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Strategies for Vacant and Abandoned Property Reuse

Moderator Yolanda Chavez of HUD, Alan Mallach of the Brookings Institution, Terry Schwarz of Kent State University's Cleveland Urban Design Collaborative, Sara Toering of the Center for Community Progress, and U.S. Congressman Dan Kildee sit at a table in front of a PD&R banner, speaking to a seated crowd visible in the foreground.
Panelists outlined several strategies for addressing vacancy and abandonment, including strategic demolition, short-term uses of space, and regulatory tools to help owners maintain properties. Photo courtesy of HUD photographer.
For many communities, the nation’s foreclosure crisis escalated the already challenging problem of vacant and abandoned properties. From declining property values to increasing crime and municipal costs, the deleterious impacts of vacant and abandoned properties are well documented. Although vacant properties present daunting challenges to their communities, they also offer opportunities — some vacant properties can be repurposed to provide affordable housing while others can be turned into gardens and farms, adding to a community’s green space. On April 10, 2014, HUD’s Office of Policy Development and Research invited experts at the forefront of this issue to examine different strategies for returning distressed properties to productive use and revitalizing blighted neighborhoods. U.S. Congressman Dan Kildee, the keynote speaker, shared his perspectives on strategies to address vacant properties. Born and raised in Flint, Michigan, Congressman Kildee helped establish the Genesee County Land Bank and cofounded the Center for Community Progress, a national nonprofit dedicated to transforming blighted properties. Panelists included Alan Mallach, nonresident senior fellow at the Brookings Institution and senior fellow at the Center for Community Progress, Terry Schwarz, director of Kent State University's Cleveland Urban Design Collaborative (CUDC), and Kim Graziani, vice president and director of national technical assistance for the Center for Community Progress.

Rethink Public Systems

Vacancy and abandonment are not limited to struggling communities. Once associated with the older industrial cities of the Rust Belt, these problems have spread to formerly stable areas in the aftermath of the foreclosure crisis. As such, policymakers need to acknowledge that even growing communities can be vulnerable to vacancy and decline and should have systems in place to proactively address them, cautions Kildee. Such an approach entails reengineering the public systems involved in vacant property management and disposition, such as code enforcement, tax collection, and foreclosure processes. In many communities, the sale of tax-delinquent properties benefits speculators, who treat the properties they purchase only as commodities. Streamlining and increasing the efficiency of tax foreclosure procedures is one way to address this problem. The state of Michigan reformed its tax foreclosure laws in the late 1990s ending the sale of tax liens to speculators and allowing local governments to take control of tax-foreclosed properties. The law also expedited the foreclosure process. This restructuring, notes Kildee, was pivotal to tackling the challenge of large numbers of vacant properties in the state.

The use of regulatory strategies is one part of Mallach’s nine-point plan to help communities deal with vacant properties. Targeted code enforcement and vacant property registration requirements can motivate absentee owners to maintain properties and prevent decline. These regulatory tools, however, do not always suffice, so communities must have a plan for acquiring and taking ownership of troubled properties, whether through tax foreclosure, receivership, donation, or negotiated sale. Another effective way for localities to acquire and repurpose distressed properties, Mallach notes, is by creating land banks.

Land Banks

U.S. Congressman Dan Kildee stands behind a podium bearing the HUD logo, addressing attendees (not pictured). Todd M. Richardson, Associate Deputy Assistant Secretary at PD&R, is visible in the background, seated in front of a PD&R banner.
U.S. Congressman Dan Kildee spoke on his experience with the Genesee County Land Bank and the Center for Community Progress in the PD&R Quarterly Briefing on reusing vacant and abandoned properties. Photo courtesy of HUD photographer.
Public or nonprofit entities empowered by state legislation, land banks revitalize vacant and abandoned properties through strategic acquisition, maintenance, and disposition. Land banks acquire properties in various ways, including through tax foreclosure, donations, municipal transfers, and open market purchases. With core powers that include self-funding mechanisms and the ability to operate regionally, extinguish back taxes, and clear titles, land banks are able to dispose of vacant properties in ways that advance community goals. One of the biggest challenges for land banks, according to Graziani, is maintaining the vacant properties in their inventory in the face of inadequate resources. The key to overcoming this challenge is to manage expectations and partner with community groups to help with the properties’ upkeep. To be effective, land banks have to be transparent, engage local stakeholders, and highlight short-term successes to attract community support.

Strategic Demolition

Some properties are too damaged and can pose a health hazard, are structurally unsafe, or require repairs too extensive to be financially feasible and require demolition. Mallach observes that demolition should be an integral part of a community’s vacant property strategy. But, he notes, communities should carry out demolition strategically and with care, basing their decisions on rational criteria and their larger redevelopment goals. In cities with weak market demand, vacant lots resulting from demolition may not be redeveloped. These localities should explore alternative green uses for vacant lots, such as community gardens and urban farms. The city of Detroit has close to 150,000 vacant lots. Detroit Future City, a long-term planning framework for the city, calls for reclaiming some of the vacant lots by developing green and blue infrastructure — “forest landscapes that improve air quality” and “water-based landscapes like swales, retention ponds, and lakes that capture and clean stormwater.” These uses may be temporary in some cases but not always. “Green reuse is going to be part of the long-term future fabric of many communities,” says Mallach.

Temporary Interventions

In shrinking cities with surplus vacant lots and buildings, temporary use projects — short-term uses such as art installations, public events, and meeting spaces — can be valuable transition tools. As director of CUDC, Schwarz launched the Pop Up City initiative, “a program that brings empty places to life through magical, ephemeral experiences….”and oversaw the installation of temporary bazaars, markets, and restaurants in the city of Cleveland’s vacant buildings. Such projects highlight the potential of vacant properties and set the stage for redevelopment. They also allow organizers to observe consumer behavior and keep public interest in a property alive. For example, as part of the Pop Up City project, Schwarz’s team worked with young professionals to create a temporary roller skating rink within a vacant industrial building in Cleveland. This space was later turned into a party venue. Temporary interventions may not directly lead to permanent development, according to Schwarz, but they lay the groundwork and promote community engagement in vacant property reuse.

In addition to the strategies mentioned above, panelists discussed ways to foster partnerships with stakeholders at different levels to further revitalization goals. Local governments should create a favorable climate for redevelopment by working with developers on issues such as land assembly, permitting, regulatory incentives, and financial subsidies. Just as important is engaging with and gaining input from community organizations, neighborhood groups, and residents.

Decades of economic decline and more recently the foreclosure crisis have left many communities grappling with the issue of vacant and abandoned properties and the enormous challenges and heavy cost burden they impose on local governments. A comprehensive approach that incorporates multiple tools ranging from strategic code enforcement to land banks and green reuse can help prevent, manage, and put blighted properties back to productive use.

For more on the challenges of vacant and abandoned properties and their solutions, please see the winter 2014 issue of Evidence Matters.

A webcast of the panel discussion is available here.