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Community development The retail apocalypse: from over-malled to underserved

Dan

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I live in a geographically isolated county in the Northeastern US with about 100,000 residents. About 25 years ago, the area had five full-service department stores, a busy middle-end mall with about 650,000 ft2 GLA, two large discount retailers, and a wide assortment of national and local clothing and hard goods stores catering to consumers from across the economic spectrum.

Today, the the region has no full service department stores. There's one Target, one Walmart, and one Kohl's. About 10-20% of the at the mall are empty, and local stores make up half of what's left. Those local stores are mom-and-pops that usually sell very specialized goods with limited market appeal, like Middle Eastern soccer jerseys or Jamaican oil lamps. Most have a lifespan of a few months to about two years. There's only two remaining clothing stores in the mall with general appeal -- Old Navy and Ann Taylor Loft. Otherwise, if you're looking for middle end clothing in the area, the options are Target, going to Urban Outfitters downtown (if you're in your 20s), changing your style to outdoorsy or bohemian hippie, or driving 90 minutes to a still-thriving superregional mall.

High population density, hundreds of hotel rooms, and a large concentration of restaurants and bars keeps downtown busy. There's a lot of foot traffic. However, downtown lacks general retail. There's a lot of mom-and-pop higher end and organic boutique retail, six head shops, a couple of old-school jewelry stores, a few used bookstores, and a few outdoors stores. Area residents and the downtown BID strongly opposes any chain retail, even when it doesn't compete with any of the locals. Given the choice of another vape shop or a H&M, residents and the BID wlll take more sick clouds, man.

We all know about missing middle housing, but I've seen nothing written about missing middle retail. Are there any other good-sized communities in the same boat, where the retail apocalypse is leaving some chasm-like gaps in the retail marketplace? Places where there's a lot of places to buy a 60" OLED TV, but residents have to leave the area to buy a office casual clothing? Where it's easier to buy an organic cotton boho dress than a decent pair of jeans? Where you can buy a $6,000 couch from Denmark, but not a $900 couch from High Point?
 

luckless pedestrian

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Yes! I am looking for a non-worky dress to wear to a wedding. I usually buy my work clothes online from a few places that I know and I know what size, what fits, etc. But because this is a different kind of dress, I really want to try it on! There's nowhere to go so I am hoping the one I ordered online looks good as I likely won't have time for a plan B.

I noticed this as an issue when I was back to school shopping with my son who is always changing sizes so he needed to try things on too.
 

Cardinal

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There are many communities your size that would be happy to have what you do. Pre-apocalypse, consolidation laid the groundwork for the demise of department stores. They became so homogeneous that there was no longer much interest in shopping them. It also became easier for corporate boards to close smaller and under-performing stores. The loss of these anchors triggered lease clauses that let some specialty stores abandon the mall, and then there were the many chains that simply did not make it once the "new reality" set in after 2007. Add in an internet that enables people to shop any store at any time. Surviving chains are adopting a strategy in which they have fewer stores - "one in market" - and expect people will shop the store once or twice, but make many of their purchases through a web portal. We still have not seen the end of the restructuring. This year we may have more store closures than any prior year, and a growing number of experts expect to lose about 20-25 percent of the remaining stores before we stabilize. Those losses are going to come from the middle.
 

Doohickie

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High population density, hundreds of hotel rooms, and a large concentration of restaurants and bars keeps downtown busy. There's a lot of foot traffic. However, downtown lacks general retail. There's a lot of mom-and-pop higher end and organic boutique retail, six head shops, a couple of old-school jewelry stores, a few used bookstores, and a few outdoors stores. Area residents and the downtown BID strongly opposes any chain retail, even when it doesn't compete with any of the locals. Given the choice of another vape shop or a H&M, residents and the BID wlll take more sick clouds, man.

This contrasts from Fort Worth significantly.

Much of the downtown real estate was bought by a single owner (the Bass family, who made their money in oil then diversified, and are still based in Ft Worth). They established Sundance Square, a central district downtown. It has gone through a lot of evolution. When they bought in during the 1970s, downtown was all but dead. They valued the local architecture, restoring several older buildings while redeveloping other lots with newer buildings (including, eventually, several towers).

Initially they focused on nightlife- clubs, bars, entertainment, restaurants- to get people back downtown after dark. To make this work they started patrolling the Sundance Square area with private security to ease concerns about crime and safety.

When they promoted retail it was at first locally based. So there are western wear boutiques and the like. More recently they've focused on bringing mainstream retail back, including LOFT, White House Black Market, and yes, H&M. They completed construction of Sundance Square Plaza in 2013, which actually gives Sundance Square a definitive locus, something that was previously missing.

One thing I've observed in the Sundance Square example is that the developer has to play a long game. They started 40 years ago and didn't really achieve their vision until the last few years (when Sundance Square Plaza was completed). The other thing I've noticed is that there is a necessary mix of local and national brands. So alongside restaurants owned by local chefs, there's a Cheesecake Factory; a few blocks down from the locally-based sports bar is a Hooters. There's a tension; the locals don't like the corporates. Visitors expect to see familiar brands.

Housing is coming back downtown (and nearby districts) as well. Downtown doesn't have a full-on supermarket, but there's a Tom Thumb just over the river to the west, and a Wall-Mart Supercenter a couple miles east. There is supposedly a concept grocery coming downtown but it's several months out yet (and will probably not be cheap). But as the housing increases, I expect supermarkets will follow. In general Ft Worth is a very competitive grocery market.

I think it's relevant that the Sundance Square interests/the Bass family is very protective of its investment, to the point that they actively promote downtown, often to the detriment of adjacent areas. For instance, they used their considerable political influence to kill an effort to bring modern streetcars to Fort Worth. The feeling was it would allow people traveling to downtown FtW to get out of their business district too readily.
 
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DVD

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Phoenix doesn't have much in the way of retail downtown, but we do have a light rail that connects you to an old mall that is now a Target and other big box stuff. There's an area just outside of downtown that has all the cute stores. Cool antiques, book stores, a place for brunch, whatever. Once you hit the burbs the malls are still thriving. And yes, there is that one area that everything costs way to much.
 

Doohickie

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There are two malls (Northeast and Hulen in the southwest) in Fort Worth that are doing well, both suburbanish, and one that is dying a slow death (Ridgmar). North of Ridgmar Mall is a Big Box strip. There is a traditional open-air suburban shopping district (buildings ca 1950) that is considered old money stylish (Ridglea), and there is a new high end open-air shopping/entertainment center (Clearfork) that stole the Nieman Marcus from Ridgmar. There are probably others that I'm forgetting. But there are plenty of shopping centers in Fort Worth. What you can't get in Fort Worth, you can find by driving toward Dallas (such as the IKEA in Grand Prairie).

Fort Worth is expanding northward (Alliance Airport/Texas Motor Speedway area), and westward. It will be interesting to see how retail supports those areas, and what effect they will have on Downtown.
 

kjel

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Phoenix doesn't have much in the way of retail downtown, but we do have a light rail that connects you to an old mall that is now a Target and other big box stuff. There's an area just outside of downtown that has all the cute stores. Cool antiques, book stores, a place for brunch, whatever. Once you hit the burbs the malls are still thriving. And yes, there is that one area that everything costs way to much.

I noticed that when we were there for APA. I am glad that I rented a car because the best places we ate and shopped at were not downtown. I will be in the "everything costs way too much" area next July for a conference.
 

DVD

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I noticed that when we were there for APA. I am glad that I rented a car because the best places we ate and shopped at were not downtown. I will be in the "everything costs way too much" area next July for a conference.

I was talking Biltmore, not Scottsdale, but either way drop me a line and we'll get drinks or something.
 
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