Wednesday, April 6, 2011

San Rafael Target gets the green light from Community Impact Study

The Community Impact Study for the proposed Target store in San Rafael was released today, and essentially clears the way for the City to approve the project, finding that the impact on existing retailers will be minimal.

  • The study estimated that the highest impact would be on San Rafael retailers in the food and drug categories, with a decline in sales of just 2.9%.
  • In addition, the Target store is estimated to create 164 net new jobs and provide a net annual tax increase to San Rafael of $646,000.
  • The consultant's review of case study cities found that there were no store closures directly related to the opening of a Target store, and that generally downtown retailers adapted to the increased competition.

It's not hard to see that the report was written in order to support the proposed store. The primary reason for the absence of impact in the consultant's analysis is given in the Executive Summary:
"An analysis of retail sales compared to resident demand shows significant under supply, or retail leakage, in General Merchandise retail stores, both within San Rafael and in southern Marin County"
It appears that the consultants reached this conclusion by comparing the pattern of retail sales in central/southern Marin, where General Merchandise stores (i.e. Big Box stores) account for approx. 10% of retail sales,  to the average for California, where Big Box stores get around 18% of sales. When you look at it like this, it is then logical that there is "unmet demand" for these types of stores, and hence that the proposed Target would be satisfying this unmet demand rather than transferring sales from existing stores in the area.

I'll let you decide on whether that makes sense.  Meanwhile I'll read the rest of the report.

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