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Change – an economic engine ?

November 6, 2006

Over the weekend, I saw on the news that a development group had purchased “Waverly Place” in Cary, NC some two years ago, and is working through plans to demolish much of the shopping complex and replace it with another of the en vogue, Northhills / Southpoint style shopping and entertainment communities.   This seemed wrong for many reasons.

I moved to this area in 1988, when I started as a student at NCSU, about the time construction on the existing Waverly place was completed.  In the early 90’s, I worked at a small computer company just up the road in McGreggor village which was also brand new, and sometimes at lunch, I would tag along with some of the salespeople to grab lunch at one of the shops in Waverly.  In the mid 90’s, I’d go to movies at the theatre in Waverly, eat at the “Chi’s Chi’s” Mexican restaurant there,  or sit across the street overlooking the acres of woods, later to be cleared in favor of the Wal Mart,  watching the fourth of July fireworks at Regency Park.   To my eye, there is nothing wrong with the design or location of the existing Waverly shopping complex.  It’s less than 20 years old – what an apparent waste to tear it all down.  What killed it?

The new Cross Roads 20, along with several other “Super Cinemas” siphoned business from older 4, 6, or 8 screen theatres  – Waverly among them.  The trend in casual dining had shifted from builtin, store front locations, to self contained format chains like Applebees, Chile’s, Red Robbin, Carolina Ale House, etc, set in rows and on corners in other developments.  Smaller stores are going away, losing out to giant Kohl’s, Super Target, Uber WalMart, Best Buy, Bed Bath & Beyond, etc.  Cary Town Center, the massive shopping sprawl at Cross Roads, the new North Hills shopping center, the Streets at Southpoint,  the new Mall complex at Capital and 540, the venerable Crabtree,  new Briar Creek, and even newer Beaver Creek in Apex,  and countless other developments springing up on every corner are all competing for people’s business.

Do developers, investment companies, government leaders and the general public not see it?  We are drowning in it.  There are only so many people in the area, with so many entertainment / discretionary spending dollars to go round.  In the last 15 years, there has been unprecedented growth, and the supply side of shopping, dining, and entertainment has outstripped the populace it serves, despite the ever increasing number of people pouring into hundreds of new subdivisions that are overrunning roads, schools, and the infrastructure.  

These places are winning out because they are newer, are en vogue, have more glitz and glamour, and currently, better locations.   In a cyclic form, new business and developments pop up, draw customers from other areas, that eventually dwindle and close, to be torn down and rebuilt in favor of something grander that will begin to erode the customer base of what was built just a couple years prior.

It seems wasteful.  How long can America’s economy bet stuck on “growth”?   Sure, as we globalize our economy and workforce, for a time, we appear to be opening new markets and fresh opportunity just like building new malls, and in so doing, we create more jobs everywhere, and employ more people making this change.  Tearing down the old, and rebuilding new is change, and change creates jobs, consumes materials and makes the economy go round.  But eventually, our land will be covered with more shopping centers, restaurants, movie theatres, than there are people to fill them, or enough money flowing through them to keep them open.  Somewhere, a plateau will form, and perhaps we will be collectively smart enough to recognize that plateau and not continue on to the downward slope that lies beyond.   Vacancy, foreclosure, unemployment.

Change is an economic engine, but must be managed carefully not only by those enacting it, but by the masses whose actions of where they shop, eat, and live provide the signals to the companies and government responding to the perceived opportunity and need.

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