Rebuilding Place in the Urban Space

"A community’s physical form, rather than its land uses, is its most intrinsic and enduring characteristic." [Katz, EPA] This blog focuses on place and placemaking and all that makes it work--historic preservation, urban design, transportation, asset-based community development, arts & cultural development, commercial district revitalization, tourism & destination development, and quality of life advocacy--along with doses of civic engagement and good governance watchdogging.

Tuesday, December 03, 2013

Walmart opens two DC stores tomorrow

I try to save money when I shop for food.  It means that I buy some groceries at deep discounter Aldi, go to ethnic supermarkets like Mexican Fruit in the Union Market District and Pan-Am International Market in Columbia Heights, clip coupons and avidly scan the weekly supermarket circulars, and I  hesitate when buying food at farmers markets in DC--at least certain markets--because the prices can be significantly higher compared to smart grocery shopping.

Walmart on Georgia Avenue NW in Washington, DC.  Under construction on November 25th, 2013.

So the fact that Walmart is opening in DC tomorrow--they being the source of "everyday low pricing" according to their advertising--ought to be something I'm looking forward to.

I'm not, for various reasons (see the report I co-authored about the Georgia Avenue location here, ANC4B Large Tract Review Report on Walmart, 5/2011).  Also see the past blog entry, "Piling on City Council for Walmart" and the WBJ op-ed, "Temper Walmart Glee with Planning."

The report for our neighborhood's "advisory commission" is mostly focused on urban design--how the building fits within its context--and transportation issues raised by the project.

For the most part, the report didn't focus on whether or not Walmart is "appropriate" or not as a company.  Unfortunately, many people focus on that question, the discussion gets very heated--and cannot ever be resolved because there is no "illegality" concerning their business model--and in my opinion the company and the developers that work for them use this "noise" to avoid dealing with other more substantive problems.  That was definitely the case in DC.

I do regret that the report didn't address customer service questions and to some extent labor treatment issues.

So on the eve of Walmart opening their first two stores in DC, here's some stuff to think about.  Some of which has already been written up in:

- Lessons from Walmart's foray into Washington, DC
- DC pols are so easy to buy: Walmart edition
- I hope for Aspen Hills' sake that Montgomery County is smart enough to learn from DC's planning errors with regard to Walmart's entry
- More research on the economic impact of Walmart
Urban design issues.  The biggest misconception about Walmart's new focus on "city" locations is that their entry necessarily means "urban-appropriate" and/or mixed use development choices.  The experience in DC is that Walmart is agnostic about "urban design" and mixed use questions.  If a developer comes to them with a project that is urban and mixed use, and it is in a location that they want to be in, they will say yes.  But at the same time, if a developer comes to them with a site they are interested in, but a project that isn't particularly urban-appropriate, they are fine with that too.
the new mixed use building, including a Walmart, at 1st and New Jersey Avenue NW
The new mixed use building, including a Walmart, at 1st and New Jersey Avenue NW.

So in DC, two of the five projects that Walmart is involved in are definitely urban-mixed use projects, where the store is on the ground floor or second story of a multistory mixed use development--at New Jersey Avenue NW, which is one of the stores opening tomorrow, and at Fort Totten, a couple blocks from a Metro Station, to be located on Riggs Road NE.  The other stores are not.

Two are part of site plans that have other elements, so could be considered to be "horizontal" mixed use.  But the Georgia Avenue store, opening tomorrow, was designed to not take advantage of the ability to develop vertically.  Sure it will have underground parking and a zero foot setback from the sidewalk, but that's as urban as it gets.  Which is a great disappointment.

Similarly, in Baltimore, a proposal for a Walmart "anchored" project is still generating a great deal of opposition, in large part to the suburban-ness of the site plan and design.  See "Contentious Walmart plan pits Remington groups against each other" from the Baltimore Business Journal.

Interestingly, the proposed design of the Baltimore store appears to be very similar to the DC Georgia Avenue store.  The big difference is that in Baltimore, it will be fronted by a parking lot, while in DC the parking is underground and the building is placed at the sidewalk.

25th Street Station goes back to UDARP, Baltimore

Planning Commission hears arguments on 25th Street Station shopping center, Baltimore

Rendering of the Georgia Avenue DC Walmart
Walmart rendering, Georgia Avenue store, DC

The lesson to other cities is to take nothing for granted about urban design when it comes to Walmart or other big box stores.

Transportation issues.  I do regret that DC did not try to get Walmart to develop a delivery system.  Knowing that you can get your purchases delivered means that you don't feel obligated to drive to the store, which can reduce motor vehicle trips.  The company is doing some transportation demand management measures, installing indoor bike parking, and paying for a bike sharing station at the Georgia Avenue store (and will be for the Fort Totten store, I don't know concerning the New Jersey Avenue store, which didn't require special city planning approvals).

The city could have also done other more important roadway reconfiguration projects for the Georgia Avenue store but ignored the need.

Employee treatment/labor issues/wages.  I didn't oppose the company coming into the city but I am going to be very specific about not shopping there, because I don't think the company treats "average" employees very well.

The Walmart on Atlantic Boulevard in Canton is collecting food for employees who can't afford Thanksgiving dinner. The company said this is proof that employees look out for one another. The group of employees who have held national strikes against the world's largest retailer says the food drive is proof Walmart doesn't pay associates enough to survive. The Organization United for Respect at Walmart, or OUR Walmart, is holding strikes against the chain at stores in Dayton and Cincinnati on Monday, Nov. 18. (courtesy of OUR Walmart)

I wrote about the employee thing in the piece cited above in the summer but it gets re-emphasized by a recent story in the Cleveland Plain Dealer, "Is Walmart's request of associates to help provide Thanksgiving dinner for co-workers proof of low wages? " where workers at one Walmart store are organizing a holiday donation program--for other employees who make very little money.

Product access and selection.  In many retail categories other than food, there just aren't many competitors anymore.  There are traditional department stores, but very few are left generally or in cities.  General merchandise stores are limited too: in the face of competition Kmart and Sears are reeling, while Target manages to succeed.  Plus you have Kohls selling apparel, and in small towns in the midwest, Shopko.  And then you have other category killer brands like Bed, Bath and Beyond or Best Buy or Staples in office supplies, etc.

You just don't have many choices.

Note that Kroger has some stores for their name stores and banners that include soft good sales in a "Marketplace" format.   Plus there is their Fred Meyer division which does this.  And the unaffiliated Meijer Company in the Midwest and HEB in Texas also.  Otherwise, there aren't traditional competitors left.  Increasingly, Walmart is the only "choice" that's available.  At least communities where Kroger and Meijer are active have more choice than much of the rest of the country.

Because DC is understored in many retail categories, especially home goods and apparel, having Walmart will provide more access to a great number of product categories without necessarily impinging on other retailers--at least those located in the city.  Presumably, the Walmart stores in the city will reduce the number of trips in-city residents make to out-of-the-city retailers.  This would reduce trips and increase local sales tax revenues.

Cost savings for consumers.  As far as saving money goes, if you shop smart at grocery stores (e.g., buy certain items when they are on sale) you pay about the same amount as Walmart, and that doesn't take into account (1) deep discount stores like Aldi; (2) ethnic stores; and (3) the competitive price reaction by supermarkets--e.g., Safeway has lowered some prices, like cilantro, to the same price as the ethnic stores, in advance of Walmart's opening.

Greenwashing.  A couple of years ago, I wrote about how Walmart makes their decisions on the basis of business considerations.  This was in response to people saying "Walmart won't make healthy food despite their affiliation with Michelle Obama because the company is bad."

I responded, no, Walmart makes decisions that favor their business, and will sell healthy food for the political and other benefits the same way they treat employees badly to cut down on labor costs--it will make them more money.

The same goes for environmental practices.  They will engage in better practices to the extent that it saves the company money and generates positive publicity.  Hey, that's the way of business.

... even though, a few weeks ago, the Institute for Local Self Reliance released a report, Walmart’s Assault on the Climate: The Truth Behind One of the Biggest Climate Polluters and Slickest Greenwashers in America, about what they call "greenwashing, and "Walmart’s rapidly expanding climate pollution."  Additionally, they criticize the Environmental Defense Fund for taking a lot of money from foundations affiliated with the company ("EDF Sells Green Cred to Walmart for the Low, Low Price of $66 Million," Grist Magazine).

Impact on traditional commercial districts.  The issue of the impact of Walmart on urban markets is tricky, because urban markets are traditionally understored, so they are lacking retail, whereas by comparison suburbs are over-stored. This is definitely the case in DC. So if a Walmart opens in DC, probably there will be less negative impact compared to a store opening in a location with a lot more retail competition. 

However, I have also written about how Walmart's presence changes the mix of stores in a commercial district, from locally owned to chains.  That is what has happened in Chicago's Austin neighborhood, even if the local Alderman doesn't notice ("Chicago politician tells Manhattan Beep Scott Stringer to welcome Walmart," New York Daily News).

Plus, Walmart's business model isn't designed to support other retailers, it's to capture as much as 100% of a customer's discretionary spending on retail.  That leaves nothing for other retailers. 

So it's a misnomer to call a Walmart store "an anchor," because by definition an anchor supports other stores and commercial districts more generally, by sharing customers.  Walmart has no intention of doing that.

So cities shouldn't be aiming to attract a company like this to their commercial districts.  Or at least there should be a commitment to the development and execution of a program to mitigate the expected negative effects.

Bad customer service.  Walmart sales at the level of individual stores continues to drop.  This is a function of two things; (1) a reliance on lower income consumers, who continue to have less money to spend since the US remains in recession and (2) cut backs in labor and the array of products carried, both measures to cut costs, which ends up leading to a great deal of out-of-stocks and other inventory problems (see "Customers Flee Wal-Mart Empty Shelves for Target, Costco" from Bloomberg) which comes back to the customer in terms of "bad service."

More generally, the company doesn't get rated highly for customer service anyway.  See "Who's right about Wal-Mart's customer satisfaction?" from MSN, "Which Retailers Have the Most Satisfied Customers?" from Time Magazine, and "Consumer Reports customer service survey: Walmart rated the worst" from the Chicago Tribune.

Is this a company towards which cities should be focusing their business recruitment efforts?

Photo: J. Emilio Flores for the New York Times.  Protest at a Walmart in Los Angeles, on Friday November 29th, 2013.

From the NYT article "Exhausted Shoppers Head Home, Replaced by the Next Wave":
The shopping season also was the occasion for protests by labor groups and some Walmart workers at stores across the country in an effort to rally support for higher wages, with some demonstrators conducting civil disobedience sit-ins in Chicago, Los Angeles, Alexandria, Va., and several other cities. Our Walmart, a union-backed group, said more than 110 people had been arrested at the demonstrations.


At 2:45 PM, Anonymous charlie said...

yes, as I said before Walmart hired a lot of gore's people after 2000 for "greenwashing". And I'd say they have been very successful on that.

Left unsaid by you is that Walmart is by poor people and for poor people. In terms of attracting a more affluent crowd -- which is the challenge for urban areas -- Walmart does nothing.

Walmart is aggressively moving into internet delivery and so DC will capture that local sales tax now. Not sure how large that will be. And it is likely (although a bad idea) that we'll tax all online transaction in a few years.

At 6:32 PM, Blogger Richard Layman said...

of course your 2nd paragraph is true. And I think I have mentioned that before, although not in this piece. And yes that's why their comp sales continue to drop, because disposable income amongst the poor continues to drop.

But their move into urban markets is partly because while there are poor people that they haven't been selling to, there are also people who aren't poor, which I think is a lot of the attraction.

It's not like the proposed store in Baltimore e.g., is in a bad part of town. Similarly, the NJ Ave., Fort Totten, and Georgia Ave. stores in DC are all in decent enough areas, middle class definitely.

At 8:37 AM, Anonymous charlie said...

well, the other thing we are leaving out is DC/PG county increase in minimum wage. It isn't a horrible idea but suffers from the long term/short term problem (good short term, may be questionable long term).

Walmart has shown they have no problem reducing staffing to keep prices low -- even to the point of customer complaints.

In terms of the proposed location, I'd say a working definition of "Middle class" in 2013 is that there isn't a walmart nearby. And going to our discussion of repair, I'd say it might be better investing in repairs in stable neighborhoods rather than ones that need gentrifying. I'd agree we've al seen houses than need $2500 of work.

At 9:55 AM, Blogger Richard Layman said...

Such tricky questions. E.g., where I live, which will have the greatest Walmart density in the country I suppose, since we'll have two within 1.5 miles, is mostly solidly middle class, houses $300 to $700K, with one and two earners in most households, interspersed with some f*ed up areas.

According to the neighborhoodinfodc website, the average household income is $115,000. I guess Shepherd Park boosts it some...

At 10:02 AM, Blogger Richard Layman said...

WRT where to invest programs, it's double edged. The problem, I think with "substandard" houses in my neighborhood isn't so much low income, although that's an issue, as much as it is an "old aged owned" house or tied up in multi-generational family ownership.

Once the houses come on the market, they get flipped pretty fast. It's getting them on the market.

The trick is how to invest in what I would prefer to call improvable or opportunity neighborhoods without forcing displacement.

I would even be diligent in trying to build houses on lots that haven't been developed, although that wouldn't add a whole lot to population. (Here and there in various neighborhoods outside of the core there are empty lots, and even within the core.)

Plus ADUs, even small apartment buildings. In Belmont, which you didn't love, his discussion about "grayfield" neighborhoods is that they need more population to be viable.

I think that's a big issue. In my neighborhood many residents don't accept that to have viable amenities offered locally we need more population. The challenge is how to add this population substantively in ways that minimize dislocation and substantive change.

For me, it's adding housing at the metro stations and in commercial districts to the extent possible and practicable. Plus ADUs. (My neighborhood lacks in-residential areas appropriate for new apartments.)

Long long term, I can see low scale apartment buildings mostly 3 stories or less being rebuilt to 6 stories, especially proximate to Metro.

At 10:14 AM, Blogger Richard Layman said...

so planning wise, to me it's to use much more robust frameworks for defining land use policy. It's why I like the Nashville Community Character Manual so much.

Again, in my neighborhood (on my mind because of the Takoma station redevelopment proposal and the various reactions to it) we lack fine grained enough definitions.
They define land use element, policy intent, and more specific neighborhood-district types.

In the community discussions, ANC Commissioners and some of the Takoma Park elected officials are arguing that every block of the neighborhood needs to be treated the same, even though this particular block is a heavy rail metro station and it is adjacent to other higher density multiunit residential and to the Takoma commercial district.

Using the NCCM, most of the neighborhood would be defined as residential maintenance, which means that things would remain unchanged (with the exception of ADUs). But that's not how the "Urban Community Center" would be defined, or how corridors (like Georgia Avenue) would be defined.

Plus, those same officials are harkening to the Takoma Central Plan, which was adopted in 2002, and is seriously out of date on recommendations for the "Urban Community Center" based on changes over the last 11 years.

Then again, as you always point out, maybe more robust planning wouldn't make any difference.

However, I have to believe that by not having better frameworks we are consigning ourselves to the escalating frustrations that we are experiencing as a community and as a city concerning how to deal with opportunities for growth, and how to position the city for moving forward.

At 10:17 AM, Blogger Richard Layman said...

speaking of scenario planning, mentioned in the blog entry that just published, we aren't as a city planning for long term f*edupedness of the federal government, which will have significant impact on the city and its economic health.

We aren't planning for the possibility of federal tax law changing concerning deductibility of mortgage interest or local taxes. Both of which will impact housing affordability and pricing, even for higher income households.


Very few citizens seem to be thinking about that.

At 12:15 PM, Anonymous charlie said...

yes, good point on repairs vs. market. A balance between the transfer taxes and montly taxes.

In terms of being granular, that is a fascianting point and very true. In an urban area a distance half the size of a block makes a huge difference (noise, nusiance, etc). Not sure what are best standards there.

In terms of thinking about the long term stuff, yes, it is a problem with mortage deduction but that is too macro to make noise about. At some point the sun will swell up and cook the oceans, etc. Pick the battles you can at least fight.

At 10:35 AM, Anonymous Andrea Rosen said...

Jack Evans said at a meet-and-greet I attended that even with six stores in the works, Walmart isn't finished with D.C. Reportedly, they want to open west of Rock Creek Park, and have their eye on Tenleytown. He mentioned the stretch of Wisconsin around the old Hechninger's, now Cityline condo building, but yesterday's Current newspaper reported that there's a transition happening further north, where the car dealership (formerly Marten's Volvo--I don't recall the current name) is vacating. Apparently even Walmart wants to go where the money is.

I would also like to comment on RL's assertion that D.C. is under-retailed, so Walmart's impact will not be as great as it would have been if we had even as much retail as we enjoyed 20 or even 10 years ago. Strangely, I used to drive out to the suburbs (White Flint and Rockville, especially) 10 and 20 years ago to shop, but now I NEVER do. Partly that has to do with, regrettably, making online purchases of clothing--although often these are from the on-sale sections of the websites of department stores with locations in Friendship Heights. That I can accommodate my acquisitive impulses almost entirely in D.C. pleases me very much; and I would hate to see Walmart wipe out what retail we have left, which is acknowledged as a possibility in this post.

By the way, the ham-handed Walmart design on Georgia is both anti-urban and waaay uglier than the one proposed for Balto.

And finally, the traffic around the Walmart yesterday between 7:30 am and 9:30 am (the time I spent protesting there) was hideous. Gives new meaning to DDoT's declaration of Missouri and Georgia as a failed intersection--which of course was completely ignored in the permitting process.

At 11:31 AM, Blogger Richard Layman said...

I agree about the Baltimore rendering. I didn't have the heart to go up to the store area and assess parking. But yes, as the report I was the chief author for laid out, there would be serious mobility issues. For the most part, every point we made was studiously ignored.

I don't know if DDOT would have considered the points had they been allowed to (the elected officials made very clear to OP and DDOT that they weren't to put up any roadblocks).

And the fact that the stores on the west side of the street lost street parking and how Walmart won't allow for shared parking scenarios is problematic.

Haven't read the Current yet. The Tenleytown stuff is kinda scary. I did see the headline about Martens.

Interestingly, I would argue that upper Wisconsin Ave. has more congestion issues than even Georgia Ave. in the vicinity of Missouri Ave.

At 12:15 PM, Anonymous Anonymous said...

In theory, I dislike Walmart. Hate is probably too strong a word but close. However, that has always been predicated on the fact that they weren't around and that I always thought other retailers treated there employees better.

I was proudly on Team Target until I recently learned that they are exactly the same except with better design.

I can't imagine Aldi is any different and would imagine that everything you wrote, in context, could be said about them.

So..I will probably shop at WalMart. I might hate myself but my wallet will be happy. It's either that or to decide that the (for now) pro-union stores such as Giant and Safeway are where I will go but damn they are expensive.

At 2:00 PM, Blogger Richard Layman said...

If you shop strategically, but you have to be into it, and it helps to enjoy it, and maybe not to pay attention to the time you spend, it's possible to buy stuff at Giant, Safeway, and/or Harris Teeter (their specials are great, but their everyday prices seem higher to me) and you "buy forward" (or buy stuff in quantity when it is on sale) and buy some store brand products, not just brand names, you can spend about the same as it would cost at Walmart.

Aldi is cheaper. I probably go there a couple times/month. But I only buy produce and basic staple products. I find their "value-added" products to be pretty bad. E.g., Aldi flour tortillas are disgusting.

Even so, as inexpensive as Aldi can be, half the products they sell can be cheaper at Mexican Fruit... depending on the season.

2. I do think that you're probably painting Target a little too broadly though. My understanding is while they might not pay any better than Walmart, certainly they don't treat their labor as badly, do they, and do many store managers strongly encourage workers to work off the clock?, which is illegal. Even though the class action suit for the treatment of women was denied, it certainly seems like Walmart systematically treats women and other sub-segments of their labor force poorly, in order to reduce wage costs.

At 3:32 PM, Blogger IMGoph said...

who was the architect for the store on Georgia Ave? it looks so much like the new Woodson HS building:

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