Developers Eyeing Detroit

[iheartthed]

Aw snap?

Well, whatever you think fits your argument. You know, sometimes these marketing and business types manage to update their statistics more than once a decade.

You are trying to compare this:

http://www.city-data.com/zips/10035.html

To this:

http://www.city-data.com/zips/48201.html

Where do you think city-data gets is information from?

[iheartthed]

Where do you think city-data gets is information from?

Actually, city-data isn't using the ACS estimate, which isn't the actual census data... And as we've already seen so far those estimates were wildly off in most cities...

[Bham1982]

East Harlem is still quite poor. The homeownership rates in East Harlem, and New York City in general, are significantly lower than Detroit. Also, NYC has at least five Target locations that I know of off the top of my head [[probably more than 10 altogether). Most of those were built in areas that were retail deserts, similar to most of Detroit.

You're right that certain census tracts in East Harlem remain poor, because of the presence of public housing towers. Same goes for the South Bronx.

But the difference is that these Targets serve much greater markets than these census tracts. Manhattan has [[by far) the highest per capita incomes in the U.S., as well as [[by far) the highest density.

So you are talking the richest and densest area in the country. The fact that some census tracts proximate to the Targets are extremely poor doesn't seem to negatively impact the sales. I'm guessing folks come from all over to these Targets.

In contrast, Detroit has poor demographics basically everywhere [[relatively low density and low income) and there's little prospect of inner suburban customers patronizing a store within Detroit city limits.

[iheartthed]

You're right that certain census tracts in East Harlem remain poor, because of the presence of public housing towers. Same goes for the South Bronx.

But the difference is that these Targets serve much greater markets than these census tracts. Manhattan has [[by far) the highest per capita incomes in the U.S., as well as [[by far) the highest density.

So you are talking the richest and densest area in the country. The fact that some census tracts proximate to the Targets are extremely poor doesn't seem to negatively impact the sales. I'm guessing folks come from all over to these Targets.

In contrast, Detroit has poor demographics basically everywhere [[relatively low density and low income) and there's little prospect of inner suburban customers patronizing a store within Detroit city limits.

Then why is there no Target in Manhattan below 116th St?

[Bham1982]

Then why is there no Target in Manhattan below 116th St?

I don't know why there isn't a Target in prime Manhattan, but my guess is that it's too expensive for their tastes.

It's the same reason Nordstrom has tried for decades to build a Manhattan flagship. It's crazy expensive in prime Manhattan, and you basically have to throw out your site location template.

Same thing with Whole Foods and its efforts in one Manhattan neighborhood. WF has [[I think) six Manhattan locations, but they don't have a location in the richest, densest Manhattan neighborhood [[Upper East Side).

The NYT asked WF representatives why no Upper East Side store, and they said the ground-floor rents were so high on major avenues on the Upper East Side, that it scared the number-crunchers back at headquarters.

But now Target is building those mini-stores, so I would guess you could see one of those in prime Manhattan. They have plenty of their urban full-size stores in the Outer Boroughs [[Flushing, Forest Hills, Flatbush, Downtown Brooklyn, and a couple in the Bronx off the top of my head) but you're right that it is strange they haven't tried to make it work in prime Manhattan.

[rb336]

But the difference is that these Targets serve much greater markets than these census tracts. Manhattan has [[by far) the highest per capita incomes in the U.S., as well as [[by far) the highest density.

yet the median income is lower than Staten Island. Manhattan has, perhaps, the most skewed income data of any 20 square mile stretch in the country. The half below the median income of 64,000 are WAY below it, the half above are WAY above it. Get into chelsea, murray hill, etc, you get professionals making 90-100 k sharing one-bedroom apartments. get into the LES, East Village, etc, you get families sharing 2- 3 bedroom tenements. it's sick

[Detroitnerd]

I remember when they opened a K-mart in Astor Place in New York. The idea of a K-mart in Manhattan seemed ridiculous. After all, we all got our stuff at specialty stores and at Woolworth's and Duane Reade and such. Would it fly? Surprisingly, it is still there.

I think authoritative statements about what will work and what won't work are often rationalizations after the fact. The fact is, big business and big box stores don't take risks. They go with sure bets. And they thrive on brand identity and pricing, not service or community engagement. It's no surprise their one-size-fits-all strategies work best at major intersections near freeways with plenty of parking and governments willing to subsidize them indirectly, through traffic control and road-building. As for whether these strategies work in urban environments with distinct identities, I'm hardly surprised the large players would rather point to failures and stay away than engage and try tweaking their offerings.

[iheartthed]

I don't know why there isn't a Target in prime Manhattan, but my guess is that it's too expensive for their tastes.

It's the same reason Nordstrom has tried for decades to build a Manhattan flagship. It's crazy expensive in prime Manhattan, and you basically have to throw out your site location template.

Same thing with Whole Foods and its efforts in one Manhattan neighborhood. WF has [[I think) six Manhattan locations, but they don't have a location in the richest, densest Manhattan neighborhood [[Upper East Side).

The NYT asked WF representatives why no Upper East Side store, and they said the ground-floor rents were so high on major avenues on the Upper East Side, that it scared the number-crunchers back at headquarters.

But now Target is building those mini-stores, so I would guess you could see one of those in prime Manhattan. They have plenty of their urban full-size stores in the Outer Boroughs [[Flushing, Forest Hills, Flatbush, Downtown Brooklyn, and a couple in the Bronx off the top of my head) but you're right that it is strange they haven't tried to make it work in prime Manhattan.

Just knowing the travel patterns -- and having been to those Targets -- I don't think they attract many people from downtown. The 116th location might skim some shoppers from the UES, but that's about it. The two Bronx locations are squarely out of the downtown orbit, and I doubt that downtown residents were of much consideration in choosing those locations. IMO, a Target in the center of Detroit is much more likely to attract inner-ring suburban shoppers than the South Bronx Target is to attract Manhattan-ites who live below Harlem.

[iheartthed]

I remember when they opened a K-mart in Astor Place in New York. The idea of a K-mart in Manhattan seemed ridiculous. After all, we all got our stuff at specialty stores and at Woolworth's and Duane Reade and such. Would it fly? Surprisingly, it is still there.

I think authoritative statements about what will work and what won't work are often rationalizations after the fact. The fact is, big business and big box stores don't take risks. They go with sure bets. And they thrive on brand identity and pricing, not service or community engagement. It's no surprise their one-size-fits-all strategies work best at major intersections near freeways with plenty of parking and governments willing to subsidize them indirectly, through traffic control and road-building. As for whether these strategies work in urban environments with distinct identities, I'm hardly surprised the large players would rather point to failures and stay away than engage and try tweaking their offerings.

Yeah, what it's ultimately about, and what a few of the commenters are missing, is that the suburban big box model has run out of fuel and those companies are scrambling for new sources of revenue. The big boxes are tweaking their models and going into the cities because most suburban markets are oversaturated with retail and the urban markets are comparably underserved.

[Detroitnerd]

I can understand why corporate or shareholders would want a conservative investment strategy -- or what they see as a safe, conservative investment strategy. Go with what works. Don't experiment. Try what has worked in the past. That's totally understandable to my mind.

The thing is, corporate and shareholders often don't have a good lock on what's next. Take the example of Zingerman's. When the partners founded Zingerman's in the early 1980s, they went to the banks for capital. The bankers basically said, "A food business? In that part of town? Why should we invest our money in a food business in a part of town that's perceived to be in decline? Where are the customers? We'd be insane to fund this."

So, the partners pulled together their money and went ahead and did it anyway. Within a few years, those aforementioned bankers were saying, "Why hadn't we thought of this?"

Well, duh. That's the one thing conservative investors don't do well: See change before it happens.

[Designerguy24]

I think a Target like the one in West Bloomfield could work.