Over-Retailed?
We are all now familiar with the consultant’s report to the PAC (Planning Advisory Committee). That report says the Windsor region is already overbuilt as far as retail/commercial locations are concerned and that we should not change zoning to accommodate more retail/commercial and that efforts need to be made to repopulate our existing commercial corridors.
There is a real possibility that we will see more commercial vacancies as more U.S. based retailers consolidate to balance their bottom lines. I came across this on Bloomberg.com today. Their analysis shows that even if the U.S. economy recovers at “bullish” pace, it is still over-retailed. (The largest consumer economy in the world is over-retailed, wacky.) The charts and graphs are interactive and in addition to being informative it’s kinda fun too.
There are a number of unique retailers around but, there are also many that sell nearly the same thing, those are the businesses that are going to be in trouble. If you dare to go to the mall check out the number of stores that all sell similar clothing like, American Eagle, The Gap, Aeropostale, Old Navy, West 49, Boathouse, Bootlegger, Campus Crew… It’s all the same shit, just a different label.
Here’s another mall staple, The Source by Circuit City - 5 locations in Windsor + 1 in St. Clair Beach + 1 in Amherstburg + another in Leamington. How many of those locations can survive a reset in consumer demand?
So fear not all you anti-big-box, retail-sprawl-haters and consumer-doomers, the end is nigh!
Tags: big box retail, City planning, Malls
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Hallelujah! I would be very happy if more fast food establishments started disappearing from our landscape too.
I thought Pac was supposed to be following this proposal for a few years now. They just let some Toronto developer tear down over 10 homes in Riverside for a new Shopper’s Drugmart, when there was plenty of room for them to expand in their current Shopping Plaza. I thought with the OLD Pac Report and study, they were supposed to study how zoning new land commercial would effect existing commercial before allowing it. This new Shopper’s site was partially zoned Commercial but this council, just a few months ago, voted to allow them to use the residential zoned land for parking. Now there is three empty Shopper’s in this city. Why not waive some of the development fees for some underdeveloped commercial corridors like Ouellette or Pelissier, or possibly reduce the taxes for a couple years and increase them for Toronto developers who are well connected and could care less about what they do to our city. This developer has no long term thought for this site or neighborhood, only a quick buck at the expense of existing commercial and more blight for the neighborhood. They have the property listed for sale before it is even built and months before it is to be occupied. $7 million. I understand their point, they are trying to make money, this is their business. I just don’t understand our elected councillors. What did Windsor gain from this new development, why rezone for them? Surely the negative for the area far outweigh the new tax revenue.
Jason, I think your definition of “blight” is a bit flawed. Let’s get working on the real blight we have in this city before we go adding developments we don’t like to the list.
Is this new Shoppers really an eye sore and safety hazard as, say, the west end boarded up homes?
Jason, your facts are completely wrong.
1. PAC did not allow “some Toronto developer” to tear down 10 homes. It was seven homes and the property owner did not PAC permission to tear down the homes. Just a demolition permit from the Building Department.
2. The developer was not from Toronto. It was Piroli Construction, a local company.
3. Yes, Shoppers could expand in the existing plaza, however, their lease prohibits them from selling food items found in a grocery store. Keep in mind that at one time Loblaws had a grocery store in that plaza, and a requirement of their lease was prohibiting other stores from selling groceries. That is why Shoppers was looking for a new location.
4. Council denied them their request to extend transitional parking into three residential lots. Piroli has appealed that denial to the OMB.
I was hoping that you would be able to straighten out the facts, Vincent. You’re a good guy to have around
Vincent, who are you getting your information from regarding what lease provisions were still on title in that shopping plaza? I was told the same thing by Percy Hatfield, who said he was told by Shopper’s this, but this is false, just to let you know. The owner of the plaza spoke at council to this, so everyone was aware. It was only 7 houses? I thought it was more. Shopper’s fight for a monopoly in this city is not a good thing for the long run in Windsor. In 3-4 years how many of these new Rexall’s will be dark. All I am saying is this report couldn’t be implemented fast enough. I thought similar recommendations were supposed to be impemented a couple years back already.
If my information about the lease provisions are in error, I stand corrected. The rest of my comment stands
I’m not sure how Shoppers would have a monopoly? Rexall is more than just Rexall. It also includes Guardian and IDA. Plus there are pharmacies in several grocery stores and department stores, even Costco. And there are plenty of independents. Shoppers may be visible (much to the chagrin of Chris) but they do not have a stranglehold on the market.
Tony Roma’s at the mall just closed for good.
Jason, keep an ear out for the new development charge by-law that is going to council in the near future. it suggests reduced or eliminated development fees for the cities “mainstreet” areas (it’s BIA’s and surrounding locals)
This will hopefully guide more human-scaled development where we need it. Whether or not it will be appropriate to the neighbourhood (as in all these humungous Shoppers stores) is yet to be determined.
Chris,
While those Shoppers stores may be ‘humungous’ compared to the old Shoppers and Big V stores, Shoppers is filling in that gap between convenience store and grocery superstores.
Agreed, but I just wish they didn’t stick out like a sore thumb in these neighbourhoods.
LOS, The “blight” I was talking about is the empty shells that Shopper’s leaves behind, or that Walmart did or will again when they leave their Dougall Location, not the beautifully stucco’d buildings that they are replacing them with. These will be landmarks for years to come. No, this is for preventing future “blight”. I agree that working on the west end boarded up homes should be up there on high priority as a city, not a new City Hall.
The Source is an ironic example, especially with TWO stores in the same Mall. WTF? Totally wasteful. We remember its predecessor, the Canadian version of “Radio Shack” which had at least twice as many locations in Windsor, albeit smaller stores, and in urban locations (Ottawa street being the last to be mothballed). There was one downtown. And every few miles on Tecumseh road east as well. Dorwin Plaza had one too. You didn’t have to drive far and in sometimes you could even walk to find consumer electronics. Not so today.
That was sort of nice, even though Radio Shack was a chian store.
James,
The Source is no longer owned by Circuit City or branded as such. Bell bought the chain in 2009. If anything, I expect Bell stores to close down and their operations shifted into existing The Source stores.
There is no end. Retail is always a few years behind residential busts. It’s called a cycle.
U.S. Consumer Confidence Tumbles Following January Rally, According to RBC Index
http://tiny.cc/bvMhf
NEW YORK - U.S. consumer confidence cooled this month as worries over every facet of their financial situation mounted, according to the most recent results of the RBC CASH (Consumer Attitudes and Spending by Household) Index. Economic attitudes soured across the board, with consumers viewing the current economy negatively and displaying increased pessimism about the future. As a result, the RBC Index for February 2010 stands at 39.4, down 18.9 points from January’s 58.3 reading.
“Although numerous economic indicators are trending in a favorable direction, it’s evident that ‘less-bad’ is just not good enough for U.S. consumers,” said RBC Capital Markets U.S. economist Tom Porcelli. “This month’s reading suggests that consumers continue to feel financial pressure from recent volatility in stocks and a soft job market.”
The RBC Index is a monthly national survey of consumer attitudes on the current and future state of local economies, personal finance situations, savings and confidence to make large investments. The Index is composed of four sub-indices: RBC Current Conditions Index; RBC Expectations Index; RBC Investment Index; and, RBC Jobs Index. The Index is benchmarked to a baseline of 100 assigned at its introduction in January 2002. This month’s findings are based on a representative nationwide sample of 1,000 U.S. adults polled from January 28 - February 1, 2010, by survey-based research company Ipsos Public Affairs. The margin of error was +/-3.1 per cent.
Highlights of the survey results include:
According to several US sources, one being the Huffington Post, at this time there are 5.1 million Americans underwater with their mortgages, looking either at walking away from the homes or having them forclosed upon, expect retail to dive even farther into the depths of despair in the near future.
Also, after the crash of 1929, unemployment didn’t peak until 3 to 4 years after the crash and then the depression really took off!
James, I agree with you about all those stores selling the exact same stuff but with different labels.
Imagine niche retail downtown concentrated in one area! Similar to a business incubator (wouldn’t the fish market building be a great place to start this?). People would certainly want to check it out to find things that are not available everywhere else.
However with rents so high in downtown (not sure about other areas of the city) because of massive tax rates, it will continue to be difficult to lure any retail.
There’s a spot like that in Walkerville at Wyandotte and Chilver. Ten Thousand Villages et al in an area full of niche boutiques. It seems like Jake Rondot is getting the job done in Walkerville while the DWBIA is spinning its wheels.
Niche retailers don’t necessarily compete with mainstream retailers, they compete with other niche retailers. Given the population and population density of Windsor, there is only so much demand for niche retail.
Commercial tax rates are the same across the City. What you meant to exaggerate, er, say, is “because of massive property taxes”. Property values are higher downtown and that translates into higher property taxes.
Vincent, yur killin’ me.
The Source - I picked out because I know its history and I know there are an awful lot of them in the area. Back in the day when they were Radio Shacks and they sold actual parts to repair electronics you could actually fix and at a time before the internet when HAM radio allowed a person to talk to other HAM radio operators on the other side of the planet - Radio Shack had all the stuff you needed and it kinda made sense to have them located handy for people to get to.
Now, The Source (by Circuit City or Bell, whatever) sells the same crap as Future Shop, Best Buy, Wal-Mart, blah-blah-blah. If retail contracts even a small bit - how many stores selling the same shit can survive?
As for the new Shoppers at Lauzon and Wyandotte. How many grocery/convenience stores are there within a one-mile radius? Within two blocks there is a Mac’s Milk, an independent variety store, Price Chopper and Giant Tiger. The move to create one of their ghastly signature stores does nothing for the neighbourhood in the way of providing something new except creating another empty commercial space (oh and more parking spaces).
Well James, we saw what happened when Aventure Électronique tried to break into the consumer electronics market in Ontario, already oversatured in the ’90s. Dismal failure. They had a good size store on Tecumseh near Walker too. The Future Shop monolith sucked up everything in its path when it came to Windsor.
Well, I can go into a Shoppers and pick up my oldest boy’s medicine and on the way out I can also pick up a few groceries, some other medication and some other supplies. I can’t do that at the Mac’s Milk, the independent variety store, Price Chopper or Giant Tiger. I thought that combining trips was a good thing
I can do the same thing by going to two-three stores within a few minutes walk of each other in my neighbourhood. Obviously we don’t have many corners in Windsor that boast that kind of close-by convenience but maybe we would have more if they stood a chance against the big chains?
We’re pretty well all on the same page here, boys! The regional category-killers are sucking the life and soul out of the community, and the neighbourhood scaled retailers (Shoppers arguably being one of them) that you can actually walk to are adding a level of intricacy to our daily routines.
It’s simply a matter of degrees, isn’t it? Rexall is a Canadian brand and would fit our mold a bit better than Shoppers, but then I will still go to our Walkerville Pharmacy for my meds before any of these. I don’t care how close to ground level these chain stores get, I will still choose to share my $$$ with somebody providing the valuable services I require and also happens to live and pay taxes (not just business and payroll, but personal property taxes as well) in my community. That’s just ticking off more of the boxes on my checklist.
Chris, many Rexall owners do just that. Including mine. I think you are too quick to discount a business’ purchasing relationship with a company like Rexall/IDA just because of some kind of angst over seeing the sign too often. Your pharmacy is three blocks away so it makes most sense regardless, but I wouldn’t boycott it, for example, an IDA sign went up, but the owner/operator remained the same. I used to have the same attitude toward franchise owners too but realized one day it’s just all about the sign. They have to put food on their tables too, just like us, and largely live in our own community. I know I run into my pharmacist constantly - and that can’t be because he sits in a big chair on Bay Street. We should draw a line between putting down suburban big box stores and locally owned franchises that are a valid part of our community’s makeup.
Both Rexall and Shoppers are Canadian brands. Rexall is wholly owned by the Katz Group of Companies and Shoppers is a publicly traded corporation headquartered in Toronto.
The majority of stores in both chains are owned and operated by franchisees (aka as the person who lives and works in the city you live in). The pharmacists at my local Shoppers Drug Mart know us well enough that whenever our oldest son is prescribed a med that is of a serious nature, they always ask if everything is okay with him.
Living in the core, I can only dream of being over retailed! I would consider even being somewhat retailed! So I think l will buy a great big honking car and just drive to my hearts content and shop, shop shop till I can’t shop anymore! Nah!
Except for several things like paint, hardware etc., I do most of my shopping online and have it delivered to my door, rather than spend an hour on a bus to get somewhere - anywhere! Thus not spending my fairly decent civil service pay in the big boxers of Windsor and surrounds.
The other upside is that I don’t fill my place with crap I don’t need not being able to fill the need for instant gratification and not having a car to go and just do it, makes me consider value of each purchase! Like how to get the sucker home!!!!
And to all the Wal-Marts and big boxers, I’ve become a fan of Overstockdotcom!!!!
“nowadays people know the price of everything and the value of nothing,” Oscar Wilde
Here’s an aside to the above discussion: A book and it’s author:
Raj Patel: His website: http://rajpatel.org/
The Value of Nothing
How to reshape market society and redefine democracy
“This is a deeply thought-provoking book about the dramatic changes we must make to save the planet from financial madness” — Naomi Klein. Opening with Oscar Wilde’s observation that “nowadays people know the price of everything and the value of nothing,” Patel shows how our faith in prices as a way of valuing the world [...]
http://rajpatel.org/2009/10/27/the-value-of-nothing/
Wal-Mart, Target seek big returns in small stores
http://www.reuters.com/article/idUSTRE6125PL20100203
NEW YORK (Reuters) - U.S. big box retailers are trying to slim down.
Retailers like Target Corp and Wal-Mart Stores Inc have expanded since the late 1980s by opening stores as large as three U.S. football fields.
In the last few years, they began to plan for smaller stores that fit in urban markets. That strategy is gaining urgency now as retailers look for new growth and seek to meet the demands of a shopper looking to buy and spend less.
Target and Wal-Mart have both told analysts they are creating smaller stores that could fit in the heart of densely packed cities where they have no presence. But analysts warn that creating a small store doesn’t just mean shrinking a big one.
Big box retailers need to whittle their merchandise to suit shoppers who live in smaller spaces, use public transportation and prefer eating at coffee tables to large dining sets.
I dunno, not a big fan of shoppers putting other grocers out of business, or replacing smaller places as they have no fruits or vegetables.
Joke - Did you hear that shoppers is doing bad and closing down some of their stores? Its not that bad as they’re only closing the ones immediately adjacent to other shoppers Drug stores
Does anyone see it coming that eventually shoppers and Rexall will merge, acquire or somehow end that battle with half of the stores closing. Are these larger style units easily convertible to other uses? Kinda big and square, at least if they were rectangular it would be easier to chop up into separate units.
Shoppers isn’t putting other grocers out of business nor replacing smaller places. Besides, plenty of businesses put out other businesses ‘out of business’. It’s called competition. If someone opens a better restaurant then yours, are they ‘bad’?
Rexall and Shoppers won’t be merging anytime soon. Both are large companies with over 1,800 and 1,100 operations, respectively.
They target every small pharmacy in this city. Either they will buy them out, or target them. Most times, when they move this is a move closer to their competion to detroy them. Huron line, right beside Rexall, Wyandotte and Lauzon, I think there is two pharmacy’s across the street, Wyandotte farther west I think they are across from a medical centre with a pharmacy. Mark, I couldn’t agree more with you regarding their big ugly boxes or the ones they are leaving behind or competitors will leave behind. (Very hard to fill, or fill with deep discount store) With respect to their Franchisee’s, they are one year contracts. Hardly any money stays in the city, as most franchisee’s would rather just be a pharmacist than take on the extra work for very little extra pay. The money Shopper’s makes goes to New York, where their real decision makers are, not Windsor. That is where the merger/aquisition will take place. Do you really think Rexall who is owned by a very wealthy Canadian will keep these new Windsor stores open for more than 10 years? None are making money. Maybe the smaller franchised ones beside clinics will, but the rest won’t. They won’t merge because the Katz group has the money to resist a long time and would never in my opinion merge with them. They are beating Shopper’s in a lot of places, just not here. I agree this is none of the City of Windsor’s business, but for the planning issues. We continue to let them have their way. Where is the plan for this?
Stand corrected. I guess when I think about it more, I’d just rather see some of the small convenience stores in the core start carrying more items and even some fruits and veg. You see it in many other downtowns and core areas more than you see it here. Detroit has the same problem.
Actually, I don’t really have a problem with Rexall and Shoppers themselves, I have a problem with some of the site plan control issues that limits connectivity with the street.
Not the issue of Shoppers and Rexall in the least bit.
I’m more concerned that we’re allowing unipurpose buildings that are more difficult to convert to different uses later on.
Thats not a proven fact in anyway, just something I’d like us to think about more. I thought it was actually a big deal in Lasalle when they required the Rexall go right up against the sidewalk and put the parking in the rear.
Thats the kind of thing I’d like to see more, Parking in rear, more walkeable, pedestrian and bike friendly.
Then you better have a chat with Barry Horrobin of the Windsor Police Service, since he is one of the reasons why we continue to have parking lots at the front of commercial buildings on the basis that they provide a more ’secure’ environment for people (ie. rear parking lots are ‘hidden’ and thus more prone to ‘bad’ things).
Why are property values higher downtown when the downtown isn’t the most vibrant place in the city; When the housing isn’t the nicest in the city (nor the most desirable).
It can’t be for the land because there is a lot of vacant property in the downtown area. So demand isn’t there.
I wasn’t exaggerating about taxes in Windsor or the high rent prices. The taxes in Windsor compared to our suburbs is a disturbing trend. I know of a couple of taxes in Walkerville on Wyandotte that rivals T.O. yet the buildings are only worth approx. $200,000 compared to $500,000+.
If Stratford can make a go of their downtown with niche shops (the festival doesn’t run year round and it hasn’t seen the attendance they used to) then certainly Windsor can. Manning Rd seems to have captured some retail that used to be on Ouellette Ave and they still have niche shops. Windsor can too. Because selling the same stuff as at the malls will not bring anyone to the core either.
Dave, I have no clue why property values are so high downtown! We just appealed our taxes downtown and they said it was because of comparable sales. Who is buying property so high when you can’t get a decent return and there is hundreds on the market, I don’t know. We rented a store DT for $1000/month. Taxes $800/month + rent $200/month. Doesn’t seem right does it. Especially when we also had to do some improvements. What improvements did the city do for their $800?
Those are some crazy-assed numbers, Jason! This is what we need to hear more of. Maybe Bosco and Vincent can share with us some concrete numbers of the costs of doing business downtown and what keeps people away, aside from some of the societal issues.
It’s the mill rate and the cost to deliver services.
Toronto’s taxes will seem lower; but they have a broader population base and commercial/industrial sector to spread out the costs - but even there, they are struggling for a variety of reasons granted - but revenues do not match costs.
This is one of the reasons comparing taxes between two municipalities is difficult, I would think. I think it is the BMA Consulting which attempts to compare apples to apples taking many factors into consideration when weighing tax rates between municipalities.
I believe 2009’s BMA report will be posted soon (if it hasn’t already) on the City of London’s website.
Vincent gave an explanation to me a few years back on my blog - maybe he can remind me as I can’t find it at this moment.
The issue in Windsor specifically, is compounded with the collapse of manufacturing and of course, commercial recession. But the costs of providing services hasn’t declined; so the remaining tax base bears a greater burden.
Tecumseh’s rate is rising 3.2%, so a house valued at $200,000 will pay $1,163.40. (Why they always choose a $200,000 house is beyond me) Looking at that number, and knowing my house isn’t worth 200 grand yet I pay over 3 times that amount, you can sort of see why some people are tempted to head east.
Wait till these suburban towns have to have full time fire departments etc.(not so much demand by citizens but by insurance companies). As their population grows the demands on and for services and infrastructure will grow - taxes will have to go up, they just can’t keep sticking their collective heads into the sand, it will be only a matter of time.
Schmitt at the Star wrote about Colorado Springs in his column today. (i saw that on Mish’s blog a few days ago.)
Colorado Springs grew by its proximity to NORAD Command not too far away. As military technology and strategy have changed the town finds itself trying to maintain itself as if it was still 1980.
Tecumseh and Lasalle and the rest of the bedroom communities surrounding the city grew because Windsor was booming, the auto sector was booming and the future was all sunshine and lolipops.
As all the auto money washes out of Windsor the city will have to burden the remaining businesses and residents to keep from finding itself in the same position as Colorado Springs. Our surrounding communities will face new challenges as the costs of their sprawl come due without the continued revenue of “growth”.
It will get more interesting. I suspect as electioneering gets going, secrets of what the real financial situation of Windsor and the county towns will start to come out as candidates and their supporters/rivals try to work over the competition.
You aren’t including the Education and County portions in your Town of Tecumseh example. That is a common error.
The total tax rate in Tecumseh in 2009 was 0.012251 which consists of a 0.005676 municipal rate, a 0.004055 county rate and a 0.002520 education rate.
Based on the 2009 tax rate, a $200,000 house in Tecumseh will pay $2,450.20 in property tax. How does that compare to the property tax you pay in Windsor?
I pay $3,700 for my $180,000 house in Walkerville.
I think part of my explanation was about the impact of regional/county government on taxation.
In Windsor, the taxpayer has to pay for everything. Out in the County, taxes are split between the lower tier municipality and the upper tier municipality. The cost of providing County services such as County roads, libraries and so on is spread over all County of Essex property owners.
So when the County reconstructs a County road in LaSalle, everyone in the County is contributing to the cost of that road. When you have more properties to spread the cost, you can have a lower tax rate (the term mill rate is no longer used).
Toronto is a unique example. And by Toronto I mean what constitutes the current City of Toronto (or the former Metro Toronto). Originally, Toronto and it’s five boroughs were able to shift a good portion of the residential property tax burden onto commercial and industrial property taxes. When Mike Harris became Premier he put caps on industrial and commercial rates. But Toronto also has higher property values and more properties (one benefit of density) it is able to have a lower tax rate.
City comes to agreement with Walmart on redeveloped store
Submitted by Leah Shaffer on February 10, 2010
Link to article: http://tiny.cc/TymTZ
Eden Prairie will start to see some notable improvements to its Town Center this year, starting with a redevelopment of the aged Walmart the sits just off of Singletree Lane.
City staff and Walmart officials came to an agreement (approved by the City Council last week) that will allow improvements to the store while also setting aside funds for streetscape amenities to Singletree Lane.
“You’ll see a lot of aesthetic improvements to the outside of the store and also the addition of the groceries on the inside,” noted Community Development Director Janet Jeremiah.
As part of the change, the city amended its parking requirements so Walmart will actually be taking out approximately 50 parking spaces and adding back green space.
The front of the store will have a new exterior that includes earth tone colors and Walmart’s new logo.
Additionally, the front of the store is intended to be more pedestrian-friendly, while also fitting in Eden Prairie’s planned streetscape lighting.
Walmart will be updating its interiors and adding an additional grocery component to the store. To accommodate this, the store will have an additional loading dock. The city of Eden Prairie and Walmart have been working through this agreement for months. The sticking point was whether the store would agree to join a special service district.
Special service districts
The city has recently been requiring developers within the Town Center area surrounding Eden Prairie Center to agree to join a future special service district. A special service district sets up a taxing district for specific sections of town – it’s a way for businesses in that area of town to share costs of upkeep and/or capital expenditures. Typically it’s something that a certain percentage of businesses within a section of town ask for themselves, but the city had been negotiating agreements with developers that required them to join a special service district at some point in the future.
After hearing concerns from the Chamber of Commerce and following the direction of the council, staff has changed its policy to not require special service district concessions in development agreements. In the case of Walmart, instead of agreeing to join a special service district, it has set up a cash escrow account to cover its share of streetscape improvements to Singletree Lane.
“Streetscape improvements” could include a number of elements, such as expanded sidewalks, ornamental features, pedestrian scale lighting, benches, additional trees and plantings on the walks and median and banners.
According to Jeremiah, Walmart agreed to pay $535,000 for the Singletree Lane streetscape improvements.
“We made some compromises to kind of help them with the affordability of that streetscape,” she added.
One of the compromises was to allow Walmart to keep the existing rear of the store instead of bricking over it. Walmart also will not pay for any streetscape improvement for Prairie Center Drive.
“We will still require that the redeveloping properties pay their fair share of the streetscape either through a special assessment or through a cash escrow like Walmart,” noted Jeremiah.
Eden Prairie residents will start to see some of those improvements as Singletree Lane expansion gets underway this year.
Years ago, there was talk of realigning Singletree Lane to connect to West 78th Street, but that plan has given way to more interim improvements, noted Jeremiah.
This summer, you’ll likely see an expansion of Singletree Lane from Eden Road to Flying Cloud Drive.