Economy
Properties with trees are valued at 5 to 15% higher than comparable properties without trees (Alexander, 2008).
The economic benefits of a well-managed urban forest are well documented. Some communities consider trees to be part of the basic infrastructure of cities—as important as streets, sewer and electricity. Trees increase property values and attract business and tourism. They reduce the public dollars spent on energy for cooling and heating, stormwater management and air quality controls.
Trees and landscaping have a positive effect on real estate values. Properties adjacent to parks can have property values 8 to 20% higher than comparable properties elsewhere (ICLEI, 2006). Even basic improvements such as hedges along parking lots have been shown to add more than 25% to the value of a nearby home. In metropolitan areas, the economic impact can be dramatic. The value of condos in New York City that look out over the green space of Central Park is significantly higher than that of those with only a view of other buildings.
Consumers will shop more often and longer in business districts with street trees, increasing sales by 11%.
Large trees are especially valuable to homeowners and municipalities. Each large front yard tree adds about 1% to a home’s resale value and an estimated increase of $100,000 in property tax values (ICLEI, 2006). Rental rates for commercial properties are about 7% higher in areas with quality landscaping and trees (Laverne, et al, 2003). Developers can maximize their final sale price by retaining existing trees and planting trees following construction.
A well-managed urban forest also has a measurable impact on economic development. In business districts with trees consumers are willing to pay 11% more for goods than in treeless districts (ICLEI, 2006). Studies have shown that consumers will shop more often and longer in downtown business districts with street trees and than in districts without landscaping.
New Castle County Metro Corridor
The structural value of the urban forest in the New Castle County Metro Corridor is estimated at $1.2 billion.
Wilmington
The structural value of all the trees in the City of Wilmington is $166 million.
The cost of replacing our urban trees would be huge, even though Delaware’s urban tree canopy cover is well below the national average of 23%. American Forest’s recommended tree cover for our area is 40% (American Forests, 2008b). Increasing urbanization since 1990 has resulted in 19% tree canopy cover in the greater New Castle County metropolitan area and only 16% in Wilmington (Nowak, et al, 2009a).
Shoppers seek out shaded parking spots. Cars parked in the shade of a tree will have interior temperatures 20 to 30 degrees cooler than a vehicle parked in the sun (McPherson, et al, 2002). Studies have shown that consumers are willing to pay more for parking with shade (ICLEI, 2006), and give 30% higher ratings to the quality of goods sold in businesses on tree-lined commercial streets.
Municipalities with street trees can save money on paving maintenance. Asphalt shaded by trees has a significantly extended life span. Repaving of shaded streets can be deferred 10 to 25 years beyond streets in full sun (ICLEI, 2006). Conversely, streets with little or no shade need to be re-paved twice as often as those with 30% tree cover.
Structural value (replacement cost) of our urban forest
The cost of replacing each tree in an urban forest with a similar tree is known as its structural value. Tree loss has a direct economic impact, analgous to the replacement or repair of any element of urban infrastructure. However, the services and economic benefits of large trees are exponentially greater than saplings or shrubs. Large trees must be replaced by a greater than 1:1 ratio to maintain the value of the urban forest.
Analyizing Wilmington's Budget Priorities
A huge discrepancy exists between Wilmington’s annual investment in water and sewer relative to its investment in urban forestry. Although research shows that trees can improve stormwater management more cost-effectively than traditional engineering solutions, the ratio of expenditures between these two sections of the budget is 400:1.
In FY06 and FY07, water and sewer expenditures constituted a fourth of the total Wilmington operations budget. During the same time period, urban forest expenditures represented barely 0.1%—one tenth of one percent. In fact, this portion of the Department of Parks & Recreation budget was actually reduced by more than $10,000 in 2007.
Wilmington’s tree canopy is shrinking. A history of flat allocations for maintaining trees and limited money for planting trees in the City budget has compounded this situation. At a time when city leaders are seeking ways to improve stormwater management while still reducing total expenditures, trees can offer a huge return on investment.
