Robert Montgomery: The Trouble With Regency Square MallSeptember 1, 2014 8 comments Print Article
It is funny that a writer for the Florida Times-Union can talk about the fact that the Regency Square Mall is largely vacant, but can ignore the large-scale blight and poverty of the Arlington area completely. So thus, a tragedy exists that a large retail space is having a hard time in today's wretched economy, with little thought as to why.
"Where are the Customers?"
The "Tale of Two Malls" story, in one of the city's main sources of news at least in print, discusses the purchase of the mall, the money involved, the fact that a new tenant, a church, brought occupancy up to 15%, and that old fears of the mall being a haven for malcontents is no longer an issue. Clearly this should be enough to bring droves of potential retailers and consumers back to the old mall. Right?
Retailers, restaurants, and other similar enterprises that traditionally occupy large indoor shopping malls have one incentive to occupy such space: access to consumers that can afford the goods they sell. Regency Square is surrounded by several neighborhoods within a convenient commute and the plethora of strip mall surrounding it. As the Time-Union writer correctly reported, the mall, being continually used since 1967, is still in very good shape. But, looking around the area, it is easy to see that much of the retail space is in reasonably good shape as well-- except for one problem: occupancy.
The Regency Square Mall, and other retail space surrounding it, lost many large corporate retailers within a short year of two years from 2007 to 2009. North of the mall up to Merrill Road is full of space built that is now largely vacant, so the question is not whether or not there is enough space in the area for retailers to sell their goods and services. The question is, "Where are the customers?"
Recently, I did a study of the effects of unemployment and poverty in the zip codes surrounding the mall as part of a larger series entitled, "The Trouble With Jacksonville." The greater Arlington/Regency area has three zip codes, 32211, 32225, and 32277, that have a total population of 112,854 people. The percentages of unemployment and people at, or below, the poverty line is as follows:
32211 - 12.4% Unemployed, 19.5% Poverty Rate
32225 - 7.4% Unemployed, 9.7% Poverty Rate
32277 - 10.4% Unemployed, 14.1% Poverty Rate.
(According to the 2011 American Community Survey US Census Dept.)
The averaged percentage of unemployed, between the three main zip codes in the area, is 10.6% of the total population, with 14.4% living at or below the poverty line. This may sound like a drop in the pail, considering the overall population in the area, but 11,962 people unemployed, and 16,250 people at or below the poverty line means a significant enough drop in purchasing power-- approximately $500 to $700 per person a year in disposable income--to close a smaller retailer, restaurant owner, occupying storefront space, or kiosk. By conservative estimates it represents almost $12 million dollars in lost revenue per year to the area because people are simply not able to afford the goods and services.
This little bit of revenue drop due to high levels of unemployment and poverty dramatically affect a market as it cannot maintain or thrive without demand. This loss of demand leads to a further drop in employment within the area, as people go to other areas of the city for employment, spending part of their disposable income there in commute and lunch (if their wages are relatively low), rather than spending it in the area where they live. If this continues, in time a neighborhood with its business districts will decline, falling into blight.
Other factors come into play as well. Larger market places--like Town Center--being relatively near will attract customers who can afford their goods and services, away from older places. So arguably, older malls do need to be competitive in order to keep middle class customers. But avoiding addressing large-scale unemployment and poverty keeps demand limited since larger retail spaces compete for a smaller consumer base. So it's not simply a matter of "creating a better, more attractive Regency Square Mall" alone; it is a matter of creating more people who can afford to support the businesses within it. And that is a role City Hall and our larger media has to creatively address with more than a little corporate welfare, vague puff piece articles and a few speeches at election time.