Investing capital funds in parks can generate significant economic returns in
the form of increased property values, but New York City is not making the
most of this opportunity, according to a study released at the Great
Parks, Great Cities conference, an international urban parks conference held
in New York City last month.
The study, conducted by the accounting firm Ernst & Young and the advocacy
group New Yorkers for Parks, selected at random 30 parks from all over the
city and analyzed the relationship between capital investments and how tax
differed between parts of the same neighborhood closer and farther from the
park over the past ten years. It also chose six different parks, at least one
borough, to examine more closely as case studies, looking at capital funding,
planning, and community involvement and comparing real estate prices, tax assessments
and turnover rates in areas next to the park with those in the broader neighborhood.
A more thorough analysis also would have included the maintenance dollars allocated
to each park, but this data was not available because the parks department uses
roving crews for most park maintenance.
The analysis found that simply upgrading a park does not automatically add
value to the surrounding area. From the sample of 30 parks, 55 percent of the
with the largest capital expenditures had either no increase or a decrease
in the value of the real estate surrounding them. "The conclusion was that
you cannot just throw money at a problem and expect to get results," said
the project’s director, Glenn Brill, senior manager of real estate advisory
services at Ernst & Young.
The detailed case studies showed that capital spending has higher economic returns
when it is part of a larger plan for the community and includes long-term maintenance
as well as the involvement of local residents and organizations.
The best example of this in the study is Prospect Park in Brooklyn, where
$103 million – including $78 million in city funds -- has been invested since
the 1980s. The Prospect Park Alliance, a public-private partnership that operates
the park, has planned and overseen the park’s gradual restoration, working
together with a wide range of community organizations. It also raises private
funds to help maintain and program the park. The study found that the gap between
the average single-family home sale price in the "park impact area" of
adjoining Park Slope and comparable areas of the neighborhood farther from
the park widened dramatically from 1996 to 2000. Before 1996, prices closer
park were from 90 to 170 percent higher. Between 1996 to 2000, the price spread
increased to 300 to 600 percent, before leveling off to 150 percent as prices
farther from the park continued to rise.
Brill said that the research underlined the need for the city to take a strategic
approach to investment in parks and coordinate it with other aspects of community
development, like housing and policing. He also stressed the need for continued
maintenance to preserve the city’s investment. "Our study supports
the concept that a well-maintained park can make a significant contribution to
real estate values," he said. "In doing so, it’s generating
wealth for the owners and certainly a portion of it will be recirculated through
New York City economy."
Anne Schwartz is a freelance writer specializing in environmental issues. Previously, she was the editor of the Audubon Activist, a news journal for environmental action published by the National Audubon Society, and an editor at The New York Botanical Garden.
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