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As I drive through the cities, towns and rural areas of the Northeast the number of empty store fronts, retailers and small businesses continue to grow. Similar trends are taking place across the US. With the exception of more affluent areas, many cities, rural areas and working-class towns of modest and lower income have large numbers of empty buildings. The scene is pretty much the same a big box store or two, a grocery store, a dollar store, some fast food chains, a couple of small independent restaurants, consignment shops, pawn shops, a few small service businesses and convenience stores. Everything else is gone along with the jobs and sense of community they helped foster. Declining income among the bottom 50% has resulted in relying more on cheap imports and little of lasting value. Major purchases come from the big box or on-line retailers such as Amazon.
What will become of all the empty retail buildings? Is there a future for physical presence in retail beyond cheap commodity products for low and modest income families?
As I drive through the cities, towns and rural areas of the Northeast the number of empty store fronts, retailers and small businesses continue to grow. Similar trends are taking place across the US. With the exception of more affluent areas, many cities, rural areas and working-class towns of modest and lower income have large numbers of empty buildings. The scene is pretty much the same a big box store or two, a grocery store, a dollar store, some fast food chains, a couple of small independent restaurants, consignment shops, pawn shops, a few small service businesses and convenience stores. Everything else is gone along with the jobs and sense of community they helped foster. Declining income among the bottom 50% has resulted in relying more on cheap imports and little of lasting value. Major purchases come from the big box or on-line retailers such as Amazon.
What will become of all the empty retail buildings? Is there a future for physical presence in retail beyond cheap commodity products for low and modest income families?
Amazon and big box stores have taken over supplying the day in and day out needs of many. We know several families who have a box delivered every month with the basic consumables -- toilet paper, paper towels, diapers, shampoo, dish soap, hair dye... They've figure out the rate that they use these items and have them on a subscription service. We make a monthly trip to Costco to stock up.
Strip malls are filling up with ethnic restaurants and grocery stores, speciality meat and fish markets, nail salons, beauty supply, tax services, computer repair, consignment shops, used book stores, thrift shops...
Indoor malls are gradually being torn down and replaced by areas with restaurants, medical and business offices, and upscale stores.
As I drive through the cities, towns and rural areas of the Northeast the number of empty store fronts, retailers and small businesses continue to grow. Similar trends are taking place across the US. With the exception of more affluent areas, many cities, rural areas and working-class towns of modest and lower income have large numbers of empty buildings. The scene is pretty much the same a big box store or two, a grocery store, a dollar store, some fast food chains, a couple of small independent restaurants, consignment shops, pawn shops, a few small service businesses and convenience stores. Everything else is gone along with the jobs and sense of community they helped foster. Declining income among the bottom 50% has resulted in relying more on cheap imports and little of lasting value. Major purchases come from the big box or on-line retailers such as Amazon.
What will become of all the empty retail buildings? Is there a future for physical presence in retail beyond cheap commodity products for low and modest income families?
Well, I expect the excess buildings will be demolished until supply and demand are better matched. There will still be the same types of retail as before, just not as much in areas that online retailers have taken up much of the business in. But "not as much" is *not* the same as "none at all".
Supply and demand! If people need "x" number of a specific type of retail, the number will trend toward "x", where supply and demand curves intersect. I suspect x is not equal to zero and there will still be brick-and-mortar shopping, just less of it.
Much of the once "hollowed out" inner city near me is now comprised of wealthy flats and condos, museums, hotels, and galleries, and destination boutiques and restaurants. Many of these are in buildings that were boarded-up brothels and gangland shooting galleries not so long ago. A reminder that there is not really all that much new under the sun. Times have always changed. Demolition has rarely been the best response.
Many of the places with dwindling physical retail and businesses are not destinations for the rich and trendy. There are still some jobs in these communities but in many cases there are increasingly more people who are out of the job market, working a lower-paying job or stringing together different part-time jobs. What is being lost is beyond the physical businesses, it is a loss of community. It also diminishes the economic value of the community since more of the dollars spent are outflows.
Many of these businesses failed because hey cannot afford the rents. The landlord will not drop the rent and the business folds. Now the landowners can leave the land and speculate. The landowner pays no to little taxes and can just leave the building and wait until the market picks up. Introduce Land Valuation Tax and he pays the full tax whether the building is full, empty or there is no building on the land. Then he will have to negotiate a rent that will keep the business afloat.
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