors end up shopping in some of the stores.

This sounds simple, but you would be surprised. I have visited too many communities that miss the rationale of event marketing. Instead, they stage their events a distance away from their stores. The logic seems right at the time - they've got a great public park or open space a block or two from the district, so why not use it? The problem is that the stores do not benefit if shoppers are not in a businesses line of sight. Because a store that is out of sight is also out of mind. No wonder the businesses were griping about paying assessments to their business improvement district - they never seemed to benefit from the efforts of the BID!