In Part 1, I gave readers the Executive Summary of the Tabb Report. Part 2 was Market Overviews. Today we continue with a Discussion of Parity:
The eastern half of the City of Greensboro has a total of 8 shopping centers. Overall, Greensboro has 93 shopping centers.
"V Discussion of Parity
The Economic Overview of the City highlighted the economic and educational deficiencies of East Greensboro.
• Lowest projected population growth (1.6%)
• Highest poverty rates
• Median HH Incomes of $21,617 versus $42,927
• Largest decrease in home ownership
• Lowest residential rental rates
• 11 of 16 public schools are in the process of working to improve their overall performance
These are conditions that cannot be ignored and in many ways set the foundation for the concerns regarding parity.
Three key metrics for increasing the presence of retail and other
service amenities in a trade area are 1) household median income levels,
2) the number of households and 3) the level of daytime population.
With the exception of daytime population levels, East Greensboro ranks
low in the metrics when compared to the other trade areas. Daytime
population for the overall East Greensboro study area (28,671) is
greater than any trade area except Lawndale (42,545) and East Market
Street, which is in the study area. The East Lee Street
trade area’s daytime population (57,175) is the highest in the entire
city. The number of households and household incomes are the greatest
hindrance to East Greensboro’s attractiveness to retailers. The study
area has the lowest number of households and the lowest median household
income.
What drives these low household numbers is the key to identifying the
solutions. In order to increase the presence of services and retail, the
number of households must increase and the income levels within those
households must increase. This means a focus on jobs, schools and the
quality of housing stock. Household median income projections are a very
important part in determining consumer expenditure
projections.Essentially, researchers work off the idea that people spend
a set percentage of their income on retail purchases; therefore, the
higher your median income level, the higher the consumer demand is
projected to be.
A review of the demand projections for Greensboro shows that only E. Lee
and Burlington have lower projected consumer demands than E. Market,
and all three are in the East Greensboro study area. On the other side
of this issue is expenditures. Only Wendover, Lawndale and Green Valley have higher actual sales than East Greensboro.
Lowest demand, yet highest sales? This is a contradiction that would
often be explained by the presence of high levels of quality retailers
that are the beneficiary of other area’s retail expenditures (the
recipient of leakage). Clearly this is not the case in East Greensboro.
So why does this contradiction exist?
Three reasons:
1. The residents of East Greensboro spend much more money in their
community than researchers believe. They actually could spend a
disproportionate portion of their income than their counterparts do in
other trade areas. The reality is many expenditures are often fixed
costs, and cannot be valued down due to a lack of income. Examples are
gas, basic clothing and food.
2. The research is simply wrong. Lower income areas spend more than
researchers believe. There are many more residents in the trade area
than researchers account for. This can include undocumented renters and
service related income generated, but not reported, such as tips, side
work, child care, etc...
3. Transportation from the study area to other trade areas is very
difficult, meaning more dollars stay in the trade area due to the
resident’s inability to exit the trade area.
Transportation is a very interesting, yet well known issue for East
Greensboro. While the area has good local road access, and should be the
centerpiece of several attractive entrances into Greensboro, its
connectivity through interstates and major roads is perhaps the worst in
the City and effectively cuts off access to the entire eastern and
northern part of the Greensboro. E. Cone’s ability to connect to E.
Florida (through Nealtown and Ward) and I - 840’s ability to connect
from the southeast are both needed to improve access from and to the
east and make the east an attractive retail environment. Without
adequate access, the east will never be considered a destination area."
As you can clearly see, things are very much out of balance. And while
many claim crime and poverty are the major reason as to why East
Greensboro lacks shopping, the study shows otherwise. Could it be that a
lack of interest in East Greensboro has pushed crime rates higher?
In Part 4 I'll present the study recommendations.
