Having real talk about real value
Wolfchase Galleria and its immediate out-parcels are assessed at more than $81 million. This is a whopping sum. Yet it consumes about 144 acres to amass that value. Another way of thinking about it is that it breaks down to an average value of roughly $560,000 per acre. By contrast, 39 S. Main, sitting on a tiny 0.06 acre, has an assessed value of $ 409,000. If you had an acre of this building, it would yield a value of about $6,932,000.
Put simply, 39 S. Main has a stunning 12 times the potency of Wolfchase Galleria. The reason for the difference is the building type and how that building uses the land. Those choices are relevant because there is a direct effect on Memphis’ tax base. By this math, it’s a difference of 12 times.
During this week’s Strong Towns Boot Camp, we are going to start conversations about these kinds of numbers and how your community operates.
On the surface, these conversations are about policy, infrastructure and taxes. But what they are really about is cash flow for your community — and by extension, for your household.
Like all cities, Memphis is a corporate entity that has costs and revenues. These are bundled into decisions made by City Hall and Shelby County government, and to some degree state and national governments in Nashville and Washington. At their root, however, those decisions stem from what happens on your block. The same math that drives your neighborhood’s strength is the genome of your entire region.
The goal of the Boot Camp effort is to root out and understand how these decisions are all tied together. We want to figure out the ways in which local and incremental change can drive bottom-up growth that stimulates everything from entrepreneurial ventures to revitalized neighborhoods to a thriving Downtown business district.
As a citizen, you are a shareholder in the “municipal corporations” of Memphis and Shelby County. Your ownership may be direct, as a taxpayer or voter, or indirect, as a renter or occasional shopper in the area. In any event, your contributions pay for the services in the community, and the desires of your lifestyle choices. The question facing us now is whether our choices balance out our desires, and can you afford your choices?
By running the numbers on complex issues like these, Memphians will better understand how to move your community into a stronger, more sustainable financial position. Over the past few years, Mayor A C Wharton’s office has taken innovative steps toward digging into the data to see how things tick. The preliminary results are a great foundation on which to build.
To use an analogy, the company that sold your mobile phone knows the cost of the silicon, glass, plastic and metal before it put the phone on the market. It also must recoup those costs in the price of the phone. Memphis must do the same math for its community if it is to stay competitive. The same holds true for all of the Mid-South — you are all in this together.
Just as your mobile phone has changed over the past 20 years — in size, design, power and functionality — so must our cities and neighborhoods. These places evolve not only in response to changing market demands, but to changing technology and information. Just as we ex- pect innovation and adaptation from our mobile phone company’s designers and manufacturers, our communities must adapt as well, seeking better efficiencies, improved character and continual, productive growth.
To do this, we need to seek better methods of measurement and management. Memphis should account for what makes the community productive culturally as well as financially — your proximity to the Mississippi River, your civil rights and musical legacy, your emerging culinary and film scenes, and your many distinctive neighborhoods. Build on those assets and seek to improve them.
In an era of struggling municipal budgets and conflicting demands, this approach is a refreshing model for the state, if not the nation.
A new history is unfolding in your city, and you are the ones to write it. Joseph Minicozzi, AICP, is the principal of Urban3 LLC (U3), a consulting company of downtown Asheville, N.C., real estate developer Public Interest Projects.