Article Sent to Jim Dyer by W.W. Goodman Regarding the Possible Effects the Addition of the Mall Could Have on Downtown

Article Sent to Jim Dyer by W.W. Goodman Regarding the Possible Effects the Addition of the Mall Could Have on Downtown

This is an article that William W. Goodman sent to Jim Dyer regarding the possible shopping center to be constructed at the fairgrounds. The article highlights the possible diminishing effects that this establishment could have on the downtown shopping scene.

The actuial article highlights a proposed shopping center at the "Meadowlands" less than 10 miles from Downtown Newark, NJ and about 5 miles from Jersey City. It reflects upon how this shopping center could impact the downtown businesses within these cities.

October 1980

The Region's Agenda

Journal Volume X, Number 1

English

Text

;
W I J U L I A M W. G O O D M A N

10/28/80
Dear J i m
Many o f the arguments i n t his report a pply
to

the p ossible Shopping Center at the

Fair Grounds - and its effect on our own downtown s hopping

area.

Thought you w ould be interested i n r eading
this!!!!!!

\l

Volume X, N umber 1

THE REGION'S AGENDA

October 1980

IMPACT OF PROPOSED MEADOWLANDS REGIONAL SHOPPING CENTER ON S URROUNDING CITIES
Statement of Regional Plan Association in Response to: "The Urban Impact of the Retail Component of
Berry's Creek Center" by Gail Garfield Schwartz, a Consultant's Report to the Hackensack Meadowlands
Development Commission on the Proposal to Build a Large Regional Shopping Center in the Meadowlands,
Less than 10 Miles from Downtown Newark, about Five from Journal Square in Jersey City

The Schwartz report leaves the whole issue of the size
and composition of Berry's Creek Center e xactly
where it was. Its i nformation does not answer any of
the questions which led Regional Plan Association
and m any others to ask for public debate before the
Hackensack M eadowlands Development Commission
approves and facilitates construction of a major
regional s hopping center at Berry's Creek.
As an "urban impact" analysis of the proposed Berry's
Creek shopping center, it fails because it considers
only the e ffects on existing retailing, not on the
eventual revival of New Jersey cities that the Governor
has pledged. And, as an analysis of the effects on existing shopping areas, it fails because ( 1) the conclusions
are based on i nsufficient d ata and (2) a key e lement
isn't q uantified at all: how m uch sales loss can be sustained by a store, a shopping cluster or a regional mall
before it has to close.
The real issue is: What can New Jersey cities become
if the leverage of State policy supports their revival—
as promised by the Governor. This report seems to
accept the c ontinued drain of the mainstream of New
Jersey's economy from its cities.
Who Will Lose What Sales?

Even the question the report does address remains unanswered objectively: What will be the effect on retaM-_
ing surrounding the Meadowlands of a regional sho
ping center at Berry's Creek? There are m any subjecti
conclusions, but no hard answers. The report itseu testifies:"... Berry's Creek C enter... will be a shopper
goods facility" (furniture, clothing, general merchandise), but "to q uantify f he distribution of such expenditures . . . of the residents of each community,
over all the m ajor accessible malls and all the other
options, including the local option, is not possible,
given available data." In other words, the report cannot answer the question asked.
Though stating that regional shopping centers are
irrelevant for another kind of retail trade, "convenience goods" (i.e., food, gasoline, stationery, hardware, etc.), the report devotes several pages to analyzing convenience goods sales, concluding that: "At
least 98 percent of the present proportion of local
residents' expenditures on convenience goods should
be retained by these communities, as a group, despite
Berry's Creek Center." It is not at all clear how such
a precise figure can be calculated for convenience
goods and not for shopper goods. In any case, the
precision turns out to depend on policy: the report
recommends that supermarkets be excluded from the
regional shopping center at Berry's Creek to be sure
that existing convenience goods stores in the m arket
shed are not severely a ffected! So again, the plethora
of n umbers leads to no objective answer to the
question addressed.
We do learn two very significant relationships from
the numbers of the report, neither of them stated in
the t ext:
1. There will be a net decline in aggregate real-dollar
retail expenditures of residents in the study area
over the foreseeable future. Therefore, whatever
dollars are spent at Berry's Creek stores have to
come out of dollars now being spent at existing
stores in the area.
2. In order to be profitable, the proposed Berry's
Creek shopping center will have to take in about

$200 million in sales per year in 1977 dollars. This
is equal to about 20 percent of all shopper goods
expenditures of all the people in the s tudy area,
according to c onsumption patterns revealed in the
research done by Regional Plan Association for the
Regional Accounts s tudy (Indiana University Press,
1980). It also equals about 20 percent of all shopper
goods sales in the s tudy area in 1977. In other words,
shopper goods sales and spending on shopper goods
by residents in the study area are about equal now,
and the proposed Berry's Creek shopping center
will have to take in a bout 20 percent of t hat amount
to be p rofitable! So it is conceivable that the total
sales of Berry's Creek, in the net, would be drained
from the d owntowns and neighborhood shops
within the s tudy area. But even if the report's suggestion is t rue that a considerable amount of the
sales diversion will be from Willowbrook Mall, both
Regional Plan's and the report's figures point to
the probability that at least two-thirds of the Berry's
Creek sales will be s hifted from M eadowlands area
downtown and neighborhood shops, not from existing regional malls.
The effect of a loss of 13-20 percent of total shopper
goods sales from the study area is not objectively
described in the report. For example, the report raises
the question of whether the loss in sales to Berry's
Creek Center "would encourage the s hutdown of
Bamberger's" in d owntown Newark. After an array of
numbers about who now shops where, there is no
answer. More disturbing, there is a deceptive answer
about the i mpact on clusters of smaller shops. The
report shows how fragile is the health of local shopping clusters: "Because small businessmen and women
are likely to go out of business more frequently than
chain stores, . . . vacancy rates in local areas are
normally . . . about 10-15 p ercent... at any given
time. The danger point is 20 percent vacancies for over
one year." So, if Berry's Creek shopping center drives
just 5-10 percent of local stores out of business, a
local shopping cluster could be destroyed-with real
estate tax e ffects for the municipality. This vulnerability of local shopping clusters is u nderplayed in the
report by concluding that 20 percent of the stores
have to be driven out of business by the Berry's Creek
shopping center to endanger the whole cluster when,
in fact, it is only the 5-10 percent difference between
normal vacancies and the 20 percent vacancy danger
point.
What is missing from the report is any indication of
the sales loss for each type of store that might threaten
its continuance. Would, for example, the six percent
decline in sales at W illowbrook, suggested by one of
the report's tables, result in stores closing? Might
enough stores close to m ake the whole mall shut down
eventually, with serious real estate tax consequences
to Wayne?
The report provides soothing but very subjective
assurance of minimal effect from building 1.5 million
square feet of shopping and perhaps more. (The
report recommends unconstrained growth of the shopping center and suggests it should be larger than now
being considered.) The work days of employees in
some existing stores might be decreased a little, some
profits thinned, with no effect on real estate taxes,
according to the report. Assuming Berry's Creek will
have good public transportation and substantial office
growth, the report implies its choice: a shiny embryonic new downtown is b etter than strengthened cities.
But in the face of the cataclysmic results of not

s trengthening New Jersey cities, the report poses as
the reason for favoring shopping centers their great
convenience for people with cars. (Dr. Schwartz might
argue t hat it is not her choice of p arking convenience
vs. strong downtowns but the public's; but she did
not h esitate to propose restricting the p ublic's convenience in h aving s upermarkets in Berry's Creek
Center to p rotect neighborhood stores. Is the v iability
of cities a less important goal?)
The r eport argues that a s hopping center near the
Region's Core is p referable to regional malls farther
out of the u rban center. With that, the contenders in
the M eadowlands dispute could doubtless all agree.
But t here is an a lternative. Promising efforts by N ewark c orporations, both to enlarge office j obs downtown a nd redevelop near-downtown neighborhoods,
suggest t hat concerted public-private-civic e fforts
could begin to m ake downtown Newark a vital center.
That is true, also, of other New Jersey cities. The report's negative evaluation of N ewark's potential is
backed by no f acts whatsoever. Nor is its assertion
that retailers d on't w ant to locate in d owntowns. Huge
new shopping centers i n d owntown White Plains a nd
Stamford belie that, as do n umerous recent news reports and c onversations of retailers with Regional
Plan staff members. Now is the t ime for a concerted
drive to restore the m ainstream of the A merican
economy and society back through our cities.
It is not enough to brush off the p otential of New
Jersey cities, saying that people d on't w ant to locate
there right n ow. If New Jersey is to ignore the Governor's promise of city revival, we should have some
vision of what will happen to the cities instead. Are
they to become even more the backwaters of the unwanted? Second-class opportunities for city residents
seem to be accepted by the report when it observes
that many Newark and Jersey City residents don't
have automobiles to go to s uburban malls nor enough
income to support good stores in the cities. That is
precisely our a rgument for recentralizing retailing
downtown. Unless middle-income people participate
in city downtown activities, there will be neither
adequate public transit to give the poor, old and
handicapped mobility n or a dequate opportunities f or
jobs and services in them.
The report's a rgument that Berry's Creek is within
easy reach of city residents and therefore good for
them implies that it will have public transit convenience and f requency competitive with what downtowns could provide if revived. In research for the
U.S. D epartment of T ransportation, Regional Plan
identified the factors most conducive to support for
public transit: a large compact downtown surrounded
by housing in w hich the density starts high near the
center and tapers off from there, i.e., the p attern of
cities not shopping centers. Nor w ould Berry's Creek
ever have the mix of activities that downtown Newark
already h as—for e xample, $350 million of new higher
education institutions near downtown and a teaching
hospital, Symphony Hall, the best reference library
in the S tate and the N ewark Museum.
In Sum
Altogether, the study is far from assuring that the ratio
of b enefits to costs of Berry's Creek Center for the
State of New Jersey will be substantial. Nor does it
deal with the basic question: should New Jersey develop in and on its cities or continue to t urn its back

THE
REGION'S
AGENDA
REGIONAL PLAN A SSOCIATION
235 East 45th Street
New Y ork, New York 10017

on them and leave them forgotten b ackwaters-with
lessening o pportunities for those who m ust remain
there and a bandonment of any h ope of restoring centers of civilization, excitement and creativity for all
New Jerseyans?
Regional Plan Association draws from the r eport the
conclusion that the net gains of such a s hopping development are far too small to w arrant its a pproval, at
least until much more effort has been made to revive
New Jersey cities and their d owntowns, as the State
has proposed.
Some Examples of Contradictions Resulting From
the Subjective Nature of the Report

1. "Limiting the size of Berry's Creek Center might
limit its d rawing power enough to discourage
tenants, b ut not enough t o assure t he s tatus q uo
in e xisting local retail areas." T herefore, the conclusion: d on't l imit the Center's size. But this
sentence follows t he c onclusion that Berry's Creek
Center, as proposed, w ill not seriously a ffect local
retail areas. So w hat does the quoted sentence
mean?
2. P ublic "support of one t ype of d evelopment" is
approved even if it "may reduce the economic
feasibility of o ther developments." That "is preferable to a completely free market where the p ublic
has no control over the e nvironment, the aesthetics,
the spill-overs, or the costs." (This is an a rgument
for g overnment assistance to retailers to compete
with Berry's Creek Center when it is b uilt.) In
another place, the report opposes public i ntervention to control "the size, type, number, or q uality
of shopping center merchants . .." as "generally
unsuccessful." The report itself suggests a c ontrol
on t ype of store: "the HMDC in m anaging the development" should "separate any s upermarkets in
Berry's Creek Center from the m ajor retail center,
so t hat the s upermarkets are accessible only to
Berry's Creek Center residents and not to p atrons
4 e ntering the c enter for comparison shopping purposes." So c ontrolling the type of store seems
promising on page 24, but likely to be u nsuccessful
' on page 54 when a d ifferent conclusion is desired.
And, despite t he p reference f or p ublic intervention
on page 56, page 24 suggests it w on't work: ". . .
consumers in a densely built up area such as the
(study area) have so m any shopping opportunities
that public policies cannot push customers from
one area to another."
Next Steps
This consultant report was one of two c ontracted for
by the Hackensack M eadowlands Development Commission in response to concerns expressed by the
Governor's Cabinet Development Committee about
the possible e ffects of M eadowlands development on
surrounding areas. The second s tudy-on transportation implications of the M aster Plan for the M eadowlands—will be completed shortly. We assume that
both the Commission (200 Murray Hill Parkway, East
Rutherford, N .J. 07073) and the Cabinet Development Committee (c/o Donald Linky, Director, Office
of Policy and Planning, Governor's Office, State House,
West State Street, Trenton, N.J. 08625) would be
interested in your c omments on t he reports, available
at the Commission.
(c) Regional Plan Association, 1980

Non-Profil O rg.
U. S. Postage

PAI D
NEW Y ORK, N. V .
PERMIT NO. 3 554

Mr. W i l liam Goodman .
p
President
8-77
Shepard's Moving & Storage S ervice
32 Henry
Eethel, Connecticut 06801