By JOHN LAUGHLIN
12:00 AM EDT, October 23, 2011
The discussion among participants in the nonprofit and governmental sectors regarding how to accelerate the redevelopment of downtown Hagerstown has largely ignored the most important constituencies in economic development: developers and private investors.
The proper roles for government and nonprofit organizations in economic development are surprisingly simple: Create an environment that welcomes investment; provide incentives that are commensurate with the risks incurred by private developers and investors; and create the infrastructure and facilities that will support the desired development.
Comparing Frederick to Hagerstown, Frederick’s most productive development years were during the administrations of Ron Young and Jim Grimes, who welcomed visitors to their office with “What can I do to help you?” and then delivered on their promises to help.
Yes, we can all worry about companies like Susquehanna Bank moving their headquarters out of downtown, but a similar move occurred in Frederick in the early 1990s when Farmers & Mechanics Bank moved out of downtown. I bought their historic building at Market and Second streets and, with the city’s cooperation, redeveloped it into a multi-tenant building that houses more employees today than it ever did as a bank. With the right city support, similar redevelopment can and should happen everywhere in downtown Hagerstown.
The Young/Grimes approach is working well in some city departments and not as well in others. Planning and zoning, fire protection and utilities have been very helpful. Plan review, code enforcement and inspections have experienced some personnel turnover and may still see themselves as “gate-keepers” rather than “enablers.” But we expect that under John Lestitian’s leadership this will change.
Good city incentives are in place, but they are not being used. The city can be more proactive in reaching out to serious developers and investors rather than waiting for these folks to file an application. The city needs to target its pro-development efforts toward people who are already successfully developing downtown Hagerstown properties. It’s a waste of time today to try to sell Hagerstown’s benefits in Baltimore, Anne Arundel and Montgomery counties.
How many “real” developers does the city need to achieve its objectives? I use the term “real” because we might as well exclude the dreamers who don’t know what they are doing — the out-of-the-area folks who thought they could buy, flip and run, and those who overpaid and now are insolvent and at the mercy of their banks.
Five. That’s how many “good” developers and “serious” investors we need. Impossible, you say? Let’s look at the success story of only one such company and then imagine the impact on the downtown area if we could find four more developers and investors like this one company.
With Debbie Everhart’s intervention, Ridgecrest Investments bought the Goodwill warehouse at Church and Prospect streets in the summer of 2005. It was a run-down building located in a neglected part of town. Today, it is a wonderful office building, filled with professional tenants.
But Ridgecrest, and its partners Frankie Corsi, Lori Burton and myself, did not stop with the Goodwill Building. With former state Sen. Don Munson’s and County Commissioner John Barr’s help, we bought and refurbished the former Hagerstown Armory, which is currently undergoing further extensive renovations.
We bought and gave a terrific facelift to the Laber’s Furniture Store on East Baltimore Street and to the Potomac Plaza building adjacent to City Hall.
If this was not enough downtown Hagerstown real estate, we bought the 78,000-square-foot Action Products building on North Mulberry Street and have already spent $2 million on this site, which we expect to become a part of a “New City Gateway” to Hagerstown. And we added to our holdings on the west end of downtown Hagerstown with the acquisition of the 75,000-square-foot Beachley and 125,000-square-foot Moller Organ buildings on North Prospect Street.
Not bad for five years of effort, but we did not stop there. Downtown Hagerstown real estate redevelopment is only half the Ridgecrest story.
We bought Laber’s Office Furniture Company and expanded both the staff and their facilities. Ridgecrest bought the Red Barron Flooring Company and moved it from Williamsport to Hagerstown. We bought Hagerstown’s Premier Settlements & Title Company and moved it downtown.
We even moved our Security Trust Company from Frederick to downtown Hagerstown and purchased an interest in the Beachley Furniture Company from David Beachley’s siblings.
Add it up: Eight buildings which represent 432,000 square feet of redeveloped or redeveloping space and 35 tenant companies in those buildings — 47 downtown jobs created or saved, $4.7 million in annual business revenue and another $600,000 in annual rental receipts. And all of this was done by a single company that I suspect almost no one has heard of. And this was all done in five years, beginning with nothing.
But if you ask Frankie, Lori or me if we are finished, we will tell you that the past five years was only a “warm up” for our future in downtown Hagerstown. Find four more companies like Ridgecrest Investments, treat them well, and then watch our city grow and blossom.
John Laughlin is president of Ridgecrest Investments Inc.
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