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Every time I look at the unofficial full map of Silent Hill, I'm always a bit intrigued by the empty area of the map northwest of the Lakeview Hotel and southwest of Old Silent Hill, where the map says "Paleville".
After seeing how far the Downpour part of town is from the rest of Silent Hill (although that has to be my favourite part of the town we've seen), I thought that when they inevitably make another Silent Hill game, it would be interesting if they used this space to create a new area to explore. I don't think we've ever seen an official map that showed that space to be empty, and even then, it could be a new development. I just don't think the town necessarily needs to be expanded further around the lake, nor do I want another game to mess around with the layout of existing parts of town like Homecoming (Why would you put a penitentary downtown? Seriously?).
So, if there was another neighbourhood there that we've never seen before, what do you think would be there? It's always bothered me that Midwich Elementary is the only school we've ever seen in town (though there's a middle school mentioned in a memo in Downpour). Since it's next to Old Silent Hill, it could be a residential neighbourhood with a middle school or a high school. Or, as a tourist attraction, there could be a historical park that recreates the less unpleasant parts of the town's past. Maybe a shopping mall like the one from Shattered Memories? Some sort of sports arena? What would make sense for a (not quite as) small town to have there?