Professional Jeweler Archive: Back to the Future . . . Downtown

November 2000


Back to the Future . . . Downtown

Some major retailers are setting up in urban neighborhoods again

Reversing the suburbanization trend that began after World War II, some major retailers are beginning to return to cities whose images were once characterized by abandonment, crime and poverty.

In 1999, New York’s Harlem got its first new supermarket (a Pathmark) in 30 years, followed by a Starbucks and the neighborhood’s first shopping mall. Meanwhile, Federated Stores announced plans for a Stern’s store in Brooklyn, NY, while ground was broken for a 300,000-sq.ft. shopping center in South Los Angeles, CA.

Partly, it’s the recognition that even inner-city residents have money to spend. Partly, it’s because some people are leaving the suburbs to move into town.

New Urban Dwellers

Some active retirees and empty-nesters are downsizing for lighter home maintenance and more convenient amenities. And faced with a tight job market, some businesses are locating within the city limits to lure young workers who want the urban sort of life they can’t get in the suburbs. “People are still looking for convenience, safe environments and a quality shopping experience,” Kenneth Narva, principal of the PEF/Park architectural firm, tells Display & Design Ideas magazine. “Suburban life has lost its halo for many people. Cities offer the better quality of life now.”

Residents of U.S. inner cities spent about $85 billion a year at retail, according to a 1998 study by Price Waterhouse Coopers and the nonprofit Initiative for a Competitive Inner City. That’s a market just slightly larger than all of Mexico.

The Goods

Here’s more good news for jewelers: Urban shoppers are highly fashion-conscious. According to a study by the Yankelovich market research company, urban residents spent 20% more on women’s apparel and 75% more on men’s apparel than those outside of the city limits.

Lower rates of home ownership mean they are less likely to buy home improvement items. But they are more likely to buy home fashions, furniture, electronics and home entertainment products.

Supermarkets seem to be the catalyst. With most people making one major shopping trip a week, a grocery store creates traffic that other retailers quickly move in to take advantage of.

“If you get the grocery store in your community, everything else follows,” Paul Zucca, chairman of an Atlanta neighborhood planning unit tells the city’s Journal-Constitution newspaper. In Atlanta, such stores as Kroger, Publix and Harris Teeter all have plans for entering retail-barren urban areas. And in downtown Detroit, Kroger plans to build a 54,000-sq.-ft. store.

Key challenges to newly urban retailers are understanding and meeting the needs of the neighborhood’s ethnic mix and ditching practices more appropriate to the suburbs. Narva’s company, for instance, strives to avoid replicating mall-type environments in areas with vibrant street life, while Pathmark has experimented with 25,000-sq.-ft. stores in locations that don’t have room for the company’s typical 50,000-sq.-ft. center.

Good locations include major intersections with easy access to parking and mass transit.

– by Mark E. Dixon

Copyright © 2001 by Bond Communications