Shopping evolution: Downtown, suburban areas adapt to retail decline
Strolling through the York Galleria on a Friday afternoon, Springettsbury Township resident Andrea Clark had just finished an eye doctor appointment and admitted she hasn't been to a mall specifically to shop in a couple of years.
Clark, 34, said she used to shop at malls when she was younger, but she tends to shop online now unless she's looking to buy big-ticket items such as furniture.
"It's just easier and more convenient," she said.
Large retail chains have taken a public hit during the past few years, with numerous well-known companies announcing store closures throughout the country.
Retail chains are closing stores as employment in the field drops in an otherwise growing economy. Can York County shopping centers adapt in time?
Consistent with national trends, retail trade employment is declining in York County, down nearly 7 percent (1,700 jobs) from February 2008 to February 2017, according to state Department of Labor and Industry statistics.
The county's total nonfarm jobs are up about 0.5 percent (700 jobs) during that same time frame, and Jeff Newman, a statistician for the department, pointed out that growth number is likely weighed down by a decline in manufacturing jobs that outpaces retail trade jobs.
Newman also added that York County appears more reliant on retail jobs than the rest of the state. In 2008, retail jobs accounted for more than 12 percent of total employment in the county and 11 percent in the state. Those numbers dropped to about 11 percent and 10.5 percent in 2017, respectively.
Michael Niemira, a retail economics expert based in New York City, said the country is seeing something of a return to the heyday of the mail-order catalog, which helped serve the retail needs of customers in suburban and rural areas during the early 20th century.
Instead of the catalogs, less populated areas are now increasingly being serviced by online retailers, Niemira said.
Niemira said estimates he's seen suggest one employee working for an internet retailer would be able to generate the same amount of sales as five employees in a brick-and-mortar store, thus resulting in a negative impact on net retail jobs.
Newman pointed out that the decline of retail jobs has seemed to coincide with more warehouse and distribution jobs.
Downtown revitalization: Kevin Schreiber, president and CEO of York County Economic Alliance, said York County is seeing an evolution of retail centered on customer convenience.
Previously York City's director of community and economic development, Schreiber noted that mass store closings throughout the country mirror the exodus of major retailers from downtown markets to suburban areas beginning in the 1950s.
That mass exodus left many cities, including York, with deteriorating, vacant storefronts that diminished the tax base and decreased employment opportunities in urban areas.
York City is just starting to recover from many of those major retail stores departing. The former Bear's department store, which closed in 1977, has been converted into One Marketway West — a mix of office space, a restaurant and apartments.
RSDC is finishing up construction on the former Weinbrom Jewelers building, which also has been converted to a mix of retail, restaurants and apartments.
RSDC also owns the former Woolworth's department store, which has been vacant since 1996. Dylan Bauer, vice president of real estate development for RSDC, said the company is planning a mix of retail and apartments in that building, but they're moving more slowly because they're having to greatly reduce the size of the first floor to draw interest.
Construction on the building — the first floor is being reduced from nearly 15,000 square feet to 2,400 — is expected to be complete by April 2018, Bauer said.
Schreiber said the retail pendulum seems to have swung back toward downtown shopping areas.
Niemira agreed, adding that densely populated urban areas will always have a big enough customer base to support physical stores.
Debbie Bailey, manager of business services for Downtown Inc, said 13 new businesses have opened in downtown York this year, with another nine set to open in the near future.
"People seem to like the opportunity to shop in specialized niche markets more," Bailey said. "They can focus on what they want as opposed to a lot of different products ... and shop owners are very passionate about their products."
Bailey pointed out that people enjoy the experience of being downtown, with a variety of options in a small, walkable, outdoor space.
Suburban adjustments: Some struggling suburban retail centers have looked to mimic that atmosphere to avoid the vacant storefronts that plagued downtown areas.
Spurred by numerous store closures, including Macy's, the enclosed West Manchester Mall has been transformed during the past couple of years into the West Manchester Town Center.
The York Galleria in Springettsbury Township remains an enclosed mall but is in the process of diversifying its offerings.
JCPenney, one of four original anchor stores in the mall, closed in early 2015, and that vacancy will soon be occupied by Swedish clothing company H&M and Gold's Gym, with some space still available.
CBL and Associates, which bought the Galleria in 1999, owns many other enclosed malls throughout the country.
CBL spokeswoman Stacey Keating said large department store closures actually present great opportunities for mall owners because those businesses often own those properties, meaning the mall owners get little or no rent.
"When they exit, we're able to turn it into more revenue-generating space," she said.
Rising retail store closures have led to CBL adding more dining, entertainment and lifestyle options in its malls, Keating added.
Keating admits malls and physical retail locations are facing headwinds — CBL has sold or has been looking to sell 18 of its "lower-tier" malls since 2014 — but she said that doesn't mean the entire industry is doomed.
"It just means that some retailers haven't made the necessary adjustments to a customer-first mentality and integrating in-store and online experiences," she said. "It's important for us to continue evolving to create an experience you can't get online."