The business case for placemaking

This article is part of a series exploring the connections between placemaking and community wellbeing, written by Canada’s Placemaking Community and Happy Cities. Building on the Power of Placemaking project and our Community Conversations, this article shares learnings about the impacts of placemaking at a local level on the economy, including the role of individuals, businesses, community groups, and organizations.

This is what we heard through conversations with practitioners shaping spaces across Canada.

People dining outdoors at a parklet with wooden planters filled with sunflowers and a view of the street and mountains — The North Vancouver Open Streets project adds patios outside of local businesses and transforms space for cars into places for people. (City of North Vancouver)

This Q&A article answers questions from our Community Conversation with Ramona Gallagher, Managing Director of My Main Street, where a group of placemakers from community-led groups gathered to discuss how placemaking can strengthen local economies. Whether you’re wondering how to connect with local businesses to boost your project’s reach, or seeking inspiration on how to get started, explore strategies and insights to create thriving, engaging places for all.

How can placemaking contribute to vibrant economies and strengthen local communities?

By building lively and inviting spaces, placemaking can prompt people to spend more time at their destination, connect with others, and visit nearby shops and restaurants. This energy draws people in, increases foot traffic, and helps local businesses thrive. A study from the Creative School at Toronto Metropolitan University, the Daniels Corporation, Lemay, Entro, and MASSIVart found a positive return on investment for placemaking activations, including increased positive perception of a place, increased likelihood to recommend that place, and a 50 per cent increase in time spent at a location with placemaking interventions.

At its core, placemaking is relational. It sparks connections between neighbours as they share a park bench or cross paths at a community event. These relationships can improve community health, help build climate resilience, and create a network of support. Communities with social cohesion have also been linked to economic growth—they enjoy higher quality of life, increased trust, and support for local businesses.

Photo of a planter box with vegetables growing on a trellis. The plant bed has signage on it, and is placed on pedestrian street that is lined with local businsses. — A “nourishing garden” along a pedestrian street in Montreal. (Emma Avery)

Many cities faced empty downtowns as a result of the pandemic. Placemaking projects have been used as a tool to foster community connections, attract tourists, and drive economic growth—all while creating public spaces that feel safer and more inviting. Organizations including Business Improvement Areas (BIAs) can use placemaking initiatives—like outdoor seating or public art—to invite people back and support main street recovery. In St. Thomas, Ontario, a local bookstore created a reading garden—a small courtyard behind the shop with seating—for community events.

But it’s not just about post-pandemic recovery. Placemaking can help communities navigate other challenging times, like construction projects. For example, a new permanent program in New York allows buildings to display art on temporary construction protection, offering creative ways to keep communities vibrant and businesses thriving as the urban environment changes.

How can a project support a vibrant economy and other community goals at the same time?

The best placemaking is multi-faceted and combines different community goals. For example, an open street might give public artists and creators paid opportunities to perform, pedestrianize an area to reduce pollution, and create spaces like public benches for community members to connect over a shared experience.

It’s important to centre community needs and voices when designing a placemaking project. This involves considering the neighbourhood’s unique goals and challenges. By designing projects with the community, placemakers create environments that meet different objectives at once—and even reinforce each other. Green infrastructure (like a pollinator patch on a main street) enhances aesthetics and climate resilience while creating an attractive place for people and local businesses. A public art project builds a sense of place and attracts people to a commercial centre.

“We need to find what works in our community and what works with our people,” said Ramona Gallagher, Managing Director of My Main Street. “This is going to be different from community to community.”

At our Community Conversation on the power of food and gardening, one participant shared the benefits of the Farm Stand Program in Calgary that addresses specific goals: bringing fresh, accessible food sources to the community and financially supporting local farmers. Many other public market projects worked in tandem this way as well, making space for local sellers and getting healthy food to the community, while creating space for neighbourhood connections.

photo of people shopping at a local farm stand under a tent in a neighbourhood park — A public market provides social connections and local foods in Cote-des-Neiges, Montreal. (Agora au service de la santé communautaire)

How can community-led projects collaborate with local businesses?

Some placemaking initiatives specifically aim to support local businesses or are championed by a business. For example, a local shop scavenger hunt highlights neighbourhood businesses. Other events are social and draw large crowds—such as festivals on main streets, which benefit local shops and boost revenue.

Placemaking groups can collaborate with local businesses to host public events, where businesses provide sponsorships or in-kind contributions and community groups bring an audience. For example, they can co-host public block parties, markets, or workshops on main streets. This collaboration boosts visibility and neighbourhood connections for businesses while generating resources for community activities.

Photo of a public plaza on a street block, next to a cafe. People sit at tables and chairs in the plaza, which has a bright painted mural on the ground — Vancouver’s parklet program transforms street blocks into public plazas for people to gather and spend time in. Each plaza has a local business or BIA that agrees to steward the space, along with local residents. (Alison Boulier)

Another effective strategy is to create more permanent shared spaces—like parks, plazas, or community centres—where local businesses can set up pop-up shops, food trucks, or stalls. This boosts sales for businesses and creates vibrant shared public spaces for community members to spend time in.

Getting local businesses involved through public art is another effective way to foster collaboration. Businesses can provide funding, materials, physical space, or promotional support, which enhances the project’s visibility and community impact. Site-specific public art and creative placemaking projects like murals and banners build a sense of identity and neighbourhood pride while supporting local artists with paid opportunities.

photo of public art along a building wall. The wall has been painted black and is decorated with colourful tile patterns of art — Tourism Radville in Saskatchewan used HCI funding to revitalize a wall in their main strip with painted quilt boards to encourage people to walk the neighbourhood. (Tourism Radville)

Joint social and environmental initiatives, such as recycling programs or bike-friendly infrastructure, can also align community goals with business interests, fostering goodwill and stronger community connections. By working together, community-led projects and local businesses create a symbiotic relationship that enhances the local economy, builds social cohesion, and reinforces shared values, resulting in a more vibrant, inclusive, and resilient community.

How do open streets support local businesses and community wellbeing?

Sometimes, business owners fear that removing car access will hurt their businesses. But data from the pedestrian street on Avenue Mont-Royal show the opposite: From 2018 to 2023, the vacancy rate along the street dropped by nine per cent. Another Toronto study finds that restaurants participating in its curbside patio program saw a 30 per cent increase in revenue. And in Scarborough, the PlazaPOPS program started transforming parking lots into pop-up parks during COVID-19, with 100 per cent of local businesses supporting the project to return in following years.

One participant in our Community Conversation shared their local main street, Montreal’s Plaza St-Hubert, as an example of a project that adapted to accessibility issues and changing shopping habits. The street was pedestrianized for the first time in the summer of 2024 with free WiFi, a bike repair station, picnic area, and other amenities. Community programming included a self-guided tour, public art, initiatives with the local library, and a sewing workshop—reflecting the many independent fabric and sewing stores near the Plaza. These initiatives create third spaces for community members to gather, while promoting the nearby businesses and solidifying their connections with the public.

photo of two red adirondack chairs on a pedestrian street, with colourful murals on the ground. Two people walk their scooters along the street, while others sit at picnic tables in the background — Plaza St-Hubert in Montreal is animated with ground murals and public seating. (Zvi Leve / Flickr)

Plaza St-Hubert is one of 11 streets that Montreal pedestrianized in the summer of 2024, showing a strong commitment to transforming road space into places for people. City planners have also taken steps to improve accessibility along these streets. For example, the local borough offers free transport to the car-free Avenue Mont-Royal—and a bike shuttle program to travel along the street—for older adults and people with mobility challenges.

photo of a big red sign in French, welcoming people to a slow zone along a pedestrian street, and providing information about vehicle transport for people with mobility challenges — Sign along Avenue Mont-Royal, explaining the free transport and bike shuttle options for older adults and people with reduced mobility. (Emma Avery)

Placemaking can be a powerful tool to boost local economies. It can foster more resilient communities that support a diverse mix of local shops, restaurants, and businesses. By creating places that people want to spend time in, these projects attract more people to main streets and increase revenue at local businesses, helping to support jobs and economic opportunities for residents. Local businesses can be important champions for this work. Placemakers can collaborate with local businesses to creatively animate main streets with public art, seating, or open streets, events, and more. These initiatives not only bring in foot traffic, but also lead to strong social connections in communities.

To learn more about creative placemaking, visit the Canada Placemaking Community’s new Toolkit for Placemakers, a collection of resources created by a diversity of practitioners with the purpose of unlocking knowledge and sharing best practices.