Friday, June 30, 2017

"Signs" of the Time: How Downtown Signage Can Drive Retail Sales

Marketing experts say that it takes 7 to 12 contacts to turn a prospect into a customer. Yet in our experience, many downtown's fail to take advantage of the opportunities they have to get in front of customers - namely through signage that captures attention. Here are a few recent examples we've come across through our work that illustrate how signage can help raise awareness of both downtown and local businesses.

Business signage - or lack there of
Visible signage is an important part of a business' marketing strategy. Consider this - an exterior sign is visible 24 hours a day and 365 days a year – raising awareness of a business even when that business is closed. Yet some communities have over regulated signs - believing that fewer or smaller signs are in "good taste".

What is down there? Hard to tell, right?  The lack of visible signage limits exploration and
make distances seem much farther away than they are, keeping customers from walking down the street. 

On the other hand, "blade" or "protruding wall" signs can help orient a pedestrian by giving them important visual cues that there are businesses down a corridor.

The businesses in touristy Great Barrington, MA do a great job of
offering signs as a form of "breadcumb" that pulls pedestrians along the street in exploration of new stores. 

Signage that isn't doing it's job
A downtown cultural anchor is a great asset - but what if most people don't know it's there?

Can you spot the Marquee for the Clemens Center in downtown Elmira?
Hint, hint - it's on the right.
During the daytime, this heavily trafficked road carries more than 12,000 vehicles.
These are 12,000 daily impressions that are being neglected. 

Cultural institutions in particular benefit from highly visible signs that also offer opportunities to promote upcoming events, like this gateway marquee marking the entrance to Downtown LA.

Painted Signs on Walls
A blank wall can be a great opportunity to help connect businesses with potential customers.

Freestanding Signs & Sandwich Boards
Many communities place restriction on sandwich boards without taking into consideration how effective they are at driving business to local stores.

This hand painted sign also reinforces the
brand of the store. You can't walk past this store
without noticing it. The lovely window display doesn't hurt either. 
This level of clutter isn't necessarily productive. Regulations can be written to
limit the places of A-frames to an area immediately in front of a business. 

Thursday, June 29, 2017

Round Up: Neighborhood Renaming Prohibition, India Retail Expansion, Urban Lifestyle Centers, "CityTrees", Too Much Parking

New York Senator Wants Realtors to Stop Renaming Neighborhoods

This Next City story questions the right of the real estate industry to change neighborhood names to their likely benefit. I remember the BoCoCa (Boerum Hill, Cobble Hill, Carroll Gardens) debacle a few years ago in South Brooklyn as residents vehemently resisted this name change. How enforceable could the Neighborhood Integrity Act be?

Over 50 global retailers to enter India in 6 months, likely to open about 3,000 stores

Small and mid-sized brands look to expand in India, now a very promising market on the rise with an "open retail policy and huge gap in the market for branded products." 

Making the move from the regional mall to the urban lifestyle center

The move marks an ongoing shift from enclosed regional mall or large suburban-style retail center to more urban lifestyle-focused mixed-use. National chains are adjusting to a smaller-format and community engagement.

Moss-covered CityTree has the same air-purifying effect as 275 regular trees

Not just good for the air we breath, but the CityTree could be a commercial corridor marketing tool. 

Downtown Akron is one-third parking lots: Akron Downtown Vision & Redevelopment plan asks for ideas on challenges

One-third is high but not unusual for the Midwest. Akron saw a high level of community engagement in response to an input seeking session and follows their Phase 1 session last year. 

Monday, June 26, 2017

Beauty Store Survival in the E-Commerce Age

The beauty store is proving that, for some retail categories, shopping in-store remains very much a social experience. Around the country, beauty stores are transitioning into places that inform, educate, and entertain, according to founders of Bluemercury, a leading luxury beauty retailer.

Beauty stores are also quickly responding to the changing habits of their consumers who crave convenience and rapid service. Bluemercury, for example, is often located in an urban and dense location, probably next to a Starbucks, so that the busy mom or working professional can easily grab coffee and then grab lipstick in one seamless trip.

Today, overall spending on makeup and beauty supply is being boosted by an influx of new brands and products creating more dollars to go around amongst retailers. In fact, spending on beauty and personal care is growing more quickly globally compared to spending on apparel and footwear, according to market research firm Euromonitor International. This may be attributable to the fact that the beauty industry also has the added benefit of not being a seasonal industry, which keeps prices relatively consistent throughout the year. Although shades of make-up change by season, products remain the same and things like facial wash and shampoo remain the same throughout the year. This is antithetical to the season-dependent clothing and accessories category.

The $80-billion-a-year U.S. beauty industry has been growing 4% annually since 2010—much faster than other areas of retail – and Hispanic and African-American women are making up a large share of this market.

How are beauty retailers reinventing to survive this e-commerce era?

Leverage social media
Fortunately, beauty consumers are also discovering new make-up looks online as they do with clothing and accessories. Many beauty retailers are getting a boost from the rise of the selfie as consumers are referring to looks they see on Instagram, Snapchat or Pinterest as inspiration for product purchases. According to Shelley Haus, vice president of brand marketing at Ulta Beauty, “Social media is shaping consumer behavior… Scrolling through Instagram, the pictures and videos bring things to life in a way that’s super absorbable.”

Sephora has even sponsored Snapchat filters that create instant makeovers to the subject in the photo. This makes the product relatable and appealing to users. Sephora also targets its Snapchat filters at specific locations within proximity of a store so that in can help capture foot traffic. Customers who may not realize they’re near a Sephora store then become aware when they turn the geofilter on.

Maintain brand exclusivity
In an age where everyone assumes they can buy almost anything on Amazon, it seems almost impossible for retailers to keep up with online Amazon sales. Ulta Beauty and Sephora, however, have managed to keep the e-commerce giant Amazon at bay by maintaining brand exclusivity. Many higher-end makeup companies distributing their products through Ulta or Sephora have little product overlap with Amazon ensuring that customers must often make purchases off of the Amazon site, according to the analytics firm L2.

This cooperation/ partnership with higher end brands is also being strengthened across all channels through combined ‘prestige brand boutiques’ whose sales rose 7% last year, according to NPD Group.

Provide satisfying in-store experience
Most importantly, beauty stores are continuing to expand beauty and makeover services provided so that customers continue to shop in-store. First and foremost, beauty stores are providing places to play with special vanity lighting and make up testing stations. This is especially important to customers who are buying a product for the first time and wish to test and sample products. Makeup shades, for example, may appear differently on screen than on the face.

More and more, beauty stores are also providing a wider range of services including full-service salons and in-store brow bars. This allows customers to learn the latest makeup application techniques that may be harder to do/ more time consuming to do online. Ulta, for example, does not charge for makeup consultations while Sephora holds free make-up classes throughout the year.

Here's more on the top three beauty stores expanding throughout the country, read on and find out what they have to offer and what they're looking for!

1.    Ulta
Description: All-inclusive stores carry over 20,000 products from over 500 brands – everything from mass-market brands to high-end cosmetics, all in a format that lets customers try before they buy
In-store services: Beauty services include nails, waxing, blowouts (Ulta launched Drybar in 400 of its stores in 2016) and salon services include facial, hair, make-up
Ulta also maintains loyalty through a successful shopper-rewards program, Ultamate. It is one of the nation’s biggest loyalty programs, with 20.6 million members—and members account for an astounding 80% of its sales.
Growth: Same-store sales rose 14.3 % for the latest period while digital sales grew 71 % in the first quarter of 2017, to $104.3 million from $61 million. Strong online sales are largely incremental to its brick-and-mortar business, with 8.6% of loyalty members now shopping across all channels
E-commerce strategies: Paid search, display advertising, paid social
Current Locations: Ulta is widely- known as the ‘strip mall secret’. Ulta’s preferred neighbors were retailers like T.J. Maxx and Target—because of the middle-class shoppers they attract. In NYC, Ulta Beauty can also be found in regional shopping centers such as Rego Center and The Shops at Atlas Park. However, its fourth store is due to open in the more urban setting of Upper East Side as it changes its co-tenancy strategy toward Trader Joe’s and Whole Foods.
Customers: Millennials, Gen X and particularly, Latinos. Customer dwell time is estimated to be at least 15 minutes per visit.
Expansion Plans: Looking to expand from 1,400 to 1,700 locations across the US, or 100 per year.
Site Requirements: 12,000 SF (10% taken up by salon stations)

2.    Sephora
In-store services: Other than the typical beauty and salon services, Sephora stores also boast high tech features like iPad stations that offer beauty classes and virtual makeup try-ons
Omni-channel game: Launched the ability for customers to purchase Sephora online and pick up their order at a J.C. Penney store the same day, planning to introduce a new online feature that will enable customers to book a makeover with a Sephora beauty consultant.
Customers: Urban,  high-end
Site Requirements: 1,500 -2,600 SF (or up to 5,000SF)
Expansion Plans: Sephora inside J.C. Penney began in 2006 and after this expansion the company's makeup, fragrances, skin and haircare brands will be available in almost 650 J.C. Penney stores in 2017.

3.    Bluemercury
Description: Upscale, neighborhood alternative to department store beauty stands. Its focus lies in offering products with natural ingredients.
In-store service: Spa services include skincare treatments, esthetic treatments, and body care treatments. Bluemercury is also known to invest heavily in knowledgeable service staff. Employees develop expert product knowledge and are offered benefits for longer-term employment.
Current Locations: Dense urban areas, customers live within 5-mile radius/ 15 minute drive in the case of suburbs, co-location with take-out and fast-casual eateries and caf├ęs
Customers: Broad array of customers – “50 percent of customers are coming for a solution to a problem or a product with a specific attribute.” However, product prices vary from mid to high and may appeal more to younger professional woman. Customer is also looking for a more relaxed environment than Ulta or Sephora
Site Requirements: 2,500 SF
Expansion Plans: Currently has 140 stores in the U.S., with 3 new stores opening every week – looking to expand up to 24 more bluemercury stores in 2016 and 18 bluemercury shops within Macy’s stores

Thursday, June 22, 2017

The Growth of Food Trucks

Food Truck Fest in Troy, NY (Photo: Townsquare Media)
Here at LOA we are paying close attention to food trends as this category continues to grow its share of overall consumer spending. Consumer dining habits are rapidly shifting as more and more spending is happening on meals outside the home than on buying groceries and eating in, according to the most recent expenditure data (Bureau of Economic Analysis, Q1 2016). In recent months, we’ve covered the new categorization of food services, and delved deeper into food hubs and food halls, but now it’s time to take a closer look at food trucks.

Food trucks are establishments primarily engaged in preparing and serving meals from a mobile truck. Food is normally prepared, stored and cooked on the truck and the truck may or may not use the same location every day. Today, there are over 4,000 food trucks across the nation. According to IBISWorld, a market research firm, from 2011 to 2016 industry revenue grew at an annual rate of 7.9% and in 2016 reached over $1.2 billion – and that’s why we’re paying attention to this industry.

NYC Food Truck (Photo: Sacha Fernandez)
Like full service restaurants and other eating places, food trucks can primarily be found in densely populated cities and regions. According to a Zagat survey from 2012, the most concentrated cities include New York (11.1% of industry establishments), Boston, Washington, DC, Miami, Houston, Austin, TX, Cleveland, Chicago, Portland, OR, and Los Angeles. The West and Mid-Atlantic are the most important regions for this industry, accounting for an estimated 25.2% and 23.3% of food trucks in 2016, respectively. As its popularity grows in Florida, the Southeast is also anticipated to account for a greater substantial share of food truck establishments.

Food trucks, however, were never this popular in the past. Early on in its inception, food trucks predominantly existed to serve the budget-strapped working class citizen searching for a cheap lunch deal. Trucks would be parked by construction sites and a hefty meal would cost no more than $6-8. Food trucks were also widely acknowledged by entrepreneurs as the quickest and most affordable way to break into the food business with low set-up, operating and licensing costs.

Today, the tables have turned. Food trucks are increasingly being used as promotional and marketing tools for established chefs, hotels, and restaurant brands. Bigger companies and national chains are using food trucks to service private events and music festivals just to get their name out there. Brian Pekarcik and Rick Stern, co-owners of Spoon and BRGR restaurants in Pittsburgh, launched a BRGR truck for that very reason. “As brand recognition, it's a great advertising piece,” they explained. “And we expect that it will drive customers to our restaurants.”

Food Trucks on parking lot in San Francisco, CA (Photo: Quinn Dombrowski)
And meals are not as cheap anymore because the trendy, young professional seeking new and gourmet food has now become a major customer segment in densely populated cities.  These changes are also reflected in successful sales locations for food trucks. In 2015, only 15% of food truck sales were made at industrial/ construction work sites versus 18% at venues and events, according to Mobile-Cuisine.Com.

Cities, however, are still trying to navigate this burgeoning industry. Some are implementing programs and policies in support of these small food businesses, while others are taking a protectionist approach by heavily regulating and hindering the growth of food truck operators for fear that they may take away sales of brick-and mortar restaurants and eateries. Others also blame mobile food trucks for congesting sidewalks and streets and diminishing the urban quality of life.

Food trucks outside restaurant in Cleveland, OH (Photo:E Little)
In Chicago, IL, for example, food trucks are being held back by regulations that prohibit them from setting up shop within 200 feet of a bricks and mortar restaurant or from parking in any one location for more than two hours. Bricks and mortar restaurants are often, if not always, located near the retail core of downtowns and near entertainment and leisure destinations where a considerable amount of foot traffic is already established. By disallowing food trucks from setting up in those areas, they may be pushed to peripheries of downtowns or less attractive streets where there isn’t a sufficient threshold of customers to break even. Also, in Chicago, where parking ratios are lower, food trucks would be hard pressed to find desirable parking spots quickly – resulting in lost critical sales hours. These restrictions and more have stifled the industry’s growth in Chicago at a 1:100 ratio of food truck to restaurants.

Food truck on Leather Lane, London UK (Photo: duncan c)
This defensive position, however, may be unfounded because the Bureau of Labour Statistics has found that counties that have experienced higher growth in mobile-food services have also had quicker growth in their restaurant and catering businesses. For example, in Seattle, the number of restaurants and surrounding King County has grown by 16% since 2010 in spite of a thriving food-truck scene. In Travis County, Texas, which includes Austin, the restaurant count has jumped 18% even as food trucks have increased more than six-fold. In fact, in Houston TX, restaurants have experienced increased business generated by food trucks parking nearby and drawing more people to the restaurants’ neighborhoods. Restaurant owners themselves have reportedly asked the Houston City Council to ease existing laws that make it difficult for food trucks to operate.

In other cities, parking laws and other ordinances are evolving to catch up with the industry’s transformation and although there is no one-size-fits-all solution, here are some best practices from around the country if you’re looking to take a supportive approach leaned towards fair ordinances that allow food truck vendors to flourish.

BEST PRACTICE: Austin, TX – Simple and non-prescriptive Food Truck Ordinance
In the City’s Zoning Ordinance, mobile food establishments, or food trucks, are permitted in all commercial and industrial zoning districts and are minimally restricted from operating between the hours of 3:00 am and 6:00 am. The distance restriction on operating a food truck near a restaurant is also very minimal at 20 feet, versus the 200 feet in Chicago.  In more residential neighborhoods, the City allows for neighborhood association areas to reasonably request further restrictions on the operations of food trucks to avoid noise and litter nuisances in predominantly more residential areas.  And that really is the end of the restrictions on food truck operations in the City.

BEST PRACTICE: Cincinnati, OH – Streamlined permitting process
Austin , TX and Cincinnati, OH are two cities that have streamlined and centralized their food truck permitting processes. This strategy lowers time and cost on the part of small business owners hoping to license their food trucks and start operating. Austin’s permitting web page has detachable forms and blank spots for the necessary signatures, with instructions regarding who to contact to obtain those signatures. On the same page, it also specifies the actual schematics of the truck components required for food preparation and handling safety, and best of all, nowhere does it suggest to refer to a subsection of the zoning code or statute not included in the document. Simplifying and making the process clear is crucial to encouraging food truck vendors.  Meanwhile in Ohio, the Cincinnati Department of Health is the only agency responsible for the city’s permitting process, application process, and payments associated with the city’s mobile food vending. Half the time, food truck vendors are required to submit applications to four or five different agencies and this process can become confusing for applicants.

Food Truck Thursday in Washington DC (Photo: Ted Eytan)
BEST PRACTICE: Washington DC – Mobile Roadway Vending Zones
Farragut Square, Washington DC, is now a vibrant outdoor food court since the city implemented Mobile Roadway Vending zones, or MRVs, in 2013 allowing trucks to vend for four continuous hours without breaking parking laws. The city rolled out eight MRVs that year, including ones at Farragut Square, Franklin Square, L’Enfant Plaza and Metro Center. 95 parking spots were made available in the MRVs and are handed out via a monthly lottery. These food trucks sell food at lunch hour to the thousands of workers in each district.

Food truck on private lot in Brooklyn NY (Photo: Jason Lam)
BEST PRACTICE: Portland, Oregon – Vacant Lots for food truck clusters
After a study in 2008 by researchers at Portland State University that concluded food carts benefited residents, the city began encouraging the use of vacant land for food-truck clusters or “pods”. The No-Vacancy guide explores temporary use of vacant space (including food truck vending!) and its applicability in the Central Eastside Industrial District. The guide shows property owners and food truck vendors how to navigate permitting and zoning processes in these scenarios.

Establish a pilot program!
If your downtown is still getting its feet wet in the food truck business, try implementing a pilot program to make informed decisions on what regulations to adopt in the future. Pilot programs are meant to test the waters and can very easily bring to light the issues that are unique to your community.  A small pilot program will also minimize any unintended impacts while still gleaning insight on what works and what doesn’t locally.

The City of Cambridge, whom we are currently consulting with on a citywide retail market strategy, launched a pilot program in 2011 that allowed permitted mobile food trucks to park in spots adjacent to riverfront parks. An initiative of the Community Development Department, the program was used to determine whether a future, permanent program should be implemented.  In the pilot, food truck vendors had to apply to participate in the program and spaces were leased on a week-by-week basis for a per-day fee.

By the end of the pilot, the City learned that the designated vending spots did not work for trucks. The City has selected low pedestrian traffic areas or times because it had wanted to activate these spaces, however it backfired on vendors who found they could not make their businesses financially viable in those areas. The City also learned quickly that a cluster of trucks needed to be marketed versus just one at each spot. Marketing and communicating to the customers that there were more than a single food option was found to be more effective.

With all the lessons learned, the City of Cambridge hopes to re-launch a new food truck program with policy improvements that were suggested by food truck operators.

Let us know if your city has an effective food truck program too!

Institute for Justice’s Food-Truck Freedom Report:

Urban Vitality Group and City of Portland’s Food Cartology Report:

The Future of Physical Retail in the Age of Online

Mike Berne, Principal of MJB Consulting, is a friend and frequent collaborator. We are pleased to share his insights on the Amazon purchase of Whole Foods. While some have come out against this merger he argues that perhaps there is less to be concerned about than we think. In September,MJB and LOA will be leading an ICSC sponsored pre-conference workshop at the IDA Annual Conference in Winnipeg.  

Still digesting this acquisition, trying to get my head around it.  

My first impression is that everyone is overreacting, as per usual.  It might have been different if they had acquired Kroger or Albertsons, but at 460 stores, Whole Foods is still a niche player in the grand scheme of things — yes, it is very prominent in the uber-educated markets where media elites tend to live (partly explaining the overreaction in the press and among analysts), but there is little overlap with “Flyover Country” between the WF shopper and the Kroger/Walmart/Aldi shopper, and businesses on the scale of Amazon need both, frankly.  

That said, the purchase of Whole Foods makes sense given that there is quite a bit more overlap between Whole Foods and Amazon Prime.  The acquisition of 460 brick-and-mortar stores essentially provides Amazon with 460 new fulfillment centers that they did not have to build themselves and that sit much closer to the dense cities where their Prime members are concentrated.  In other words, these 460 fulfillment centers help to solve the so-called “last-mile” problem and can theoretically improve their margins on food delivery. 

Many of the articles appearing in the last few days manifest little to no doubt that Amazon will be able to conquer the grocery space in short order but the reality is that Amazon (and others) have been trying to do this for years now, and has mostly failed at it.  The market share for online grocery in this country is still negligible and it is not at all clear that Americans will ever follow the U.K. example.  (Yes, there is Fresh Direct, but that is an anomaly, focused as it is on the extremely dense NYC metro).  

These articles also make scant reference to the fact that Amazon has yet to establish a money-making business model for e-commerce more generally.  Over the course of two decades, the company has generated profit of roughly $5.7B — over two decades!  By comparison, Walmart generated profit of some $14M last year alone!  This is primarily because the cost of shipping and returns remains a killer, even at Amazon’s scale!  Buried within all of the hyperbole is the inconvenient truth that pure play e-commerce is simply not sustainable, and that it is only by diversifying into bricks-and-mortar that Amazon and other smaller e-tailers will be able to thrive in the long term.

So yes, free shipping and returns are great, drones are cool, and cashier-less grocery stores would be wonderful.  But as they say, segments on 60 Minutes don’t pay the bills. And I wonder how much patience investors would have had in Amazon if the company had not happened upon the much more highly-profitable cloud computing business.  

In sum, then, if this acquisition helps Amazon to lower its supply-chain costs and thereby derive some profit from selling groceries, then yeah, it will be a winner for them.  But I think the company is past the point where merely growing (taking) market share will do the trick.  It is time for results.

Authored by Mike Berne, MJB Consulting

Friday, June 16, 2017

International General Merchandise Brands Growing Here

Store: MUJI
Originally From: Japan
Years in Business: 35
Stores in US: NY, CA
Site Requirements/ SF: 3,600-4,000 SF
Store Type/ Concept:  Sells a wide variety of household and consumer goods. It is distinguished by its design minimalism as a physical store and in its products. MUJI sells more than 7,000 products ranging from stationery and clothing, to food items and major kitchen appliances and home ware. MUJI products have a limited color range and are displayed on shelves with minimal packaging.
Price Point: Low to moderate
Target Customer: Consumers are younger, aged 20-35. Lifestyles are minimalist and environmentally-conscientious
Expansion Plans: Opened its first US store in 2007 in NYC SoHo. Since then, it has expanded to one other state California. MUJI intends to nearly double the number of its international stores over the next few years. More specifically, the target for U.S. is 100 stores by 2020 and 500 in the longer term.

Store: Flying Tiger 
Originally From: Copenhagen, Denmark
Years in Business: 22
Stores in US: New York (Flatiron neighborhood)
Site Requirements/ SF: 5,000 SF; preference for location near other designer home furnishing brands such as ABC Carpet, Design Within Reach etc.
Store Type/Concept: The store's mission is to make high design accessible to everyone, "the dollar store of Danish Design". Each store is filled with 'quirky products' that are mostly designed in-house. The merchandise ranges from gifts to food and office supplies. The store aims to offer a less serious shopping experience than other general merchandise stores like Target or Muji. 
Price Point: Low (90% of Flying Tiger’s products are less than $15)
Target Customer: Young, trendy professionals and families - customers have a flair for design
Expansion Plans: Unknown - expansion in the US from 1 to 4 stores strictly in NYC in the last 2 years

Store: Miniso
Originally From: Japan/ China
Years in Business: 6
Stores in US: CA Old Pasadena Business District (first store in the US opened in April 2017)
Site Requirements/ SF: 3,000 SF
Store Type/ Concept:  A single Miniso store offers some 10,000 products across the various categories including housewares, beauty products, inexpensive jewelry, and electronic accessories
Price Point: Low (Average price per item is $5)
Target Customer: Wide range of consumers but most popular with 18-35 age group
Expansion Plans: Company has aggressive growth plans for the U.S. involving first California and Texas, with a focus on major metro areas such as Los Angeles, San Francisco and Dallas. Aims to open roughly 25 U.S. stores this year with the ultimate aim of having about 50 stores in total by end of 2018

Friday, June 9, 2017

Managing Homelessness Downtown

Our recent experience working with downtowns in the state of New York and in North Carolina this past year has brought to our attention a spike in stakeholder concerns over homelessness downtown. The homeless population is often referred to as the people who “lack a fixed, regular, and adequate nighttime residence". In downtowns, the homeless are often seen occupying public or private places that are not designed to be regular sleeping accommodation including parking lots and garages, storefront stoops, transit stations, vacant buildings/ lots etc. In addition to this group, there are also the homeless who live in substandard buildings that lack sanitation, cooking facilities or heat, who are often disregarded.


Seeing the rising concern over homelessness in our own projects led us to dig a little deeper into the trends happening elsewhere. As it turns out, homelessness is indeed spiking in cities all across the country, and particularly in downtowns. In San Diego, for example, tent cities have begun proliferating downtown near freeway on-ramps and commercial districts and homeless service centers. On a recent trip to Seattle, WA, I witnessed the same trend occurring under the on-ramp to I-90 by the CenturyLink Field and Chinatown District.

A myriad of factors contribute to the rising homeless population downtown but many leaders are increasingly placing blame on criminal justice reforms, which have downgraded some felonies to misdemeanors and therefore keeping some people out of prison or drug treatment and instead leaving them on the streets.

The more popular reason for the rise in homelessness downtown, however, remains the increasing cost of rents and disappearance of residential hotels. As more people look to live in convenient and vibrant downtowns across the nation, the high demand for downtown apartments and houses is slowly driving prices up for all housing stock. Meanwhile, homeless advocates are also pointing to the significant loss of single-room occupancy units, or SROs, as a key factor in the homelessness crisis. Many SRO units that still remain are unfortunately uninviting and unaffordable.

Why do homeless people gather downtown?

While those who can afford to live in downtowns are moving to these areas for comfort, convenience, and entertainment, homeless individuals on the other hand are coming in droves because downtown is often the best place to seek day service centers, social service centers, and basic amenities such as bathrooms and water fountains.  Downtown is also the place where homeless folks can get a meal, a shower or a shelter bed – resources that often cannot be found elsewhere.

During a stakeholder interview for our work in Middletown (NY), Director of the Thrall Library, Matt Pfisterer informed us that the homeless population there was particularly active around the library because they needed bathroom access in the day when they were not in shelters. Later in the afternoon, he reports, the homeless crowd migrates towards the soup kitchens and other downtown homeless service centers as they start to compete for safe and comfortable night time lodging. The Thrall Library, as do many other libraries across the nation, does its best to accommodate this group by ensuring bathrooms are monitored and maintained constantly throughout the day by staff and personnel to ensure that all library users can continue to use the bathrooms hassle-free.


Bathroom lines and litter are hardly issues when it comes to dealing with homelessness downtown. Many cities are facing harder problems such as drug use in public, rise in reported theft, and overall, a perceived lack of safety amongst residents and visitors. This overall unwelcoming atmosphere is not only discouraging some from living and investing in downtown, but also discouraging customers from shopping and visiting downtown. In our experience, we have heard from business owners and property owners that homelessness downtown has negatively impacted foot traffic and in turn, sales. In some cases, the homeless population has been driven to spend nights on storefront stoops and use back alleys as latrines, giving store employees additional work in the morning when they return to open and operate businesses.

Lower patronage downtown has even resulted in businesses closing in Portland, OR. A dance studio in downtown Portland, OR experienced dwindling class attendance from out-of-towners who felt scared walking to and from parking lots and dance class in the evenings as a result of the spike in the homeless population there.

Management Solutions

Whether perceived or real, this lack of safety experienced downtown can be managed by downtown organizations. The first step in managing homelessness downtown is counting, keeping track, and being aware of the current situation. After all, you cannot manage what you don’t know.  By keeping count of your homeless population, you will be able to determine the actual size and scope of the issue and at the same time identify hot spots with high concentrations of homeless folks and their peak visiting times during the day.

A common way to count the population is to use the ‘point-in-time’ method. This method requires that the count take place on one day every year across the city or downtown and therefore provides a Point-In-Time snapshot of the homeless population. This can be conducted by public or private sector volunteers including, of course, the downtown organization. This information can then even be registered with the US Department of Housing and Urban Development to become a part of a nationwide database for understanding homelessness across the country and will be required to be considered for federal funding to combat homelessness.

The limitation with this method, however, is that volunteers counting are only limited to what they can see by eye. In essence, they count the number of homeless people seen in cars, and on foot and if there are those who are hidden in tents, an assumption is made that there are two people per tent and may therefore be undercounting. Keeping a consistent counting method throughout the months and years is crucial for comparing data over time accurately and as long as this limitation is recognized, downtown organizations will be able to make informed decisions.

Downtown San Diego Partnership takes counting a step further by organizing a monthly survey instead of an annual one. Homeless outreach workers with the Downtown Partnership cover 275 city blocks between midnight and 5 a.m. on the last Thursday of every month and they have been counting since 2012. This has enabled them to see changes year-on-year and the data has helped the Partnership determine what actions need to be taken to manage the spike in homelessness and also to determine factors that may be affecting the numbers.

Taking Action

There are a number of actions that can be taken by downtowns to manage their homeless populations depending on size and scope.

First, developing a Vulnerability Index has been critical to many downtowns and cities in order for them to identify and prioritize the homeless population on the streets that should qualify for housing. A Vulnerability Index typically measures length of homelessness and mortality risk and is a practical application—a person-to-person survey—that is “revolutionizing the speed at which … chronically homeless population is placed into permanent housing”.

In some cities, non profits are stepping forward to create diverse housing stocks for the formerly homeless and low-income residents. Mixed-income permanent supportive housing is becoming a popular strategy to house the homeless population in larger cities such as DC and NYC.Often these buildings also feature community spaces such as rooftop terraces, gardens, lounges, gyms and laundry rooms that help the residents get out and engage with neighbors – a holistic environment for recovery from homelessness or any other dire situation.

While providing housing stock may be a longer term strategy, other short to medium-term strategies are also in place in many downtowns across the country. Libraries, as mentioned earlier, are becoming top community spaces that support the homeless population. The DC public library, for example, now provides an innovative outreach program for the homeless since its first hire of a Health and Human Services Coordinator. A Knight Foundation grant in 2015 enabled DC Public library to create an online interface of health and human services data  and train librarians in homelessness outreach so that when homeless folks come up to a librarian, he/she is able to direct them to the right service providers and give the correct referrals. This is a simple yet essential tool for supporting homeless folks and getting them back on track.

In other instances, business improvement districts have partnered with existing homeless-serving organizations to carry out supportive programs. In Los Angeles, CA, Downtown Center Business Improvement District  funds homeless outreach teams to contact, interview and assist homeless people living in the west side of downtown. Over $255,000 has been funneled from the BID to two social services agencies in order to hire staff to do this outreach work. PATH, or People Assisting the Homeless, is one of the organizations that provides services, including street outreach, shelter and housing construction. Chrysalis, a skid row program, then provides job preparation and temporary work experience, and also has been tasked with picking up litter in areas heavily-trafficked by homeless folks. In the first year of funding from the BID, outreach workers completed 196 assessments, and placed 36 people in permanent housing and enrolled 56 in PATH’s housing services.
Downtown San Diego Partnership, on the other hand, has set up a Clean and Safe Program and DowntownDC BID partnered with the city government and 20 local service providers in order to facilitate various efforts to end homelessness. This includes a partnership with Pathways to Housing DC that has deployed a 4-person, clinically-based outreach team that provides street-level intervention to move individuals beyond homelessness to independence. In addition, DowntownDC BID’s Safety/ Hospitality and Maintenance employees have 12 specially-trained members, known as the Homeless Outreach Service Team (HOST), who work closely with the Pathways to Housing DC Team and are trained to recognize and engage individuals with mental and addiction challenges. The smallest yet most impactful effort made by DowntownDC BID, however, remains the brown bag discussions that help educate the public on homelessness and raise awareness.

Installing public bathrooms is another potential strategy that might mitigate instances of public urination/ defecation. Although not all instances of this offence is carried out by the homeless, the compassionate approach rather than law enforcement approach has been widely praised by residents of the city of Denver, CO, where a pilot program of mobile public restrooms was established last year. These mobile facilities cost $12,000 per month to lease and are cleaned nightly and rotated regularly to different locations. Public bathrooms are basic amenities that should be made available to all users of downtown.
Given that vacant lots are often targeted for homeless camps to set up, downtown organizations may mitigate the situation by requiring or ensuring that private property owners have reliable property management companies in place to monitor compliance with zoning codes.

Finally, as downtown organizations plan ahead the annual schedule of events, they might start thinking about organizing events in partnership with homeless groups and shelters to accelerate and coordinate the move-in process. These processes normally take 60 days to happen but can be expedited in a single all-day event that serves as both outreach to homeless folks and also one that raises awareness amongst the general public.

Take a Comprehensive Approach

Overall, it is important to acknowledge that ignoring the homeless population downtown will not make it go away. A comprehensive approach must be taken by downtowns, in partnership with city, state or even federal agencies, and nonprofits and local community groups. Addressing the full range of issues faced by the homeless including housing/shelter, employment services, meals, and rehabilitation is crucial to managing the problem. It is also important to remember to count and measure the scale and scope of the issue first before taking any mitigating steps. This ensures that the response or strategies implemented directly serve those in need rather than simply blanket the problem.