Defining the Implementation Process and Institutional Arrangements

Determining the optimum institutional structures will be key to the success of the project. Institutional arrangements may range from formal to informal, with varying degrees of authority, accountability, and responsibility for coordination, handover, and delivery. Depending on the project requirements and whether it is public or private sector-led, there are a number of options for the types of vehicles that might be created to guide, monitor, and maintain the regeneration project to ensure coordination and results. These entities might have a range of powers depending on the scale and complexity of what is required to catalyze and sustain the regeneration project.

Given the complicated nature of development, a useful and very broad delineation of public and private roles will be needed to distinguish between land development and development of the buildings. In this instance, it is the public sector that potentially assumes more of a role in the delivery of some services, such as parks and transportation improvements. For its part, the private sector delivers the buildings and public amenities that will attract people to the regenerated areas. Financing, governance, and operational responsibilities can then flow from this.

Although this is necessarily a general construct, it can be useful as a guide for land or vertical development. For example, it is often the case that the public sector will build and manage affordable housing. A key and commonly used method for the public sector to maintain control, ensure competition, and protect its interests is to release parcels for development only when necessary. Parcels are offered through a competitive process to ensure that the highest quality and best financial offer is achieved. The extent of public land ownership is a key determinant of the type of public-private institutional arrangement that will be possible. Further, it gives the public sector broad latitude in using land as an incentive and source of leverage in achieving a city’s regeneration.

One example of institutional arrangements in this type of development is public development corporations established by the government to directly lead and manage regeneration projects, such as the Battery Park City Authority in New York City. It led the 40-year-old redevelopment of 80 acres of prime waterfront land in Lower Manhattan. Likewise, in the United Kingdom, the London Legacy Development Corporation was created to lead the development of the 600-acre Olympic Park following the 2012 London Olympics.

Other models involve public sector organizations, such as planning commissions or advisory entities that rely more on regulations and the enforcement of contracts than direct involvement in the delivery of development projects. Some examples are summarized below; however, more arrangements could be possible depending on each country’s specific regulatory environment.

    • Public development corporations. This is the most formal type of organization created to manage project development and handover. It can have a full range of powers, depending on project requirements and political will, including eminent domain, land use, financing, development and construction expertise, marketing, master planning, design review, and facilitation. More information regarding these corporations is detailed in box in this section.
    • Public-private board. The term “board” is used here to include various public-private arrangements—from joint legal entities to contractual relations, such as concession leases. Depending on whether and how public land is contributed to the regeneration venture, the board can be more or less formal. If the public sector is an equity partner, it would fully participate in all project decisions and would be responsible for project oversight, handover, and performance. However, even if public land is not contributed as equity, joint venture arrangements can be organized to allow for significant joint-decision making, project oversight, and assurance. Some potential examples of such boards or corporations are covered in below box.

Urban development corporations

Types of public-private cooperation

  • Planning commissions. These entrust delivery to the private sector. Public sector involvement would be limited to regulatory oversight through a planning body that would ensure the master plan is being implemented pursuant to its approval.
  • Contract management with advisory board. A project is managed largely through contract performance depending on the differing roles of the public and private sectors. There might be an advisory board to monitor progress and resolve conflicts. However, it is largely a contract-driven relationship that defines handover until and unless there are nonperformance issues.
  • Steering committee. The least formal arrangement, the steering committee structure is a forum to bring together the diverse interests engaged in the regeneration project to monitor implementation, resolve problems, and provide advice on project-related issues. It is best used to either supplement other vehicles with a more formal structure, or when the project is private-sector-led and delivery is largely within its purview. The committee structure would be useful in galvanizing outside resources and maintaining and promoting the profile of the project. It can also work to resolve any major tensions that might surface.

Providing for ongoing operations and maintenance is critical to project sustainability and must be planned for in advance. This “aftercare” of projects during and after construction includes provisions for security, the upkeep and programming of the public realm, and providing for the needs of the local community. A well-established vehicle is a business improvement district (BID), which is covered in the financing section of this chapter.

The key point is that it is never too early to plan for the best range of organizational entities that the regeneration project might require. Indeed, there can be multiple entities, each with its own focus that can be created or supported to ensure long-term success. It is therefore not a simple matter of whether regeneration is public or private. Rather, it will usually be a complex mix that requires careful consideration of a range of options for how the public, private, community, and civic sectors can best interact, as well as the institutional arrangements that are best suited to the aspirations of the leadership and demands of the project.

One example involving thorough institutional arrangements in urban regeneration projects concerns the Santiago Repopulation Program (see chapter 5), delegated to the Santiago Development Corporation (SDC). The SDC was conceived as the executive arm for the implementation of the Santiago Regeneration Plan. Its flexible institutional structure facilitated the negotiations and partnerships developed with the private sector. Municipal corporations in Chile are ruled by the private law. Thus, they are authorized to enter into contract with public or private institutions, receive contributions, and borrow from private banks or financial entities, and so on. This institutional feature allowed SDC’s executive directors to play the role of public entrepreneurs, working on behalf of the community—and using the financial instruments available to the private sector. The PPP agreements between the SDC and other actors were regulated in the same manner as contracts between two private actors. However, beyond its managerial attributes, the SDC worked closely with the municipality, as the mayor was the president of the corporation. For more details, see for the organizational chart of the corporation.

Table: Organization of the Santiago Development Corporation