Returning Former Mill Complexes to Engines of Economic Growth

Written by Amanda Maher

Long before the cities in the Midwest became industrial powerhouses, Northeastern manufacturing centers like Lowell, Providence and Manchester, NH, were driving the country’s growth. Some of these cities fared well even as manufacturing made its way west. But as industry declined in the U.S., many of these cities faced a similar fate. Left behind were behemoth industrial complexes that developers have struggled to give an identity.

Lawrence, Mass., is one of these cities. Nicknamed the “Immigrant City” and once a leading producer of textiles, Lawrence struggled to fill the abandoned mills that dotted the Merrimack River. By 2000, poverty in Lawrence was more than double the statewide average. But in 2003, entrepreneur Salvatore “Sal” Lupoli, who was looking for a commissary for his successful pizza franchise, saw the potential in the Worsted Mill Complex – now known as Riverwalk Properties. With the support of allies at the state and local levels, Lupoli purchased the complex and has since steadily transformed the 3.6 million square feet site into a thriving “live-work-play” complex. When others gave up on Lawrence, Sal doubled down by strategically targeting small businesses, offering affordable space at the Riverwalk. Given the size of the mill complex, Sal could be nimble with tenants; as companies like Solectria Renewables, a solar panel manufacturer, grew, Sal was able to accommodate them with larger – but still affordable – space. Today, Solectria has 125,000 square feet of space at the Riverwalk, and was recognized as a 2014 Inner City 100 winner for its growth. There are now more than 200 businesses located at Riverwalk Properties, and the housing units are almost 100 percent occupied. What was once an eyesore is now one of the city’s most treasured assets.

Like many mill cities, Franklin, N.H., also sits along the confluence of two rivers – bodies of water that were critical to power the mill during the Industrial Revolution. But today, the mills sitting along the Winnipesaukee and Pemigewasset Rivers are starving for investment. There was an uptick in excitement when a Montreal developer purchased one of the mills in the 1990s; realizing the rents would be too low for the project to be financially feasible, he sold it a few years later. Various big ideas had been planned – including redeveloping the mills, demolishing them, or offering heavy tax incentives to draw new commercial users – but none has led to fruition.

Todd Workman, an entrepreneur, loan officer and real estate developer, now has another big idea: permaculture, a system of sustainable agriculture based on emulating the patterns of nature. Workman’s idea is to redevelop the former mill sites in an environmentally self-sustainable manner, using electricity generated by the river. “We are now living in a post-growth society, and a…way of life needs to be created as a viable alternative,” Workman told the Boston Globe.  Transforming the city using this wholesale approach would be more successful than the city’s previous piece-by-piece efforts, he argues. And now others are getting on board. A vision like this will take years – decades – to fully unfold, but it’s an important step for Franklin, which is otherwise struggling to revitalize its economy.

Falling somewhere between the successful Riverwalk project and the nascent Franklin redevelopment is a mill project in Biddeford, Maine. Like the others, Biddeford was once a thriving mill city, located on the Saco River, and was a leader in textile manufacturing. Since the manufacturing industry left Biddeford, its downtown has been plagued with high unemployment and commercial vacancy.

Signs of life are beginning to emerge. Much like the Riverwalk Properties in Lawrence, the 35-acre mill district in Biddeford has hedged its bets on attracting startup companies who count on affordable space at their earliest stages. Today, an array of startups and small businesses—from manufacturers to a distillery and an art school—employ more than 400 people at the complex. The goal is to employ a mixed-use strategy like that in Lawrence; a Maine developer recently purchased the 233,000-square foot Lincoln Mill to transform it into 100 market-rate loft apartments and condominiums. A boutique hotel is also in the works. City planners are strategically positioning Southern Maine Medical Center and the University of New England—two of the region’s anchor institutions—as selling points for companies interested in relocating to downtown Biddeford, an increasingly walkable neighborhood.

Mill renovations are no easy task. Most need substantial investment to bring utilities in line with today’s standards, such as electrical and broadband internet. High ceilings and large single-pane windows make heating or cooling these buildings costly. Typically, large city, state and federal investments are needed in order to transform a project in a way that is financially feasible for developers. A range of tools, including federal New Market Tax Credits and state Brownfield Tax Credits and Historic Preservation Tax Credits, are often required to attract supplementary private investment. For cities, it remains a challenge to balance the desire for redevelopment with the need to remain fiscally prudent. Policymakers are sometimes hesitant to use District Improvement Financing (DIF) or Tax Increment Financing (TIF) for fear of “giving away the house”—but as successful redevelopment projects like the Lawrence Riverwalk illustrate, it takes cross-sector partnership to transform these abandoned mills into new economic engines. And while this transformation is a challenge, projects such as these are showing that it is possible.

Read more about the Riverwalk Project in our latest What Works for Cities Case Study: A Mixed-Use Development of a Former Textile Mill In Lawrence, Mass.