The Gap. Eddie Bauer. Abercrombie & Fitch. And now H&M.
What do these national ready-to-wear retail chains have in common? All had a store in downtown State College and closed. Or, in the case of H&M, will close in less than two weeks.
This goes against a common refrain I have often heard over the years that national retailers are taking over downtown and forcing out locally-owned businesses, a lament that is somewhat reinforced by a couple of groups.
The top of the “Shop” page of the Downtown State College Improvement District’s website reads, “Searching for the perfect gift for that certain someone? Need a little retail therapy? The downtown shops feature an eclectic mix of both retail chains as well as independent local shops.”
In that statement “retail chains” get top billing over “independent local shops” even though the list of 58 stores that follows contains (by my count) only six retail chains compared to 52 locally-owned shops. And one of those chains is Sheetz, which is considered by many of us to be a semi-locally-owned business that’s done well for itself. Mare of Easttown can take her Wawa elsewhere.
The top of the “Shopping” page of the Happy Valley Adventure Bureau’s website keeps national chains out of the picture by not mentioning them once. Although the first reasons they suggest you might want to shop in Happy Valley are for Penn State souvenirs and Nittany Lion gear. Certainly we might like to think our area is more varied than that, but I guess we should capitalize on what we’ve got, right?
However, as you go down the shopping subheadings of the bureau’s website, the top of the “Shopping Centers and Associations” page reads, “Visitors and locals alike enjoy shopping the malls and shopping centers in State College and Centre County. You’ll find national chains and local Pennsylvania shops in downtown State College, Bellefonte, Boalsburg, Philipsburg and area malls.” Again, “national chains” get top billing over “local Pennsylvania shops” and the first location they cite is downtown State College.
Granted, the shopping plazas immediately outside of downtown State College – on East College Avenue and North Atherton Street – do have their fair share of national chains (several of which have closed in the last year), but I’m not aware of a whole contingent of national chains taking up residence in Bellefonte, Boalsburg and Philipsburg.
And the use of the plural on the word “mall” is a bit misleading as well. Asked to name a mall in Centre County, I think most residents would have trouble coming up with anything other than the Nittany Mall. Which, if we’re using Merriam-Webster’s definition of mall as “an urban shopping area featuring a variety of shops surrounding a usually open-air concourse reserved for pedestrian traffic,” you could make the case that the Nittany Mall no longer qualifies as a mall because of the lack of variety of shops.
Though, one area of business around Happy Valley that locals will point out is having a much larger influence from non-local ownership is commercial real estate. Talk to long-time residents and they’ll tell you that for decades the only two non-locally-owned properties were Hills Plaza and Westerly Parkway Plaza. Now it seems out-of-town and out-of-state owners are buying up properties on a regular basis.
But in any case, I believe this concern for locally-owned retailers in downtown State College being tossed aside by national chains is unfounded. I’ve been out of retail for over 25 years but some things about it don’t change – especially the need to turn a profit. And retail in downtown State College – and for the most part Happy Valley as a whole – is a fickle business and not for many of the national chains outside of the big-box stores (we do have two, count ‘em, two each of Target and Walmart in State College!).
Retail chains make their profit in the fourth quarter. It’s not unusual for them to do 25% of their yearly sales in the month of December, and 50% between the months of November through January. But in Happy Valley, half the population leaves midway through December and doesn’t return until a month later in mid-January. Sales do spike a bit in August as the students arrive for the beginning of fall semester, but that rarely makes up for an entire month of lost revenue in the holiday season.
Local retailers know this and account for it in their revenue and expense projections. National chains often do not have that foresight and the ability or willingness to adjust to such a bold departure from their traditional sales and expense patterns. Over time it becomes clear they are unable to make sense of the downtown State College market and as their leases allow them to do so, they will vacate.
Urban Outfitters is possibly one outlier to this trend as they are coming up on their 10th anniversary on College Avenue in the next few weeks. As most national retailers will sign five- or 10-year leases, if Urban Outfitters is still here next month you can assume they have bucked the trend and been able to make the necessary adjustments to successfully do business in the Happy Valley market.
This odd market plus State College Borough’s insistence that all the new high-rise construction in downtown contain retail space on the first floor is contributing to the somewhat disconcerting amount of vacant storefronts as you walk around town. But in the world of opportunities it provides plenty for locals who wish to try their hands at retail to get into the game. Because as much as we may believe the national chains are winning, the locals have traditionally been the ones to survive.
