August 5, 2019
Why is it that some communities succeed and others flounder? What draws people into some shops and not others? What makes a great community? Is there a science to revitalizing downtowns and communities? Today’s guest, Heather Arnold, has made a career helping to answer these questions and many more. Grab you calculators and open up a new spreadsheet, because on this week’s PreserveCast we’re taking a deep dive into the science of revitalization and community redevelopment.
Heather Arnold is the principal of research and analysis and managing director of public sector work at Streetsense, a strategy and design collective based in Bethesda, MD. In this role, Heather specializes in retail market analysis, incentive planning, and merchandising for downtown environments. With over 20 years of experience, she has made incredible strides toward shaping urban commercial landscapes and increasing access to opportunities in underserved neighborhoods. In this pursuit, she has been a catalyst for meaningful change — from repositioning malls toward active uses to creating community where surface parking once dominated. With an expert eye toward the development and implementation of retail solutions, Heather brings data-driven strategy to communities in need.
Why is it that some communities succeed and others flounder? What draws people into some shops and not others? What makes a great community? Is there a science to revitalizing downtowns and communities? Today’s guest, Heather Arnold, has made a career helping to answer these questions and many more. Grab your calculators and open up a new spreadsheet because on this week’s PreserveCast, we’re taking a deep dive into the science of revitalization and community redevelopment. [music]
From Preservation Maryland Studios in the historic podcast district of Baltimore, this is PreserveCast.
Before we start this week’s episode, I really want to thank you for listening, and I want to ask for your help. PreserveCast is powered by Preservation Maryland, a nonprofit organization that depends on member contributions to fund its work. This podcast receives no government support and currently has no major fund or support. Its budget is entirely dependent on listener contributions. I’m hoping you’ll consider making a quick gift to help support this podcast, which is bringing important preservation stories to thousands of listeners around the country. Think of us as your preservation Netflix. Any amount helps, and you can make a quick online donation by going to preservecast.org and clicking the donate now button in the upper right-hand corner. We greatly appreciate it. Now, let’s get preserving. This is Nick Redding. You’re listening to PreserveCast. Today, we’re joined by Heather Arnold, who is the principal of research and analysis and managing director of public sector work at Streetsense, a strategy and design collective based in Bethesda, Maryland. In this role, Heather specializes in retail market analysis, incentive planning, and merchandising for downtown environments. With over 20 years of experience, she’s made incredible strides towards shaping urban commercial landscapes and increasing access to opportunities in underserved neighborhoods. In this pursuit, she’s been a catalyst for meaningful change from repositioning malls toward active uses to creating communities where surface parking once dominated. With an expert eye towards the development and implementation of retail solutions, Heather brings data-driven strategy to communities in need. And we are so pleased because we are in need of learning more about this. Heather, it’s a pleasure to have you with us here today in PreserveCast.
Thank you so much, Nick. It’s a pleasure to be with you.
So where are we talking to you from today? Where are you located right now?
S I’m in the office in Bethesda, which is kind of a nice change of pace because I’ve been on the road quite a lot lately.
Okay. Well, we’ll get into that and talk about where you’ve been and what projects you’re working on. But let’s learn a little bit about you. Where did you grow up? What was your path to this kind of work? It’s an interesting sort of niche. And I know you have an interest and passion for history and preservation. Where did it all start, and what took you on this path?
Sure. So I imagine, like a lot of people, my real love for history and especially the history of buildings and how it shapes people’s lives started when I was a kid. I grew up in an 1860s house that my parents bought because it was what they could afford. And they spent the next 20 years restoring and maintaining and improving that home. And I just loved everything about living in an historic house. We had an attic where the children had their playroom. And there were notes scribbled all over the place in pencil saying like, “Abigail is a dodo head,” and things like that. We thought that was hilarious. When my dad would garden in the backyard, we would find shards of pottery and old nails. And I actually didn’t think anything of it. I thought that happened to everyone when they gardened. And we had an enormous boulder in the basement of our house that was there because at the time that they built the house, it made more sense to just leave it and build around it than it did to try to get rid of it. And I just thought all of those things were so meaningful in my childhood and influenced our family in so many different ways. And I loved art. And somewhere along the way, I think my parents who realized that I wasn’t especially talented at art started to direct me towards architecture because I think that they were under the impression that if I could draw a straight line, I would at least be able to make a living and visited the University of Virginia when I was in junior high and fell in love with it and dedicated the rest of my high school career to getting SATs high enough to be an out of state student from Pennsylvania to the University of Virginia. And it all kind of took off from there. My career path, if you asked my mother, she would say I’m circuitous. But it’s been an interesting journey because I think that every step I took led me to this very interesting specialized niche.
And I started out working as a historic bridge analyst for departments of transportation throughout the Northeast. And I absolutely loved that work, doing section 106 reviews prior to bridge demolition. And later went on to work for Harvard University as a preservation planner there. And then my last job in preservation-related fields was for the Massachusetts historical commission where I was helping with section 106 review on the other side and doing tax credit review throughout the state as well.
And so when did you make the jump to this type of work that you’re doing now, and maybe let’s describe the kind of work that you’re doing now. And tell us a little bit about how you made that jump because it’s funny that you say when I worked in preservation because I still consider you working in preservation. But at this–
But when did you make that jump? And tell us a little bit about what it is that you– in a broader sense, we’ll drill down, but what you’re doing now.
Right. So today my primary responsibility, and it’s going to sound like an earth shift away from what I just described, is I actually discovered along the way in graduate school and then in my later career that I had an ability to look at numbers and figure out what kind of questions needed to be asked in order to get answers from them, which sounds kind of mystical, I think. But what it means, generally, is that I am familiar enough with what type of data is necessary in order to support a retail environment that I can look at a very large data set and be able to determine the factors that will lead to success or failure with a retail project. And so I am brought into projects by private developers and by communities and counties and cities and neighborhoods to be able to figure out if a condition is being created, that would support a healthy store or restaurant environment.
How’d you figure out you had that skill? Because you said, “Oh, I kind of determined that I had this.” I’ve never just one day been like, “I’m really good at determining whether or not the market is ripe for a coffee shop.” How did you just stumble into that one day?
So it’s a little bit of trial and error over a period of time. The way that I started doing it was I was working for a firm in Alexandria, Virginia, called Cooper Carry under the guidance of a really genius designer, Richard [Heaps?], who had at that point very recently finished overseeing the construction of Mizner Park in Boca Raton. And we would continue to have these conversations about how frustrating it was that so many of the retail spaces were either leasing for less than expected. Rent rates or had remained vacant, and we were trying to understand why. And at the time because they had been so successful in Mizner Park, the firm was being asked to design more and more of these new town centers. And the question really became how much retail can we support in these new town centers. And it turned out that the under leasing and the vacancies were being caused because we were adding either too much retail space to a market that already had quite a bit, or we were overpricing the market, or we were trying to put in a level of retail space that didn’t match the demand.
So if we were putting in class A retail space, which would be the very best most universally adaptable retail space, that actually needed some lower-cost retail space maybe for discount stores. And so we were just seeing these mismatches between design in the market. And really falling out of the boat to hit water, I started to bridge the gap between how do you apply a market-driven solution to a design problem. And so that just kind of snowballed over a 20-year period, and I think it’s because I’m actually quite obsessed with retail market indicators. I read SCC retail or filings for fun, that I’m able to look at a lot of metrics and be able to figure out whether or not a market can support that kind of an opportunity.
SMy husband loves to pick on me. And we’ll go in, we’ll be on vacation and go into a new downtown area and he’ll say to me, like, “Okay. So tell me why this place can’t support a Barnes and Noble?” And I think that he used to do it to be charming while we were dating. Now I think he’s just poking at me [laughter]. Because we’ve been together for a very long time, but.
So you work at Streetsense now, and Streetsense is broadly engaged in this kind of work. Won’t you tell us who Streetsense is and your principle there?
So what does it kind of– how does it dovetail with what you’ve just described that it’s sort of your niche in your expertise?
At Streetsense, we’re really working on how does the meant and brand identity contribute to how people experience places and shopper’s goods and experience, all those sorts of things. And my work is usually brought in to inform direction that we’re going to take. So we’ll be asked to do a market analysis to inform how much development should occur on a site for a planning team, or were brought in to understand whether or not a restaurant tour wants to make a decision to lease the space if there’s enough opportunity there to make it worth their while. We also brought it on projects– we’ll probably be line of last resort for a lot of cities and developers who have tried a bunch of different solutions. And, honestly, just have not seen the results that they wanted to. We’re very big into [inaudible]. And so, lots of places. We’ll guess that, “Oh, if we just had a better marketing program, all of our retail [sales?] will be sold.” Not usually. If actually almost never’s the answer. We kind of have to get to the root of the problems and try to figure out how to dig it out and deal with it. And so at Streetsense, we are a collection of people who have specialties in architecture and planning and branding and marketing and analytics. And what we found is that at particularly in [inaudible] and downtown environment, you can’t look at the issues that are facing any of those places from one angle. You can’t look at it from a design angle or a market angle. We’re a branding angle. It takes all of it. And each one impacts the other. So it’s very important for us to work collaboratively on teams in order to not only make sure that we have a really solid answer to some of these problems, but to make sure that we’re not unintentionally creating other problems.
So why don’t we talk a little about the kind of projects that you’re actually working on right now? Because I feel like that’s a good lead, and you kind of give the broad sense of what you guys do which is a lot, right? I mean, there’s a lot to take in. And for a lot of people who are listening who maybe aren’t familiar with this kind of work. It all sounds good. But it’s like we’ll– well, how does that come together? So do you have an example or maybe something that you’re working on right now or something you’ve worked on the past that you’re kind of proud of? That would be a good example of how this all kind of comes together. And the kind of role that you played in that conversation.
Definitely. I’ve had about five different ones going through my brain right now. But probably the most illustrative one is the work that we did for the City of Detroit. We finished that work just about a year ago now, where we were hired by the city to come and look at neighborhood retail quarters throughout the city. And there were 13 of them in areas that had felt like they had really been underrepresented and under resourced with the city being very focused on improving their uptown and midtown areas. And they asked us to come and look to see how we would go about recommending improvements for these neighborhood retail centers, basically, that were very charming. That were very robust in the 1950s when the city was at it’s [thinnest?]. But now, kind of sat there as historic vacant storefront that reminded people of a better time, and then also reminded them that that time wasn’t now. And they wanted to figure out a solution to start to address that issue. And we very quickly started to understand that there were a lot of really good quality retail businesses throughout the City of Detroit. They weren’t able to take advantage of architectural conditions that would allow them to be more successful and better well known to the customer base. We dealt with a lot of neighborhoods who to we would say, “You have that great pie shop down the street.” They’d be like, “What are you talking about? I don’t even know that I have a pie shop in my neighborhood.”
And why is that? What’s happening there? What suggests that?
Yeah. So that’s usually a sign that some places oversupplied. And that basically means that they have more retail space than they can support from a sales and demand standpoint. And so what ends up happening is that instead of having a centralized location where your retailers clustered and continuous. And ideally, on both sides of the street so that you have that great sort of main street experience. You might have one great retail location and then two blocks of vacancy. And then another great retail location and then vacancy. And then somebody’s built a hospital there. And then it just kind of goes on and on. And it requires somebody to have the [inaudible], seek out those individual light retail locations which is a much harder marketing and customer attraction strategy than if you’re clustered and centralized. And so we started to talk to the city about identifying places where the retail could be most successful in these retail locations. And focusing their grant programs on relocating them into the centralized areas. And putting resources into those areas like they had a huge sidewalk improvement program. We should focus them in the retail priority areas. From one neighborhood, they had three miles of retail commercial space. And they had the demand for about six continuous linear double-sided retail space. And they continued to try to create little sparks all along this three-mile stretch. And we’re very clear that they needed to consolidate their sparks in a very centralized location and get a fire going. And then you could talk about the rest of the three-mile area.
Now, this works in theory. Do you see that it’s– is it difficult and practice to say like, “We’re going to focus our resources in this one area which means we’re not focusing them in another area”? I mean, how does that work? I mean, it’s one thing to be the consultant and actually kind of know the reality of it. But then there’s a political reality of it. So how do–?
Is that sort of like, “That’s kind of up to the community”? Or how does that all play out?
Well, I personally made a sacrifice for that effort. In that one of my very dearest team members ended up moving to Detroit to work for the client to implement the strategy. So I personally sacrifice for that effort. It required us to be able to say, “All right, what do we do for the other two and a half miles in that one particular neighborhood?”
So what did you do?
And something that we’ve been really very focused on. Not just for Detroit but for cities across the country is how do we start thinking about non-retail solutions for retail spaces across the country. And it was costar report the estimated that we have 13 billion square feet of retail space, but that we won’t be at a market equilibrium for that space until we’ve eliminated 1 billion square feet of it. Which means either demolishing it or repurposing it for another use. And that doesn’t come out of these gigantic shopping malls. It’s coming out of 10% of everybody’s overall retail supply. So thinking about it’s very difficult to take a retail space and accept it not being a retail space anymore. And whenever I work with communities across the country, I always say to them, at the very least I want it to be occupied space. I don’t care if it’s occupied by professional office or somebody who wants to live in a storefront. It doesn’t matter. I want occupancy over vacancy every single time.
That would be a good bumper sticker occupancy vacancy. I want it.
An occupancy of any kind really is going to be preferable, because the thing that happens with vacancy is it makes it much more likely that the adjacent spaces will become vacant over time. And so, trying to find those answers have been really important and we’ve been working on a set of guidelines and thinking principles that we can share with communities that say, this might be retail infrastructure. This might be retail architecture. But we need to allow professional offices like dentists and lawyers and accountants to occupy these spaces, but we want them to agree to a couple of rules.
And some of that is like challenges associated with zoning, I would imagine as well.
There is some challenges.
Right. I mean, that we’ve become so restrict or at least we were so restrictive with zoning. And so the move to kind of try and get away from that seems to play right into this as well.
It doesn’t so many different ways. From a retail perspective, it’s even hard for us to talk about it as a pure idea, because retail has become so many other things. And this idea that professional office might have a role in retail space, at least, that light industrial uses have a role in retail with [inaudible] about right and the Washington DC area. We recently had an issue were being a coffee roaster was putting you in a light industrial category. And so we had to look at ways in order to change that. There’s such a blending of these ideas going on that probably started with live workspace back in the day. It’s now really coming down on a micro-level.
Let’s take a little shift here. And sort of following along this idea, but let’s talk about main streets because the main streets I know that they’ve been a decent chunk of the kind of work that you do. I know you worked here in Maryland and Frederick and all across the country in different Mainstreet type communities. And I know a lot of Main Street folks Listen to this. And so I just want to talk a little bit about main streets for a second. So in your experience, traveling around the country, seeing all these different things, as your husband says, you can figure out why Barnes and Noble don’t work. What is it that in a nutshell makes a dynamic Mainstreet community from what you’ve seen from the ones that work versus the ones that don’t.
It’s a great question. It’s something that I’ve spent two decades thinking about. We actually had a chance to write a book a few years ago based on some work we did for the Washington, DC Office of Planning, where they asked us to figure out, what were the essential components of a successful retail main street? And we studied 19 different streets around the world and tried to isolate their components from a data perspective to figure out what are the some of the characteristics that are the same if you’re in Patrick Street in Frederick, Maryland or Main Street in Culpeper, Virginia or on the Champs-Élysées. We figured if we could find similarities between things so disparate, that it would have to start to lend itself to being an essential element.
These are sort of cultural universals for the anthropologist. These are main street universals.
Yeah, there you go. Yes. I’m going to steal that for sure. And so something that we had struggled with in past, and we were able to conceptualize a little bit more easily after we completed the study, was that it would be very typical for a city or a main street program to come to us and say, “We just need you to come design some new streetscape for us because that’s really going to pick up our street, and that’s going to solve all our bar vacancy problems.” And through this process, we realized that that’s a little bit like putting up the wallpaper in your house with leaking pipes, and that there were way more utility type of things that needed to happen before you were able to get that level of improvement. And it was really basic stuff. The most successful main streets have an organization that’s representative of all the retailers. And based on size and scale, that could be a business improvement district. It could be four people that get together for coffee at the– in my hometown of Danville, Pennsylvania, it’s four people who would get together for coffee at the hot dog stand, of all places–
The best coffee.
There you go– and talk about what was going on, and be able to represent the voice of the retailers on the street. So if you didn’t have that mechanism, it was really hard to undertake any of the other improvement strategies. But the other things that were really important was that you understood who your customers were and what they needed, and did they need it in enough bulk to support a store? And we started to offer– it became a very interesting exercise in figuring out ways for people to self-assess their market without having to go back to college and learn how to do real estate market analysis. And we were very concerned when we finished publishing this book that we had just ended our careers because nobody was going to need us anymore. Thankfully, that hasn’t happened yet. But it was really important from our perspective that people realize that there is a market consideration. And we think of retailers being this endless infinite resource. Everybody just wants to put retail at the bottom of buildings and think that’s the solution to every sidewalk activation problem. And in fact, it’s contributed to a bigger problem, which is that we have too much retail now. So that self-awareness is really important. But to be quite frank, above and beyond, and the advice I would give to main streets across the board is that idea of safety around your main street is everything. If it means having brighter lights, if it means getting rid of cracks in the sidewalk, if it means dealing with graffiti within 24 hours of it happening if it’s not beautiful intended art graffiti. All of those things contribute to a sense of safety and being cared for and looked after.
So, really, safety is one of the big– it is really one of the big takeaways.
It is absolutely one of the big takeaways. And that sense of– it’s very [Jane Jacobsky?]. It’s all about being activated and having somebody have eyes on the street. And even if you can’t see eyes on the street, because there’s no litter, because the sidewalk has been swept, because care is obvious, that somebody’s eyes are coming on the street at some point. And that gives customers a sense of security. It makes retailers want to invest, and really is very integral in the mind of fostering a really successful mainstreet.
Well, that’s a good way to kind of wrap up the I guess the mainstreet conversation. I mean, I was going to ask you to kind of go down the road of what’s the worst thing they could do or sort of common mistakes, and it sounded like you kind of said that sort of seems like the streetscape idea where let’s just fix the streetscape and not deal with the root problem or these other issues that seem to be much more basic and you need to fix, which is sort of having that business council and making it safe. Coming to terms with how much retail you actually need, I guess.
Yeah. It’s sort of the more boring things people want to do the more somethings usually. And I’m the person who has to tell them, “No, I think we have to go back to basics on the couple of these things. The other thing that I would equate with the streetscape program is that very few mainstreet trouble mainstreet from a retail perspective anyway have been solved through branding and marketing. It tends to be evidence of something else going on underneath. So before you try to take on a fund approach to a mainstreet solution, make sure that your fundamentals are in place.
And how do you feel about activating and placemaking and things like that? Sort of the low cost placemaking stuff. I mean, that’s kind of along the lines of streetscape, but it’s a heck of a lot cheaper, and it’s sort of almost like the gorilla tactical urbanism kind of quick dirty stuff to kind of activate space. Where do you come down on that?
Such an interesting because I changed my position on this probably 100 times over the past couple of years. There’s an argument to be said that the most important customer-based for a retail is a reliable customer base. And that is a two-way street. It’s like a trust ball almost where the customer has to know that you’ll be there and what times you’ll be open and what kind of merchandise you’re offering. And the retailer needs to know that the customer is coming. So for a while, popups stores just kind of turned my stomach a little bit because I thought we’re not fostering that relationship that’s so critical. But then you start to see popup stores become part of I would say the infrastructure of cities in the sense that they attract the customer who doesn’t necessarily have an expectation of what’s going to be there but is drawn to it on a more regular basis because they want to find out. That is fascinating to me. And so the psychology of customers has changed so much in the past couple of years, influenced by technology and e-commerce but also this idea of I’m going to call it like a temporary demand that can be filled by a temporary supply. So that’s food trucks and it’s popup stores, and one of my favorite ones is the Amazon truck. I know that’s not actually what it’s called, but I get a text every day that tells me what Amazon has on the truck that’s driving somewhere around Washington DC that’s been offered for some enormous sale. I think this morning, it was bidets [laughter].
Did you get one [laughter]?
They were only in Columbia, I think [laughter]. And that’s a little bit too far to drive. But this idea of– it used to just be a shopping mall that was a million square feet. And you could practically figure out where it was but with a divining rod based on the context of a city. Today, it’s much more fluid and much more immediate. We’ve been doing a lot of work recently with transit authorities across the country trying to figure out how to make the connection between commuters or travelers and retail more immediate so that they don’t actually get out of the transit facility before they have an opportunity to make a purchase. And that is a completely different type of psychology than just the person who’s on vacation or walking down the street or at lunch during their workdays. So I think that we’ve always been really focused on the financial fundamentals that a retailer needs to be successful. Now, bridging the gap between the operations and the customer psychology has gotten to be a really higher-level thinking that we’re trying to apply to all of our work.
So if people want to learn more about this, you mentioned that you guys wrote a book. That seems like it would be a good one to recommend. What is the name of that and any others that you might recommend that they pick up and sort of dive a little deeper into this? Because this obviously requires some study.
Absolutely. The name of our book is the Vibrant Streets Toolkit. It’s available through our website. Thank you so much. That was an unexpected plug. But my favorite book about the idea of retail, especially retail in a historic street and the importance of it– we think every time– we’re like, “Oh, that’s cute. Someplace to go buy or sell something.” I think of it as being so much more important than that. And I would recommend Community by Peter Block. And I especially love that book because to me the real value of retail is that it is a place for interactions of people who are so different but still make up a community. And it’s through these casual interactions that they create a web. And [it’s?] based in part off of a study that I love at the University of Chicago that looked at how communities rebound from natural disaster. And it sounds that one of the components that allow communities to rebound faster was if they had a commercial center because they were more inclined to think about solutions that considered a we component rather than just me. And to me, that’s kind of everything that we’re working for here at Streetsense and that I would like to accomplish in the next 50 years of my career.
Well, that’s some good reading there for us to dig into. And if people wanted to get in touch with Streetsense and they want to learn more about your work or somebody out there is interested in maybe hiring you to do some of this work, where can they find you?
At streetsense.com. And on the Team page, you can connect directly to me.
Perfect. And before we let you go, most difficult question of the day, favorite historic place or site?
Oh. Okay. Does it have to be domestic?
No. It can be anything.
Okay. So, probably in the whole world, it’s Sacré-Coeur–
Okay. Explain it.
–in Paris. So Sacré-Coeur is a site of just the most gorgeous church in Paris. And the last time I was there, there was a little apartment with a gorgeous balcony for rent. And I said, “Okay. I’ll take that [laughter].” I don’t think it was really an opportunity that was available to me at the time [laughter]. So globally, that would be my choice. But because I’m a graduate of the University of Virginia, I am required by law to say Monticello.
Right. Yeah. I’m glad we got that.
But that’s legitimately one of my favorite places [laughter] in the world. And when I was at the University of Virginia, I was 1 of 16 students enrolled in their architectural history program. And we had a pass to be at Monticello whenever we wanted. And we would just go up there and sketch. And it’s an amazing, amazing place.
Very cool. Well, this has been a fantastic conversation. I feel like we could talk with you and do 10 of these because there’s so much to learn from what you have done in your career and what you guys are doing at Streetsense. So, thank you so much for joining us today. This has been a lot of fun.
Oh, thank you for asking me, Nick.
[music] Thanks for listening to PreserveCast. To dig deeper into this episode show, notes, and all previous episodes, visit preservecast.org. You can also find us online at Facebook and Twitter, @PreserveCast. This program was supported by the Historic Preservation Education Foundation. PreserveCast is produced by Preservation Maryland and Baltimore City. Thanks again for your support and remember to keep preserving.