The blocks would be extremely narrow - thus limiting what could be developed. I'm not going to spend more time in traffic just for dunkin donuts or a 7-11.
And I call BS on developers requiring a decision to make a proposal. Developers don't sit around waiting for a pristine piece of land to become available if they really sense a great opportunity. If the demand is there, developers would be lobbying hard to win public approval for a project with announcements, consultations, renderings, tax breaks, etc.
There is no demand for new business development downtown outside of SU/Upstate. There is still a glut of commercial office space that nobody wants. The kennedy square redevelopment has nothing to show for it after all these years.