In retail, appearances aren’t everything. They’re the only thing.

I’ve pontificated upon main street retail numerous times on this blog, yet I still haven’t come close to running out of good material. The subject (and retail in general) is deeply sensitive to individual circumstances, and the ingredients of a healthy, vibrant, low-vacancy main street often evolves steadily, right along with our shifting consumer preferences.

One thing that remains constant amidst all the change is a generalized attitude: the content, quality and occupancy level of retail overwhelmingly influences our perceptions of a district. We often judge whether or not a town is “nice” by the character of its main street—which is one of the main reasons the auto-oriented suburbs of the 1960s and 70s have been working overtime to help endow themselves with “downtowns” where, in many cases, none previously existed.

But even the most devastated, depopulated, de-industrialized of old city centers have, in recent years, devoted considerable effort in deactivating the decline. If a struggling downtown can claim even a microdistrict with some real street life—central Toledo around its ballpark, for example—the civic leadership of that city can steer public perception remarkably in favor of downtown…even if tumbleweeds still drift across a good 80% of the city center.

During my two-and-a-half years living in the Lehigh Valley of Pennsylvania, the central city of Allentown achieved exactly this result. When I arrived in 2014, I was hard-pressed to find more than two restaurants that stayed open after 6pm. In the ensuing years, the downtown witnessed the completion of a hockey arena, two first-class office buildings, over 250 units of apartments, the revival of an old top-end bank into special event space, a Renaissance Hotel with convention hosting capacity, and a smattering of new restaurants—enough to constitute a minor “scene”.IMG_1539IMG_1540Such intensive investment has resulted, not surprisingly, in a bifurcated downtown: one in which a few blocks reveal all the trappings of urban revitalization, even though this investment has yet to “spill over” into the remainder of the district, which still suffers the reputation of concentrated poverty, abandonment and crime. But the primary investors in downtown Allentown—much of it a single visionary developer—is that Keynesian economics will bear fruit over time. Hope springs eternal.

Most evidence would suggest that the strategy is working, as more businesses seek to locate in downtown Allentown, no doubt abetted by state-sponsored tax incentives, of which Pennsylvania’s third-largest city is—per the statutory definitions—the only municipal benefactor. (Plenty other Lehigh Valley bloggers are far better versed in how the Neighborhood Improvement Zone—the NIZ—came to be, and I’ll defer to the City of Allentown’s definition of this unique, spatially defined tax credit to avoid embarrassing myself.) At any rate, most of the investment arrives through two stylized development packages: urban infill (placing multi-story, mixed-use structures on former parking lots) or slightly more controversial redevelopment (in which the developers demolish clusters of century-old, largely vacant small commercial buildings to make way for a single mixed-use structures with large floor plates). The strategy is hardly earth-shattering, and even the more controversial approach—the one that involves demolition—hasn’t ruffled too many feathers, largely because the old buildings were dilapidated to varying degrees, and Allentown’s center city remained so starved of any real investment.

The one distinctive byproduct of this intensive growth over the last three years is the multi-block ArtsWalk, a three-block pedestrian corridor that has emerged to help activate the interstices between the newly constructed buildings, connecting three major anchors: the PPL Center (the venue for the Lehigh Valley Phantoms hockey team), Miller Symphony Hall (home of the Allentown Symphony Orchestra), and the Allentown Art Museum.

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Essentially, the ArtsWalk has claimed Court Street, a former public right-of-way, transforming it to a largely pedestrian corridor.

It’s a risky venture for a variety of reasons.Allentown ArtsWalkNumber one: the U.S. lacks any real legacy of successful pedestrian zones in downtowns. For every Burlington and Madison, we can find ten (or twenty) scarred main streets, where 1970s/80s attempts to pedestrianize downtowns failed abysmally. (Allentown is among these casualties: a few blocks of the city’s Hamilton Avenue struggled for decades as a pedestrian-only corridor, complete with awnings over the sidewalks, before city leadership capitulated and returned the failed main street into a one-way arterial for cars.) The history of pedestrian planning in American and Allentown is deeply fraught.

Number two: the three anchors that serve as bookends—and a fulcrum—are hardly community mainstays. Sure, the arena can pack in the crowds for a hockey game, but it usually opens at night, while conventional retail’s dominant hours are the daytime. And hockey is seasonal. A symphony hall brings far fewer people, far less often, and an art museum can go years without a milestone exhibit. None of these institutions have the capacity to attract customers the way a department store would, and Allentown no longer has any downtown department stores. (Besides, department stores in general lack the cachet they claimed as recently as 2005, manifest by the widespread closures of Macy’s and Penney’s.)

Number three: while the ArtsWalk itself is immaculate, as are all the buildings that flank it, the whole concept still sits just two blocks from desperately poor residential quarters. (And one of those buildings that abuts the ArtsWalk houses low-income seniors.) The fact remains that the total income density around the new linear plaza remains generally low for the region, despite the presence of a few new expensive apartments and office buildings. And while hockey games or music concerts definitely bring people with spending power into downtown Allentown, most people don’t want to buy expensive clothes before a watching the big game.

As a result, the ArtsWalk has endured a mixed success in its less than three years of life. Few of the businesses that first opened remain. Among the highest profile was Shula’s Steakhouse, the national chain lured to a space along the ArtsWalk from its former location at the Promenade Shops at Saucon Valley, at least in part through the generous tax breaks induced by the NIZ, which closed after just six months in operation.  The problem? Most local media sources speculated that Allentown failed to attract enough big spenders from the suburbs to patronize the establishment. Less than a year later, the owner/operator of women’s clothing boutiques Sage and Aquarius, attracted to the ArtsWalk from Promenade Shops through similar enticements, announced he would close his two stores as well.He had already shuttered a shoe store months earlier.IMG_7005

 

What’s left?IMG_7006

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Most of the vacant space has quickly found new tenants. A more moderately priced barbecue restaurant replaced Shula’s, and it seems to be packing in the crowds. Virtually all other spaces have secured other tenants within three to four months. But let’s look more closely about what claims an address along this pedestrian-only corridor.

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The former site of Popmart, a specialty arts and craft gallery based in nearby Bethlehem, now hosts a leasing office for the apartments that flank the ArtsWalk. While such an entity is essential for the health of the immediate area—it needs warm bodies in all those residential units on the upper floors—the site previously went to a distinct tenant. Additionally, the fact that a leasing office occupies such a high-profile space suggests that the apartments themselves are far from achieving full occupancy. And notice the decals on the window immediately to the left of the door.IMG_7008They refer to RE:find, an Easton-based home furnishing boutique that opened shortly after Popmart closed.  But, as of early spring 2017, the Allentown location of RE:find had closed as well.

Even more telling is the immediately adjacent storefront along the ArtsWalk.IMG_7009

It hosts Roey’s Paintbox, a group painting studio. This sounds like a perfectly valuable tenant, and collective painting classes have turned into a quiet fad nationwide. And such a business helps reinforce the “arts walk” concept. But check the hours listed on the door:IMG_7010Only three hours a week, unless by appointment. Under what conditions could a business stay profitable while operating such a short time? The lease would have to cost the little company next to nothing.

I remain sanguine that the ArtsWalk will ultimately catalyze downtown Allentown’s ongoing regeneration. At any rate, the organizing and managing powers to be have kept it looking good and well-tenanted, even when the reality has proven iffy. But the current conditions shine light on a fourth challenge not yet mentioned in this article, though I’ve discussed it ad nauseam elsewhere in this blog. How much longer can bricks-and-mortar retail remain viable anywhere? If anything, the ArtsWalk will need to attract restaurants, salons, and other small businesses that feature a distinctive service, rather than simply selling goods. The density will need to increase, both in businesses and residences, and these newcomers will need to prove they’ve got disposable income. And, most importantly, as development continues to the east, thereby extending the length of the ArtsWalk concept, the powers that be will need to show similar perseverance in maintaining appearances. They’ve done a bang-up job so far, and, while you’re in the most successful block-long portion, you almost feel as if you’re in a fully thriving suburban lifestyle center. But since even lifestyle centers have recently failed to thrive the paradigm for urban storefronts may need to change again soon. As is the case with downtown revitalization efforts in general, we can only hold out hope that what we’ve witnessed in Allentown since 2014 remains more than a short-lived fad.

7 thoughts on “In retail, appearances aren’t everything. They’re the only thing.

  1. Brian M

    A sobering reminder. My town just adopted a “plan” for its Downtown and an old commercial strip which emphasizes all the usual things. We are in a more prosperous (in some respects) regional economy, but the decline of retail has hit us as well, and my constant refrain is that the Plan is not a miracle worker. Especially given the fiscal constraints of California local government

    Reply
    1. AmericanDirt Post author

      Thanks for the observations, Brian. If the commercial strip you’re referring to is (as most are) single use and one-story, this may be the optimal chance for a developer to purchase it in its depressed state, demolish, then reassert the property as a mixed use structure, with offices or housing above.

      This is a pollyannaish reworking of the solution, which may be way off-base since I don’t know the traffic/parking/zoning conditions, but I think the old maxim “retail follows rooftops” is more powerfully true than ever. It was always the case, but, these days, it’s almost possible for a retail-oriented structure to succeed in the long term unless there’s considerable housing density nearby. And it has to look good too, which often means de-emphasizing the parking that tenants claim they need so badly. We simply have too many convenient-but-ugly shopping centers; from coast to coast, the demand is saturated.

      Reply
  2. Chris B

    I heard a report referencing the US retail oversupply on NPR’s Marketplace last night. According to a 2015 article on Forbes.com, the US has “close to 25 square feet of retail space per capita (roughly 50 square feet, if small shopping centers and independent retailers are added). In contrast, Europe has about 2.5 square feet per capita.”

    I think building new retail and/or insisting on ground floor retail in every mixed use development is a really bad idea for urban revitalization. Build housing and some offices and let retail and restaurant development find more-economical old space to re-purpose.

    Reply
    1. AmericanDirt Post author

      Chris, I wish you were wrong. But you probably aren’t.

      I agree that we have to be far more strategic about where new retail goes, even in presumably high-density urban settings. Shoehorning it in won’t work on a local street downtown; it needs to be at least a collector, or the retail should probably just go along the corner of the building.

      And yes, because we’re so oversupplied, we should abandon suburban, auto-oriented retail development almost completely. We’re getting close: witness the failure of the Gershman proposal in Greenwood, and all the backlash for the Whitestown shopping center proposal (https://www.ibj.com/articles/63577-developer-proposes-50m-shopping-center-in-whitestown) indicates that the “retail apocalypse” has become known among the layperson.

      That said, an urban development with an FAR of 4.0 or greater should probably at least consider some corner retail at the street level. Though it’s tougher to lease these spaces than it was 10 years ago, the very concept of walkable retail is one of the great selling points for urban environments. It’s amazing how much an urban apartment/condo building’s identity can get wrapped up in the stores that are on the first floor or within a five-minute walk (see Craig’s List want-ads for proof). And a commercial district, no matter how tiny, helps endow an urban neighborhood with an identity.

      That said, most developers–except for the ones in Whitestown apparently–are wising up to the fact that strip malls/lifestyle centers/power centers/malls aren’t a good idea. Whether the short-sighted city leadership–who often subsidizes such proposals in the form of tax abates to attract an investment that will shore up municipal finances–will catch wind remains to be seen.

      Reply
      1. Chris B

        Lol re Whitestown. Burlington, Ross, TJMaxx…can you imagine what their urban format would look like?

        Reply
        1. Chris B

          And yes, I think corner retail will be the more viable model in tier 2 and 3 urban areas, with some well screened parking hidden behind and/or elsewhere on the ground level. Something like The Delaware, Slate, Hinge and Villagio in Indy.

          The mid block ground floor commercial here, as you have pointed out repeatedly, ends up being non-retail and limited intensity commercial.

          Reply

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