October 14, 2019 Supporting Manhattan-area entrepreneurs, businesses, events

How to Build a Stronger Aggieville

Aggieville’s continued redevelopment is going to require multiple funding mechanisms through partnerships with the City, university, and private investors that have yet to be realized. How can we learn from comparable districts to build the Aggieville we’ve envisioned? 

According to the Brookings Institute, an innovation district is a dense enclave merging research-oriented anchor institutions, high-growth firms, heavy arts influence and creative start-ups in well-designed, amenity-rich residential and commercial environments. The most common type of innovation district is the anchor plus model, where mixed-use development is centered around major anchor institutions, such as research universities, in downtown or midtown areas of a city. The Brookings Institute discusses three main components necessary in developing an “innovation ecosystem” for districts: people, firms, and place. 

As Manhattan’s innovation district, Aggieville possesses these three components naturally. “In exploring the eat-play-sleep priorities, Aggieville checks a lot of the boxes,” says Tracy Anderson, founding partner of Anderson Knight Architects. ”The proximity to K-State, Manhattan Christian College, City Park and downtown are so beneficial.” Additionally, Ryan Bramhall, current Aggieville Business Association president and owner of Tubby’s Sports Bar, says, “Although some people think Aggieville is nothing but bars, we have 96 businesses with only 15 bars, and actual bars without a kitchen is even less. We already have a lot of mixed-use.”

Aggieviell Manhattan Kansas MHK Business News Magazine
Photo by David Mayes

As a tax increment financing (TIF) district, Aggieville’s future depends heavily on increased spending within the district so that the increased real estate and sales tax revenue can be collected. Since TIF funding is projected to only account for $15.2 to $20.5 million out of the $23.3 to $30 million it will take to fund all the proposed improvements, it’s clear that in order for Aggieville to become the attractive mixed-use district we’ve envisioned, it’s going to require multiple funding mechanisms through partnerships with the City, university, and private investors that have yet to be realized. 

It’s been reported that private developers require additional parking structures before investing in the district, which is why the first approved Aggieville improvement is the City of Manhattan’s $15.5 million project for a parking garage at the intersection of Laramie and North Manhattan south of Rally House. Streetscape improvements are also included in the project budget. However, the key element in an innovation ecosystem that is arguably missing in Aggieville is the “synergistic relationship” between the people, firms, and place, namely Kansas State University and private investors. 

Even with private developers appeased by the addition of parking, Aggieville will remain an anchor plus-based innovation district without its anchor. To build a stronger Aggieville, business leaders must identify key indicators of innovation and learn from other regions and districts with strong city, university, and private investor relationships.

Block22 Transforms Pittsburg 

For inspiration we only need to look to the town of Pittsburg, Kan. where Block22, a new entrepreneurial epicenter is transforming four historic downtown buildings into areas with apartment living for students, co-working and business incubation makerspaces inside a start-up called The Foundry, along with multiple new dining, mingling and entertainment options. This mixed-use, living-learning community is how many envision a future Aggieville to be, and it recently was selected as one of the top university-led projects in the nation by the University Economic Development Association. 

Fueled by Pittsburg State University’s expansion into the city core in the fall of 2018, Block22 resulted from public-private partnerships between Pittsburg State University, the City of Pittsburg, and the Vecino Group, a housing specialist based in Springfield, MO. 

Aggieviell Manhattan Kansas MHK Business News Magazine Block 22 Pittsburg Kansas
Photo by David Mayes

“In fall 2015, the City had an idea to pitch to us at the university with a possibility of student housing moving downtown,” says Shawn Naccarato, Pittsburg State University’s chief strategy officer. “The buildings on 4th and Broadway were the first four original commercial spots in Pittsburg’s founding from 1870s known as the Commerce, Baxter, National Bank and Opera House Hotel buildings. Yet, they were empty, nearly ready to tear one down and in decline for generations. Now, this area is back as a collision of art, industry, commerce and talent, just like the start of these buildings nearly 150 years ago.” 

After several studies and planning phases, Block22 blended funds to create a living-learning development complete with nearly 100 units of student housing and more than 16,000 square feet of innovation space to explore new ventures and community entrepreneurs. The City of Pittsburg committed $1.5 million from their Revolving Loan Fund, the university raised $1 million, and Vecino secured $10 million in tax credits. The remaining $5.4 million loan assumed by Vecino will be paid through a long-term lease agreement with the university. 

Aggieviell Manhattan Kansas MHK Business News Magazine Block 22 Pittsburg Kansas
Photo by David Mayes

“It’s what we call ‘strategic serendipity,’ to work towards moving forward together and being in the right place at the right time,” Naccarato says. “We were looking for ways for others to come home as leaders who want to return and have spaces new folks could enjoy. Rather than getting derailed or side-tracked, the university became the anchor tenants to cash flow the initial projects and tax credits. So much has come in such a short time. We injected life and planted a flag back downtown as a space for starting the next best companies in the Midwest.” 

An Opportunity to Create a New Manhattan

Block22 demonstrates that innovation districts flourish when all three types of assets (people, firms, and place) are combined with a supportive, risk-taking culture. As the heartbeat of Manhattan, Aggieville has the opportunity to become a leading-edge district like Block22 because it, theoretically, already possesses many assets like unified groups of people, diverse businesses, and a desirable location.

Ryan Bramhall acknowledges how unified groups can help push projects forward. “We’re raising our voice of strength for Aggieville with a more united front than any time previously,” says Bramhall. “Everyone’s on the same page. We’ve done a lot to make sure everyone knows what is happening and ready for next steps.”

The next steps include moving forward with design contracts to prepare the streetscape, transportation patterns and parking options with potential public-private partnerships. “The pain point has been parking and finding successful ways to tie Aggieville to the greater community with walking, biking, delivery and personal vehicles with multiple ways to get the community in and out of the area,” says Trent Armbrust, director of economic development at the Manhattan Area Chamber of Commerce. 

Aggieviell Manhattan Kansas MHK Business News Magazine Block 22 Pittsburg Kansas
Photo by David Mayes

Connecting Aggieville to other areas is important especially when Manhattan is in the process of re-creating cornerstones of the community. Each area, from East Poyntz, North Campus Corridor to Grand Mere, is distinct and part of Manhattan’s pathway forward.  “We need a total plan with all of the components as a complete system,” Armbrust says. “No part should be singled out. We must look at a full system, collective fashion, but Aggieville is a key to it all.” 

Tracy Anderson agrees, “Aggieville provides Manhattan an initial opportunity to create a new identity for itself. Manhattan needs to stand on its own two legs. We want to create a renewed place to make Manhattan cool and attract people by getting people to say, ‘Manhattan is awesome. Here’s a place I can live, work, have fun and get what I need.’”

Innovation Takes Risk

The creation of Manhattan’s new identity and Aggieville’s redevelopment will require significant risk-taking in terms of both ideas and shared financial responsibility among multiple entities. “We’re seeking bold moves to help support risks,” Anderson says. “I worry that we’re sometimes so risk averse that Manhattan may fall off the edge.” 

While stakeholders and policy makers hold strong to the long-term vision that entrepreneurism and creativity become a stronger cornerstone of Aggieville’s identity, what’s next for the innovation district? Beyond the new hotel and garage, additional catalyst projects and revenue streams must be actualized to even allow Aggieville the chance to become an economic driver for the entire region. 

Aggieviell Manhattan Kansas MHK Business News Magazine Block 22 Pittsburg Kansas
Photo by David Mayes

“Catalyst projects give energy. New businesses seek a quality environment for their talent. They want to be in a place where their talent wants to be,” Armbrust says. “Aggieville is perfectly positioned with characteristics with geographically defined area next to anchor institutions,” Armbrust says. “We have all of the pieces, and now we need to transform Aggieville to take advantage beyond being just ‘mutually beneficial.’ The potential is all there to realize the benefits.”  

Armbrust continues, “This is different than anything else we’ve done. If Manhattan wants to attract the talent to bring in business, we need to transform our thinking to consider our next development. We’re seeking to implement what we know will work from others to press forward to build a district for tomorrow.”

Block22 is the exact type of “district for tomorrow” we must learn from. Shawn Naccarato says, “Projects like these are all about motivation and energy. One guiding philosophy for us has been that zip codes can’t determine destiny. There’re locals right now where we are who need a space and culture of innovation to do big things right here. The commitment from the community and university creates a shared destiny. It’s about a true embrace of creative disruption. We want to be in a posture to not accept the tragedy of rural America, but reverse the trends and bring in new markets.”

The success of Block22 shows that a partnership, not just in theory but in practice, between the city and the university is central to driving innovation. 

Aggieviell Manhattan Kansas MHK Business News Magazine Block 22 Pittsburg Kansas
Photo by David Mayes

“We built a strong relationship to formulate how our city and university could work together like tempered steel,”  Naccarato says. “Over the years, we worked as a marriage with the city and university to be the best college town of our size. We seek to offer truly transformative experiences for the community to explore ways to prime big moves of intentional economic growth.” 

In order for Aggieville to become an innovation ecosystem where creativity, professional work, retail, living and entertainment collide, the district needs strong relationships with the very organizations seeking to benefit from it. Perhaps the “build it, and they will come” philosophy surrounding Aggieville is intended for its absentee anchor, and this is all a part of the plan. 

Ashley Phillips is an account strategist at 502 – A Strategic Marketing Agency and the managing editor of MHK Business News – The Magazine. 

Lucas Shivers works with USD 383 focusing on curriculum, professional learning, instructional coaching and project management. 

Aggieviell Manhattan Kansas MHK Business News Magazine Block 22 Pittsburg Kansas
Photo by David Mayes

Types of Assets within a District

  • Economic assets are the firms, institutions and organizations that drive, cultivate or support an innovation-rich environment.
  • Physical assets are the public and privately owned spaces—buildings, public spaces, streets, and other infrastructure—designed and organized to stimulate new and higher levels of connectivity, collaboration and innovation.
  • Networking assets are the relationships between actors—individuals, firms, and institutions—that have the potential to generate, sharpen and accelerate the advancement of ideas.

What is Innovation?

Innovation is when new or improved ideas, products, services, technologies or processes create more market demand or cutting-edge solutions to economic, social and environmental challenges.

As there are many types of innovations including market, social, civic and place innovations. This article focuses on innovations derived from a subset of industries benefiting from co-location and proximity where firms and workers interact and collaborate. These industries include:

  • High-value, research-oriented sectors such as applied sciences—from life and material sciences to energy technology to nanotechnology
  • The burgeoning “app economy” and tech startup community
  • Highly creative fields such as industrial design, graphic arts, media, architecture, and a growing hybrid of industries that merge tech with creative and applied design fields
  • Highly specialized, small batch manufacturing in advanced manufacturing industries, advanced textile production, and small artisan-oriented manufacturing
  • Other industries organically locating in these areas and are benefiting from interaction and collaboration. Each city should look for other industries during their own analysis—cities could be ahead of the research.
Aggieviell Manhattan Kansas MHK Business News Magazine Block 22 Pittsburg Kansas
Photo by David Mayes

Twelve principles guiding innovation districts

1. The clustering of innovative sectors and research strengths is the backbone of innovation districts.

2. For innovation districts, convergence—the melding of disparate sectors and disciplines—is king. 

3. Districts are supercharged by a diversity of institutions, companies and start-ups.

4. Connectivity and proximity are the underpinnings of strong district ecosystems. 

5. Innovation districts need a range of strategies—large and small moves, long-term and immediate. 

6. Programming is paramount.

7. Social interactions between workers—essential to collaboration, learning and inspiration—occur in concentrated “hot spots.” 

8. Make innovation visible and public. 

9. Embed the values of diversity and inclusion in all visions, goals and strategies.

10.Get ahead of affordability issues. 

11. Innovative finance is fundamental to catalyzing growth.

12.Long-term success demands a collaborative approach to governance.  From: www.brookings.edu/innovation-districts/

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