Innisfil – the Retail Dilemma

In my last article, I talked about local food issues and how zoning can play an important part in promoting resilience. There are a few more things the Town might consider doing to support local businesses and economic development.

Alcona, as the primary commercial core, is too sparsely developed, so far, to form an adequate retail shopping environment. Existing commercial buildings are too spread out between vacant ‘dead’ zones, to make an attractive, walkable retail neighbourhood. Zoning and streetscape improvements were intended to attract significant development but that may be more years away from reality. Cookstown, Lefroy and Stroud are expected to have their own ‘core retail’ as well but will also be years away.

It appears to me that we have too many absentee landlords of commercial properties in Innisfil. Because there are few other options available (vacancy 0.9% in 2010), rents are too high for the current level of economic activity here. Distant landlords are both indifferent and uninformed. This appears to have been disastrous for a number of business tenants that have come and gone in the past few years. Properties can sit vacant for extended periods. This hurts all existing businesses. 

Besides zoning, the Town could consider land-banking some key commercially-zoned properties to exercise stronger control over the type, size and timing of development for mixed use and retail projects. This might make smaller retail spaces more easily accessible for local entrepreneurs, micro-businesses and social enterprises and increase rental competition. The Town’s Retail Demand Study (2011) concluded that available commercial and retail spaces were too small for the usual big box and chain stores. They base their plans on generating larger sales volumes. The defunct Canadian Tire store plan (65,400 SF) would have dwarfed all existing commercial space in Innisfil. The Town has been considering land-banking some property to provide adequate future parking space but we could look beyond that limited purpose.

Focusing on developing and supporting smaller locally-owned and operated businesses may be a better strategy for Innisfil. Transition activists (The Power of Just Doing Stuff, Rob Hopkins, Transition Books, 2013) have documented the following:

  • “the Federation of Small Businesses in Scotland found that large supermarket developments led to a decrease in the number of conventional retailers in the town centre, an increase in the number of vacant units …”
  • A study by Civic Economics (Utah, USA) “compared independent retailers and restaurants with … chains. Local retailers returned 52% of their revenue to the local economy as opposed to 14% for chains, and local restaurants recirculated 79 % of their revenue locally as opposed to 30% for chains.”
  • One study “looked at 2,953 counties …and found that the ones with a larger density of small, locally owned businesses had experienced higher per capita income growth, whereas those with higher levels of chain businesses had experienced a negative impact on income growth.”

Can Innisfil buck the global trend toward massive chain store retailing to support a locally owned and operated, viable and sustainable, retail sector? I would argue that vacant commercial properties impose a significant economic cost on the Town in commercial activity lost to other jurisdictions. Shifting those costs back to the landlord should give them an incentive to seek a tenant more aggressively at competitive lease rates. This could possibly take the form of an Idle Asset Surcharge added to the property tax at 4 month intervals until the commercial property is occupied. This might also encourage landlords to support temporary pop-up shops or markets in their vacant spaces to avoid a surcharge. If it encourages some absentee landlords to sell their idle property to motivated local entrepreneurs, it may be a net benefit to our community as well.

A Retail Demand Study (2011) estimated potential Innisfil retail expenditure at more than $254 million. Two-thirds of that consumer spending, as much as $167 million, occurs outside Innisfil. Recapturing just 1% of that locally would add almost $2 million per year in economic activity to Innisfil. Not bad for a population of 35,000 residents. The consultant’s study suggested a long-term target to recapture 60 to 65% of consumer spending was reasonable.

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2 thoughts on “Innisfil – the Retail Dilemma

  1. It’s difficult to see how Innisfil could capture commercial development beyond that which serves the small Alcona trading area. Barrie has substantial vacant commercial space, as commercial geographic shifts take place. The Cookstown outlet mall is in an interceptor position and will continue to siphon Innisfil demand. If Innisfil wants to play with the majors then it will have to see that the Innisfil 400 area is serviced and zoned to permit tenants who will be attracted by the Highway 400 exposure. Is the servicing cost of that area beyond the municipalities pocket book?

    • I don’t know about “playing with the majors” but if we’re supposedly planning for ‘complete’ and ‘walkable’ neighbourhoods there should be a place for viable commercial developments in proximity to residential areas. The “small Alcona trading area” is still worth millions of dollars to our local economy. Yes, the cost of servicing Hwy 400 is beyond the Town’s current resources. An Open House on May 21 discusses the proposed plan for a Municipal Services Corp. to create sufficient borrowing capacity. The cost of long-term financing would shift from development charges to water and waste-water rates.

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