Retailers Abandon Detroit - No Big Chain Supermarkets, Nowhere to Buy a Chrysler

[Ming]

Retailers Head for Exits in Detroit
by Andrew Grossman
Wednesday, June 17, 2009


Shopping Becomes a Challenge as Auto-Industry Collapse Adds to City's Woes

DETROIT -- They call this the Motor City, but you have to leave town to buy a Chrysler or a Jeep.

Borders Inc. was founded 40 miles away, but the only one of the chain's bookstores here closed this month. And Starbucks Corp., famous for saturating U.S. cities with its storefronts, has only four left in this city of 900,000 after closures last summer.

There was a time early in the decade when downtown Detroit was sprouting new cafes and shops, and residents began to nurture hopes of a rebound. But lately, they are finding it increasingly tough to buy groceries or get a cup of fresh-roast coffee as the 11th largest U.S. city struggles with the recession and the auto-industry crisis.

No national grocery chain operates a store here. A lack of outlets that sell fresh produce and meat has led the United Food and Commercial Workers union and a community group to think about building a grocery store of its own.

One of the few remaining bookstores is the massive used-book outlet John K. King has operated out of an abandoned glove factory since 1983. But Mr. King is considering moving his operations to the suburbs.

Last week, Lochmoor Chrysler Jeep on Detroit's East Side stopped selling Chrysler products, one of the 789 franchises Chrysler Group LLC is dropping from its retail network. It was Detroit's last Chrysler Jeep store.

"The lack of retail is one of the biggest challenges the city faces," said James Bieri, president of Bieri Co., a Detroit-based real-estate brokerage. "Trying to understand how to get it to come back will be one of the most important keys to its resurgence -- if it ever has one."

Detroit's woes are largely rooted in the collapse of the auto industry. General Motors Corp., one of downtown's largest employers and the last of the Big Three auto makers with its headquarters here, has drastically cut white-collar workers and been offered incentives to move to the suburbs. Other local businesses that serviced the auto maker, from ad agencies and accounting firms to newsstands and shoe-shine outlets, also have been hurt.

The city's 22.8% unemployment rate is among the highest in the U.S.; 30% of residents are on food stamps.

"As the city loses so much, the tax base shrinks and the city has to cut back services," said Margaret Dewar, a professor of urban planning at the University of Michigan. That causes such hassles for retailers as longer police-response times, as well as less-frequent snow plowing and trash pickup.

While all of southeast Michigan is hurting because of the auto-industry's troubles, Detroit's problems are compounded by decades of flight to the suburbs.

Hundreds of buildings were left vacant by the nearly one million residents who have left. Thousands of businesses have closed since the city's population peaked six decades ago.

Navigating zoning rules and other red tape to develop land for big-box stores that might cater to a low-income clientele is daunting.

The lack of grocery stores is especially problematic. The last two mainstream chain groceries closed in 2007, when The Great Atlantic & Pacific Tea Co. sold most of the southeast Michigan stores in its Farmer Jack chain to Kroger Corp., which declined to purchase the chain's two Detroit locations, causing them to close.

A 2007 study found that more than half of Detroit residents had to travel twice as far to reach a grocery store than a fast-food outlet or convenience store.

Michelle Robinson, 42 years old, does most of her shopping at big-box stores in the suburbs. When visitors staying at the hotel near her downtown office ask where to shop, she sends them to a mall in Dearborn, 12 miles away.

A few retailers are thriving. Family Dollar Stores Inc. has opened 25 outlets since 2003.

FULL ARTICLE

[CamaroCrazy]

Sad, sad, sad. There was a similar article in the Journal yesterday about houses in Detroit selling for $100. The land was valued at $95 and the house at $5. At some point, its just going to be easier to bulldoze the whole city and start over.

[Darc Requiem]

Sad, sad, sad. There was a similar article in the Journal yesterday about houses in Detroit selling for $100. The land was valued at $95 and the house at $5. At some point, its just going to be easier to bulldoze the whole city and start over.

Wow that is sad. When you said that last line. Robocop immediately came to mind. I always thought that the idea of a New Detroit being built while the old one rotted was sheer fantasy. It may actually come to fruition if something isn't done though

[johnny smallblock]

Hate to say it, but Detroit can't depend on the Big 3. They should be able to attract some businesses (you'd think) since it must be hard to find a city with cheaper real estate.

[steinravnik]

A city of 900,000 and only 4 Starbucks? I guess crackheads don't buy $5 coffee.

[dindak]

Hate to say it, but Detroit can't depend on the Big 3. They should be able to attract some businesses (you'd think) since it must be hard to find a city with cheaper real estate.

Easier said than done in this environment unfortunately.

Eventually, business and people will be attracted back to the city by low costs but the city must develop a plan and I am not sure if they have the resources or people to do it.

Sad but true.

[ZR2BlaZeR2]

Pittsburgh hasn't had decent shopping downtown in decades. Let alone a grocery store. Things are slowly changing now, but you get used to going out of your way to shop.

Heaven forbid you have to cross the street for some coffee. Not to underplay the severity of Detroit's woes at the moment. But around here, its a hassle to drive downtown, pay to park, and pay higher prices for things just because you buy them downtown.

Pittsburgh has had a sort of renaissance after years of fallout from the steel industry leaving. Detroit will turn the corner eventually. Pittsburgh has used robotics, medicine, and technology. Detroit will use batteries and the world's finest automobiles. Let's hope.

[msitter]

Detroit has been a cesspool of crime, drugs and corruption for years. Is it just now that anyone sees this? I had to travel there in the 70's and 80's on business and it was depressing then. If you follow the politics of Michigan and Detroit in particular, you can see a pattern of anti-business, pro entitlement sentiment. If things keep going the way they have with the new administration, I look to see several other parts fo the country suffering the same fate. California is well on its way and NY, NJ, CT, MA are sure to follow. All nanny states that feel that penalizing the producers and rewarding the non producers is the right thing to do. All it does is drive out the producers and leave those who don't behind. You either pull the wagon or ride in the wagon and for Detroit the horses have left.

[Z28x]

The city shrunk by over 50%. They need to bulldoze all the abandoned old buildings that aren't worth saving. They need to shirk retail and residential space.

[steinravnik]

Pittsburgh hasn't had decent shopping downtown in decades. Let alone a grocery store. Things are slowly changing now, but you get used to going out of your way to shop.

Heaven forbid you have to cross the street for some coffee. Not to underplay the severity of Detroit's woes at the moment. But around here, its a hassle to drive downtown, pay to park, and pay higher prices for things just because you buy them downtown.

Pittsburgh has had a sort of renaissance after years of fallout from the steel industry leaving. Detroit will turn the corner eventually. Pittsburgh has used robotics, medicine, and technology. Detroit will use batteries and the world's finest automobiles. Let's hope.

I was in Pittsburgh last winter, and it didn't seem too bad to me. I was downtown and just southeast of downtown. The neighborhood I was in had a Whole Foods and a whole bunch of sit down restaurants and stores.

[Firebird00]

Detroit appears to be a dead city. Too bad one of America's biggest industrial areas has gone down the tubes.

[Dave B]

Wow. I didn't realize it has become that bad there. Not even a regular grocery store?? Sounds like someone could open one and do well there actually.

But maybe now is the time to buy into some of that low price real estate and just sit on it until the city rebounds.....I hope.

I have not been there in many years so it sounds much different now.

[msitter]

Don't weep for Detroit, they got exactly what they set out to get. You can't hammer on the job creators and lead people to believe that the employee is entitled to what the owner has. The right to work states are kicking the butt of the closed shop states. When the rules and laws become too onerous the companies leave for greener pastures. The rustbelt states will never again be the industrial leader they once were unless and until there is a fundamental change in the system. I don't care if you give them the factory for free, the taxes and pro-labor sentiment will drive you broke in short order.

[Novak454]

Well, just today the Detroit News reports Homicides may be under-reported... and they tie St. Louis every year for the most crime-ridden city. Folks, I'm a cop in SE MI, and worked UC in Detroit. Unless you actually see it for yourself, and see the politics of that total, total, total hole of depraved humanity for yourself, you simply won't get the fact - FACT - that Detroit can not be saved. It is telling that there is not ONE major retailer in the ENTIRE CITY. NONE. The only reason there are stores at GM's headquarters is because it is policed like a bank, with a police force for the size of a 80,000 resident suburban city packed into a 4 block area. That should tell you something. GM puts a police officer IN the movie theatre in the Renn Cen... that should tell you something. 30% on food stamps, 20% unemployment... that should tell you something. Homes selling for $100... that should tell you something. When the State's Supreme Court over-ruled residency requirements for Detroit's cops and firefighters, the remaining decent areas were instantly vacant as those employees ran to the burbs and got their families the heck out of there... that should tell you something.
GM needs to get out of Detroit and move to their established centers in Warrant (tech) and Milford (proving grounds)... let Detoit die, they've earned it. Anyone who cared left years ago.... I'm tired of people not from the area granting sympathy on Detroiters whom elected an indicted mayor, and soon to be indicted counsel members to run things for them... that should tell you something. Crooks elect crooks - a representative democracy in action!

[Uzzy]

Wow. I didn't realize it has become that bad there. Not even a regular grocery store?? Sounds like someone could open one and do well there actually.

The grocery store argument has been going on for years, that is not new. The problems there ahve been ongoing, but now they are nearing a breaking point and because of the Automaker woes, it's getting some press coverage outside of the area.

One of the 4 Starbuck's are on Wayne State University's Campus. I have no idea where the others are, I'm sure at least one is in the city's downtown core, which is not doing too bad still, but not great. Most people in the area don't have the money to spend on a night out on the town. I'll be there on Saturday for the Tigers/Brewers game, though.

Check out this thread for some more Detroit sadness...