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When Cities Choose Developers First – Lessons from Failure

What national redevelopment projects can teach St. Petersburg

by Ron Diner
Infographic showing six major U.S. redevelopment projects that experienced delays, cost overruns, lawsuits, or unmet promises after developers were selected before comprehensive public planning was completed

In a recent post, I highlighted 10 cities that got major redevelopment projects right by planning first – establishing a clear public vision, laying out the streets, and then selling the land parcel by parcel to developers, while retaining some parcels for community priorities.  

It seems clear – the best cities plan first.  

But what happens when cities choose a developer before they decide what they want to build?

What happens when cities reverse that order?

Across the country, many high-profile redevelopment projects began with developer proposals before the city completed the planning.  More often than not they ended with delays, cost overruns, lawsuits, scaled-back promises, and heavy taxpayer burdens.

They illustrate a recurring risk: when the public planning comes second, cities often lose. 

Brooklyn, NY — Atlantic Yards / Barclays Center

Developer-first approach led to eminent domain fights, delays, and renegotiations.

New York State adopted developer Bruce Ratner’s vision early, before fully locking in community benefits, infrastructure, open space, and housing timelines. The result: years of lawsuits, massive delays, and bitter community opposition. Affordable housing units were delivered far slower than promised, terms were repeatedly renegotiated, and costs ballooned.

Key lesson: Without a strong master plan upfront, developers control the timeline and public obligations — often at the community’s expense.

Wisconsin — Foxconn “Innovation Campus”

$3+ billion in incentives for a project that barely materialized.

Wisconsin rushed a massive deal with Foxconn before thorough land-use planning or economic vetting. The “city of the future” promise shrank dramatically. Most of the development was never built, jobs fell far short, and taxpayers spent hundreds of millions on land and infrastructure that now sits largely empty.

Key lesson: Choosing a developer and incentives first often produces fantasy projections that collide with reality.

Miami, FL — Miami Marlins Ballpark

Taxpayers left with enormous long-term costs.

The city and county moved quickly on a stadium deal driven by team owners, with limited independent economic analysis or redevelopment framework. While the public contribution was roughly $634 million, the financing structure has saddled taxpayers with roughly $2–2.4 billion in total debt service over decades. Promised economic benefits and jobs largely failed to appear.

Key lesson: Accepting a developer/team-driven proposal without strong planning produces lopsided financial terms that burden taxpayers for generations.

Kansas City, MO — Power & Light District

Entertainment district that became a long-term fiscal drain.

Kansas City issued an RFP and committed public financing before fully testing market demand or long-term risks. Revenues consistently fell short of projections, forcing the city to cover hundreds of millions in shortfalls from its general fund.

Key lesson: When optimistic developer assumptions replace rigorous city-led feasibility analysis, taxpayers end up subsidizing projects for decades.

Detroit, MI — Former Wayne County Jail Site (“Fail Jail”)

Repeated false starts and scaled-back ambitions.

After the original half-built jail project was abandoned due to overruns, the county pursued redevelopment through a land swap with Dan Gilbert’s Bedrock team. Ambitious mixed-use and life sciences plans were proposed, but multiple visions have been significantly downsized amid market realities, lost tenants, and delays. Ground was finally broken in 2026 on a smaller project.

Key lesson: Flashy private proposals without clear upfront public guardrails and feasibility testing often shrink when reality hits.

San Francisco, CA — Hunters Point Shipyard

Developer timeline collided with environmental realities.

The city advanced Lennar’s proposal before full environmental review and remediation planning were complete. Major soil-testing scandals, contamination issues, halted construction phases, litigation, and deep community distrust followed.

Key lesson: Letting developer schedules drive the process ahead of public due diligence can lead to catastrophic oversights.

What These Projects Teach Us – The Best Cities Plan First

These projects encountered different challenges — unrealistic projections, weak oversight, shifting economics, environmental surprises, and litigation. Yet they all shared one critical flaw: the public vision and framework came after the deal was struck.
 
By contrast, America’s most successful redevelopments began with the city clearly defining the streets, parks, infrastructure, open space, density, and community benefits first — then inviting developers to compete within that established framework.
 
As St. Petersburg now shapes the future of the Gas Plant District following the Rays’ departure, the central question is not whether developers are good or bad. Developers build outstanding projects every day when given clear rules and a strong public vision.
 
The real question is simpler: Should the city define the vision first — or should the developer?
 
The evidence is clear. The best cities plan first.

 

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