Tag Archives: suburbs

Ikea as suburban economic engine and sign of suburban change

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The wealthy Indianapolis suburb of Fishers now has an Ikea and the community hopes it spurs economic growth:

When Ikea opens Wednesday, it could alter the character of this northern suburb city from a drowsy residential nook into a dynamic regional shopping mecca. The giant Swedish furniture retailer’s gravitational pull has already attracted other businesses nearby and prompted major highway and road work.

Which is why city officials expect the residents to get along just fine with the new kid. For one thing, Ikea has cache, even if the store is three times the size of a Walmart. For another, Ikea’s guests are quiet and well-behaved. And most importantly, Ikea will contribute millions of dollars to the local economy in sales taxes and in-town spending at other stores…

But for Mayor Scott Fadness and the City Council, the wave of development is the cornerstone to expanding and defining the city. It follows a similarly aggressive flurry of construction just blocks away, across I-69 in downtown proper, now called the Nickel Plate District. Over a five-year period, the city encouraged residential and business development to get people living and working downtown. Two high-rent apartment buildings with first-floor restaurants and shops were built next to City Hall and several high-tech firms set up shop nearby, earning Fishers the reputation as a technology hub…

Ikea asserts, and experts agree, that it’s 44 U.S. stores draw customers from as far as 200 miles, and they spend money at more places than just the furniture store.

It is not enough for many places to be well-regarded bedroom suburbs: many of these communities now want more.

  1. An expanded tax base. Bringing in businesses means more money for local services and a reduced tax burden for residents.
  2. Excitement about the community. Many postwar suburbs have experienced decades of development. Newer suburbs or exciting urban neighborhoods offer new options. How will a high-status suburb stay on the radar screens of people within the region and elsewhere? New development always brings excitement.
  3. A new vision for the future. What will the suburb look like in the 21st century? Can they develop new plans and visions? The postwar suburban era is over; what will these suburbs look like by 2050?
  4. Number two and number three above are linked to attracting young professionals. These are high-status people who can contribute to the tax base, provide employees that high-end employers want, and bring energy to the community.

The moves in Fishers echo those of many other suburbs across the United States. Some, like Fishers, are well-positioned with their wealth and location to take advantage of possible opportunities. Others will pursue some of these options but ultimately lack the ability and/or resources to carry them out.

Another horror film set in suburbia; same old story?

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The new horror film Super Dark Times treads some familiar ground in its story:

Director Kevin Phillips stunning feature debut is true to its title. An unnerving and bleak examination on teen angst, Super Dark Times turns a horrific tragedy into a ticking time bomb of violence. In Brad’s review, he raves, “Super Dark Times is tragedy in its purest of forms, removing the safety blanket from suburbia, tormenting the town with a morbid tale that will leave scars on each and every person who lives there.”…

That Super Dark Times takes place in mid ‘90s set suburbia is fitting; the lack of cell phones and the internet as we know it today meant growing up during this time amounted to boredom. Teen angst and boredom in the quiet suburbs was a recipe for destruction, especially if there’s already an underlying darkness as there is within Josh.

The article then goes on to list other notable horror films set in the suburbs but does not get to the obvious question (at least obvious to me): how many horror films can cover this same ground? There is no doubt that bad things do indeed happen in suburbia and often they feel worse because residents and outsiders do not expect them to happen in the suburbs. After all, that is why many of them moved there in the first place. Yet, more broadly, how many times can it be original or interesting to rehash the typical suburban critique that peeling back the curtain on perfect looking suburban lives reveals pain and horrors? Perhaps each generation has to tackle this issue but the more times a trope is used, the ante is raised on how it is going to stand out this time.

See earlier posts on this topic here and here.

The suburban expansion strategy of Sears in the 1920s

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In an intriguing article comparing the rise of Sears and Amazon, Derek Thompson explains how Sears expanded from a mail-order business to physical stores:

In the early 1920s, Sears found itself in an economy that was coming off a harsh post-World War recession, according to Daniel M. G. Graff and Peter Temin’s essay “Sears, Roebuck in the Twentieth Century.” The company was also dealing with a more lasting challenge: the rise of chain stores. To guide their corporate makeover, the company tapped a retired World War I general named Robert Wood, who turned to the U.S. Census and Statistical Abstract of the United States as a fount of marketing wisdom. In federally tabulated figures, he saw the country moving from farm to city, and then from city to suburb. His plan: Follow them with stores.

The first Sears stores opened in the company’s existing mail-order warehouses, for convenience’s sake. But soon they were popping up in new locations. Not satisfied with merely competing with urban department stores like Macy’s, Wood distinguished new Sears locations by plopping them into suburbs where land was cheap and parking space was plentiful….

The company’s brick-and-mortar transformation was astonishing. At the start of 1925, there were no Sears stores in the United States. By 1929, there were 300. While Montgomery Ward built 90 percent of its stores in rural areas or small cities, and Woolworth focused on rich urban areas, Sears bet on everything—rural and urban, rich and poor, farmers and manufacturers. Geographically, it disproportionately built where the Statistical Abstract showed growth: in southern, southwestern, and western cities.

So what is the equivalent today of the burgeoning suburbs of the 1920s in terms of locations? The end of the article hints at one option:

Amazon, too, will thrive as long as it uses American demographics as a roadmap and takes advantage of new personal technology, like mobile phones for shopping and AI assistants for the home. In the last six months, Amazon has spent $13 billion to buy Whole Foods and its upscale urban locations. At the same time, it has offered discounts for low-income shoppers to become Prime subscribers.

Locating in wealthy communities is an interesting strategy. Other major popular retailers today are following such a model: think of Apple stores (perhaps another reason they cannot truly be town squares if they are primarily in wealthy areas) and Starbucks locations (less exclusive than Apple but still located within reach of wealthier customers or along well-trafficked roadways – see all 11 locations in the wealthy suburb of Naperville). Could we end up with a bifurcated retailing model where the wealthy (and those who can travel to these locations) can shop at a bricks and mortar store while the majority of Americans primarily shop online? This might be an overlooked edge for Walmart at this point: Amazon may rule online but Walmart stores, like Sears, are where many more typical Americans are and it may take some time to switch loyalty.

Millennials seek suburban homes and SUVs

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Recent data shows several consumption patterns among Millennials:

Generationally speaking, the stereotype of millennials as urbanites falls flat when it comes to homeownership. The Zillow 2016 Consumer Housing Trends Report found that 47 percent of millennial homeowners live in the suburbs, with 33 percent settling in an urban setting and 20 percent opting for a rural area.

Millennial homebuyers do wait longer to buy a first home than did previous generations. But they are skipping the traditional “starter home” and buying larger homes that were previously considered the norm for “move up” buyers…

Erich Merkle, an economist with Ford, says that as millennials cross the threshold into family life, they’re buying large SUVs.

“We expect them to carry on as they age with three-row SUVs and likely go larger simply because they need the space to accommodate children that are now teenagers or preteenagers,” he said.

That combination so emblematic of 2000s consumption – the suburban big home (a McMansion?) and SUV – may be back. On one hand, perhaps this is what millennials are used to or they think they should aspire to. On the other side, consuming these objects can draw criticism. Did Americans learn anything (housing bubble, reliance on cheap oil)? Do they understand the consequences of these purchases (a commitment to sprawl and consuming more than they need)? How could they make such uncool choices (compared to dwellings in hot urban neighborhoods or acquiring cooler vehicles)?

Perhaps this suburban driving culture will continue for a long time…

Unusually successful experiment: the CTA Yellow Line

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The CTA Yellow Line to Skokie was constructed in the 1960s and quickly became a success:

The proposed transit test brought together a unique trio: a federal agency looking to improve transit, a city rail system experimenting with expansion, and a suburb grabbing at the chance to maintain a rail connection to the city. Funding for the concept was split between the three parties—$349,217 came from the Department of Housing and Development, $1,837,415 from the CTA, and $37,193 from the village of Skokie. At the conclusion of a two-year test, the parties would figure out next steps…

After one day, the CTA logged 3,959 riders, and almost immediately added weekend hours. By early 1965, 6,000 riders a day rode the Swift (the CTA estimated that the service removed 1,000 cars a day from the highway). The CTA logged more than 3.5 million rides during the two year test period, and by 1967, the passenger load had grown 170 percent from already-high 1964 numbers, hitting a record high that year of 8,150 riders a day. Chairman DeMent told the Chicago Tribune that it was “a perfect example of how good rapid transit can induce motorists to leave their cars at home.” Not only did the service prove itself, it made a profit of $216,717 on revenues of just under $800,000 in its first two years of operation. At one point, the Feds actually asked for $250,000 of their funding back.

This success didn’t necessarily lead to much change across metropolitan areas:

In short, the experiment wasn’t replicated. As some writers at the time noted, other Chicago suburbs could have set up similar lines, and even had the abandoned rail lines to do it; the Chicago, Aurora, and Elgin Railroad, which ran through western suburbs such as Wheaton and Glen Ellyn, lay dormant beginning in 1961 (to be fair, the line was eventually turned into the Prairie Path, a wildly successful rails-to-trails conversion). In the late ‘60s, Skokie voters rejected a bid to apply for a federal transportation improvement project.

Perhaps most importantly, during a period of highway expansion and urban renewal, the money wasn’t there, and additional capital for building such systems from scratch was hard to come by. Just look at the 1967 federal transportation budget. Of the $5.35 billion spent, only $160 million, or 3 percent, went to transit. As Joe Asher, a writer for Railway Age, wrote in 1968, “the streets and highways of U.S. cities suffer arteriosclerosis, the urban population chokes on auto exhaust, and one downtown after another gets chopped up to make room for new spaghetti-bowls of highways.”

It is hard to convince suburbanites to use mass transit unless it has significant advantages compared to driving. The Yellow Line to Skokie seems to offer such advantages: a relatively short ride with Skokie right outside the city, a big parking lot, and a fast train. But, could this work further out from the city? What if the train was a slower commuter train or a bus? Or, if parking was hard to find in the suburban lot?

Rather than seeing the Yellow Line as a model to follow, perhaps it is difficult to replicate. That does not mean cities shouldn’t attempt similar efforts – we have a good sense of what building more highways leads to – but they should be realistic about what is possible.

Not so fast: turning suburbs into cities

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One way to revive America’s cities may be to adapt to increasing densities in Americans suburbs:

But this analysis also misses something important. These trends don’t just represent people’s moving decisions — they also represent changes in the places themselves. If enough people move to a low-density area, it becomes a high-density area.

People are pouring into Dallas and San Diego. So unless those cities continue to sprawl ever farther out across the countryside, the new arrivals will increase density. People will want to live close to their jobs instead of enduring hour-long commutes. Apartment blocks will spring up where once-empty fields or single-family homes stood. Today’s fast-growing suburb is tomorrow’s urban area.

In other words, the great urban revival might not be ending, it might just be relocating. Instead of piling into existing cores, Americans might simply be creating new ones across the country. And if each of these new cities creates the productivity advantages enjoyed by places like San Francisco and New York City, this could be a good thing for the economy.

This is an intriguing concept: some suburbs, because of their popularity, willingness to build taller structures, and population size, might become like cities. This has already happened to some degree in a number of suburbs across the country.

Yet, just because a location has a certain number of people or reaches certain population densities does not necessarily mean that it feels or operates like a city. We also already have some denser urban areas – see the Los Angeles suburbs which are pretty dense compared to many metropolitan areas – but that does not automatically make them cities or urban. What is required? Most American cities have: a core or multiple cores that are multi-use and include a good number of businesses or offices; a walkability that extends for a good distance (beyond just a suburban downtown or large shopping center) and mass transit options to extend beyond the core(s) – in other words, good options beyond operating a car; a vibrancy and diversity that could range from thriving economic activity to restaurants and bars to filled public spaces; and an identity among residents and others that the area is a city.

Imagine Naperville, Illinois really wanted to become a city. It starts approving dense residential and commercial projects throughout the community. (Just to note: the local government has rejected these in the past.) The population ticks upward past 200,000 or even 300,000. There are still some pockets of single-family homes and vestiges of small-town life. How long would it take for the conditions of a city as discussed above arise? How would the community adapt to having so many businesses along I-88 rather than downtown? Would this limit the number of people who ride into Chicago on the Metra each day? (Naperville right now has the busiest stops in the whole system.) How would a city atmosphere develop? This all would take significant time and effort and perhaps decades before Naperville would be considered from both the inside and outside a city.

A new suburban Walmart comes with tax revenue, crime, and economic development

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How exactly does a new Walmart change a suburb? Here are at least a few factors to consider:

From its opening day to June 30, 2017, officers responded to 445 calls for service at Walmart, 166 of which resulted in arrests, according to records obtained by the Daily Herald. That means police were called to the store an average 1.2 times per day in its first year…

Walmart announced in 2012 its plans to close an East Dundee store and build the Carpentersville supercenter less than three miles away, prompting a lengthy legal battle between the company and the two villages. Walmart is expected to receive $4.3 million in tax increment financing funds ­– property taxes above a certain point in the area that would have gone to local governments — for the new store…

Though he declined to disclose specific sales numbers, Rooney said the new Carpentersville store has generated more sales tax revenue than East Dundee reported losing…

Already, the supercenter has significantly increased traffic and economic interest on the village’s east side, he said. Plans are moving forward for constructing a new five-tenant building and an O’Reilly Auto Parts on the store’s outlots.

To be honest, many suburbs cannot afford not to welcome Walmart into their communities. It is rare to find a user for a decent sized portion of land along a major road that will bring in so much tax revenue and provide jobs. The increase in crime can be chalked up as simply part of doing major retail business (I assume there may be bumps with other major retailers or shopping malls) and may not be a huge issue if it is largely isolated to the Walmart site.

In the long run, there are additional factors to consider including the local business climate with the behemoth Walmart in town (more competition for certain businesses), the opportunity cost of what else might have operated on that site, and the image of having a Walmart and related businesses. There is a reason more exclusive communities turn down big box stores and large strip mall areas. Furthermore, the fate of East Dundee could soon befell Carpentersville; if Walmart eventually wants a better deal or a bigger store, they can simply move and bring their benefits (and problems) to a different suburb.

As I suggested above, given these short-term and long-term outlooks, most American suburbs would choose to welcome Walmart. From whence the Walmart came does not matter while the tax receipts can be blinding to many.

The nuisance of Apple’s new HQ vs. it can help double your property values

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This article details the complaints of neighbors of the new Apple headquarters facility in Sunnyvale yet ends with this tidbit about property values:

Some worry that the neighborhood of mostly single-story homes built in the 1950s and ’60s is living on borrowed time as long-time residents sell their homes to newcomers.

Housing values in the neighborhood have doubled since 2011, according to Art Maryon of Intero Real Estate Services. And in the first six months of 2017, 24 houses in Birdland sold on average at $1,690,350, according to Maryon.

The increase in property values mirrors what has happened in the rest of Sunnyvale, and across the Bay Area, but Birdland’s proximity to Apple Park makes it even more desirable.

“Many say we should just be happy that Apple is raising our property values,” said Birdland resident Debby MacDonald. “This doesn’t do me much good unless I plan to sell. And I am not sure what we have had to put up with and will continue to put up with is worth the money.”

This presents suburban residents with quite the dilemma: will NIMBYism or raised property values win out? Both are goals for the average suburbanite. They resist significant changes to the character of their community as this can disturb their quality of life through altered scenery, increased traffic, and a change in neighborhood activities. Ultimately, the changes may lower property values. Yet, this massive headquarters may change their neighborhood and significantly raise property values since it houses many employees and is home to one of the most desirable brands in the world.

Someone needs to make sure to follow up on this in a few years or ten years and find out how many residents are left. And even if they cash out – some because they want to and others because they have to (increased housing values can also lead to other increased costs) – those who leave might feel a real sense of loss.

What is the best single marker of being a suburb?

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Spurred by yesterday’s post on Alaska’s changing suburbs, I put together a list of the most important markers that indicate whether an American community is a suburb roughly in order from the most important to less important:

  1. Proximity to the big city. If you are within the social and economic orbit of the big city (and this can differ based on the city as well as on the size of the big city), the community is a suburb. This is more vague on the outer edges of the metropolitan region.
  2. A physical layout dominated by roads and relatively spaced out single-family homes. (This may describe some urban residential neighborhoods but I would suggest the homes there are typically closer together and there are often additional transportation options.)
  3. An exclusivity toward undesirable residents and businesses. Suburbs have different socioeconomic levels but there are typically groups that are not as welcome and there are a variety of techniques to keep them out.
  4. A moral order built around the autonomy of individual residents as long as this doesn’t hurt the property values of other residents and a lack of social conflict because neighbors generally leave each other alone (unless they choose to interact through common interests – such as kids in school).
  5. A community emphasis on middle-class family life. This may be more aspirational than reality (whether it involves wealthier residents who claim to be just middle-class or working-class or poorer suburbs who distinguish themselves from poor urban neighborhoods).
  6. Additional physical markers including roads lined with shopping malls, strip malls, fast food restaurants, and big box stores as well as a lack of walkability.
  7. Homogeneity across residents. There are plenty of suburbs today that are not this way but American suburbs are still often perceived as white and wealthy.
  8. An emphasis on local government as community members seek to control their own lives.

It is hard to separate out these factors as many can be found in other geographic settings or are traits of American culture at large. Yet, the combination of these factors leads a unique social setting that can be defined and measured.

Alaska suburbs to become less Alaska, more suburban

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Changes are coming to the suburbs of Alaska:

PALMER, Alaska — For years, pet owners in this Anchorage suburb of big homes and lawns have fretted over snares set in the local parks by fur-trappers going after fox, lynx and rabbits. But in a quiet revolution this spring, dog lovers got the upper hand, and after a series of public meetings where few trappers showed up to fight back, trapping was banned by the borough council. The suburbs had won.

“That part of old Alaska is moving further out into the bush,” said Mike Albright, 44, a business owner who was lounging at a park with his three dogs on a recent afternoon. “It’s a good thing.”…

But many longtime residents, writers and businesspeople here said that the sense of “only in Alaska” exceptionalism underlying this place and its identity for generations is fading. Improvements in communications and transport are shrinking the sense of physical distance. High-speed internet is reaching tiny villages, opening communities and families to greater connection with the outside world for everything including social media and commerce.

Sadly, the rest of the article says little more about suburbs and instead looks at the whole state and the Alaska spirit. Yet, it is interesting that this nature-human interchange is used an example of how the suburbs are changing. This comes up occasionally with American suburbs across the country as some suburbs encroach on natural habitats while other places experience natural adaptation (such as overpopulations of deer or the reemergence of coyotes).

This could also lead to helpful questions of how people would know that Alaska suburbs are truly no different than other American suburbs. Cookie-cutter subdivisions? Little to no open land? A landscape dominated by single-family homes and driving? An emphasis on middle-class family life and excluding those who don’t fit those categories? Given that suburbs today take many forms, it may not be very easy to say Alaska suburbs have finally crossed the line.