Written by Amanda Maher
City-owned vacant or underutilized property can be a valuable asset for municipalities. This real estate can be leveraged for large-scale development projects that address important community and economic development issues such as affordable housing, commercial development and open space. But often, city-owned properties of this type are small and scattered. When these properties remain unused, they drain city resources without contributing to the tax base. The recent foreclosure crisis resulted in cities owning even more of these properties. Philadelphia has 40,000 such properties, Chicago 50,000. Even smaller cities like Louisville and Providence own thousands of vacant properties
Disposition of these properties is challenging. They are often too small to attract traditional investment or development. Selling off properties one by one can be costly and time consuming for local officials. Some cities, including Buffalo and Newark, have resorted to selling lots for as little as $1 each.
Enter OpportunitySpace, a civic tech startup that the Harvard Innovation Lab has pegged the “Zillow for government-owned real estate.”
OpportunitySpace serves as a unique intermediary between city government and end users such as small businesses and developers. As their website explains, the company helps governments “turn real estate liabilities into productive assets” by aggregating disparate property data and creating map-based inventories of public real estate. These properties are then marketed to a broad range of potential “micro-developers” and community members.
For potential buyers, OpportunitySpace aggregates public data about the property, including information on its zoning and potential tax incentives that could be leveraged for its reuse. Often, land is available for low-cost leases that creative professionals and small companies may find of interest.
In its first round of seed funding, OpportunitySpace reached its goal of $500,000 from a number of real estate industry investors. “Our funding validates the investment potential in the surging real estate and public sector technology verticals. More broadly, it signals strong support for ventures that are solving urban issues, such as disinvested real estate,” said OpportunitySpace CEO Alexander Kapur.
One of the company’s biggest challenges now is handling all of its inquiries: After ending its pilot year with six city and state entities, it is now expanding to 15 new markets by the end of Q2 2015. More than 170 cities and towns have showed interested in joining the OpportunitySpace network.
On March 4, World Business Chicago announced it would partner with OpportunitySpace to promote opportunities for food and beverage, recreational, cultural and educational retailers along three blocks of the Chicago Riverwalk. Meanwhile, the Massachusetts Department of Transportation is using the OpportunitySpace platform to solicit ideas for transforming space under publically accessible highway overpasses in inner city areas like Fall River and Springfield.
OpportunitySpace is another example of the role civic tech can play in transforming urban environments. Where public agencies face challenges, entrepreneurs are increasingly finding solutions. Given its rapid growth so far, OpportunitySpace shows real promise for activating public properties that would otherwise contribute to urban blight.