The resilience of commercial streets in walkable urban neighborhoods

It’s been suggested that the Coronavirus Pandemic will turn out to be a disaster for stores on commercial streets in walkable neighborhoods. Most of these stores have had to close or at least to limit their operations during a lockdown that’s now been in force for ten or eleven weeks. Bustling commercial streets are a critical component of what these neighborhoods have to offer residents, so the implication is that the surrounding neighborhoods will be in trouble too.

Those who make this argument could well turn out to be right, but I’m inclined to point out that many of these streets have shown a surprising resilience over the last few decades. They are excellent examples of capitalism’s creative destruction at work. All of the commercial streets with which I’ve been familiar over several years have experienced a constant churn in their retail landscape as conditions have changed.

Broadway in Lake View between Diversey Parkway and Addison Street is the pedestrian-oriented Chicago street that I’ve come to know best. I moved to Aldine Avenue just off Broadway in 1984 and have often found myself on this part of Broadway even after moving a mile and a quarter north in 1996. Most of the stores that were on the street in 1984 have vanished, as consumer preferences and technology have changed. Back then, there were, for example, three fruit-and-vegetable stores on Broadway within a couple of blocks of Aldine. But they just couldn’t compete with nearby supermarkets, and they all disappeared within a couple of years. A kosher butcher and a Jewish delicatessen closed a few years later. I doubt whether the neighborhood became less Jewish, but newcomers with a Jewish heritage presumably had less and less interest in specialized shops (or maybe meat!). Another example: In 1984, video stores were still growing like crazy. Most of them closed twenty years later. They couldn’t compete with Redbox or mailed disks from Netflix. The last video stores vanished a few years later when Netflix’s streaming site came up. Similarly, Dominick’s and Treasure Island, two of Chicago’s major supermarkets, both with outlets on Broadway, went bankrupt and closed when Whole Foods, Trader Joe’s and Walmart arrived in town.¹

But here’s what’s important: Closed stores have almost always been replaced by others. Smaller shops have sometimes been taken over by ambitious newcomers, often bringing new types of commerce to the street. A physical therapy facility, a gym, an urgent care complex, a vape shop, a children’s play center, and a (short-lived) outlet for home bakers have been added to the street in the last decade and a half. Dozens of restaurants and bars have opened (while many others closed).² Outlets of national chains have gone through a comparable turnover. After Borders went bankrupt in 2011, the small Walgreens across the street from the Broadway Borders took over the bookstore’s much larger space and claimed to be the largest Walgreens in Chicago. (It closed last year, perhaps because there didn’t need to be three Walgreens within a quarter-mile of each other.) The somewhat old-fashioned one-story Dominick’s supermarket was replaced by a new, multi-story Mariano’s, a much more modern establishment, in a massive building that includes a Starbucks, a PNC Bank, an XSport Fitness, and a large dental office. There has also been some pressure to add residential space to the street, even though the area’s zoning classification makes this difficult. Still, two four-story apartment buildings with ground-floor retail have replaced one-story structures, and the closed Treasure Island supermarket is in the process of being replaced by a mid-rise apartment building, also with ground-floor retail.

Even the few stores that survive from 1984 have undergone changes. The Broadway outlet of Chicago’s most widespread supermarket, Jewel-Osco, went through a complete renovation perhaps a decade and a half ago. Unabridged Books, an excellent independent bookstore, and Windy City Sweets, a first-rate candy shop across the street, were also renovated (and Unabridged expanded) maybe twenty years ago. It’s possible that I’ve missed a shop or two, but I believe that only a couple of dry cleaners, a coin laundromat, an old-fashioned True Value Hardware, an even more old-fashioned shoe-repair shop, and two parking facilities³ have remained largely as they were.

My sense is that numerous other commercial streets in walkable neighborhoods in the United States have undergone similar shifts over the years. This is certainly true in Chicago, where, for example, streets like Southport Avenue between School and Grace and Milwaukee Avenue between Ashland and Damen have experienced the same kind of retail churn as Broadway. Perhaps as a result, both are arguably far more bustling and healthy today than they were in the 1980s. All these successful streets are in neighborhoods with a moderately high population density. Residents of these neighborhoods are on average reasonably prosperous and highly educated and include a substantial proportion of young or youngish adults. It also seems likely (but is completely unprovable) that, in the complicated process through which people end up living where they do, these neighborhoods acquired a high proportion of residents who were comfortable in a place where many tasks are best accomplished by walking, something that’s not a given for Americans.⁴ As a result, shops on these streets have had plenty of potential customers at hand, as long as they continued to offer services and products that were actually wanted.

I’m certainly ready to concede that some urban streets with retail shops haven’t done nearly as well (Chicago is full of examples⁵). I also acknowledge the pain that retail churn causes to those who put their savings into a shop that doesn’t succeed, and, like most urban residents, I’ve sometimes found myself mourning the loss of a favorite establishment.  It would be absurd to argue that the operative principal—that the organization willing to pay the most gets to operate a storefront—leads to the best results for customers. This kind of problem, however, is endemic to a free-market economy, and it’s a little hard to see how it could have been avoided.

Note that one of the characteristics even of the successful streets is that they’ve had fairly regular ups and downs. On Broadway, for example, there were dozens of vacant stores during the period of the Great Recession. As the Recession receded, closed stores got rented, but the process wasn’t speedy.

There have also been quite a few vacant stores on the street over the last two or three years despite the fact that the area has been prospering.⁶ The consensus is that competition from Internet commerce is at fault. This is a perfectly reasonable hypothesis. Among the sites that have been vacant longest are those where a video store, a used bookstore, and a local bank branch were once located.

The Coronavirus Pandemic has added a new factor into the mix. Social distancing and government-mandated closures during the Pandemic couldn’t possibly be good for busy urban commercial streets. These measures have been particularly hard, of course, on restaurants, coffee shops, and bars, which have been almost immune to competition from online retailing. During the Pandemic, every one of these establishments has had either to close completely or else to convert to providing takeout only. Some seem to be doing a good takeout business, but their owners quite reasonably argue that this doesn’t bring in enough revenue to pay the rent.

There is, obviously, no way to predict what will happen to Broadway and comparable streets if and when Covid-19 recedes. Some people are quite pessimistic, arguing that the Pandemic has undermined the case for urban living in general. It’s hard to argue with the general proposition that density makes the spread of disease easier. Not only do residents of cities more or less by definition live in closer proximity to strangers than people in low-density areas do. They are also more likely to ride in elevators, pass through building lobbies, and hop on buses, in other words to engage in activities that have suddenly come to seem quite dangerous. Could the Pandemic end up causing a new wave of migration to the suburbs? It’s possible. But some people made a similar prediction after 9/11, which also exposed urban vulnerability. 9/11 was followed by nearly twenty years during which the demand for residential space in most of America’s largest and densest cities was more pressing than it had been for decades.

The past resilience of certain commercial streets in cities at least suggests the possibility that they will continue to be busy and successful places.

Note added 8 January 2021. Nearly ten months into the Pandemic, the stretch of Broadway described above seems as bustling as ever (although I can’t prove this with solid statistics), but there are certainly signs that its commerce has been disrupted. Last June (as noted in footnote 6 below), 29 out of the 203 storefronts on Broadway between Addison Street and Diversey Parkway were unoccupied. This morning, 46 storefronts were vacant, and that figure is probably too low, since several establishments I counted as open are clearly in trouble. One restaurant, for example, had a sign in the window announcing a “temporary closure.” Several others have limited hours and only minimal availability of take-out food. The obvious problem is that restaurants, as well as bars and coffee shops, are now enduring a second period when indoor service is forbidden. Even if the city had imposed no such rule, it’s possible that not many people these days would have wanted to risk eating in a crowded indoor space. Only a few of these establishments have outdoor seating, and, while some of these have added protection to their few outdoor seats, outdoor dining and drinking in Chicago in midwinter remains a hard sell.

There is also some good news about the stretch of Broadway with which I’m concerned. Several new stores have appeared in recent months despite the pandemic. A dance studio, a couple of restaurants, and pop-up stores for Halloween and Christmas have opened, and signs in windows promise additional new shops.

Furthermore, restaurants on the southern half of the street arranged a nearly complete closure of Broadway between Belmont Avenue and Surf Street on several weekends last summer and fall and filled much of the roadway with seats, leaving a substantial walking path. Most seemed to be doing good business. “Dining on Broadway” (as the event was called) clearly brought in visitors from far and wide. But these street closures, which required hiring extra security personnel and renting, installing, and uninstalling special furniture, were apparently expensive to organize, and I don’t know whether they were a financial success.

Closer to the Loop in Chicago, there have been several long-term Pandemic-era street closures that permit restaurants to spread out in the street more or less permanently, which presumably reduces costs by quite a lot. This kind of thing is, of course, pretty common in Western Europe and might be appropriate for Broadway as well. There are certainly enough pedestrians to guarantee that the street would be a congenial and safe place, and there are alternate parallel streets for traffic. The closures last summer and fall provided for easy automobile access to Mariano’s supermarket, and so could a long-term closure. But a street closure of nearly half a mile would require a rethinking of urban land use that, I suspect, would be difficult to pull off in Chicago.   

Note added 28 September 2023. Broadway seems to be doing all right these days—it’s a bustling place. But there are still quite a number of vacant storefronts. I counted 26 yesterday. That’s out of approximately 206 storefronts in the mile-long corridor I talk about above. This number includes a somewhat arbitrary three vacant storefronts in the apartment building that replaced the closed Treasure Island supermarket maybe a year and half ago; they’ve never been rented. (As the sign on the window says, this block of empty storefronts could be subdivided in any number of ways.)

26 vacant storefronts suggest progress. There were 46 vacant storefronts in January 2021, when vaccination was just getting underway, and 29 in June 2020, when the Pandemic was not far from its height (see the text above and footnote 6). The closed storefronts include the substantial Walmart “neighborhood market” north of Diversey, closed this past year along with several other Chicago Walmart outlets in part (it’s widely believed) because theft was such a problem. Walmart’s neighbor, once a large Walgreen’s, remains closed. An H&R Block next door and a Gap north of Belmont Avenue have also closed over the last year. Are national retailers losing their interest in urban commercial streets? Many (and probably most) of the new stores on Broadway—largely restaurants—seem, in fact, to be locally owned.

Developments over the last couple of years suggest a continuation of the churn that has characterized this stretch of Broadway (and other urban commercial streets) for the last several decades.