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The Richmond Fed Community Conversations team learned about efforts to pivot in central business districts and achieve collaborative wins in affordable housing during a recent visit to Northern Virginia.

Bank President Tom Barkin, Regional Executive Renee Haltom and Community Development Regional Manager Jarrod Elwell met with business and community leaders in Tysons, the Rosslyn Business Improvement District in Arlington County, and housing leaders in Arlington and Alexandria on Feb. 16–17.

During a roundtable discussion on the future of central business districts, the Community Conversations team learned how downtowns have worked to draw tenants and customers back following Covid.

Due to more businesses adopting remote and hybrid working models, cities are navigating the effects of lower commercial leasing. Slower return-to-office trends have had a trickle-down impact on surrounding businesses, leaving these restaurants and shops with fewer customers. Higher commercial vacancies have also resulted in lower tax revenues.

“So many central business districts, like Rosslyn, are adjusting and reevaluating their business models,” Haltom said. “It’s a challenging problem to solve going forward, but an interesting aspect is that the community has an incentive to work together. Every business and landlord benefits if more workers are coming downtown, and that draws more amenities and residents, which in turn draws yet more workers.”

According to participants of the roundtable, solutions to the issue are underway. In the short term, Rosslyn and its property owners, employers and local governments are collaborating to prioritize amenities, events and attractions that make it worthwhile for workers to come to the office. Business districts are also recruiting a broader mix of tenants and reimagining unused office space for creative purposes. 

Longer term strategies include office districts making the transition to mixed-used neighborhoods, but this shift is costly and could take some time. 

“Rosslyn is an example of a downtown district that had shifted toward mixed use long before the pandemic, and that has helped it adjust,” Haltom said. “We also heard that continued redevelopment will require the cooperation of local governments, developers and existing residents. All of this is something the community is actively working toward.”

A second Community Conversations roundtable focused on workforce housing in the region — one of the most expensive places to live in the nation — and the efforts that Arlington County and Alexandria are taking to provide affordable options for the workforce. Leaders in the region shared their collective view of affordable and workforce housing as a critical pathway to economic development.

“The region is committed to housing at all levels,” said Elwell, with the Community Conversations team. “Arlington has done an amazing job of leveraging public and private resources to develop units of housing, in a challenging market, that are affordable for its employees.”

Strong economics – including rapid growth and the support of a major employer like Amazon – have likely aided the region’s ability to provide housing solutions. But the roundtable also demonstrated the willingness of leaders to leverage collective thinking in meaningful ways to benefit both residents and the local economy long-term.

Haltom and Elwell agreed that the cross-sector collaboration in both business and community development spaces in the region will be key to creating the kind of community that all can thrive in long term.