Category Archives: DANTH

The Apparel Niche and the Home & Hearth Niche: The Growing Importance of Independent Operators

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Introduction

The apparel niche and the home & hearth niche may seem unrelated, but they share several commonalities:

  • They are both particularly important to downtowns
  • They are both facing challenges, and
  • They will both be relying on the success of independent operators for their future well-being and growth.

Apparel

First, let’s consider apparel. This niche is important to downtowns because women are our most prominent and powerful shoppers (making 80% of the purchases for the home and family). And clothing, shoes and accessories purchases for themselves and their children are an important part of women’s purchases. As we’ve reported in previous blasts, time-pressured mothers are willing to accept higher prices from downtown vendors if they can shop quickly and easily close to home. In addition, a successful apparel niche adds diversity to the downtown mix and stimulates interest in strolling and window shopping.

But apparel has been an at-risk niche for the past two decades. While the industry has grown, it has grown at a pace much slower than other retail sectors. Additionally, major retailers like Ann Taylor, the Gap and Chico’s – the kind of trophy apparel shop that many downtowns have targeted as their dream tenants – are not opening new stores as they suffer reduced sales in a difficult economic climate.

What to do? We all know of downtowns where there is more than sufficient unmet demand for apparel within a ten-minute drive shed to support a new store with $300,000 to $400,000 in annual sales. Such revenue may be too low for a national chain, but very adequate for an independent operator.

These new merchants will need a great deal of support from the downtown organization in finding affordable space, negotiating leases and perhaps even “sourcing” their merchandise. To succeed it will help that these merchants:

  • Be a local resident – for instance, a local mother – with a network of friends and colleagues in the community
  • Represent and market to a specific and strongly populated ethnic group in the community
  • Be opening a very high-end shop that provides an exceptional level of pampering and customer service
  • Be able to solve the problem of sourcing attractive merchandise

In many instances, an independent operation apparel niche is not going to be recognized or realized without the proactive intervention of a downtown organization. Your organization can help foster such a niche by:

  • Having market research performed to identify opportunities
  • Indentifying and cultivating possible entrepreneurs
  • Helping the entrepreneurs form a viable business plan, find appropriate affordable space, find loans or investors, etc.

Home & Hearth

For decades, revitalization advocates have searched for a type of retailing that can thrive in downtown locations despite the presence of nearby malls and big box discount retailers. DANTH has found that home and hearth niches are very often the answer.

Home and hearth niches are groups of shops that feature goods and services that enable shoppers to make their homes more comfortable, more entertaining and more beautiful. They include retail establishments selling furniture, carpets, antiques, table top goods, window treatments, hardware, electronics, art works, picture frames, tiles, appliances, kitchen and bathroom equipment, plumbing supplies, telephones, and gardening equipment. This niche can also include architects, plumbers, carpenters, contractors and service firms that deal with lawns and septic tanks.

Usually, the firms in this niche are overwhelmingly independent operators or small regional chains. They usually don’t need vanilla box spaces.

The home and hearth niche is very dependent on the housing market and the niche’s current economic woes have traced the decline in home values. But DANTH believes that demand for this niche’s products and services soon will begin to grow as consumers start to put more money and attention into fixing up their current homes instead of buying new ones. Home Depot and Lowe’s have already pivoted their marketing in this direction. Economic conditions have also sent Americans into more “cocooning” in their homes which is leading to strong sales of flat screen TVs and other home theater accoutrements.

Plus, the long-term trend for this niche is very good, showing that businesses in the home and hearth sector have grown at a pace greater than GAFO in eight of the last ten years for which data are available. DANTH expects that as the current housing crisis is resolved and household formation again rises, sales in home and hearth stores will follow suit. Now, as the market is bottoming out, is a good time for downtown organizations to strengthen or build their home and hearth niches.

Another positive for this sector is that downtown organizations will need to do less work in attracting and building this niche than with an apparel niche – since less home and hearth business owners are “newbie’s” to the industry. The downtown organization can take on a more traditional business recruitment effort without having to provide the large amount of business development assistance that independent apparel operators will require.

This posting was condensed from my longer report by Mary Mann. To read the full report on Apparel and Home & Hearth Niches, visit www.ndavidmilder.com.

Downtown Retail Part II: The Nexus of Time Pressure, Proximity, Convenience and Customer Service

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In recent postings I have detailed how retailers, over the coming five years, will be facing an environment in which shoppers, especially those in the middle-income bracket, will be having fewer discretionary dollars to spend and consequently inclined to give more weight to low price in their purchasing decisions. In this posting I argue that downtown retailers will best handle these trying circumstances if they understand and exploit the nexus of time pressure, proximity, convenience and customer service. Even in an economic environment where price is a leading factor, downtowns and downtown retailers can compete when they offer the time-pressed local shopper the proper convenience and customer service. Time pressure is what is making proximity again a powerful downtown asset.

Time pressure: Americans are more time pressed than ever and this is changing our society in many ways, sometimes subtle, other times not. Major golf outings are down 33%, major cultural centers like the Metropolitan Opera are shortening performances and intermissions to satisfy the modern customer who demands “express entertainment” and health clubs are offering 30-minute “drive-by” workouts for the busy-but buff-body. The most time-pressed group is working mothers with young children. One way these mothers are creating time for themselves is by spending far less time shopping, especially traveling to and from malls. Another is outsourcing food preparation through take out, sit-down and prepared meals. Time pressure is making consumers look for shopping opportunities close to home. It also inclines them to “satisfice,” i.e., to buy merchandise that is “good enough” in terms of quality and/or price, which sometimes makes it easier for downtown merchants with limited assortments to compete.

Proximity: Downtowns have always been closer to the typical residential shopper than that super-regional mall, but, as we all know, the allure of the mall with its vast retail selection, sea of parking and low price points has siphoned off downtown customers for decades. Now, time pressure and convenience (and gas prices to fill that gigantic SUV) are making downtown appealing again. Back in the 1970s, people might pile into the car for a 10 a.m. to 3 p.m. day at the mall – it was considered a leisure trip. This is not the case anymore.

Convenience: This means making visits quick, easy and, if possible, enjoyable. Time in and out is fast and/or well spent; products are easy to find. But can convenience compete against low prices in an economic crunch? Yes, if the other three factors of Time Pressure, Proximity and Customer Service come into play. Studies show that convenience can often beat price when it comes to household necessities like food and drugstore items. Even Wal-Mart, Home Depot and Sears are experimenting with smaller store formats to speed up the shopper experience – including self-checkouts. Downtown retailers with their intimate size are already there – but don’t hide the milk at the back of the store! Consumers get aggravated when they realize they are being manipulated and are losing precious time. Convenience also means that the entire downtown shopping district is quick and easy to navigate – busy streets are easy to cross, parking is well-marked and available, public toilets are provided and are user-friendly for moms with young children, etc.

Customer Service: This means providing customers– through personal services — a quick, easy and enjoyable shopping experience. There are numerous ways to achieve this including letting customers shop after hours, knowing their names and their favorite products, sending them birthday cards, providing cappuccinos, offering gift wrapping and delivering their purchases to their homes so they don’t have to carry them around town. Big boxes cannot compete on the same level (or they haven’t tried – yet!).

Downtown merchants can seldom compete on price, but they, alone and organized, can hit home runs on convenience.

For the full report on “The Nexus of Time Pressure, Downtown Proximity, Convenience and Customer Service” visit www.ndavidmilder.com after May 1, 2008.

This posting was written with the inestimable assistance of Mary Mann.

Downtown Retail? Part II: Downtowns Will Be Effected To Different Degrees

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The first installment of this retail trends assessment argued that it was very likely that over the next five years retailers would be facing a situation in which consumers would be having significantly fewer discretionary dollars to spend. The first installment also argued that the resulting increased importance of price in consumer decisions would enhance the attractiveness and strength of price-driven value retailers while decreasing the appeal and strength of retailers who offered shoppers opportunities for “trading up.”

However, there will be some variation in the ways that downtowns encounter stressful economic conditions.

A. Regional Economies. There will be significant variation by state – and by region within states – based on their housing markets (not all are tanking), foreign exports (now hot), agriculture (now hot), auto industry (now cold), etc.

B. Shoppers’ Household Incomes. DANTH’s analysis suggests that downtowns in market areas dominated by middle-income households may be stressed more significantly than those that rely on shoppers from either low-income or high income-households.

Downtowns With Lots of Low Income Shoppers.1 In a very interesting piece of research, Cox and Alm have shown that households in the lowest income quintile have a surprising amount of spending power that is far greater than their taxable incomes: though their average household income in 2006 was $9,974, the average total for household expenditures for consumer goods was nearly twice that, $18,153.

Household income correlates with household size. Factoring for this and looking at consumption per person, the difference between the richest and poorest households is just 2.1 to 1, while the income differential between the richest and poorest households is close to 15 to 1. 2

Quite astonishingly, Cox and Alm found that: “The average person in the middle fifth consumes just 29 percent more than someone living in a bottom-fifth household.” 3 This may help explain why, in addition to their population density, “poor” neighborhoods often have bustling shopping districts where merchants can have surprisingly high sales per square foot – e.g., $1,300 PSF.

Cox and Alm explain the surprising purchasing power of America’s poorest households by their financial inflows. They claim that, on average, these lower-income families have access “to various sources of spending money that doesn’t fall under taxable income” amounting to $10,716 per year.4 Cox and Alm claim that the sources of these financial inflows “include portions of sales of property like homes and cars and securities that are not subject to capital gains taxes, insurance policies redeemed, or the drawing down of bank accounts.” DANTH believes that for the many mired in poverty other “financial inflows” may be involved and that substantial portions of these monies may not be very dependent on the business cycle.

DANTH’s review of the Cox and Alm data suggests that only about 16% of the consumer expenditures made by low income families are for discretionary items. This means that 84% of their expenditures are for items that are everyday necessities and for which their “demand” is rather inelastic.

Many downtowns and large urban commercial districts located in low and moderate income neighborhoods are also buttressed against stressful economic times because they have a number of economic functions that must be performed whether the economy is running hot or cold. Among these functions are hospitals, schools, government offices, courts and transportation facilities. Their employees and the visitors they attract are important customer bases for local retailers.

Dart Westphal is the president of the Mosholu Preservation Corporation in the Norwood section of The Bronx (NY), which is dominated by low- and moderate-income households. The local economy is heavily influenced by Montefiore Hospital and has a vibrant commercial district along Jerome Avenue and Gun Hill Road. Westphal feels that his commercial district is not effected adversely by recessions as much as other districts because:

“Hospitals are counter cyclical or at least more resistant to economic slowdowns than other sectors. In the first place people don’t get sicker or less sick depending on the business cycle and our “customers” are not usually making a purchasing decision they can put off. Put another way demand for hospital services is not elastic. Secondly, as other parts of the economy slow down and prices flatten or decline, the ability of institutions to spend money buying and building things may actually increase, helping the area in general maintain economic stability. Local retailers benefit by continuing to have customers (hospital employees) who have jobs. Also at the ‘inexpensive’ end of the residential market there is less purely discretionary spending so that the money that is in the economy is weighted more heavily to basic necessities…not many people trading up to Gucci.”5

Downtowns With Many Wealthy Shoppers. As one observer has noted, there are:
“…Consumers who will buy …regardless of recessionary woes, the kind of folks, who, to paraphrase a WWD headline a few days ago, are more concerned with getting their high heels wet waiting in a drizzle outside of Chanel’s couture show, than they are about this ‘thing’ called a recession.” 6

While this quote may be somewhat hyperbolic, most retail analysts agree that the consumer behavior of the nation’s wealthy shoppers will not be strongly curtailed by the current stressful economic conditions. Some cite households with incomes above $150,000/yr as the income threshold for such recession resistant shopping behavior.

A review of the following statistics from Cox and Alm indicates why the consumer behavior of the wealthy is so resistant to economic downturns. The top quintile of households earned an average of $149,963 in 2006 and spent a total of $69,863 on food, clothing, shelter, utilities, transportation, health care and “other categories of consumption.” The remainder of their income was spent on taxes, $23,376, and most significantly, savings and investments, $47,171. Indeed, among the top quintile of households, all consumer expenditures – discretionary and non-discretionary – represents roughly 47% of household incomes. The same figures for the middle and lowest quintiles are 77% and 182%.

Downtown retail districts such as Rodeo Drive (CA), Madison Avenue (NYC), Greenwich (CT), Wellesley (MA) and Palm Beach (FL) may expect relatively undiminished levels of affluent shopper traffic.

Many “luxury” retailers also developed significant merchandise lines and sales channels that targeted middle income shoppers wanting to “trade up.” They are now being squeezed to the degree that their trading up sales contributed to their bottom lines. They probably will continue to be stressed as long as middle-income shoppers feel they have declining discretionary dollars. These “mass luxury” retailers are often located in strong, revitalized downtown commercial centers such as Westfield (NJ), Englewood (NJ), Old Pasadena (CA), Bethesda (MD), etc. that have lots of upper middle income shoppers.

Downtowns With Mostly Middle Income Shoppers. The first installment of this retail trends assessment detailed the increasing constraints on the discretionary expenditures of middle-income households and noted the importance and susceptibility of dual income households with children. At this point of the analysis it is useful to clarify the implications of this finding for downtown retailers and their downtown organizations.

Working on this assessment DANTH has concluded that:
• For the vast majority of downtowns, dual-income middle class households with children are a very important potential consumer market. They represent a lot of the spending power in a downtown’s trade area. The working women in these households are their most important potential shoppers.
• This has been the case for about 20 years
• Although a few individual merchants in a downtown may succeed with this strategically critical market segment, most downtowns have failed to make local shoppers from dual income households steady retail customers.
• The relatively few downtowns that have successfully developed a dual income female shopper customer base – e.g., Westfield (NJ) and Englewood (NJ) – have been shining examples of downtown retail revitalization
• It is noteworthy that, currently within the downtown revitalization community, there seems to be agreement that the best strategy for revitalizing a downtown’s retail base is to have multi-use redevelopment projects that bring in young professionals (a.k.a. yuppies or the “walking wallets’) and the empty-nesters. When this strategy works the yuppies and empty nesters help create an array of retail offerings and a shopping environment that then can attract shoppers from dual income families
• The yuppie-empty nester-mixed use retail revitalization strategy takes a lot of time to implement, requires large financial investments and usually entails enduring grueling local government permissions and approvals processes
• Strategically, what most downtowns need – especially those that are small and medium sized– is a strategy for attracting the working mommy shopper that is cheaper, quicker and less expensive than the yuppie-empty nester redevelopment strategy.
• Such a strategy will help many downtown retailers and their downtown organizations to cope with the current tough economic conditions.

The pursuit of such a strategy will serve as a filter in the remainder of this assessment.

In our consulting assignments and in our visits to downtowns across the nation, DANTH has observed that in most small and medium-sized downtowns that have successfully attracted working mommies there are other operations that provide merchandise and services for children – e.g., schools; apparel, toy and hobby shops; dance and martial arts studios, etc. These downtowns also tend to have non-retail functions such as entertainment and “pamper” niches that generate traffic retailers can feed on. These observations will provide another filter in the discussion that follows in later postings.
——————————-
ENDNOTES:
 1. A caveat: This analysis does not claim or imply that our nation’s poor face anything other than dire and unacceptable economic conditions. However, in our assignments in Jamaica Center (NY), Fordham Road(NY), Downtown Brooklyn (NY), Norwood (NY), West New York (NJ), Elizabeth (NJ), etc., we have found vibrant low to moderate –income, ethnic shopping centers with surprising total retail sales. We believe this analysis helps explain why those districts are strong.
2. W. Michael Cox and Richard Alm, “You Are What You Spend,” New York Times, February 10, 2008
3. Ibid.
4. Ibid.
5. Dart Westphal, President, Mosholu Preservation Corporation in an email communication.
6. “Fashion Notebook: The Luxury Market, The Recession and What Marketers Can Do About It.” WWD is an acronym for Women’s Wear Daily, a fashion industry paper. Article Here.

 

DOWNTOWN MOVIE THEATERS WILL BE INCREASINGLY IN PERIL

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Our Lustrum Trends Assessments.

For the past 20 years, about every five years (a lustrum) DANTH, Inc. has engaged in a review of the social, economic and political trends that are — or soon will be– affecting the health and well-being of downtown, urban neighborhood and Main Street commercial districts. We do this because it is an essential asset when we work on any kind of revitalization strategy for our clients.

Being a curmudgeon, I must also strongly opine that being aware of these trends and their potential effects is an essential component of any district manager’s job. Unfortunately it is a job function that too many managers ignore.

The results of DANTH’s last trends assessment in 2003 are available free of charge at: https://www.ndavidmilder.com/pdf/trends_3_25_05.pdf

Below is a “tease” excerpt from the first installment of the 2008 assessment.

Downtown Movie Theaters Are Very Vulnerable.

Downtown movie theater closures are bad news because:
• They are usually important downtown assets
• Closed cinemas are usually large, highly visible spaces, occupying considerable frontage and consequently a huge negative for a downtown’s image. It is also usually very hard to re-tenant an empty cinema — too many stay vacant for numerous years, often for decades. Some of the conversions, e.g., bingo halls and flea markets, are often less than desirable for spaces having prime locations and large size.

Movie theaters are in an increasingly weakened position because:
• Their hold on adult audiences is small and diminishing. By a five-to-one ratio Americans view films more at home than they do in movie theaters. Move theaters account for only about 12% of the movie industry’s revenues.
• Even the most frequent movie goers prefer home viewing
• Many theaters have low operating margins based primarily on revenues from concession stands and screen ads. Just a small drop in the paid attendance can be devastating financially: a mere six percent drop in attendance in 2000-2001 put most of the theater chains into bankruptcy.
• A relatively modest reduction in paid attendance by a small group of frequent moviegoers could easily erase these meager margins. The frequent movie goers do not have to completely stop visiting movies theaters for the impact to be devastating. This is an important point.
• The frequent movie-goers have demographic characteristics that highly correlate with the use of computers and other electronic home entertainment equipment
• Many theaters lack amenities such as many screens, large screens, first run films, stadium seating, clean restrooms and theaters floors. This is especially true of cinemas in small and medium-sized downtowns
• Theaters provide a very small revenue stream for the major movie studios. Consequently, the studios are incentivized to make decisions that will help other film distribution channels although they may hurt the theaters

Rival Home Film Distribution Channels Are Poised To Grab Market Share.

Competing film distribution channels have been improving, many finding formulas that are aimed straight at the three key variables that most impact film viewer behavior — convenience, film selection and cost:
• On-demand cable TV has great convenience, wide household penetration, competitive prices and indications that some large operators will be offering significantly greater film selections. The introduction of HD broadcasts will also improve product quality and enhance competitive strength
• Apple TV and Vudu have a strong films service formula that could really grab market share if they can offer sufficient film variety. They, too, already offer on-demand convenience and competitive prices. Apple, because of iTunes, has a large amount of household penetration and brand loyalty.
• The competitive strengths of the brick and mortar DVD shops and the mail delivered DVD services versus movie theaters has been improved recently by the growing presence of large HD TVs in American households and the final victory of the Blu-ray HD DVD format.

Tipping Point Scenarios.

Below are some scenarios under which a tipping point might occur:
• The cable TV and Internet film services improve their film libraries sufficiently to become real competitors with movie theaters.
• Real household incomes erode to the point that the cost of movie consumption grows in importance in consumer decision-making. The cost advantage of home viewing, popcorn, sodas, baby-sitting, etc, is substantial. Given the recent low growth in median household incomes and the soaring costs of medical services, energy, college educations, etc. and the reduced values of private homes, this scenario is likely to have substantial impact.
• The convenience and comfort of home movie theaters increase to the point that consumers prefer the home viewing experience even more than reported in the 2006 Pew survey. This is occurring now; the question is how big its impact will be.
• The major studios finally go for “simultaneous releases.” In 2006 and 2007 there was a lot of discussion within the major movie studios about releasing films to theaters, cable TV and Internet film services at the same time, with DVDs being released three months later. A major survey of movie audiences in the USA, Japan and Germany, which account for over half of the world’s film market, found that simultaneous releases would enable the studios to increase their revenues by 16%, but cause the revenues of movie theaters to shrink by 40%. More recently there has been some discussion of simultaneous releases for a limited number of films.
• An accumulation of impacts from all of the above.

The Complete Report

DANTH’s complete assessment of the dangers that downtown movie theaters will be increasingly facing will be posted on our website www.ndavidmilder.com and publicly available by March 24th, 2008. As our current work on trends progresses, I plan to periodically post the complete reports of our findings on our website and excerpts on this blog. Here are some of the other topics we’ve been looking at in our assessment:
• Time-pressured people continue to be downtowns’ best friends
• Retailing is in for much tougher times
• Post-Kelo redevelopment
• Boomers are now seniors and a great market segment for downtowns
• Green redevelopment
• Owners or renters: downtown residential redevelopment
• Downtown crime redux
• Downtown solution trends:
— Mixed-use projects
— Transit-oriented development, getting more important every day
— Place-making
— Niche development
• Downtown organizations: a time to alter missions, roles and responsibilities
• The internet and downtown revitalization

Unfortunately, some of the trends DANTH identified suggest that downtowns will soon be confronting major new challenges. DANTH believes that being forewarned enables downtown organizations to be forearmed. Although proven solutions to these emerging threats do not exist, I will try in my postings to outline some approaches to finding them, while welcoming other members of the downtown revitalization community to share their solution suggestions.

Despite The New National Wave Of Crime, Downtown Security Strategies Still Stand

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In a June 24, 2007 posting, “The Downtown Crime Problem Redux?”, I asked if crime was again becoming a crippling problem for our nation’s downtowns because:
“(T)he FBI just announced an increase in violent crimes for the second straight year, an occurrence that signals the first continued spike in homicides, robberies and other serious offenses since the early 1990s. This spike is especially noticeable in medium-sized cities and cities located in the Midwest. In large cities such as New York, the crime rate continues to decline.

What is unknown at this time is how this recent uptick in crime has impacted on downtown districts.”

I was concerned because such an uptick would be a strong indication that the new policing strategies combined with the creation of 24-hour downtowns were no longer effective ways to solve downtown crime problems. That was important since I had claimed in DANTH’s 2003 downtown trends report that “crime is no longer the barrier to downtown revitalization that it once was” (see our website to download the report https://www.ndavidmilder.com/pdf/trends_3_25_05.pdf).

I recently conducted an online search for information about downtown crime rates around the nation. I found data for 12 large and medium-sized cities. While this is admittedly a small sample, the results seem reassuring:

Atlanta, GA, Aug.2007. Population: 486,411
1. For several years downtown had 9% of city’s crime, but a daily population of half the size of the entire city. It now has just 6% of the city’s crimes.
2. Downtown there has been a 61% drop in major crimes over the last 6 months

Boise, ID July 2007. Population: 198,638
Continuing trend of declining crime downtown, with a 14% decline in the last year.

Chapel Hill, NC Nov. 2004. Population: 49,919
1.Reports of “major crimes” had gone down in each of the last three years for which the numbers were available.
2, But the number of arrests for crimes committed in the downtown had gone up. Leaders feared people could still feel unsafe even though statistics showed some positive trends.

Cincinnati, OH May 2004. Population: 332,252
1.Last year, serious crime in downtown dipped by 1 percent. The bulk of all downtown crimes are thefts, many from cars
2. Of the city’s 75 killings in 2003, one was in the Central Business District.
3. Major problem: area is still perceived to be unsafe

Dallas, TX, January 2008. Population: 1,232,940
1. Car break-ins were a problem a few years ago, but crime has gone down in the past
year
2. “I tell people safety and crime is old news downtown,” says the downtown manager

Dayton, OH, January 2008. Population: 156.771
1. In January, 2008, City of Dayton officials released statistics that show the city’s crime rate continues to decline significantly.
2. Targeted crimes downtown declined by 39 percent over the past five years. From 2006 to 2007 alone, key downtown crime categories dropped more than 25 percent.
3. A further perspective on downtown safety: in 2007, statistics for targeted crime categories downtown represented just 5 percent of the city’s overall targeted crime numbers.

Lawrence, KS, Nov. 2007. Population: 88,605
1. Since 2001, violent crime has risen in downtown Lawrence
2. According to the Kansas Incident Based Reporting System, 41 assaults were reported in downtown Lawrence in 2001, a number which has steadily increased in the last five years. In 2006, there were 245 reports of assault and battery in downtown Lawrence,
an increase of nearly 100 from the year before.

Kansas City, MO June 2005. Population: 447,306
Between 2002 and 2004, the period before and after the improvement
district was introduced downtown crime had dropped in all categories: robbery, 34 percent; juvenile crime, 28 percent; public intoxication, 21 percent; suspicious behavior, 10 percent; and miscellaneous crimes against property, 10 percent.

Los Angeles, CA June 2007. Population: 3,849,378
1.The Downtown crime rate has dropped to its lowest level in more than 60 years.
2. Even as Los Angeles’ decrease contrasts with the national trend of rising crime rates, statistics show that the city still contends with high levels of gang-related violence. There was a 14% increase in such activity in 2006

Miami, FL, 2006. Population: 404,048
1. Over the past five years, Downtown Miami has become a safer place. Investment has soared, new businesses have opened, and the population continues to grow.
2. While the same decreases in crime incidents are registered city-wide over the 2000-2005, the overall decreases are more dramatic within the DDA boundaries.
3 Almost every category of crime incidents decreased within the DDA boundaries between 2000 and 2005.
4. Most notably there was nearly a 68% decrease in robberies and 38% decrease in larceny/thefts.
5. Criminal homicides within the DDA account for less than 4% of those occurring city-wide.

Philadelphia, PA 2004. Population: 1,448,394
1. The 9th consecutive year that there was a reduction in crime downtown
2. Statistics that document a continued drop in downtown crime: Comparing 2003 and 2004, part one crime (aggravated assault, homicide, rape, burglary, robbery, stolen auto and theft, minus retail theft) in the 6th and 9th police districts fell 9.46%; the Center City District experienced a 7.99% drop. Between 1999 and 2003, part one crimes, not counting retail theft, fell 35.77% in the 6th and 9th police districts and 31.94% in the Center City District.
3.Theft from auto declined 19.7% between 2003 and 2004 in the 6th and 9th police districts and 16.77% in the Center City District. Between 1999 and 2003, theft from auto fell 36.58% in the 6th and 9th districts and 30.72% in the Center City District.

Portland, OR, Jan. 2007. Population: 537,081
1. Crime drops for third straight year
2. 16% decrease in 2007

Some Observations:
• Except for Lawrence, KS, a medium-sized college town in the heart of the Midwest, all of the other downtowns report declining crime rates
• In several downtowns (e.g., Cincinnati, Atlanta, Dallas Miami and Kansas City) the wording of the report suggests that the downtown organization is still dealing with the problem of the fear of crime being out of sync with the actual level of crime. This is a long existing problem. Looking at the housing data in Eugenie Birch’s report “Who Lives Downtown” suggested a possible explanation: downtowns that lost considerable populations sent lots of people to live in other parts of the city who would tell others negative things about the downtown and who would be hard to persuade that things had improved. These “lost residents” created a powerful negative word-of-mouth network that spreads fears about being a crime victim if you go downtown. For example, between 1970 and 1980 Downtown Miami lost 41% of its population; Downtown Atlanta lost 21.9%; Downtown Cincinnati lost 27.2%; Downtown Dallas lost 27.7%. In contrast, Center City in Philadelphia only lost 8.8% of its population between 1970 and 1980 and had population increases thereafter. Downtown Portland also had a small population loss during the 1970s, 2.2%, and population growth thereafter. Surprisingly, Downtown Los Angeles has had a growing residential population since 1970.
• The situation in Downtown L.A. also demonstrates that high gang activity need not mean a higher crime rate nor impede a reduction in the fear of crime. This is consistent with the situation in Trenton, NJ that I reported on in a previous posting: Trenton has about 2,000 Bloods in a city of 85,000 people. The crime rate has fallen, though gang activity has risen and violence is confined to areas where the gangs are dominant.