News & Resources

Why Businesses Are Moving Downtown

As shown by Smart Growth America’s survey released today, there is a trend nationally and locally for businesses to move to walkable city and town centers.  There is a message here: cities and towns that become more walkable and cultivate a strong sense of place will have a competitive advantage.

Under the model that prevailed for 50 years, businesses were looking for single-use suburban office and light industrial locations.  Employees could live anywhere—they arrived and left by car and parked in surface parking lots.   Economic development strategy primarily focused on marketing the locations—access to highways, cheap land costs, and any concessions the municipality could offer.  Most municipalities weren’t thinking about where the workers would live; in fact, many would frankly say they wanted the jobs, not the housing.

That model is clearly shifting, as companies see a compelling need to attract and retain talented young workers who want to work in walkable and vibrant locations. To take two metrics, the siting decisions surveyed showed a jump in walk score of 36 points (from 52 to 88) and in transit access score of 27 points (from 52 to 79). 

But it is not just about walkability and transit.  Businesses were looking for vibrant places—restaurants, retail, housing, and public space.  At a panel discussion, a Cushman & Wakefield broker said “Our brokers are not pitching an office or a store or a place to live, they are pitching a lifestyle.”

What does the new economic development strategy look like?  It means identifying the places where you have—or can picture having–the kind of neighborhood that will attract businesses.  That is likely to be a downtown, or secondary business district, but it could also be underutilized land near transit. 

Then it means evaluating your zoning in those places—and making sure that the zoning promotes a mix of uses, appropriate density, and emphasizes connectivity by all travel modes. 

And it means asking whether there is a strong sense of place and actively thinking about place-making.  It also requires governance that will provide the amenities and programming that will sustain that sense of place.  Such governance can be provided by business improvement or community benefit districts (if the legislature passes a bill we support, H 144/S 1070). 

The trend to downtowns has another implication for municipalities.  For those cities that are already seeing property values rise, there must be increased focus on building social equity into the equation (using tools like inclusionary zoning and linkage between commercial development and housing). 

Massachusetts is lucky to have a lot of walkable urban places.  If cities and towns want to be part of our thriving 21st century economy, we’ll see even more in the years to come.   

The full report can be found here: