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Why the era of strip commercial development may be nearing an end.
by Edward McMahon; from PCJ #82 (Spring 2011); 4 pages Read excerpts below; to order & download the full article use Shopping Cart button at bottom of this post. For more on dealing with commercial strips, see Ross Moldoff's Controlling Strip Development. |
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For more than 50 years retailers have favored the commercial strip: a linear pattern of retail businesses strung along major roadways, characterized by massive parking lots, a plethora of big signs, box-like buildings, and a total dependence on automobiles for access and circulation. For years urban planners and public officials have tried to contain, control, and improve the strip. Now they are getting some help from an unexpected quarter: consumers and the marketplace. Today the era of strip development is coming to an end. Evolving consumer behavior, changing demographics, high priced gasoline, internet shopping, the economy, and other factors are all combining to create a new paradigm for commercial development. Commercial strips are not going to disappear overnight, but it is becoming increasingly clear that strip retail is retail for the last century. The future belongs to town centers, main streets, and mixed-use development. Among the reasons for this transformation: 1. We're Overbuilt on the Strip From 1960 to 2000 there was an almost ten-fold increase in U.S. retail space, from 4 to 38 square feet per person. For many years retail space was growing 5 to 6 times faster than retail sales. Most of this space came in the form of discount superstores on the suburban strip. The recession made clear that we have too much retail. Strip centers are now littered with vacant stores. By some estimates, there is currently over one billion square feet of vacant retail space. Much of this space is going to have to re-purposed or demolished. In fact, one retail analyst estimates that we need to demolish 300 million square feet of retail space. On the other hand, the only places left with more spending power than stores to spend it in are our cities. 2. Retail is Rediscovering the City In 2010, Target announced plans to remodel the century-old Carson Pirie Scott department store in Chicago. This landmark building designed by architect Louis Sullivan will be just one of a number of new, so-called big box retailers planned for urban neighborhoods. Similarly, in late 2010, Wal-Mart announced plans to open its first ever stores in Washington, D.C. To make the four new stores fit an urban environment, the company has agreed to consider an array of layouts, designs, and parking arrangements, a reflection of the chain's willingness to adapt its prototype to enter lucrative urban markets. The D.C. store planned for New Jersey Avenue illustrates Wal-Mart's new approach to store design. The company plans a store of 75,000 to 80,000 square feet (much smaller than usual) on the ground floor of a five story mixed-use building featuring 315 apartments, underground parking, and space for smaller retail stores. Home Depot already has a new urban store in Toronto with 90 units of housing on top. At the same time that Wal-Mart, Target, and other big box stores are planning dozens of new urban stores in cities all over America, as many as 400 former Wal-Mart stores and other big boxes sit vacant on commercial strips across the country. Most analysts agree that cities and urban neighborhoods are the new land of opportunity for retail. ... McMahon's article then continues with sections on: 3. The Suburbs are Being Redesigned4. Traffic Congestion, Fuel Prices, and Poor Design are Hurting the Strip 5. The Economy is Restructuring the Retail Landscape 6. Consumers Favor Walkability and Places With Character 7. E-Commerce and New Technologies Mean Fewer and Smaller Stores plus: Where Do We Go From Here? -- what can planning commissions do to help reshape the strip; some recommendations culled from leading experts. ... the full article is available to order & download immediately below. |
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On the corner. In the downtown. Along highway strips. At interchanges. Retail development is a significant land use in virtually every community. It has its own demands and impacts that are distinct from offices or services. One only has to look at the acres of parking and traffic congestion commonly associated with shopping centers to understand this.
In many communities today, the supply of retail space exceeds the demand for it. There are vacancies in downtowns, strip centers, and shopping malls. We have over-zoned land for retail development and in the process have spread it out across the landscape. So how does a planning commissioner determine where retail development should go and how it should be designed and accommodated?
Regional Retail Market Analysis
The first step in planning for retail development is to undertake a regional market analysis. Shopping is largely a regional experience. In spite of the interest in buying locally, most consumers do travel around a region for shopping purposes as not all goods are provided in each community. In addition, people often shop where they work -- which is often in a different part of their region.
Regional retail market analyses are typically conducted by regional planning commissions, chambers of commerce, or regional development agencies. Some analyses are undertaken in response to major retail development proposals; others in anticipation of retail changes or needs. Planners should be cautioned about developers' or retailers' market analyses as they may be skewed towards favoring a specific proposal.
A retail market analysis estimates the potential growth in retail demand and compares that to the supply of retail facilities within the trade area. Information is compiled on population growth, income, and expenditures by retail type (groceries, apparel, furnishings, etc.). From these projections, estimates of retail sales and square footage demand for different types of retail stores in the region can be obtained. The analyst will also consider what share of sales will take place online, especially important since some goods, such as computers, have a high share of online purchases. Sidebar, E-Commerce.
Next, a community-by-community inventory of existing retail space and occupancy rates is conducted. This inventory will show where the retail areas are within the trade area. A comparison between the existing available space and the projected space needs can be made and gaps identified.
Most market analyses distinguish between convenience goods and comparison goods. Convenience goods are widely distributed, less expensive, and frequently purchased items. Examples include food, newspapers, and gas. Comparison goods are purchased at less frequent intervals and are generally more expensive; they also are often purchased after examining prices at several stores. Examples of comparison goods include major appliances, furniture, and sporting goods.
The regional market analysis will indicate the extent to which the region may already be "over-stored" (more space than demand justifies) or "under-stored" (less space than demand justifies) with either convenience or comparison goods. It may even point out areas where future shopping should be planned.
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In the 1970s suburban shopping malls were draining the life out of downtowns around the country. Retail businesses and offices in center cities were either closing or moving out to the periphery. They left behind places plagued by crime and arson, deferred maintenance, and abandoned properties. Downtowns were in crisis and planners, developers, preservationists, property owners, and city officials diligently were looking for ways to turn the situation around.
