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Thread: Wal-Marts and property values?

  1. #1
         
    Registered
    Aug 2006
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    Pittston Township, PA
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    31

    Wal-Marts and property values?

    Pittston Township, my hometown and a booming suburb of Scranton, PA, recently approved a developer's plans to construct a new 18-store strip mall, anchored by a Wal-Mart Supercenter, adjacent to our housing development. The location is ideal for commercial development, visible to more than 100,000 vehicles daily from I-81, I-476, and Highway 315. Our home was appraised back in 2000 at approximately $145,000. Due to the steady increase in overall real estate prices in the Scranton/Wilkes-Barre MSA since 2000, along with several major home renovations, that number has since been pushed to around $200,000.

    This new strip mall will be located on a hilltop directly adjacent to our property lines. Does anyone know what a new Wal-Mart next-door will do to residential property values? We were assured by the developer that Wal-Marts increase residential property values, due to their overall attractiveness, but I remain skeptical that such a dramatic increase in traffic, noise, and overhead lighting will do anything but harm us.

    I have a few questions. First, if we have official appraisals from several different real estate appraisers that currently value our home at $200,000, would we have any legal recourse against the developer if we can show that our property was devalued significantly several years later on account of the new strip mall? I was always skeptical that this project could bring any benefit to a fringe suburb just outside of a struggling downtown, but all three of our local elected officials are high school dropouts and aren't skilled enough in critical thinking to weighing the "cons" of increased congestion, poorer air quality, water runoff concerns, a negative downtown impact, etc. vs. the huge surge in tax revenues. As such, they, along with many of my own neighbors, took the "bait" about "higher housing values" hook, line, and sinker. If our property is devalued because of this, what legal recourse do we have to recoup our lost investment. We were here long before the growing suburb decided it needed another mall; Why should we suffer economically because of it?

  2. #2
    Cyburbian Random Traffic Guy's avatar
    Registered
    Jul 2005
    Location
    Lone Star State
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    639
    You may have been there before the center, but was the "ideal for commercial development" site zoned or comp planned as retail, or simply obvious as a future development opportunity? If not, you have my sympathy. If it was zoned or obvious, not even much sympathy Either way, I don't think you have any legal standing for property values. I mean you can find a lawyer to try it, but chances are zero. I have a highway in my home's vicinity and several large plots that are zoned highway or regional retail. Right now they are great for throwing the frisbee or running the dog, but I know they will be developed at some point in time. In the development process I can try to improve the product that is put on those plots, but I can't change their basic makeup. But it works both ways since there is a transit station within a mile that will hopefully spur some TOD revitalization and property value increase. It's all part of the internal equation used when one buys a piece of property. If the factors affecting your property were evident when you bought, you may have got a break compared to similar properties farther away from the retail zone (even if you didn't consider it, other buyers may have been warned off and competition reduced).

    Are you thinking that being a Wal-Mart would have special impact, versus some other generic retail establishment of the same size? Being a part of a larger retail center should help minimize any special impact of being a Wal-Mart, I think.

    For day to day living with Wal-Mart or any large development on your doorstep, get to know as much info about their operation as you can. You can often get manager's home numbers, call them when you have a problem. Document actual impacts as ammunition. Talk to your city code inspectors etc, and make sure the site is complying strictly with whatever they agreed to in the development process. Be reasonable in your requests - there will likely be some ultra-nimby person who isn't, and the stores will want to work with you as "the normal one" to show they're not ignoring the situation.

  3. #3
    Cyburbian Cardinal's avatar
    Registered
    Aug 2001
    Location
    The Cheese State
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    10,055
    I have done impact studies for several commercial development projects. As a general rule, they do not de-value property unless the development of the site in some ways dominates the other property. For instance, if you end up against the back of the building with a good buffer between you, then there should be no harm. On the other hand, if you are going to be ten feet from teh building with lights on 30' poles casting into your bedroom, you will be impacted. I have seen some development where adjacent property values have gone up, where there is an opportunity to develop or redevelop with commercial uses. I would mostly play it safe and say no change.

    I agree that you likely have no case. This property most likely had a commercial zoning when you bought your home in 2000. Even if not, it was most likely identified for that use in the city's plans.
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  4. #4
    Cyburbian
    Registered
    Oct 2006
    Location
    Indiana
    Posts
    41
    Unless the whole neighborhood deteriorates, your property values probably won't decline (assuming that at least mininal planning standards are met with regard to buffering and separation, etc.). However, the properties directly adjacent to a large commercial enterprise are likely to have slower growth in value than their neighbors who do not directly abut the development. Think about it, would you rather buy the house directly adjacent or the house one street away?

  5. #5
    Agreed on the 'one street over' idea. I personally like the idea of having a Wal-Mart within close distance, but don't want to wait for folks leaving the parking lot to pull in to my own driveway.

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