New downtown Worcester district seeks to add range of improvements
January 7, 2019 : Worcester Business Journal, by Grant Welker
Downtown Worcester has already found success in redeveloping the former Galleria mall site, bringing back Front Street, adding new housing and finding better uses to long-vacant sites like the former Paris Cinema.
Now, property owners are looking to do more to market downtown Worcester, clean-up sidewalks, add signs and hire ambassadors to improve the neighborhood that much further.
This year, Worcester is set to roll out the eighth business improvement district in Massachusetts, where property owners pay into a fund to make upgrades to a specific neighborhood. With approval from the City Council in November, Worcester's new business improvement district already has set up a board of directors and is preparing to hire a vendor and an executive director to oversee a 78-acre piece of downtown centered around Worcester Common.
Of more than 90 property owners in the district, the idea has received broad and strong support, said Troy Siebels, the president and CEO of the Hanover Theatre and a driving force behind the effort to bring the district to reality.
"What those 90-plus property owners have in common is a desire to have more services in our neighborhood than we can reasonably expect the city to provide, and a willingness to step up and make that happen," Siebels said.
The district expects to bring in roughly $950,000 a year through small tax surcharges on properties in the district's boundaries. A few nonprofits in the district, who are otherwise exempt from paying property taxes, have already committed to paying, including the Hanover Theatre, YWCA and MCPHS University.
Funding neighborhood ambassadors
The idea for the district came from the Theatre District, which was centered around the Hanover Theatre. Though it didn't use a tax surcharge to pay for improvements, the district was designated by MassDevelopment as part of the state agency's Transformative Development Initiative, making it eligible for planning aid and investment funding.
Siebels said the timing was right to create a business improvement district now, which was not practical 10 or even five years ago.
For the business improvement district, surcharges on properties will amount to three one-thousandths of a percent of a property's assessed value, or $3,000 on a $1 million property.
Those funds are expected to pay primarily for beautification and safety improvements, as well as marketing, advocacy and public art or sculptures.
Ambassadors, workers who will do everything from keeping sidewalks clean to giving out suggestions or directions, are at the top of the list of features organizers want to see implemented, said Julie Holstrom, a senior project manager for the Worcester Business Development Corp. and a board member for the district.
"You will see and hear and feel the difference a BID will make downtown," Siebels said, using an acronym for business improvement district.
Ambassadors are planned to be roaming the district for 16 hours a day, seven days a week.
Focusing on the right parcels
The district includes many of downtown's largest commercial buildings, including Mercantile Center, the Worcester Plaza tower, the mixed-use Grid District and newer developments, including the AC Hotel and 145 Front at City Square apartments. In all, the district includes roughly 140 properties, from small slices assessed at just $38,000 to the largest buildings up to $62 million in value.
The district's boundaries were thoughtfully mapped out to include the right parcels, including those along Foster Street where many enter downtown, said Peter Dunn, the city's business and community development coordinator and a member of the district's board.
"You want to identify boundaries that have this sort of natural boundary to it," Dunn said.
Worcester's business improvement district joins a list of Massachusetts improvement districts including Hudson's downtown and part of downtown Boston covering Downtown Crossing and Theater District, which has transformed from a seedy neighborhood to one with new residential buildings and a long pedestrian-only stretch of restaurants and shops. Downtown Hudson created its own business improvement district last year to capitalize on growing retail.
Boston's business improvement district started in 2011, with initiatives including promotional literature and maps, walking escorts, trash and graffiti removal, and street and sidewalk upgrades. The district brings in more than $6 million a year.
Turning Worcester into a destination
Worcester's district has received broad support from property owners, including Davis Publications, which owns the Printers Building at 44 Portland St., and the Menkiti Group, which in 2018 bought three buildings in the district with plans for revitalization. Representatives from both urged the Worcester City Council to approve the project in November, when it did so unanimously.
The owners of the Mercantile Center, Grid District, City Square are also among those on board.
"Our family has seen the ebbs and flows and the pendulum swing, and the pendulum is swinging back for Worcester," said Julian Wade, the president of Davis Publications.
Paul Morano, a former development official for the city and now a regional director of real estate for the Menkiti Group, said the district will help property owners secure tenants. Such a partnership is needed to help ensure steps are taken to make the neighborhood a destination, he said.
The Worcester district received support from all except six property owners, Siebels said. Dean Marcus, the owner of the Midtown Mall on Front Street, is opposed, saying he and others already pay substantial taxes.
"It's another tax on a lot of properties. Many [property owners] can afford to, some of them cannot afford to," Marcus said.
The district set up a board of directors in December and expects to have resumes in hand later this month for its first executive director. District leaders, who should begin seeing revenue for the first time in February, hope to begin making visible changes to the district in time for the spring.
"The whole idea," Holstrom said, "is taking the winter to organize ourselves and when the spring comes, we can really hit the ground running with this."