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Data Help Bed-Stuy Tell Its Retail Story

On one of the few sunny Saturdays last March, a trolley bus rumbled up and down Fulton Street, past the modest storefronts and crowded sidewalks of one of Brooklyn’s busiest thoroughfares. Inside, Dale Charles regaled her passengers – entrepreneurs, location scouts from national retailers, commercial real estate brokers, and local lenders – with stories about the possibilities offered by those storefronts.

Charles, director of economic development at Pratt Area Community Council (PACC), was on a mission to convince her listeners that on Fulton Street, profits are there for the taking. She was armed for the occasion – armed with market research provided by LISC/MetroEdge that revealed those pedestrians had plenty of money to spend, and that they spent it. But often not on Fulton Street or even in the Bedford-Stuyvesant neighborhood. Instead, they did their discretionary spending elsewhere. Find the details in market study.

Capital One Bank Fulton Street NY

Capital One opened on Fulton Street in 2008.

Heidi Reijm

Charles wants to give shoppers a reason to spend their money closer to home.

“The Bed-Stuy community has $600 million of concentrated buying power per square mile and every year over $40 million dollars is spent by our residents at restaurants and bars alone in other parts of the city,” said Michael Rafferty, economic development officer at Bedford Stuyvesant Restoration Corporation (a partner on the tours) and executive director of the Bed-Stuy Gateway Business Improvement District. “How many of you would like to see some of that $40 million?”

Who knew? Clearly, some long-time Fulton Street businesses did, because they’ve been tapping into that spending for years. But to bring in more retailers, a coalition including PACC, Restoration and Bridge Street Development Corporation has been forming merchant associations, improving storefronts and raising money to support safety, marketing and organizing activities.

New businesses needed

Community advocates knew anecdotally that there was a need for sit-down restaurants, evening entertainment and other retail services. But a stigma existed about Bed-Stuy’s safety and economic viability. And cold, clear evidence of business opportunity wasn’t available.

Enter LISC/MetroEdge, a retail market analysis firm that’s part of Local Initiatives Support Corporation, a nonprofit that promotes community development nationwide. In early 2008, the coalition summoned MetroEdge to conduct a retail market study for their target areas. The Mayor’s Office of Comprehensive Neighborhood Economic Development (CNED) and NYC Small Business Services picked up the tab.

Bed-Stuy Gateway Market Profile

Marketing materials count "rooftops" and the spending they represent.

MetroEdge conducted interviews with neighborhood leaders and government officials, visited business owners in their stores, and analyzed the community’s demographic, economic and retail data. They documented that the area has $200 million more in concentrated buying power per square mile than Brooklyn as a whole. And indeed, its major retail needs include restaurants and bars, clothing and furniture stores and other retail categories. Even Bed-Stuy boosters were stunned.

 “The findings were counterintuitive to most people’s view of Central Brooklyn and Bed-Stuy,” said Melissa Lee, then acting director of the city’s CNED office.

Retail analysis findings

MetroEdge found strengths and retail potential in each of the target areas, though the socio-economics and the retail mix varied. MetroEdge highlighted the types of stores that were operating as well as the types that buyers were seeking. 

MetroEdge also recommended how the organizations could use the data to strengthen their revitalization strategies – especially important since the study was conducted just as the 2008 recession hit and small businesses were feeling the effects of reduced consumer spending. MetroEdge showed that attracting new businesses was only one part of the story; Bedford-Stuyvesant also needed a strategy for retaining and supporting businesses that were already there. 

But back to Dale Charles on her trolley. The ride was part of a storefront stroll called Roll Up the Gates, in which retail spaces along the corridor opened their doors for the event. Passengers could board and exit the trolley at any of the open locations to check out potential spaces. While on the trolley, they compared notes about best practices, lending opportunities and small-business assistance. For PACC and Restoration, the setting provided an opportunity to recruit and evaluate potential new business owners and, according to Charles, “make sure there’s a good fit between a property owner, the entrepreneur, the business and the neighborhood.” (Video of trolley tour by BRIC Community Media and Brooklyn Independent Television.)

Data rules

MetroEdge data was a starting point for many of the discussions. Bridge Street, for example, uses the MetroEdge data to persuade existing businesses that, despite hard times, they need to invest more resources into marketing. The residential area immediately surrounding the corridor, Tompkins Avenue, had the highest concentrated buying power and the highest number of middle-income households of the three target areas. It also had some of the area’s only children’s clothing stores, but still had retail leakage (money spent elsewhere) in that category. Bridge Street used this information to work with a new spa as well as a children’s clothing store to improve and increase their marketing to surrounding residents.

Le Chateau de Frenche spa

A new spa on Tompkins Avenue.

Heidi Reijm

“We started a campaign called Slice of Bed-Stuy and created promotional postcards for each of several businesses on Tompkins,” said Collete Gil-Pierre, Bridge Street’s deputy director. “Every week, we mailed a new postcard to neighborhood residents to let them know these businesses exist.”

The groups also use the data to make the case to foundations and public partners for greater investment in physical improvements and business support. They cite the evidence in radio and newspaper interviews to indicate there’s real market potential in the community, and communicate it to brokers and small businesses that they hope will expand into BedStuy.

The data also help the organizations and public partners on joint efforts. The groups shared their property and vacancy information in a single database to match new businesses to the most appropriate locations. They developed joint marketing strategies, pooled resources to provide high-quality supportive services to businesses, and hope the MetroEdge data will help them get ahead of the economic rebound by attracting key industries and businesses.

Bed-Stuy Gateway

Heavy pedestrian traffic translates into spending power in Bed-Stuy Gateway.

Heidi Reijm

Changing people’s perceptions of Bed-Stuy will take time, but the real story is starting to be told. A New York Times article in September 2009 heralded the opening of three new businesses, and cited the MetroEdge research. “Store rents are still cheaper than in other Brooklyn neighborhoods, which is especially important now that bank financing is harder to come by,” the story said. “Residents also have been starving for new businesses. Michael Amirkhanian, a broker with Massey-Knakal Realty Services, cites a 2008 study by the market research firm LISC MetroEdge showing that Bedford-Stuyvesant residents have been spending more than $30 million in bars and restaurants elsewhere.”

“You have real consumer buying power,” he said, adding that these dollars “are going to Downtown Brooklyn and the city.” (View NY Times slideshow.)

 

Keywords: Bedford Stuyvesant, Brooklyn, data, economic development, MetroEdge, retail

Posted in New York

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