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Medical Districts as Anchors of Urban Revitalization

Healthcare systems have long been an important element in the milieu of local communities. Beyond their essential role in delivering necessary medical services, these institutions facilitate the flow of billions of dollars of spending, boosting local economies both directly and indirectly.

Sadly, despite the strong presence of medical institutions in center-city areas throughout the nation, inner city environments continue to struggle with declining economic fortunes. Much of this can be attributed to the loss of local investments in commerce and industry that once served as a stabilizing foundation for these communities. This has led to high levels of unemployment, housing blight, marginal schools and a sustained pattern of generational poverty.

It is widely recognized that hospitals and medical centers have the capacity to provide a strong, stabilizing presence to counterbalance some of the challenges that these neighborhoods face. These “anchor institutions” often possess a wealth of physical and economic assets, as well as political influence; all factors that can help spark a transformational reset of surrounding area conditions.

In Aurora, Colorado, just outside of Denver, a rapidly developing “Medical City” is building repute as a model for medical districts nationally. This massive complex, known as the University of Colorado’s Anschutz Medical Campus, is located on a portion of a former Army medical base that had fallen into disrepair. It houses health science-related schools and colleges under the flagship University of Colorado Hospitals and Anschutz Centers for Advanced Medicine. Co-located on this expanse is the Fitzsimons Life Sciences District, which includes the 184-acre Science and Technology Park, and the new Children’s Hospital. The campus will also serve as the future home of the Veteran Affairs Hospital, and the mixed use residential/retail town center known as 21 Fitzsimons.

Unfortunately this shiny new, multi-million dollar campus abuts one of the grittiest, low-income neighborhoods in the metro area. Revitalization efforts in the immediate vicinity have been slow to take hold due to recessionary patterns as well a lack of civic commitment in fostering improvements. By all accounts though, that could soon change.

Recognizing the importance of community development investments in renewing this neighboring area, a new initiative known as Campus Community Partners recently announced a $1 million dollar cash infusion for the adjoining neighborhood, funded by the University of Colorado Denver Anschutz Chancellors Office. The primary goal of this project is to expand outreach efforts, which support area residents in identifying neighborhood resources and healthy lifestyle options. A portion of these monies will also be directed toward expanding workforce development efforts in the community, with an emphasis on job readiness for available positions on the nearby medical and research campus.

A similar medical district project, known as the BioDistrict, is rapidly blooming in Louisiana. Spanning 1,500 acres in the Downtown and Mid-City areas of economically ravaged New Orleans, this district will feature a world-class bioscience ecosystem providing high paying jobs in research and development and health care delivery. A key component of this project is the University Medical Center, the 1.2 billion LSU teaching and research hospital scheduled to open in mid-2015. This hospital will replace Charity Hospital, the longstanding public site shuttered by Hurricane Katrina.

Like Anschutz, plans are underway to use the BioDistrict as a springboard for community revitalization in this unappreciated section of New Orleans. Major efforts are already in play to foster a mixed use community with housing and other lifestyle amenities designed to raise the overall economic climate of the community.

Fueled by the growth trajectory of health care and life sciences industries, these medical districts offer a much needed investment infusion to adjoining neighborhoods and communities seeking to gain traction with their revitalization efforts. Through the clustering of complementary uses, they facilitate the strategic leveraging of public/private assets with the goal of repurposing vacant land, dilapidated structures and underutilized property.

A number of medical districts are capitalizing on this movement by envisioning a “town center” concept. Here, the medical center and health sciences complex would serve as the anchor for a expansive community replete with housing, active green spaces, walkable arterials, organic grocery stores, fitness centers and other lifestyle conveniences. Nearby vacant land and building rooftops could be repurposed to promote an urban farming and locally grown food ecosystem that supports adjoining urban communities.

Omar Blaik, Founder and CEO of U3 Advisors, a nationally recognized consulting practice specializing in real estate and economic development solutions to institutions that anchor communities says that healthcare systems that redeploy their institutional assets and resources to create economic benefits for surrounding neighborhoods can be a worthy investment if executed thoughtfully. He, however, offers a word of caution to healthcare institutions contemplating such an initiative. “Leaders often see these efforts as a “silver bullet” that could potentially turn around a locality overnight. They believe that a simple set of actions will quickly create the economic development multiplier that everyone hopes for. This is a far cry from reality,” says Blaik.

Kim Zeuli, ICIC’s Senior Vice-President and Director of Research agrees with this time trajectory assertion. “There’s no doubt that these initiatives can take many years and thus should be viewed as long-term investments by the institution. Executing a unified approach and comprehensive strategy is key to ensuring a lasting impact; one that makes sense for both the healthcare institution as well as the community as a whole. says Zeuli.

In terms of emerging trends Zeuli notes that there’s buzz aplenty surrounding the Affordable Care Act’s potential of insuring many of our nation’s uninsured. The thinking here is that dollars traditionally used for charity care can now be redirected toward community investments. “Its widely known that non-profits are required by the IRS to spend a targeted amount on community benefits in order to maintain their non-profit status. We are carefully monitoring this trend as it has the potential for significant monies to be redirected toward community revitalization, healthy neighborhoods and other projects. We see this as a very positive development.”

In light of the continued emergence of health institutions as community anchors, look for medical districts to emerge as hubs of employment, innovation, sharing economy activities, medical tourism, and tax revenue generation, serving as an economic boost for areas that have long been abandoned. And by championing a healthy lifestyles concept, these districts offer added value in terms of addressing persistent health and wellness issues that have long affected underserved communities within their reach.

Michael Scott is a Denver based journalist whose thought-pieces examine the economic and social impact of cities and regions. You can follow his work at urbanwebcityonline.tumblr.com

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