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12 Economic Benefits of
historic Preservation
Rehab Costs Are Roughly the Same as Building New
• If no demolition is required, a major rehabilitation will cost between 12% less and 9% more
than new construction.
• If constructing a new building requires demolition of a significant existing structure, the cost
savings from rehabilitation will be between 3% and 16%.
• Life spans for new buildings are often 30-40 years vs. more than 100 years for most historic
structures.
2 Creates Jobs
• In a typical rehabilitation project, 60% to 70% of the total cost is labor.
• Laborers are almost always hired locally. They, in turn, spend their money locally, supporting
the local economy.
• A California study found that rehabilitation resulted in 10% greater wholesale purchases and
43% greater retail purchases from suppliers than the same amount spent on new construction
activity.
• $1M spent on building rehabilitation creates:
• 12 more jobs than $1M spent on manufacturing in Michigan
• 20 more jobs than $1M spent mining coal in West Virginia
• 29 more jobs than $1M spend pumping oil in Oklahoma
• 22 more jobs than $1M spend cutting timber in Oregon
3 Increases Property Values
• In a study of National Register districts in Philadelphia, homes in historic districts received a
sales price premium of 131% over comparable properties in undesignated neighborhoods.
• A study of nine Texas cities found that local designation increased property values from be-
tween 5% and 20%.
4 Conserves Resources
• Approximately 25% of the material being added to the landfills is demolition and construc-
tion waste.
• Demolishing one typical two story commercial building on Main Street eliminates all of the
environmental benefits of recycling 1,344,000 aluminum cans.
• Historic buildings contain significant embodied energy. That's the amount of energy associ-
ated with extracting, processing, manufacturing, transporting and assembling building materials.
5 Uses Existing Public Investments
• Every community has significant investments in public infrastructure, including roads, sewers,
parks and schools.
• Historic preservation directs development to places where infrastructure is already in place.
• Rehabbing historic schools instead of building new saves money for education and often cre-
ates a better learning environment.
6 Supports Small Business
• 75% of all net new jobs in the U.S. are created by small businesses.
• Older buildings make ideal locations for small, independent businesses and for start-ups.
• 60 cents of every dollar spent at independent businesses remains in the local economy vs.
less than 10 cents at national discounters.
7 Revitalizes Main Street
Since 1980, local Main Street programs have:
• Stimulated $48.9 billion in total private and public investment.
• Created 94,176 net new businesses.
• Generated 417,919 net new jobs.
• Generated a reinvestment ratio of $27 to $1 per community.*
•The average number of dollars generated in each community for every dollar used to operate the local Main Street Pro-
gram.
8 Attracts Investment
"In economics, it is the differentiated product that commands a high premium.
If in the long run we want to attract capital, to attract investment in our communities, we must dif-
ferentiate them from anywhere else."
•Donovan Rypkema
9 Attracts Visitors
• 78% of U.S. leisure travelers (118 million adults) participate in cultural and/or heritage activities
when traveling.
• Cultural heritage travelers spend, on average, $994 per trip compared to $611 for all U.S. trav-
elers.
• Cultural/heritage travelers took an average of 5 trips in 2008-2009 compared with slightly
less than 4 trips for non-cultural/heritage travelers.
10 Prevents Sprawl
• Saving historic buildings and keeping our towns and cities healthy reduces the pressure to
pave the countryside.
• In 1970, the state of Maine spent $8.7M to bus students to and from school. By 1995, with fewer
students enrolled, the cost had risen to $54M.
• When we reinvest in older neighborhoods, we are reinvesting in inherently sustainable com-
munities that are generally dense, walkable, transit-accessible, and feature mixed-uses.
11 Creates Affordable Housing
• To replace the current housing units occupied by lower income residents would cost $335 bil-
lion.
• In 2005, 1,101 unites of affordable housing were created in historic buildings using the federal
rehabilitation tax credits.
• Historic structures are often located close to services and public transportation, reducing trans-
portation costs for residents.
12 Is Good Economic Development
• In Nebraska, historic preservation generates $170 million per year:
• Between 2001 and 2005, an estimated total of$1.5 billion was spent on rehabilitation of
buildings.
• Twenty-two jobs are created for every $1M spent on historic preservation, which sup-
ported 3,869 jobs in the state in 2009.
• Historic designation of neighborhoods and downtowns enhances and protects prop-
erty values. Of the districts studied, property values as a whole showed increases in
historic districts.
References
Lahr,Michael L.,David Listokin,et al. Economic Impacts for Historic Preservation in Nebraska. New Brunswick,New Jersey: Center
for Urban Policy Research,Rutgers,The State University of New Jersey,October 2007.
Mandala Research,LLC."The Cultural and Heritage Travelers Study."2009.
Rypkema,Donovan D. The Economics of Historic Preservation: A Community Leader's Guide. Washington,D.C.: National Trust for
Historic Preservation,1994.
. 2005. "Economics,Sustainability,and Historic Preservation." Speech presented at the National Preservation Conference,
Portland,Oregon,October 1,2005.