The Case for the Innovation District as a Sustainable Economic Development Tool in the Knowledge Economy

By Sarah Carnes

The Tech Square Innovation District
The Tech Square Innovation District

Here in Atlanta we’ve seen the innovation district materialize on the Georgia Institute of Technology’s campus. Education and research are coupled with office and retail to construct a “premier high-tech business neighborhood.” Cities like Barcelona, Boston, and Chattanooga have joined Atlanta in hosting the phenomenon of the innovation district, which has emerged in recent years as an attractive economic development and urban regeneration tool to spur job and wealth creation, innovation, and quality-place making within modern urban centers. As we dissect the structure of these districts in an attempt to define a replicable and adaptable implementation model, we discern that they vary widely based on leadership, cluster-type, and firm-support programs.

Lessons from Chattanooga

Left with a deteriorating city center following the rise of suburbanization and expansion of the interstate-system, Chattanoogans welcomed the twenty-first century with a number of downtown redevelopment projects in an effort to reaffirm the city center as a place that is “authentic and evolving, lively and attractive, diverse and engaging, dignified and celebratory.” The most notable effort included the creation of an innovation district as an attempt for the city to leverage its strengths and resources to emerge as a hub of innovation in the knowledge economy. While the traditional innovation district model positions eds-and-meds as the anchoring institutions, Chattanooga’s foothold is its ultrahigh-speed fiber optic Internet services managed by the city’s public utility company. Internet speeds in Chattanooga are approximately 50 times faster than average speeds in other areas of the United States, making the city especially attractive for high-tech firms.

Local officials realigned the core mission of the Enterprise Center – a non-profit founded in the early 2000s to entice economic growth to Chattanooga – to serve as a catalyst and convening entity to amass “buy-in, investment, and cooperation from other sectors” and to lead “community efforts related to the innovation economy.” A centrally located innovation center also supports the city’s innovation district from both spatial and organization perspectives, and especially caters to the entrepreneurial ecosystem.

We learn from Chattanooga that traditional innovation district models can vary in urban environments that differ by size, location, and resources. Thus, as we seek to create a leadership model for the burgeoning innovation district, we must be mindful that the list – and extent of involvement – of public, private, and civic institutions will likely be a function of a city’s unique composition. Chattanooga’s unique contribution to the innovation district space is its government-affiliated non-profit that exists with the sole purpose to support the innovation economy via the city’s innovation district.

Lessons from Boston

The Massachusetts Institute of Technology’s (MIT) Kendall Square is frequently touted as the most exemplary urban innovation district model in the United States, notable because of the high academic concentration in Boston. The innovation district’s current portfolio is comprised of nearly three million square feet and is home to over 150 high-tech and life science companies, while additional expansion plans are in the works, including an additional one million square feet of office and housing space.

MIT’s planning process prioritized the involvement of the larger public and favored the modern city-led public participation process. Specifically, engagement involved collaboration with the city and community “to develop a viable proposal that responds to the interests and concerns of various constituencies, including the residential community, MIT faculty and students, Kendall Square employees, and visitors to the area.” Efforts have emphasized the creation of affordable housing and additional public spaces for recreation.

MIT is intentional and deliberate in its use of place-making strategies to strengthen Kendall Square’s contributions to the innovation economy as well as its sense of place. In short, the university leverages its own talent and resources to fulfill the visionary role of the planner and innovator. The Institute’s definition of community also expands its property boundaries, which enables it to provide benefits to a larger public. Thus, we learn that Kendall Square not only functions as an innovation district. It also serves as a living laboratory for urban-planning strategies that serve public-policy and built-environment purposes. As other entities create new innovation districts or expand existing ones, a similar approach to that of MIT should be taken.

Lessons from Barcelona

22@ Barcelona is a prime example of a predominantly government-led innovation district model. The project emerged as an urban renewal initiative in Poblenou, a blighted industrial neighborhood, over 15 years ago, and now stands as a massive hub for knowledge and innovation. Since the innovation district’s establishment, it has become home to more than 7,000 companies and nearly 100,000 employees. The revitalization effort was also an attempt to aggregate international and local firms in a more concentrated geographic environment with hopes of fostering increased collaboration.

Collaboration amongst the city-government, education institutions, and the private sector have contributed to the success of the district. Physical infrastructure improvements began when the city pledged nearly $227 million in an attempt to create a more vibrant business community. Each year, representatives from each of the district’s firms are invited to a design charrette to respond to new challenges and determine where future resources would best be allocated. Current district housing plans call for the restoration of over 4,600 traditional houses in surrounding areas as well as the construction of 4,000 subsidized housing units, a quarter of which are required to be rental. The district also attracts small and medium firms by offering public financial assistance through the city’s Barcelona Activa program.

The most important takeaway from Barcelona is the particular validation of innovation districts as a sustainable urban economic regeneration tool. Through strategic programming and a robust planning model that emphasizes the physical, social, and economic, the City of Barcelona has created one of the most successful innovation districts in the world. Similarly, other districts must have an entity comparable to that of the platforms in Barcelona that specifically oversee business-assistance programs. This type of program will make districts more competitive and also facilitate the success of start-up firms.

Innovation districts are a sustainable economic development and urban regeneration tool for cities in the knowledge economy that differ on countless levels – from city size and anchor institution to the degree of government support. Moving forward, additional case-studies should be compiled to reveal more common themes for these districts, but it can already be shown through examples such as Atlanta, Chattanooga, Boston, and Barcelona that the innovation district is a powerful tool for urban flourishing.


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