University of Wisconsin - Extension

An empty department store downtown or on the edge of a small community sends a message that something in the local economy isn?t working right.

?Whether it be excessive retail competition or declining market demand, the ghostly appearance of an underutilized building is something most residents simply don?t want to see in their town,? says Bill Ryan, University of Wisconsin-Extension community business development specialist.

Many believe the only appropriate use for a vacated department store is another similar store. ?Local residents typically like the convenience and selection offered by department stores,? explains Ryan. ?Zoning already is in place and there is typically plenty of public support for maintaining the site as a commercial location.? The site also would offer a new retailer lower construction costs and shorter turnaround than building at a location elsewhere.

?However, a closed store also sends a warning sign to potential new retailers that the site is poor or the market is weak,? Ryan adds. ?New retailers might conclude that ?if another store failed here, we might, too.??

Many examples exist of new retail replacing the space of department stores, says Jerry Braatz, UW-Extension Calumet County community resource development educator. Often, the building takes on a new retail format or may be subdivided into many stores or a ?mini mall.? Examples of this in Wisconsin include a department store in Merrill that was converted into a grocery store and bank and a department store in Rice Lake that was converted to a furniture store.

Wisconsin communities that lost Pamida stores between 1990 and 2000 converted them into such businesses as liquidator stores, banks, auto sales, furniture stores, storage space, a Family Dollar store and office space.

?Residents of a small community often are very proud of their town,? Ryan adds. ?Quality of life including the convenience of shopping locally is of major importance.?

When a large retailer closes business in a small city it does not go unnoticed. Residents often react by blaming city government. Once the initial reaction time passes, the community still has the dilemma of dealing with an empty store.

?Attracting a business or another use to a vacant store is not easy,? Braatz says. ?In many situations it takes a business, government, and concerned citizen partnerships to secure a new tenant. For successful business development to occur, efforts must be comprehensive, well organized and have broad support. They must include education, vision, positive attitudes, patience, local ideas and investment.?

Small communities will continue to face challenges and increasing competition from metropolitan areas. Communities that build their local economies and strong local partnerships will be in a better position to meet future challenges.