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Why some national retailers won't locate in urban areas

Marc Lefkowitz  |  03/06/06 @ 11:26am

Rebuilding in city neighborhoods and first suburbs such as University Circle, Cleveland Heights and Shaker Heights requires developers with knowledge of issues such as environmental remediation, building at higher densities, and, in the case of commercial retail, finding anchor tenants. Anchor tenants are large operations that attract lots of shoppers who also patronize smaller stores in the district. 

Developers looking for anchor tenants have increasingly turned to national chain operations. This has presented something of an issue for commercial districts in University Circle and the Heights because national anchor tenants usually look at two things in the area when deciding if they will locate - household income and highway access. 

Household income is usually determined by drawing concentric circles (1- 3- or 5 miles) from the location and taking an average of the income inside. (Sometimes the market area circles become ovals or other interesting shapes to capture a certain demographic or ignore another). Highway access in the Heights has been limited since the late 1960s when residents defeated an effort to extend the I-490 highway from E. 55th to the Shoreway (it would have torn through Shaker Lakes).

All of this is to say that word has reached us, from a Coventry Road merchant, that talks with Trader Joes to fill the vacant Medic space have stalled because the national chain demands highway access to its stores.

We wonder if Medic building owner Michael Montlack realizes that ODOT is moving forward with plans to build a 'highway' (actually a six-lane boulevard) from I-490 through the Central neighborhood to University Circle?

Can it be argued that this so-called Opportunity Corridor is the highway access that Trader Joes and other national chains desire for the Heights and University Circle?

It may be that Trader Joes isn't the right retailer for Coventry, and that a local, specialty food operator fits better with the independent spirit of the district. Maybe the definition of what or who is an anchor tenant needs to be re-thought in urban redevelopment?

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