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Possibly. Everything retail though comes down to money. It's basically a simple formula based on potential sales and loss. Maybe their forecast showed Philly upside potential is far below that of the cities you listed. Regardless, still a shame they decided to pass on our city.
An outfit called the Ludwig Institute for Shared Economic Prosperity, which defines its mission as "help[ing] achieve shared economic prosperity for all Americans, particularly for middle- and low-income families," has a bunch of local analyses that analyze how well middle-income families can live in the 50 largest US metros (specifically, how much money they have left over after paying for necessities).
Their metrics differ significantly from those used in stories about unemployment, cost of living and median income; their metric for "unemployment," for instance, includes not only those not working or in search of work but also those working at jobs that pay less than the poverty level (what might be called "underemployment" in news stories). You should visit the LISP's website to see how they define the various metrics.
Anyway, what's useful to this discussion is the chart that breaks down the percentage of the metropolitan population in low-, middle- and high-wage occupations and shows the area figures relative to the national median percentages across all 50 MSAs. The Philadelphia MSA figures [PDF] are illuminating here: the share of the local workforce in low-wage occupations (jobs where two workers still cannot earn enough to meet the basic needs of a family of four) is 36.4%, 0.9 percentage points above the median percentage for all 50 MSAs, while those in middle-wage occupations (where both adults can meet the basic needs of a family of four on their wages or salaries) account for 50.9% of the total, 3.1 points above the 50-MSA median. Those in high-wage occupations (where it takes only one worker to cover the basic needs of a family of four, the old "breadwinner" model of the 1950s and much of the 1960s) make up only 12.7% of the total, a good 6.5 points below that median.
IOW, this region doesn't have as many households with that kind of mad coin to spare after getting by as many of our peers do.
An outfit called the Ludwig Institute for Shared Economic Prosperity, which defines its mission as "help[ing] achieve shared economic prosperity for all Americans, particularly for middle- and low-income families," has a bunch of local analyses that analyze how well middle-income families can live in the 50 largest US metros (specifically, how much money they have left over after paying for necessities).
Their metrics differ significantly from those used in stories about unemployment, cost of living and median income; their metric for "unemployment," for instance, includes not only those not working or in search of work but also those working at jobs that pay less than the poverty level (what might be called "underemployment" in news stories). You should visit the LISP's website to see how they define the various metrics.
Anyway, what's useful to this discussion is the chart that breaks down the percentage of the metropolitan population in low-, middle- and high-wage occupations and shows the area figures relative to the national median percentages across all 50 MSAs. The Philadelphia MSA figures [PDF] are illuminating here: the share of the local workforce in low-wage occupations (jobs where two workers still cannot earn enough to meet the basic needs of a family of four) is 36.4%, 0.9 percentage points above the median percentage for all 50 MSAs, while those in middle-wage occupations (where both adults can meet the basic needs of a family of four on their wages or salaries) account for 50.9% of the total, 3.1 points above the 50-MSA median. Those in high-wage occupations (where it takes only one worker to cover the basic needs of a family of four, the old "breadwinner" model of the 1950s and much of the 1960s) make up only 12.7% of the total, a good 6.5 points below that median.
IOW, this region doesn't have as many households with that kind of mad coin to spare after getting by as many of our peers do.
Interesting you say that. Income data for large metros has Philadelphia in the middle of the pack and often in better shape than "peer" regions. (https://www.lisep.org/localanalysis).
For example, below are 2022 totals for 3 income stats, I grabbed some of the biggest metros and ordered them by median income for a family of 4...
Data in order:
1. Total Cost of Necessities for a 4-Person Family, 2022:
2. Median Income, Family of 4, 2022
3. Surplus/Deficit Family Income after Cost of Necessities, 2022
San Fran: $116,563--$203,046--+$86,483
Washington DC: $100,563--$172,064--+$71,507
Boston: $115,612--$170,724----+$55,112
Seattle: $106,919--$164,868-----+$57,949
New York: $109,708--$142,246--+$32,538
As you can see, the Philadelphia region performs well, and not far off the usual top suspects.
I don't think Zara pulling out has anything to do with area incomes (Zara is not high-end and already operates several stores in the burbs). I think it has to do with Philadelphia (city) specific issues, whether it be crime, absurdly high rents, potential risk versus return, etc.
And on the spending topic, my friend works for the parent company of luxury jeweler Van Cleef & Arpels (the brand recently opened a store in KoP), and he said the new KoP store has far exceeded sales expectations and is among the brands highest grossing US stores. So there is money to be spent in the region...
LOL... you don't think lawlessness and rampant looting was the main factor a retail shop didn't drop millions to open in a market where that would very possibly be their fate? That seems like a massive deterrent to me. And I'm sure it wasn't just one video that sparked the decision. The unrest in Center City is well documented and has made national news. The leadership team probably sat down with their Finance and Legal heads and decided the risk/reward was not smart. They can open anywhere they want. You think they want the expense, grief and potential employee liability that comes with semi-regular looting and violence?
Of course I think crime is a factor. I just don’t buy that an international store like Zara would see a viral video and then email the next morning saying they’re pulling out of discussions for a potential lease. A lot more would go into making that decision.
Of course I think crime is a factor. I just don’t buy that an international store like Zara would see a viral video and then email the next morning saying they’re pulling out of discussions for a potential lease. A lot more would go into making that decision.
That's a good point. Business executives are probably a bit more logical in their risk-reward analysis than the average crime p*rn connoisseur. It probably has a lot to do with the ongoing viability issues faced by brick-and-mortar retail, viability issues we see at a national level, not just in Philadelphia.
An outfit called the Ludwig Institute for Shared Economic Prosperity, which defines its mission as "help[ing] achieve shared economic prosperity for all Americans, particularly for middle- and low-income families," has a bunch of local analyses that analyze how well middle-income families can live in the 50 largest US metros (specifically, how much money they have left over after paying for necessities).
....
IOW, this region doesn't have as many households with that kind of mad coin to spare after getting by as many of our peers do.
Yeah, I'm questioning the methodology/data that LISEP is using. That doesn't seem to add up, given my read of recent American Community Survey data.
As of the recent estimates, the Philly metro is in the top 10% of 392 metro areas with regard to the highest percentage of employment in "white-collar" occupations (what the Census classifies roughly as Management, Business, Science or the Arts). These occupations account for ~48% of all jobs in the Philly area, ranking 29th.
And corresponding to that, the percentage of households earning more than $200,000 annually also puts the Philly area in the Top 10% of all metro areas (~15% of households in the metro area, also ranking 29th--pretty much only behind the other big Northeast Corridor metro areas; Seattle, LA, and the Bay Area on the West Coast; and the big tech hubs of Austin and Denver).
That doesn't even normalize for COL, which cpomp was alluding to, which is clearly much more in Philly's favor compared to anywhere else in the Northeast or West Coast.
All that to say, "disposable income" is definitely not lacking in the area.
Of course I think crime is a factor. I just don’t buy that an international store like Zara would see a viral video and then email the next morning saying they’re pulling out of discussions for a potential lease. A lot more would go into making that decision.
Philly has the 4th highest volume of foot traffic in the US behind NYC, Chicago, and Boston which is why I (unfortunately) do think something like this may have been the deciding factor. I do acknowledge that there are flash mob videos from random stores getting hit in DC, Chicago, LA, etc. like every other day though.
Great news this is opening. However, while I’m not trying to be negative, we’ve known about this and Vuori for a while. We haven’t had an announcement of a new store opening on Walnut in a while now and there are several vacancies. I hope we’re not entering into a cycle where more places are closing than opening.
The West Elm closure and the Barcade (in a very large space on the ground floor of a major office tower complex, no less) opening are emblematic of the wider trend for at least three years: actual retail selling goods is clearly troubled and purveying food, alcohol, and activities related to generational Peter Pan syndrome are ascendant downtown. Yes crime has accelerated this and the city’s entrenched taxes and other fees have continued to make the city less appealing for some residentially and commercially. The mayor has to make viable retail a priority as a well as directly going after significant employers to relocate to or locate anew to Center City. It’s great that we excel as a residential downtown; but this is a big city and we need to work harder to ensure the core grows employment in a diverse set of corporate services. The commerce director should spend a great deal of time actively courting companies along 202 or in Conshohocken, for example, to move into town. Even the ones that left for those places. Of course delivering actual needed fiscal and service provision reforms is hard work that often goes by the wayside.
The West Elm closure and the Barcade (in a very large space on the ground floor of a major office tower complex, no less) opening are emblematic of the wider trend for at least three years: actual retail selling goods is clearly troubled and purveying food, alcohol, and activities related to generational Peter Pan syndrome are ascendant downtown. Yes crime has accelerated this and the city’s entrenched taxes and other fees have continued to make the city less appealing for some residentially and commercially. The mayor has to make viable retail a priority as a well as directly going after significant employers to relocate to or locate anew to Center City. It’s great that we excel as a residential downtown; but this is a big city and we need to work harder to ensure the core grows employment in a diverse set of corporate services. The commerce director should spend a great deal of time actively courting companies along 202 or in Conshohocken, for example, to move into town. Even the ones that left for those places. Of course delivering actual needed fiscal and service provision reforms is hard work that often goes by the wayside.
This may or may not make a difference, but have you been following the news from San Francisco?
Another trend that has hit downtowns all over the country, but San Francisco's especially hard, is companies adopting either hybrid or fully remote work. (The publisher I work for is one of the latter; we gave up our Center City offices one year ago.)
This means that significantly less office space is being consumed, even by companies whose workers still come into the office on a regular basis. As leases expire, companies are giving back some of the space they occupy, which leaves more empty space on the market.
This may well be something we can't recruit our way out of. And in that case, our large downtown residential population becomes a safety net, especially as they work from home rather than walk to work (something a full third of Center City residents used to do).
Those residents are keeping our downtown from becoming the ghost town San Francisco's has become. (And San Francisco isn't the only city whose downtown has become a ghost town. The same can be said of my hometown of Kansas City, Mo.)
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