A few days ago I read this post from Provo Buzz expressing excitement about the city’s development. I share that excitement and I love reading blogs like Provo Buzz that write intelligently about the city. But after reading I thought it might be time to revisit the economic impacts of the LDS Church’s Provo Tabernacle Temple — aka the “City Center Temple” — which may not be as significant as most people expect.
First, there isn’t a major precedent for the temple to revitalize downtown. Most LDS temples are located in suburban areas where commercial revitalization isn’t an issue. The fact that these temples have failed to spur adjacent commercial development should itself be a warning sign. And the handful of urban temples went into places that were already comparatively well-developed, even thriving.
I’ve expressed these concerns before (also, here), but the one big exception is the Salt Lake temple. It’s urban, historic, and a major destination in the city. The comparison to Provo makes sense, which is probably why people keep making it.
But the funny thing is that Salt Lake, particularly around Temple Square, isn’t all that thriving.
Consider first the high percentage of parking in downtown Salt Lake City. As mentioned in this post, 20 percent of downtown Salt Lake is paved for parking lots. That only happens when demand for real estate is low enough to make structures economically unattractive. In other words, there is surprisingly little demand for real estate in downtown Salt Lake City.
This problem is particularly apparent in the area immediately surrounding Temple Square, where massive parking lots abound.
This picture is pretty typical of downtown Salt Lake City, where tall buildings are generally surrounded by huge parking lots. Here, the lot is on the right and is larger than the picture really conveys.
It’s ugly, of course, but most importantly shows that the land immediately surrounding the temple is barely performing, economically speaking. That’s a situation at odds with our image of a lively temple with lots of temple-goers-cum-consumers in the area. But either way, if the temple was generating significant investment, people would be snatching up this land for development.
Yet another big, flat, underperforming piece of land in downtown Salt Lake City.
So based on Salt Lake City, the biggest change we should expect to see in downtown Provo when the temple is completed is more parking lots.
Next, consider who is investing in Salt Lake City: the LDS Church. I applaud the church’s efforts to revitalize downtown (even as I criticize its methods) but again, this suggests that there’s a conspicuous lack of demand for space downtown.*
If the temple in Salt Lake was spurring adjacent development there should already have been a lively retail sector before City Creek existed. Instead, the temple’s owners — the church — had to step in and do it themselves.
If existing buildings, including the temple, were really generating investment the church wouldn’t have needed to build its own mall; investors would have lined up to do it for them. If demand had been high enough — and it should have been — the church could even have dictated the type of environment it wanted the way it did with City Creek. None of that happened so the church had to foot the massive bill on its own.
The type of development that surrounds Temple Square is also curious. There are mediocre hotels, a ratty looking JB’s restaurant, etc. Other than Church-owned property — which is in great condition — it’s surprisingly run down. Within a block or two there are major vacancies and blight. It’s pretty dire and in some cases worse than the situation in Provo, though the gleaming towers in the mix make it seem more thriving than anywhere in Utah County.
This JB’s restaurant is directly across from Temple Square. These kinds of building suggests to me that the temple is not creating significant demand for space or investment opportunities.
There’s no doubt that Salt Lake City is on the rise and downtown in particular is improving. But it’s being buoyed up by the same economic and demographic factors that are benefiting Provo, not by the presence of an LDS temple. Indeed the temple has existed for generations, but that didn’t stop Salt Lake from experiencing the disinvestment and decline that the car-centric mid twentieth century brought to many cities. And that was still going on very recently; when I moved to Utah a decade ago downtown Salt Lake was even less desirable. During those last 10 years the temple is one of the few things that hasn’t changed.
I like the Salt Lake Temple and I like the area surrounding it. But in terms of economics and revitalization it’s really a case study in the surprisingly minimal economic benefits a temple brings to surrounding consumer businesses. Sure any infusion of people helps and when the temple in downtown Provo opens nearby restaurants are likely to get a few more walk-ins. But if Salt Lake City offers any clues about the future of Provo, we all have reason to worry.
*Some people will argue that the area surrounding Temple Square has been developed (or paved) by the LDS Church because the church wants to protect the environment around its headquarters. Or in other words, that economics aren’t a factor. That may be true to some extent, but many of the parking lots are privately owned, conditions generally get worse moving away from Temple Square, and the retail centers that aren’t insulated from the market — namely Trolley Square and now the Gateway — are struggling.