City of Chicago, Illinois Corridor Opportunity Study Appendix Beverly, Morgan Park and Mount Greenwood February 2005 Goodman Williams Group Mid-America Real Estate Corporation Beverly, Morgan Park, Mount Greenwood Market Assessment February 2005 Prepared For Chicago Department of Planning and Development By Goodman Williams Group Mid-America Real Estate URS•TPAP Corporation Table of Contents I. Summary of Major Conclusions..........................................................................2 II. Study Area Characteristics .................................................................................4 III. Retail Market .....................................................................................................8 IV. Residential Market...........................................................................................14 V. Other Commercial ...........................................................................................19 VI. Retail Conclusions...........................................................................................21 VII. Train Station Areas.........................................................................................27 VIII. Other Recommendations ................................................................................29 I. Summary of Major Market Conclusions Retail Market The analysis of the study area reveals high-income households, high traffic counts, and good regional access that should attract the attention of many retailers. However, today’s most sought-after retailers have largely by-passed this area for reasons that include the following: • The study area provides a relatively small pocket of affluence among lower income neighborhoods. Many retailers prefer to target a particular customer base of significant size rather than draw from households with a range of incomes. • The study area is racially diverse. The communities that surround this area are, however, virtually all white or all black. This profile may complicate the location decision for certain retailers. • The population density is high for the area in three- and five-mile radii. The density of the immediate study area is not, however, the level that many retailers seek. • The predominant customer base of the nearest shopping center, Evergreen Plaza is not comprised of residents of the study area or Evergreen Park. As one result, this regional shopping center has not generated complementary retail development on adjacent sites in Chicago. • The major commercial corridors of the study area, where more intense retail development should occur, do not have the attractive architectural or design character that is found on the residential streets or in the train station areas. • Appropriate development sites have not been available in this mature community to accommodate large-format retailers or new centers with exciting tenants. The types of retailers that the community desires have their choice of top locations. Such stores include Williams-Sonoma, Talbots, Pottery Barn, Crate & Barrel, and Banana Republic. They prefer to locate in clusters, which are found in regional malls, in true lifestyle centers, and occasionally in high-end suburban downtowns or neighborhoods. The nearest lifestyle concentrations are 10 to 15 miles distant, at North and Clybourn and on Michigan Avenue in Chicago and in suburban Orland Park. Others are located more than 15 miles away in the Yorktown and Oakbrook malls. Residents of the study area already shop in these locations, so an additional store would not grow the sales of these retailers. The top lifestyle stores are unlikely to consider the study area for an expansion location. Although today’s “hottest” national apparel and home décor retailers may not be prospects for the study area, other desirable retailers may be interested. An analysis of expenditure potential reveals that the study area is not over-stored, and specialty grocery, apparel stores, and restaurants are target categories. Although specific retailers are identified in this report, the retail categories are more important in the rapidly changing nature of the industry. Beverly, Morgan Park, Mount Greenwood Market Assessment Page 2 The objective of the plan that was developed in conjunction with this market study is to draw strong retailers in the short term, and position 95th and Western as a competitive retail location in the long term. Market factors related to location and demographics cannot be significantly changed. The plan does, however, address two important issues that can be changed by discussing how the commercial corridors can be made more attractive and identifying sites that are key to enhancing the retail vitality of the area and preserving opportunities. The plan concentrates new development along 95th Street and on Western Avenue. It identifies sites that present the strongest opportunities for attracting a sufficient amount of retail to anchor the area and create a strong image. The plan seeks to reinvigorate the stalled mid-1990s vision for 95th Street: a Border’s bookstore, other mid-sized lifestyle retailers, and smaller stores and restaurants in a pedestrian environment. This level of development would be a major improvement over current conditions and satisfy some of the community’s retail needs. Over time, this location should be increasingly able to vie for a wide array of retailers, including, perhaps, some that are not now interested. Residential Market The study area has very attractive housing stock, highly competitive community amenities, and constrained supply conditions. The Plan recommends particular sites for the development of attached ownership housing that will diversify housing choices for existing residents and newcomers and attract more young households to the community. The URS•TPAPplan shows potential sites for new residential development in the Metra station areas. The station areas are ideal locations for this higher density alternative to the predominant single-family housing in the study area. New housing within easy walking distance of Metra stations should attract downtown Chicago workers who may not have otherwise considered Beverly or Morgan Park. These new households will strengthen support for existing retailers and service providers in those areas. Certain areas along the commercial corridors are identified as appropriate for residential development. In these cases, the character of the corridor, surrounding land uses, and possible alternative uses were considered. The Neighborhood Mixed-Use District zoning designation may be appropriate for some corridor sections that are under- developed and not competitive for new retail development. Other Opportunities Various banks and health care providers occupy individual buildings and are a significant presence throughout the study area. Some of these existing buildings need to be upgraded. Additionally, new ones are likely to be built. With the strong local base of commercial businesses, office uses for second-floor space in new buildings should be considered. The gap between achievable rents and the cost of new construction suggests, however, that new commercial buildings are likely to be built-to-suit rather than speculatively built. Reinvestment to create attractive buildings and new construction projects are consistent with retail and residential land uses in the corridors of the study areas, and such commercial uses should be encouraged. Beverly, Morgan Park, Mount Greenwood Market Assessment Page 3 II. Study Area Characteristics Introduction This market assessment is one component of a study of the development opportunities in Chicago’s Beverly, Morgan Park, and Mount Greenwood communities, prepared for the Chicago Department of Planning and Development. The consulting team is composed of Goodman Williams Group (market analysts), URS•TPAP (planners and urban designers), and Mid-America Real Estate (retail brokers). This market study was intended to help build consensus on development strategies and to guide the physical planning efforts of URS. The primary emphasis of the market study is the analysis of opportunities for retail development. Political, business, and community leaders have been frustrated that the socio-economic characteristics of many of the residents of the study area are not reflected in the retail development. This report examines demand and supply characteristics of the retail market and sets forth recommendations for redevelopment. Census Profile The study area includes three community areas on Chicago’s southwest side: Beverly, Mount Greenwood, and Morgan Park. Profiles of those community areas, which are among 77 community areas designated by the City for planning purposes, are presented in the table Select Census Characteristics in the addendum. With a combined population of 66,038, the three community areas are the size of a small city and represent 2.3% of the City’s population. Several characteristics set the area apart from other parts of the city. • As a whole, the study area is racially diverse. Roughly two-thirds of the Beverly population is white and one-third is black, while Morgan Park is the inverse. About 94% of the population of Mount Greenwood is white. The addenda include maps that show the racial characteristics of the area as well as its larger geographic context. The population to the east, in the City of Chicago, is largely black, and the population in suburban communities to the west is predominantly white. The reputation of Beverly and Morgan