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Innovation Districts – The Development Trend of the Future

By Alvin S. "Spud" Mistr, Jr., PE, Consultant, KBJW Group

There is a growing trend in metropolitan areas to create Innovation Districts as a means of attracting world-class developments and fostering technology driven jobs growth.  The goal is to create a walkable urban community that merges a cultural focus on innovation, research, and entrepreneurship with amenity-rich commercial and residential environments that support collaboration.  In the U.S. alone there are more than a dozen major projects including Boston, San Antonio, Seattle, and Nashville as well as midsize and even neighborhood efforts.  To fully encompass this concept, community leaders must understand that an Innovation District is a process not a project.  It is an ongoing approach to benefit the entire community.

Innovation districts, by various definitions, are geographic areas where leading-edge anchor institutions and companies cluster and connect with start-ups and business incubators.  To foster collaboration, they are physically compact, transit-accessible, and technically-wired and offer mixed use housing, office and retail. The premise is that when people with diverse technical skills are working in close proximity, they share ideas, and can quickly tap onto one another to solve problems.

Innovation Districts - photo of a city

Yet unlike more conventional “technology parks”, innovation districts are conceived as integrated live-work-play communities that have a social networking component and greater potential to spur productivity and build sustainable economic development.  During times of inefficient land use, extensive sprawl, and continued environmental degradation, they also present the potential for denser residential and employment patterns, can leverage mass transit, and foster the repopulation of urban cores.
What are some of the key characteristics of an Innovation District?  They can vary widely in how they function, but all innovation districts have three key components – economic assets, physical assets, and networking assets.  When these assets combine with a supportive, risk-taking culture they create an innovation ecosystem.  This allows relationships to develop that facilitate the generation of ideas and accelerate commercialization.

Economic assets are the firms, institutions and organizations that drive, cultivate or support the innovation environment.  Economic assets can be separated into three categories:

  • Innovation drivers are the research and medical institutions, large firms and entrepreneurs focused on cutting-edge technologies, products and services for the market.
  • Innovation cultivators are the companies, organizations or groups that support the growth of individuals, firms and their ideas.
  • Neighborhood-building amenities provide important support services to residents and workers in the district.  This ranges from medical offices to grocery stores, restaurants, coffee bars, small hotels and local retail.

Physical assets are public and privately-owned spaces  buildings, open spaces, streets and other infrastructure - designed and organized to stimulate new and higher levels of connectivity, collaboration and innovation.  Physical assets can be divided into three categories:

  • Physical assets in the public realm are the spaces accessible to the public, like parks, plazas, and streets that become locales of energy and activity.  Parks and plazas provide places for rest, relaxation, and communication.  Streets can be transformed into living labs with the flexibility to test new innovations, such as street lighting, waste collection, traffic management solutions and new digital technologies.
  • Physical assets in the private realm are privately-owned buildings and spaces that stimulate innovation in new and creative ways.  Office developments can be configured to share work and lab space that may be conducive to start ups to develop without a large expenditure of cash and reduced overhead.
  • Physical assets that knit the district together and/or tie it to the broader metropolis are investments aimed to enhance relationship-building and connectivity.  For some districts, knitting together the physical fabric requires remaking the campuses of advanced research institutions to remove walls, fences and other barriers and replace them with connecting elements such as bike paths, sidewalks, pedestrian-oriented streets and activated public spaces.  

Networking assets are the relationships between actors - such as individuals, firms and institutions - that have the potential to generate, sharpen and accelerate the advancement of ideas.  Networks fuel innovation because they strengthen trust and collaboration within and across companies and industry clusters, provide information for new discoveries and help firms acquire resources and enter new markets.

Networks are generally described as having strong ties or weak ties.  Strong ties occur between or firms with working or professional history that have higher levels of trust and are willing to share more detailed information.  Weak ties occur between people or firms working within different contexts or economic clusters where there is infrequent contact.

Where are these districts?  As noted previously, there are more than a dozen innovation districts in the U.S.  They generally adhere to one of three models.  They are the “anchor plus”, “re-imagined urban areas”, and “urbanized science park”.

The “anchor plus” model, primarily found in the downtowns and mid-towns of central cities, is where large scale mixed-use development is centered around major anchor institutions and a rich base of related firms, entrepreneurs and spin-off companies involved in the commercialization of innovation.  The “anchor plus” is best exemplified by Kendall Square in Cambridge (around MIT and Mass. General Hospital) and the Cortex district in St. Louis (flanked by Washington University, St. Louis University, and Barnes Jewish Hospital).

The “re-imagined urban areas” model, often found near or along historic waterfronts, is where industrial or warehouse districts are undergoing a physical and economic transformation.  This change is powered, in part, by transit access, a historic building stock, and their proximity to downtowns in high rent cities, which is then supplemented with advanced research institutions and anchor companies.  This model is best exemplified by the remarkable regeneration underway in Boston’s South Boston waterfront and Seattle’s South Lake Union area.

The third model, “urbanized science park,” commonly found in suburban and exurban areas, is where traditionally isolated, sprawling areas of innovation are urbanizing through increased density and an infusion of new activities (including retail and restaurants) that are mixed as opposed to separated.  North Carolina’s Research Triangle Park, perhaps the 20th century’s most iconic research and development campus, is the strongest validation of this model.

Innovation districts have had a major impact in the revitalization of several major cities in the U.S.  They create a magnet for world-class companies and also for millennials who want to reside and work in a downtown district that is convenient and walkable.  Where will the next innovation district be located?  Will it be in the Richmond Metropolitan Area?  Stay tuned.