Real Estate Services Group
Historic Preservation and Economic Development in the 21st Century
SUBMITTED TO THE LEADERSHIP CONFERENCE ON CONSERVANCY AND DEVELOPMENT
1999, Yunnan Province, China
the world quickly passes into the 21st Century the context and environment
of local economic development is rapidly evolving. The purpose of this paper
is to identify some of the elements of that evolving context, establish some
principles the will underlie economic development in the 21st Century,
enumerate the "Five Senses" that each community will need to be competitive,
and suggest that the preservation of the historic built environment, far from
being a hamper to economic growth, can be a critical vehicle to make it happen.
This paper is not intended to be an exhaustive discussion of any of these issues,
rather it is hoped to be a checklist of economic development components against
which a variety of specialists can consider their own areas of expertise.
of the 21st Century Economy
21st Century will be a globalized economy. This will effect every
national economy regardless of political or economic system.
most significant impacts of the global economy will not be at the national
or even the provincial level. The biggest impacts will be local. Akito Marito,
founder of Sony, calls it "Global Localization"
will be a rapidly growing demand for products world wide. But the manufacture
of those products will require fewer and fewer people. Likewise the need
for agricultural products will only increase with world population growth
but fewer agricultural workers will be necessary to grow that food.
areas of the economy that will grow, both in output and in employment are
products, individually produced
of 21st Century Economic Development
each of the above growth areas, quality and authenticity will be major variables
in consumer choice
all of the potential benefits of a globalized economy (and there are many)
it carries with it the substantial risk of a globalized culture, of which
there are few if any benefits, BUT
is NOT inherently necessary that a globalized economy leads to a globalized
culture, in fact it is crucial for economic as well as other reasons that
it does not, BUT
will require decisions at the local and regional level to make sure a globalized
local culture does not occur
parallel to the above the "modernization" of local communities in infrastructure,
public health, convenience, and quality of life does not necessitate
the "westernization" of the built environment.
copy of a built environment from elsewhere will never be as good as the
original. An imitative strategy for the built form quickly leads a community
from being "someplace" to "anyplace". And the distance for "anyplace" to
"no place" is short indeed.
communities and their citizens which will be successful in the next century’s
economic development will be those that recognize the realities above and respond
by embracing five principles.
To ignore the reality of a globalized economy, or to recognize it but not
respond will make many communities the victim rather than the beneficiary
of globalization. To adopt globalization as a principle allows a local community
the opportunity to identify its own characteristics that can be competitive
in the global marketplace and to establish measures that mitigate the adverse
impacts that a globalized economy can carry.
The definition of what "economic development" means needs to be a local
one. It needs to be specific and measurable. Many local economic development
yardsticks in the 21st Century will be qualitative rather than
quantitative. Localization will always necessitate identifying local assets
(human, natural, physical, locational, functional, cultural) that can be
utilized to respond to globalization. Those assets need to be first identified,
then protected, then enhanced.
The concept of diversity has three different facets in relation to economic
populations are more mobile and more diverse even on the smallest local
level, there will need to be an accommodation of human diversity in
economic development and an appreciation of the valuable alternative
perspectives that diversity can provide in an economic context
will have to have a diverse local economy to provide protection from
the volatile patterns of demand in the marketplace. Excessive reliance
on a single source of employment, production, and economic activity
leaves communities inordinately vulnerable.
economic globalization as a given, the extension is that potential customers
for goods and services will be exceedingly diverse. Successful economic
development will recognize and customize to meet the needs of a diverse
markets rather than standardize and homogenize thereby ignoring customer
Five Senses of Quality Communities
Sustainability in economic development has for sometime been recognized
by the resource industries – the necessity to pace extraction or renew resources
so that the local economy is sustainable over the long term. A broadened
principle of sustainability recognizes the importance of the functional
sustainability of public infrastructure, the fiscal sustainability of a
local government, the physical sustainability of the built environment,
and the cultural sustainability of local traditions, customs, and skills.
While in most parts of the world there will be provincial, national and
international resources that can occasionally be tapped for use in enhancing
a local economy, the vast majority of the efforts will take place at the
local level. This, then, requires that each community takes a large measure
of responsibility for its own economic future. Certainly local government
has a part to play in that process, but so does the private sector when
it exists, NGOs, and citizens at large. Each must recognize the responsibility
at the local level to define and pursue a community-wide economic development
the past the economic fate of a given community was largely driven by locational
and resource factors. Is it near a port? Is there timber to be cut? Is transportation
available by waterway? Is there copper that can be mined? Certainly these and
similar factors will continue to play a major role in the economic future for
many locations. But in the 21st Century there will also be variables
that will influence local economic opportunity that are not locationally driven.
These are referred to as the Five Senses of Quality Communities and will, in
the intermediate and long term, have considerable impact on the economic health
of individual communities.
Preservation as and Economic Development Strategy
of Place Both the built and natural environment should be used to express
the particularity of this place. That this community is neither "anyplace"
nor "no place" but "someplace," unduplicated anywhere.
of Identity In economics it is the differentiated product that commands
a monetary premium. A community which in the long term wants to be a "valuable
place", however that is defined, needs to identify its attributes that add
to its differentiation from anywhere else
of Evolution Quality, living communities will neither be frozen in time
as museum relics nor look like they were built yesterday. The physical fabric
of a community should reflect its functional, cultural, aesthetic and historical
of Ownership If there needs to be responsibility exercised at the local
level to create and benefit from economic health, then there has to be a
sense of ownership of the community by each of the sectors. This does not
mean ownership in a legal or property sense, but ownership more broadly,
a feeling of an individual stake arising from that particular place and
of Community A sense of ownership acknowledges an individual benefit
from, an individual stake in, and an individual responsibility for one’s
place. A sense of community acknowledges the obligations to and interconnectedness
with the other residents of that place.
preservation has often been portrayed as the alternative to economic
development – "either we have historic preservation OR we have economic growth."
This is absolutely a false choice. Increasingly around the world historic preservation
is becoming a uniquely effective vehicle for economic growth.
preservation has moved from being an end it itself (save old buildings in order
to save old buildings) to being a vehicle of broader ends – center city revitalization,
job creation, small business incubation, housing, tourism, and others.
historic preservation in this fashion, however, requires the recognition of
landmarks and monuments need to be identified and protected, BUT
resources are far more than monuments and often are vernacular buildings
of buildings rather than individual structures are often what is important
vast majority of buildings of "historic importance" have their importance
defined by their local significance, not national or international
reuse of buildings is central to an effective historic preservation
as economic development strategy
those understandings a historic preservation based economic development strategy
has several measurable benefits:
is an important element in sustainable historic preservation based success
creation. The labor intensity of building rehabilitation generally
means that there is a greater local economic impact in jobs and income
than with the same amount spent on new construction
training and skills passing. The local craftsmanship of the building
process can often be nearly lost in a generation but instead can be
passed on through historic preservation, creating jobs and skills simultaneously
substitution. A central strategy in building a sustainable local
economy is import substitution – creating locally what otherwise would
have to be purchased elsewhere. Almost by definition historic preservation
is locally based, using expertise, labor, and materials from the local
market. Often new construction is the opposite, requiring the importation
of expertise, materials, and often labor from elsewhere.
with modernization There are certainly many historic buildings that
don’t currently meet today’s standards for comfort, convenience, and
safety. But over the last two decades great strides have been made around
the world in the methods of bringing historic buildings into compliance
with modern demands without harming their physical structure or their
architectural character. Most components for modernization – water and
sewer lines, telephone cables, electric wires, even high speed computer
data transmission lines – can be put in place almost invisibly – often
underground – without jeopardizing the individual historic resources
or their important context and interrelationships.
with evolution Once there is an acknowledgement that effective historic
preservation isn’t just museums and the concept of adaptive reuse is
adopted, historic buildings have proven themselves remarkably versatile
in responding to the demands of the widest imaginable range of uses.
product differentiation In economics it is the differentiated product
that commands a monetary premium. If in the long run a community wants
to attract capital, to attract investment, it must differentiate itself
from anywhere else. It is the built environment that expresses, perhaps
better than anything else, a community’s diversity, identity, individuality,
in short its differentiation.
effective venue for cultural goods and services For communities
that have cultural assets and crafts products that represent economic
opportunity, historic buildings often constitute the most appropriate
physical locations for the sale and display of goods and the presentation
of productions. The physical context of the historic building adds to
the sense of authenticity, originality, and indigenousness of the art.
business incubator for small enterprises Regardless of a nation’s
overall economic or social system, entrepreneurship nearly always begins
on a small scale – a one or two person operation. The size, location,
character, and often pricing of historic buildings means that they frequently
serve as natural incubators of emerging enterprises.
Policy Reasons for Historic Preservation as Economic Development
for tourism While tourism will be one of the fastest growing segments
of the world’s economy in the 21st Century, not every community
can or should look to tourism as a major portion of its economic base.
There are cultural, economic, logistical, sometimes even religious reasons
why tourism isn’t appropriate for every locale. Further, it would be
a mistake to inflexibly connect "historic resources" and "tourism" –
there are far more avenues by which historic buildings can be used.
In the U.S., for example, 99% of all of the historic resources in productive
use have nothing whatsoever to do with tourism. That having been said,
when tourism is identified locally as a component of an overall
economic development strategy, the identification, protection and enhancement
of the community’s historic resources will be vital for a successful
preservation also has numerous attributes which warrant using preservation as
an economic development tool from a public policy perspective.
areas Historic buildings are usually located in areas that are otherwise
determined as appropriate targets for public intervention – center cities,
close in residential neighborhoods, rural villages.
a zero-sum game Many approaches to economic development are essentially
zero-sum games. That is to say, for community A to succeed community
B has to lose (a factory recruited from place A to relocate to place
B, for example). Because nearly every community has its own historic
resources that can be used to house a variety of activities, for one
community to benefit from the adaptive reuse of its historic structures
in no way precludes another community from doing so as well.
dispersed Related to the above, public officials and NGO institutions
do not have to limit a strategy to a single geographic area (city instead
of village; coast instead of inland, for example). Because communities
are geographically dispersed throughout a province, an economic development
strategy based on the use of historic resources also automatically becomes
a geographically dispersed strategy.
of project scales A variety of factors will affect the public sector’s
ability to implement plans on a large scale. Financial constraints,
political factors, environmental concerns are all reasons that the "big
project" is often delayed or shelved. Historic preservation, however,
can be done at virtually every scale, from the smallest shop building
to the massive revitalization of areas in large metropolitan regions.
The smaller projects can proceed while larger ones are still on the
Even non-market economics are not immune to the ups and downs of world
wide economic cycles. Because of their scale, cost and labor intensity,
historic preservation projects are often possible even in down cycle
periods, providing a measure of job and income stability to a local
change It isn’t inherently change that seriously adversely affects
a local economy and its culture; it is change that is rapid, massive,
and beyond local control. Historic preservation by definition is an
incremental strategy within the framework of an existing community,
not an immediate and overwhelming type of change which often leads to
feelings of powerlessness locally and a decline in the sense of community.
base to build NGOs Non-governmental organizations (NGOs) have proven
themselves to be singularly effective in responding to serious issues
on a grass roots level in every corner of the globe. They have tackled
and solved local problems that neither government nor, in market economies,
the private sector have been able to effectively address. In historic
preservation in particular, the NGO sector has been most effective in
advocacy, in education, and in the creative reuse of historic buildings.
If it is public policy to encourage and support a strong NGO sector,
historic preservation activities can be an effective means to do so.
without Westernization Historic preservation as an active public
policy is an effective way to allow for modernization to meet the public
safety, comfort, and convenience needs of citizens without the Westernization
of the local built environment and the concomitant loss of local character.
preservation as an economic development strategy is consistent with all five
principles of 21st Century economic development: globalization, localization,
diversity, sustainability, responsibility.
preservation reinforces the five senses of quality communities: sense of place,
sense of identity, sense of evolution, sense of ownership, and sense of community.
preservation can meet the test of both "quality" and "authenticity" that will
be critical elements in economic development in the next century.
cultural assets of a community – dance, theater, music, visual arts, crafts,
and others – are inherently influenced and enhanced by the physical context
within which they were created and evolved over the centuries. If cultural resources
are to become and remain an economic asset for a community, then the physical
context that has always influenced their creation needs to be maintained. Otherwise
more than just the physical buildings are at risk; the quality, character, differentiation,
and sustainability of the other assets are in jeopardy as well.
preservation allows a community to participate in the positive benefits of a
globalized economy while resisting the adverse impacts of a globalized culture.
preservation allows a community the opportunity to modernize without having
to Westernize. More than that – historic preservation is the irreplaceable variable
to achieve modernization without Westernization.
the 21st Century only the foolish community will make the choice
between historic preservation and economic development. The wise community will
effectively utilize its historic built environment to meet the economic, social
and cultural needs of its citizens well into the future.