A Hub for New Local Businesses and New Places to Live

Alongside unsustainable sprawl, unsightly strip malls are too often a feature of our suburban landscape. This article draws ideas from DeSoto Marketplace in DeSoto, Texas. The approach here was incremental and adaptive, introducing small cost-effective changes that, over time, transformed the underutilized shopping center into a pocket of walkability and a vibrant local business.

Further case studies can be found in a paper prepared by the Metropolitan Area Planning Council and the Congress for the New Urbanism, Reclaiming the Strip Mall: A Common Suburban Form, Transformed, by Christopher Kuschel. 

DeSoto Market in DeSoto, Texas – an incubator space for authentic local retail. (Photo Credit: Andy Jacobsohn/The Dallas Morning News)

Mixed-use neighborhood reshapes suburban landscape

Taking advantage of unexpected demand, the mixed-use Village Center is defined by three-to-five-story buildings and recalls the character of Huntsville’s historic town center.

Providence, which won a 2018 CNU Charter Award, is an example of how traditional neighborhood development can add to quality of life in a car-oriented suburban landscape.” explains Rob Steuteville, Public Square. The 305 acre Village of Providence intentionally rebalances the previously fragmented, single-use sprawl at the northwest city limits of Huntsville with infill, housing diversity, shared amenities, and useful commercial. By providing the region’s missing ingredients in a walkable environment, it has become a preferred place to live and a popular evening hang-out.

Link to 2018 CNU Charter Awards announcement:

The Link Between Urban Sprawl and Life Expectancy

West Palm Beach, FL – Compact places encourage a healthier lifestyle and have potentially higher life expectancy than areas of urban sprawl

A new study confirms cross-sectional associations between urban sprawl and life expectancy. Sprawling counties have higher traffic speeds and longer emergency response times, lower quality and less accessible health care facilities, and/or less availability of healthy foods. Compactness affects mortality through less vehicle miles traveled, which is a contributor to traffic fatalities, and through improved body mass index, which is a contributor to many chronic diseases. Dr. Hamidi, who led the research, concludes We found that the impact of sprawl amounts to about a 2.7‑year difference on average. Change won’t happen quickly, [but] we can make our cities more dense, walkable and accessible, and less car‑dependent, and ultimately improve our overall health.”

Link to the study published by the International Journal of Environmental Research and Public Health: https://www.ncbi.nlm.nih.gov/pubmed/29701644?mod=article_inline

 

The Bipartisan Cry of ‘Not in My Backyard’

A view of suburban Houston. Credit: Josh Haner/The New York Times

The Department of Housing and Urban Development, wants to spur construction of mixed-income, multifamily housing. With more built, the Department believes that housing will become affordable, and there would be more options of where to live. The approach is not without its challenges. The kind of housing described is often impractical, doesn’t accord with regulations, or simply too costly to build in suburbs and big cities alike. While many see rolling back regulations as a way to open up opportunities, nimbyism continues to provide reason for tightly regulated development. Further, its homeowners of both political parties that support restricting development around them and they do so often in spite of their own ideologies. The fear that such development threatens property values motivates homeowners as voters to protect them. The instinct may simply be too deeply ingrained and politically sensitive in America to change.

Millenial Sprawl – Realtors Wooing the Generation

Main events in Lakewood Ranch, FL.

Millennials seek the live-work-play lifestyle, but evidence suggests they are no longer solely focused on compact, diverse urban centers. In an attempt to attract this valuable demographic “suburban villages” are being created in larger developments. Lakewood Ranch is sighted as an example, with its Main Street cluster of condos, shops, restaurants, theaters and employers nearby. The investment appears to be working as millennials are buying homes in large numbers, and their preference shifting towards mature and emerging suburbs.

Pattern zones help development in the suburbs

Image Credit: Matthew Petty, Infill Group, and Matthew Hoffman, Miller Boskus Lack

A new technique called a pattern zone can be used by cities and towns to make good urbanism a natural outcome of their local real estate market. The concept itself isn’t necessarily new as Matthew Petty, a planner and developer in Fayetteville, AR, discusses.

Before zoning codes and land use lawyers, cities were built from pattern books containing construction plans for the building types in common use.  However, a municipal pattern book with pre-approved plans is at the center of the latest pattern zone concept. It changes the market activity because it lowers those barriers in ways that are valuable to developers: time and money. Matthew explains “For a missing-middle project, the savings can equal thousands of dollars per unit, once again making middle-scaled buildings as economical as single-family subdivisions and large-scale developments.”

 

How America Uses Its Land

These fascinating maps challenge our perception of sprawling America – the urbanized area seems compact in comparison to all other uses, 3.6 percent of the total. However, the urban area is growing at an average rate of about 1 million acres a year and sprawl is still winning the numbers game.

The U.S. is a 1.9 billion-acre jigsaw puzzle of cities, farms, forests and pastures that Americans use to feed themselves, power their economy and extract value for business and pleasure. The above map shows the proportion that is urban. See link above for additional maps.

How sprawl makes walkable places less affordable

Denver growth in the 1940s: Expanding the urban grid in every direction. Source: Denver Urbanism.

Significant changes in urban real estate markets over the last two decades has invigorated downtowns and urban neighborhoods. People who have choices are forgoing private subdivisions and gated communities in favor of places with more authentic neighborhoods and a sense of community. They are finding these characteristics in historic cities and towns. This article discusses how Sprawl has constrained the expansion of urbanism, inflating the economic pressures in high-demand urban neighborhoods.

High prices in America’s cities are reviving the suburbs

“The last time Americans fled the cities for the suburbs, from the 1950s to the 1980s, they were driven primarily by fear of crime. This time the migration is the consequence of the cities’ success, not their failure. Housing
and rental prices in many of the country’s largest metro areas have soared, inspiring residents to pack up and move out.

As more young people decamp from the cities to the suburbs, … a hybrid might develop, where people who leave cities—especially the most vibrant and expensive ones—will gravitate to places with similar amenities. Or transform them—as is happening in San Marcos. Though it has its fair share of cookie-cutter homes and strip malls, its well-preserved old downtown boasts a brewery and beer garden, a yoga studio and, now, a bootcamp boutique.”

Plan to retrofit suburban to mixed-use urban

The square at the heart of a proposed Southside town center, with Abercorn Street re-imagined as a multiway boulevard at the lower right. Source: CNU Legacy Project team led by David M. Schwarz Architects.

In honor of the annual Congress to be held in Savannah May 15-19, the Congress for the New Urbanism (CNU) developed a “Legacy Project” intended to leave an enduring mark on the host city and region. Retrofits of a suburban college campus and failing mall are key to creating a safer and more lively community.

“Consultants proposed a new town center for Southside Savannah that connects to the Georgia Southern University Armstrong (GSU-Armstrong) campus and transforms a busy, automobile-oriented thoroughfare into a boulevard. A failing mall could also be redeveloped into mixed-use urban blocks on the scale of Savannah’s historic district. Many tenants have left the mall, and broken escalators are signs of poor maintenance.

If the mall fails, the site could begin to redevelop incrementally. The mall site is rectangular, and so the design team applied the scale of blocks and a square that are similar to Savannah’s Oglethorpe grid plan. The redeveloped mall site would connect to the new town center and allow more urban residential development of townhouses and other “missing middle” housing types. If mixed-use development is to take place here, residential and university-related uses will likely prevail, with civic uses and limited retail and restaurants, Swartz says. The university expansion makes that vision feasible.

A large-scale suburban retrofit requires many moving parts—transformation of thoroughfares, new blocks and streets, mixed-use development, re-imagined green spaces, and revised development regulations. The plan covers all those elements, and city officials reacted positively.

Mayor Eddie DeLoach said, “Their approach to the area was dynamic and provides the City new ideas to spur redevelopment opportunities in a traditional suburban setting which would complement our National Landmark Historic District and pristine waterways.”

Suburban Remix: The Next Generation of Urban Places

New normal: As people 65 or older and 34 or younger come to dominate U.S. population growth—a pattern that will continue through the 2030s—demand for single-family houses in suburbs will fall as demand for multifamily housing rises in urban settings in cities … and suburbs.

Authors of the new book Suburban Remix, by Jason Beske and David Dixon, describe the challenges we face as a result of sprawl growth patterns in effect since WWII. The book details examples of unique and successful sprawl repair in several communities through common themes and techniques.

“North America is in the midst of “suburban remix.” A perfect storm of challenges has broken apart a 70-year-old suburban growth model shaped around car-focused, relatively affluent, and dispersed development. But as this model falls apart, another far more resilient model is taking shape: walkable, dense, diverse, compact—and urban.

In a dramatic reversal, more people living in poverty now call suburbs home, while affluent households are relocating to cities. This has slowed tax-base growth, battering local budgets. Demographic and economic trends suggest that these dynamics will grow more disruptive over the next two decades.

[Several suburban case studies offer unique lessons, while utilizing common] process, policies, and placemaking. Each started with civic leadership—a local official, advocate, or organization that stepped forward and made the case for change. Each community launched a transformative planning process built around inclusive engagement that used education to build strong local support in places where terms like “dense” and “urban” had long been anathema. All market-driven, these initiatives also rely on innovative public/private partnerships to fund an “urban” infrastructure of streets, parks, and structured parking. They grow upward, not outward, creating a compact critical mass that supports the people (and disposable income) essential to bringing life to their new streets—without touching a single blade of grass on nearby residential lawns.”

 

 

Bike to the Future: Portland uses bikes to rethink 70 years of strip malls

Halsey’s sidewalk-facing business strip on a winter morning.
The parking lot at Gateway’s shopping center, just off Halsey, is zoned for skyscrapers.

At the cutting edge of sprawl retrofit, Portland is working to making biking desirable in a neighborhood originally built for cars, where the 1920s-style commercial lots to the north face unbroken sidewalks, and the 1950s-style lots to the south face a two-row parking lot.

“Portland’s leaders [are] thinking these two blocks are the perfect place to begin what many of them see as the great work of the 21st century: undoing the errors of car-dependent design that began in the 1940s.

If this row of buildings successfully leads Gateway’s transition to a more walkable, bikeable neighborhood, it’d put the street at the forefront of a national movement to redevelop close-in suburban neighborhoods.

The city’s plan is to preserve parking on both sides of the street, but flip the parking and bike lanes so a combination of curbs and parked cars would separate bike and auto traffic.

That’s why Halsey and its couplet street, Weidler, are slated for $20 million in public investmentin 2018, including a major new city plaza, shorter crosswalks and parking-protected bike lanes at the hub of a new 39-mile low-stress biking network through the area.”

Troubled Malls Finding New Owners And New Life

Independence Center in Independence, MO, is a classic 1970s-era property.

More developers are finding new opportunities in underutilized malls and empty storefronts with mall retrofits.

“Tearing down these properties often makes less sense than finding new uses appropriate for an era when consumers shop so much online.

“A lot of these projects are at Main and Main streets,” says Najla Kayyem of Pacific Retail Capital Partners, “and great locations don’t go out of style.” Pacific Retail Capital Partners recently decided to step in as the operator of Independence Center, an iconic lifestyle shopping center in Independence, MO, just outside of Kansas City.

“We want people in the area to be proud of their center,” Kayyem says. She echoes the thoughts of many people currently developing or renovating retail centers in that these spaces need to provide experiences “that really create a community environment.”

Suburban Remix: A New Generation of Walkable Development

Kaid Benfield reviews a new book on Bethesda Row in Maryland, where office space, retail, and multifamily housing in an architecturally varied and human-scaled setting has considerable appeal as a place to work, shop, dine out, and live.

“The premise of Suburban Remix is that we need more places like Bethesda Row, to respond to growth pressures and rapidly changing market forces now favoring walkable urban places.  And that we especially need them in suburbs, where many people prefer to live and where, as outmoded forms of automobile-dominated commercial development go out of service, there lie many opportunities to build them on “grayfield” redevelopment sites.  The case studies in the book provide examples of how forward-thinking communities and developers are doing just that.”

 

The Case for Putting Amazon’s HQ2 in the Suburbs

The land-use plan for the new Tysons (Fairfax County)

Amazon could turn a vast swath of suburbia into a walkable, transit-connected, mixed-use, and architecturally interesting satellite city. Such a project would prove transformational for whatever region it’s in. But it would also become a template—and an impetus—for many more such projects around the country. As the mother of all suburban retrofits, HQ2 could help rewrite land-use patterns that are environmentally wasteful and experientially banal. It could model a new kind of suburbia—one that younger Americans will actively want to live in, rather than just settle for.

Instead of exacerbating an affordable-housing crisis in a pricey urban center, Amazon could help build a model of an inclusive urban suburb.

One argument against a suburban HQ2 site is that it would fuel sprawl. But infill isn’t sprawl, and a locality could prevent the creep of subdivisions around HQ2 if it abided by smart land-use rules.

 

The urban renaissance is making only a small dent in it. So polycentric urbanism ought to be the goal in the 21st century.

Sprawl Repair – The next frontier in residential innovation

From the Sprawl Repair Manual: Left: Conventional single-use residential development. Right: The proposed sprawl repair provides maximum flexibility, a mix of uses, and a full range of human environments from rural to urban.

The Policy Watch section of the National Association of Home Builders’ quarterly magazine featured our new article on Sprawl Repair – The next frontier in residential innovation.

Changing demographics, retail trends and lifestyle choices are establishing a new frontier for Home builders interested in helping to transform our suburbs, with actions targeted toward establishing urban centers.

Home builders play a key role in delivering desirable, livable products and can remain competitive by leveraging existing infrastructure, location, and market needs to create value out of stranded real estate assets. By including housing within auto-centric commercial development, sprawl repair promotes economic diversity and vitality.

Form-based zoning is a necessary tool that the home building industry should know well and take advantage of. It enables options and flexibility to transform single-use parcels into more diverse and resilient urban nodes that accommodate different people, incomes, and ages, and serves the suburban population at large.

A suburban town revitalizes incrementally

Parsons Alley activates abandoned properties, creates a popular and lively new public place, and attracts businesses that appeal to young professionals.

“As downtowns and urban neighborhoods thrive across America, leaders and citizens outside city centers have begun to ask, “How do we reinvent the suburbs?” Moreover, how can this be done in an incremental way that doesn’t require a large transformative project? Major projects are hard to come by and are risky propositions.

Parsons Alley, the public-private redevelopment of a 3-acre infill site, offers answers in a small suburban city 10 miles northeast of Atlanta.

“Parsons Alley is serving as a true a catalyst for redevelopment and has already has sparked over a hundred million dollars of private residential projects within the downtown core,” notes James Riker, economic development director for the City.”

Can We Create A New Kind Of Downtown In Abandoned Suburban Offices?

Bell Labs Photo by Peter Dant Photography

Developer Ralph Zucker, of Somerset Development, is turning an iconic single-purpose masterwork by Eero Saarinen into a new kind of Downtown – a “metroburb” – in suburban Holmdel, NJ, one of the country’s wealthiest McMansion enclaves. The abandoned, historic Bell Labs created a huge problem for the town, but also huge opportunities. The project is a prime example of what can be accomplished through suburban sprawl retrofit, though the community is still resistant to full integration of diversified housing options.

“The town of Holmdel searched for buyers, but tenants in need of 2 million square feet of space were now rare; across New Jersey and the rest of America, sprawling suburban corporate complexes were being abandoned at an alarming rate for remote work or more urban headquarters.

When he first brought the plan for the metroburb to a Holmdel town hall, the response Zucker heard was, “Hell no.” People told him this was antithetical to the reason they moved to Holmdel, a sheltered, quiet place to raise their families. They didn’t want anything urban. What changed their minds, Zucker says, was an event he hosted at Bell Labs soon after touring the building in 2009: an open house wherein he projected shops and offices onto the walls of the old laboratory spaces, and hosted a pop-up gelato stand and a bar. The simulation of the space’s potential was so compelling, he says, that one woman smacked her head on a wall, thinking a projected hotel lobby was, in fact, the real thing. Still, though, it took until 2013 for Zucker to receive final approval from Holmdel for the purchase and to have the building rezoned as mixed-use; construction began not long after, and in the intervening years, Holmdel has largely embraced the development.”

Sears had a miserable, miserable Christmas

Sears Reuters-Mike Blake

“CEO Eddie Lampert said that its lenders and vendors must have a better outlook about the company’s future… and that negative outlook is putting Sears at a competitive disadvantage.

Lampert again insisted that the company is on course to turn a profit in 2018. But he also ominously warned that the company’s board will “consider all other options to maximize the value of Sears Holdings’ assets” if the company can’t refinance its debt.

Sears (SHLD) closed hundreds of stores last year, leaving it with just over 1,100. Last week it announced plans to close another 103 Kmart and Sears stores by April.”

Consider retrofitting the stores and malls through Sprawl Repair to save jobs, create livable communities and boost the investment returns.

Jobs everywhere! Except at stores

The retail meltdown is having the worst impact on the young, elderly, women and minorities hardest. According to the December Jobs Report:

“General merchandise stores, the segment that includes department stores, were hit the hardest, losing 90,300 jobs.

These job losses tend to hit the young, elderly, women and minorities the hardest. About 60% of department store employees are female, compared to 47% of workers overall. Minorities, the elderly and teenagers are also far more likely to find jobs in department and discount stores than they are elsewhere. Teenagers hold 8% of department store jobs, compared to 3% of jobs overall.

In 2017, 7,000 store closings were announced, a record that was more than triple 2016’s number. And the trend will undoubtedly continue in 2018. Sears Holdings (SHLD), owner of both Sears and Kmart, said Thursday it plans to close more than 100 additional stores.”

It is more important than ever to diversify our economy and opportunities through sprawl retrofits and mall repair that supports all of our citizens.

Here’s what could happen to America’s hundreds of dead malls

A Sears store inside the Woodbridge Center Mall in Woodbridge, New Jersey. Business Insider/Sarah Jacobs

It appears that the mall as we know it may be dead. Long live the retrofitted mall! New uses, new infill, new life for the king of the American consumerism. Read more about retrofit options that can boost an entire community from Leanna Garfield of the Business insider:

“More than 6,400 store locations have announced closures this year. In a recent report, analysts from Credit Suisse predicted that 20% to 25% of malls — about 220 to 275 shopping centers — would shutter over the next five years, largely because of store closures.

Malls of the future have an opportunity to fulfill other community needs besides commerce, June Williamson, an architecture professor at the City College of New

“The development climate of malls were driven less by demand and more by opportunity,” Williamson said. “As new centers get built, anchor stores are lured away, and a cannibalization process begins. … Only so many consumers are going to malls, and they will flock to newer ones. If developers build a new mall, they are inevitably undercutting another property. So older properties have to get repositioned every decade, or they will die.”

Closed department stores will most likely become other businesses that could benefit from the large square footage, such as fitness centers, churches, offices, public libraries, and even medical clinics, Williamson says.

Since most food courts have a lot of natural light, they could be used as gathering spaces for community groups or daycare centers if they closed down, Williamson says. Some food courts, however, are redeveloping into clusters of higher-priced restaurants.

Mall atriums are wide open spaces that can allow for events like concerts or fashion shows, or serve as car showrooms — all of which generate revenue, Williamson says.

Many dead retail spaces, Williamson says, will most likely morph into businesses that have community functions, such as apartments, public libraries, indoor farms, and refrigerated spaces for processing food for local restaurants or grocery stores.

Malls may increasingly turn their surface parking lots into space that emphasizes walking rather than driving.

Williamson describes ethnic malls as shopping centers that target a specific ethnic demographic in a community. She says this type of customized mall can thrive more than a traditional mall because it better meets local shoppers’ needs.

To subsidize regular retail shops, destination malls, also called super regional malls or lifestyle centers, use experiential attractions like movie theaters, bars, casinos, restaurants, rock climbing walls, laser tag, and even roller coasters.”

Learn more about Mall Retrofits in the Sprawl Repair Manual.

The Great Retail Retrofit

The abandoned Randall Park Mall in North Randall, Ohio Joshua Gunter/AP

Richard Florida describes how the “retail apocalypse” presents an opportunity to re-think and re-energize our communities in the wake of ongoing bankruptcies of chain stores, high-end retailers, suburban malls and metropolitan flagships. With hundreds of thousands of jobs lost, and more to come, Sprawl Repair presents a series of strategies for retrofitting communities at any scale.

“WeWork’s takeover of Lord & Taylor could be a good portent for urban economies. Work, not shopping, is the key to urban productivity and growth. … higher urban rents… are a function of higher urban productivity.

As talented people and high-paying jobs move back to cities, there is demand for more office space. But smaller companies and gig-economy workers need flexible coworking spaces that companies such as WeWork provide, and they need affordable living spaces as well. Both of these can be built in the shell of former retail spaces.

Educational and healthcare facilities, two land use types that are growing as retail shrinks, are a logical fit for these large, boxy spaces.

Mall retrofits can also help with resilience and sustainability efforts. Dunham-Jones and Williamson estimate that 10 such projects have been transformed into green infrastructure or parks.

Some of the most ambitious mall redevelopments are becoming mixed-use neighborhoods.

The Villa Italia Mall in Lakewood, Colorado, outside Denver, was almost completely demolished to make way for a new street grid lined with offices, arts facilities, parks, and residences, as well as new stores. The project is already generating four times the tax revenues that the old mall did.

Dunham-Jones and Williamson estimate that there as many as 650 mall retrofits in some phase of development across the country. From megachurches to indoor paintball parks, former malls and retail spaces are being converted to all manner of uses that better reflect the way we live.”

Westfield: Lowy family sells shopping centre empire to French property giant for $32 billion

The giant retail mall operator, Westfield, is being purchased by French property giant Unibail-Rodamco, to remain resilient in the face of the changing retail market. High-end markets remain their target. Agility and diversity will be key for retailers and their employees who continue to bear the burden of the changing retail climate. Communities that promote mixed-use mall repairs may have a chance to combat the sliding economy.

“The acquisition of Westfield is a natural extension of Unibail-Rodamco’s strategy of concentration, differentiation and innovation. It adds a number of new attractive retail markets in London and the wealthiest catchment areas in the United States.”

The Lowy family will retain control of Westfield’s retail technology platform, OneMarket, which will be spun off into a new company on the ASX, with Steven Lowy remaining as chairman.

Westfield Corporation runs 45 shopping centres and airport retail precincts in the US, UK and Italy, including the retail space in the new World Trade Centre in New York.

Retailers across the United States are in what appears to be terminal decline as shoppers abandon traditional bricks and mortar while the digital revolution lays waste to traditional shopping.

That, in turn, has begun to harm shopping malls as retailers have struggled to pay rents with many closing down their outlets.

Thousands of mall-based stores have shut their doors across the US this year, including stalwarts such as JC Penney, Macy’s, Sears and K-Mart reducing their physical footprint.

That, in turn, has begun to affect employment. Until as recently as two years ago, shopping malls were providing America with 200,000 extra jobs a year, but that trend has now suddenly reversed.

According to the latest Bureau of Labour Statistics, the retail industry has lost an average of 9,000 jobs a month this year. This time last year, malls provided jobs growth of around 17,000 a month.

Generation Z May Not Want To Own Cars. Can Automakers Woo Them In Other Ways?

Citi Bike users pedal through the streets of Manhattan. Some members of Generation Z, the younger generation following the millennials, are less inclined to own cars and lean more toward bike-sharing and ride-sharing services.
John Moore/Getty Images

Generation Z, the born between 1995 and 2012, and raised entirely within the digital age, are likely to mix things up even more than the Millennials. Gen Z-ers in more urban settings are even forgoing a traditional rite of passage: getting a driver’s license and then the car. Natalie Bettendorf, a Gen Z-er just coming of age, describes why she has no intention of getting a car. The Big Three U.S. automakers have taken notice, and ride-sharing applications are busy tracking the way we move. While rural areas of the country can’t easily be served by ride-sharing, Gen Z may be even more influential in pushing transit-oriented development and averting sprawl than Millennials.

“Ford started its own bike-sharing service recently. It wants to sell to people like me who have no interest in buying a car.

The Big Three U.S. automakers — Ford, Fiat Chrysler and General Motors — say they are no longer just automakers. Every major car company is trying to make a move, whether it’s car-sharing, ride-hailing or self-driving.

GM has a new car-sharing app called Maven that it’s betting billions on. “We needed to create a new brand because this is really about access and not necessarily ownership,” says Peter Kosak, executive director of urban mobility for Maven.

Millennials are starting to buy cars in big numbers, The Associated Press reported last year. They just had a late start — mostly because of the Great Recession. Could the same thing happen for Gen Z?”

Dollar General is opening 900 new stores next year

Contrary to the current Retail Meltdown from excessive retail outlets and online competition, the dollar store model – simplified offerings to meet basic needs, no-frills buildings or service, and continued investment in markets that show good returns – appears to be attractive to low- and high-income shoppers, as well as to investors. They fill a need, especially in more rural markets.

Dollar General is bucking the retail trend.

By the end of the year, more than three in four Americans will live within 5 miles of a Dollar General, the company noted on the call.

Shares of Dollar General (DG) have climbed 25% this year. Dollar Tree (DLTR), its top discount competitor, has risen 38%.

Dollar General has succeeded thanks to its lean business model, said GlobalData Retail analyst Neil Saunders. Its smaller stores sell cheap day-to-day essentials, especially in rural areas where it doesn’t make sense for Walmart or other large retailers to open up shop.

“The company [is] the closest and most convenient general merchant for millions,” said Saunders.

Sales were up 4.3% last quarter at stores that were open a year ago, a sign of retail health. Revenue last quarter ballooned to $5.9 billion — an 11% uptick from last year — in part from hurricane-related spending in Texas and Florida.

More middle income and affluent shoppers are helping lift Dollar General’s overall sales. The expansion, especially in metro areas, will allow it to continue reaching these shoppers, said Saunders.

But lower-income Americans remain the store’s primary customers. The stores attracted shoppers during the economic downturn in 2008 and 2009, and consumers haven’t stopped coming back since, even as the economy has picked up steam.

The Quiet Revolution Happening in the Suburbs

Suburbs first gained popularity for being everything a big city wasn’t. Now they want to be just like downtown. Photo by David Kidd

It is becoming more apparent that the suburban pattern of development created imbalances and burdens on society, the economy and the environment. In a very worthwhile article, Alan Greenblatt describes the revolution that is taking place and gaining steam. The most valuable and successful communities will be those that are developed around diverse town centers and transit. SmartGrowth and Sprawl Repair will be the key. 

“All over the country, suburbs are rushing to develop new mixed-use corridors, complete with dense, walkable shopping areas, often attached to a town hall or performing arts complex, as in Shirlington [VA], and usually surrounded by mid-rise apartment or condo buildings.

Mixed-use developments like these are becoming kind of a cliché in American metropolitan areas — but that doesn’t make them any less revolutionary.

“People who don’t have kids in their houses eat out a lot more than people who have kids,” says Ellen Dunham-Jones, director of the urban design program at Georgia Tech University and a leading authority on suburban evolution. “Suddenly,” she says, “you see the suburbs have way more restaurants than they used to, even bars and nightlife, which used to be anathema.”

“The downtown housing has gotten absurdly expensive in those cities that have revitalized,” says Dunham-Jones. This explains to a large extent the denser development taking shape in communities such as Shirlington and Rockville [MD].

An increasing number of developers want to appeal to people who prefer to live and work in places where they don’t have to drive for everything they want. “The suburbs that have gotten that are going to be the winners in the future,” says Ed McMahon, a senior resident fellow with the Urban Land Institute. “The way people work, shop and move around is changing. Those that have figured that out are going to prosper, and others are going to decline.”

“The privacy that the aging boomers really valued while raising their kids, now they’re beginning to question that,” Dunham-Jones says. “Do I really want to mow that big lawn? If they’re retired, suddenly that privacy can seem lonely.” Or, to put it another way, the ability to conduct much of one’s life on a cellphone may be generating a desire for in-person contact, perhaps the only thing the phone cannot deliver.

You’ll pay at least 25 percent more per square foot for housing in Reston, Va., which is built around a town center, than in nearby Sterling, a postwar cul-de-sac suburb that’s the same driving distance from Washington.

The most in-demand suburban developments are being built around transit, and this is true even where the share of commuters using transit is still low.”

Why Are Millennials Leaving New Jersey?

 

People arrive at Hoboken Terminal to commute to New York City. Eduardo Munoz/Reuters

Paul Genovesi, CNU-A, is an Urban Designer at DPZ CoDesign in Miami, FL. As a Millennial, formerly of New Jersey, he offers additional commentary on Alastair Boone’s piece:

“Why Are Millennials Leaving New Jersey?

  • New Jersey ranked 47th out of 50 states and Washington, D.C., for its percentage of Millennials in 2012.
  • Of the state’s 565 municipalities, only 183 scored well on two or all three smart-growth metrics, and according to the study, only 111 of those places are popular with Millennials.
  • New Jersey’s Millennials are struggling to find affordable housing in their home state. For one, 47 percent of them live with their parents. In fact, New Jersey has the highest rate in the country of 18-to-34-year-olds living with their parents.
  • 54 percent of the housing in New Jersey is made up of single-family detached homes”

Losing millennials is just the tipping point for New Jersey. As these young, talented professionals flock to Hoboken to work in New York, or flee to adjacent Philadelphia and leave the state altogether, their empty-nester parents are also abandoning the Garden State to escape the high property taxes. Even their prospective employers are following them on the train out of NJ. According to Plan Smart NJ, the state currently has a 60+ year stock of vacant office space, and it’s increasing by the day as companies follow the millennials to areas like Brooklyn and Philadelphia.

Repairing suburban office parks and shopping areas to make them once again viable for millennial employers/retailers should be a priority. These areas should be near existing major transit stations, as they are primed to better provide an exchange of residents, jobs, and lifestyle activities with the major metropolitan areas like New York, Hoboken/Jersey City, and Philadelphia.

However, none of this will be possible without a major bureaucratic makeover in the state. Exclusionary zoning laws prohibit the building of walkable urbanism and housing types other than single family. High property taxes make homeownership difficult and force rents to be higher than the market dictates. Arguably, the extremely limited/restrictive liquor license laws may be the biggest hurdle that prohibits millennial-popular places from forming in New Jersey. Several of the new urban/infill projects in the state are successful, but lack a pulse after 8pm, just like the sleepy suburb the millennial fled in the first place.

 

Longtime Retail Pariah Now A Mall-Industry Darling

For years, gym tenants were unwanted by mall landlords as they were believed to provide little value, attracting visitors who were unlikely to spend money at any of the shops in the vicinity.

As the Retail Meltdown continues to rage, mall operators are rethinking their tenant mix to capitalize on increasing trends toward fitness and gym memberships to bring foot traffic to languishing stores. Lara O’Keefe describes the new attraction:

“Now, gyms are a valued addition to the tenant mix. Americans’ focus on health and fitness has grown to such an extent that athletic apparel has become an acceptable form of attire, increasing people’s willingness to shop after working out, the Wall Street Journal reports.

While many retailers have shuttered their doors due to e-commerce competition and declining foot traffic, fitness centers are on the other end of the spectrum as gym memberships skyrocket across the country.

This dynamic has made gyms attractive to landlords, especially as they look to reinvent themselves as entertainment destinations that offer a variety of activities aimed to draw shoppers.”

The Triumph of the Latin American Mall

Suddenly it’s 1990: Oakland Mall in Guatemala City, where the mall culture is in full bloom. (Nolan Gray/CityLab)

As American malls are failing, Latin American malls seem to be thriving. Social and economic factors appear to be the key. The good news for American retailers is that those who retrofit based on the resurgent Main Street model will be best positioned to capitalize on changing trends.

“…fear of violent crime and a relative lack of high-quality urban environments are also factors in the Latin American mall boom … malls provide a safe place to shop, and mall managers invest heavily in security. Combine this with the lack of reliable mail and home delivery service that hampers the e-commerce sector and there isn’t much competition for Latin America’s rising middle-class shoppers.

In most U.S. cities, on the other hand, violent crime has fallen dramatically over the last 25 years, and walkable urban neighborhoods that boast restaurants, bars, salons, and “experiential retail” are thriving. In this sense, the decline of the North American mall reflects a positive trend: The Main Streets that malls once menaced are coming back. Such amenity-laden neighborhoods are also in a better position than suburban malls to fend off the threat of online shopping.

In the U.S. and Canada, malls are still overwhelmingly anchored by major retailers like Sears, JC Penney, and Macy’s. And as the fortunes of these department stores have declined, they’ve dragged the malls they’re attached to with them. In Latin America, on the other hand, a whole variety of businesses act as anchors. Grocery stores are common in Latin American malls and are often situated at the end of long corridors lined with smaller shops, creating a steady flow of foot traffic.

When we feel nostalgia for malls, maybe what we’re really feeling is nostalgia a time when incomes were rising and the quality of life of average people was improving.”