Downtown Baltimore has entered the new decade from a remarkable position of strength, in spite of the recessionary drag on the economy in 2009.

Approximately 113,000 people work in downtown Baltimore, 16th in the country for job density. Downtown's primacy as a business center was further solidified by the recent decision of the accounting firm RSM McGladrey to relocate 300 employees to the city from the suburbs.

Downtown's residential population of more than 40,000 ranks us seventh in the country, ahead of other dynamic downtowns in Atlanta, Boston, Denver, Portland and Washington, D.C.

And there were more than $4 billion worth of downtown projects under way in 2009. Hotels opened on Charles Street and Fallsway; new restaurants welcomed patrons on Light, Charles and Saratoga streets; and a cutting-edge office tower started accepting tenants in Harbor East.

While the office vacancy rate was a cause for concern, downtown Baltimore fared well from a local and national perspective. At the end of the year, our Class A vacancy rate was 17.5 percent on average - with 3 percent of the increase attributable to the positive addition of the new Legg Mason Tower. Our rate was better than the regional vacancy rate of 18.5 percent and better than such cities as Atlanta, Chicago, Denver, Miami, Pittsburgh and San Diego.

While these successes are heartening, the dawn of the new decade comes at a critical time for Baltimore's downtown. Indeed, its future economic importance to the entire region could be undercut by the creation of competing business districts outside downtown. It may be alluring and exciting to develop new districts from whole cloth, rather than to improve what already exists, but we must avoid development policies that favor the new over the existing - policies akin to those that contributed to downtown's decline generations ago.

If we've learned anything from downtown's ebb and flow over the past several decades, it's that market forces will not be the sole deciding factor. As history shows, markets are heavily influenced by policy decisions and government incentives.

Urban population loss after World War II, for example, was made possible by growth policies that favored suburban development over urban redevelopment and road construction over transit; and land use policies that suppressed suburban density and pushed growth further into the countryside. Even now, federal spending on highways is generally four times greater than spending on transit.

Certainly, government incentives have helped downtown over the past several decades - and the return on that public investment has benefited the entire region. But the need still exists.

The main districts of downtown - City Center and the west side - are architecturally and culturally diverse and transit-connected, and they have an authenticity and human scale that are very appealing. They also contain the overwhelming majority of downtown's jobs, even with recent expansion along the waterfront. Still, this traditional downtown core needs help. Many of the older buildings and public spaces are showing their age, and increasing vacancies could become a fact if new investment is not realized.

The state recognized this when it expanded the tax incentives of the city's Enterprise Zone to include a 45-acre section of downtown bounded by Paca, President, Lombard, and Baltimore streets. The city is also aware of the need and has committed to critical projects such as the redevelopment of the arena, the rebirth of Hopkins Plaza and revitalization of Pratt Street. Unfortunately, the money needed to push these initiatives forward is limited, and there are many worthy projects throughout Baltimore that are competing for funds.

To help shape decisions about development funding priorities and land use, Downtown Partnership has convened a diverse group to create a new strategic plan for Downtown Baltimore. Our vision with this plan is to connect the islands of development into one seamless, mixed-use district that thrives with activity, all day long. To get there, we need to address key questions: How do we create memorable, attractive places? How do we maximize public space? How do we find new uses for outdated buildings? What's the best way to incubate new companies? What are our priorities for limited funding?

We are at the beginning of the strategic planning process, but it is already clear that future government incentives and development policies should not support new business districts at the expense of downtown. At a minimum, the older parts of downtown should receive a comparable level of government investment as major, new office developments in other areas of the city. This is the best way to ensure the future viability of the region's single most important economic engine.

Kirby Fowler is president of the Downtown Partnership of Baltimore. His e-mail is kfowler@dpob.org.