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Dollar Tree Moves Next To “100% Corner”

by Paul Bass & Meagan Jordan | Jun 27, 2014 1:40 pm

(26) Comments | Commenting has been closed | E-mail the Author

Posted to: Business/ Economic Development, Downtown

Paul Bass Photo Meagan Jordan Photo Following a last-ditch city attempt to land a high-end retailer, a retail space at the heart of efforts to upscale downtown will soon open as a 9,000-square-foot dollar store.

The national Dollar Tree chain is in the process of spending “hundreds of thousands of dollars” to renovate the space on the ground floor of the Centerpointe apartments at the corner of Church and Chapel in anticipation of a July 17 opening, according to landlord Michael Schaffer.

The store will probably hire 20 to 30 people, Schaffer said. Some 200 people have come by for applications over the past weeks, he said.

Paul Bass Photo

Schaffer has tried for a decade to fill that vacant storefront, since his company, 235 Development Associates, renovated the upper floors of the corner property (pictured) into 83 market-rate apartments.

City and state officials backed that renovation in hopes of spurring a revival of the historic but somewhat worn block of Chapel between Church and Orange Streets. The intersection there is known as the “100 Percent Corner”—the most central commercial crossroads in town, a crossroads of New Haven’s stratified worlds. It’s also seen as a barometer of civic New Haven’s efforts to boost property values (or, depending on your perspective, to gentrify the poor away from downtown’s most valuable real estate).

Schaffer’s housing plan worked. After his apartments started renting, another developer constructed the 32-story 360 State apartment tower and ground-floor Elm City Market a block away.

One Vision

The Church-to-Orange block has seen some new investment, too, but largely has yet to follow the envisioned trajectory. Two key corner buildings (pictured above and at right) at the corner of Orange and Chapel remain empty, one pretty much uninhabitable. Two other lots remain vacant, though a property owner has asked the city to sell him one of them to construct a new building.

The pending arrival of the dollar store has sparked debate among downtown retailers, customers and officials about the best uses for a downtown block, and how much public effort should or can go into determining its course. In the end, the market spoke.

Before that, the Harp administration prevailed on Schaffer to delay sealing the deal with Dollar Tree for several months to allow for some last-ditch pitches to higher-end retailers, according to city economic development chief Matthew Nemerson.

“I was very underwhelmed when Michael told me he was putting a dollar store in. I asked him to hold off, which he did, for five months,” Nemerson said. “We want to change the whole character of the street and bringing in a national fashion retailer there. There are a number of new urban concepts for some of the big power-center stores—the stores that do 40,000 and 50,000 [square-foot] stores are now doing 10,000-square-foot stores. It was not inconceivable that we would find somebody.

“We came close. To Michael’s credit, he talked to a lot of good retailers. It just didn’t quite work. “

“It’s downtown. It’s a higher end,” said Carol Orr, owner of the upscale English Market across the street from the Dollar Tree. Orr said she and her husband Robert bought their building (which includes the Bourse co-working space) guessing that it would take five years for that stretch of downtown to pick up. That was 11 years ago. (Click here to read an article the Orrs wrote about the struggles of downtown businesses.)

“We wish they could have diversified the retail mix a bit more. There’s an exact same kind of store a block down,” Town Green Special Services Chief chief Win Davis said, citing the Family Dollar on Chapel between Orange and State.

But overall, Davis said, he’s pleased that the storefront, vacant for a decade, will now have a tenant. Nemerson agreed. He said the city will work enthusiastically with Dollar Tree as it would with any employer.

“Dose Of Reality”

C.A. White Photo For his part, developer Schaffer (pictured) called the arrival of Dollar Tree “a dose of reality to the commentary that’s out there. Clearly the market was telling us what would and would not work in that location.”

Schaffer argued that people have the wrong idea about Dollar Tree. He called the company “a very savvy, sophisticated retailer” that will cater to the downtown market, including groceries in its inventory.

He noted that the company is putting in its own electrical HVAC, and refrigeration storage systems as part of its six-figure build-out, a sign of the company’s investment in the property.

“People should wait and see what’s going to be offered and realize they do serve a need. In this niche they’re probably the best operators out there,” he said. “They’re a major national firm with 5,000 locations. We have them as a tenant in East Haven. They’re on Universal Drive in North Haven. They’re in Orange.”

Plus, he noted, New Haven needs the jobs.

Another Vision

Meagan Jordan Photo People interviewed on the block Chapel Street largely agreed with Schaffer. They look forward to the store opening up.

“It’ll be a wonderful thing, a lot of people are out here starving on the street. They need a dollar store. They need one bad,” said Howard Powell (pictured), who sells hot dogs from a cart on the Chapel Street block. “I myself feed 50 hungry people a day for free. If I wasn’t feeding them they will be snatching purses and wallets,” said Powell.

“We don’t need high end. We need help,” agreed Al Gamble. “You have more minorities down here.”

“I can understand wanting to make it high end,” remarked vendor Leamond Suggs, “but everyone doesn’t have high-end pockets. He predicted the Dollar Tree will “attract more people to this area. People that disagree with it are probably the same people who don’t want us down here, and don’t live in New Haven.”

At the Beauty Plus outlet, employee Lisa Harrell welcomed the Dollar Tree, as well. She called it more of a “true dollar store” than the Family Dollar a block east. Co-worker Elizabeth Syovia predicted Family Dollar will lose business to Dollar Tree.

The Dollar Tree’s pending opening also prompted discussion on Facebook. On one active thread, one longtime New Havener, Michael Clinton, noted that discount stores like Kresge and Grant used to occupy the block decades ago. Clinton put the issue in the context of “this ongoing balkanization dance in that section of downtown. It’s always been a strange containment zone for businesses that appeal to the poorer or younger demographic.”

Nudging The Market?

Paul Bass Photo

Meanwhile, City Hall’s unsuccessful efforts to land a higher-end retailer on the spot have prompted an internal debate about the role of government in driving the retail market, according to development chief Nemerson (pictured).

In retrospect, Nemerson said, he wonders if his office should have offered money to subsidize the lease of a high-end retailer. He compared the tactic to how private developers fill out shopping malls: They offer “lavish incentives” to anchor department stores. They can then jack up the rents they charge for smaller surrounding spaces. Similarly, the city perhaps could have raised property values along Chapel Street if a higher-end retailer had occupied the 9,000 square-foot Centerpointe storefront, he argued. Then the city would make back its subsidy, and more, over the long term, through higher assessments.

The other side of the argument: Government wastes money trying to steer markets, picking “winners” and “losers” rather than building on choices shoppers make with their credit cards.

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posted by: meta on June 27, 2014  2:03pm

I guess it’s better than nothing, but not by much. I really don’t know why this prime spot has been vacant for so long..

posted by: Stylo on June 27, 2014  2:03pm

Why were they trying to attract retail? Would’ve been a good space for a restaurant.

Anyway, I don’t see what the big deal is. It’s better than being empty. There’s Dollar Tree’s in Manhattan.

It’s NOT a true dollar store though, just like Dollar General isn’t. Some of the people on the street are clueless about what it is.

posted by: ILivehere on June 27, 2014  2:04pm

Schaffer and the city should be embarrassed the “high end retailer” was a Gap. Now instead of moving the city forward were moving in the wrong direction. This is where the NHI lacks as well if this story had run a month ago people would have complained and we would have a Gap but its to late to make a difference now.

posted by: FacChec on June 27, 2014  2:12pm

““It’ll be a wonderful thing, a lot of people are out here starving on the street. They need a dollar store. They need one bad,” said Howard Powell I feed 50 hungry people a day for free. If I wasn’t feeding them they will be snatching purses and wallets,” said Powell.

““We don’t need high end. We need help,” agreed Al Gamble. “You have more minorities down here.”

“I can understand wanting to make it high end,” remarked vendor Leamond Suggs, “but everyone doesn’t have high-end pockets. He predicted the Dollar Tree will “attract more people to this area. People that disagree with it are probably the same people who don’t want us down here, and don’t live in New Haven.”

Apparently Nemerson just doesn’t get it.. and neither does Harp.

posted by: LookOut on June 27, 2014  2:33pm

Too bad - but really, if you’re thinking about locating a business downtown, what do you investigate;

1.  Fixed Costs - taxes and utilities are obscenely high - this will be reflected in the rent.

2.  Convenient and safe access for customers:  Let’s see parking charges till 9:00pm and a recent stabbing on the street.

3.  A friendly business environment - ask the folks @ 360 State how the city treats newcomers.

This city is in dire need of leadership for a turnaround.

posted by: anonymous on June 27, 2014  2:38pm

The City should stop wasting time and money on the retail mix - the real issue here is the street design. This block has a narrow street, with narrow sidewalks, no street trees, and speeding traffic except for a few minutes at rush hour. Therefore, it is a highly unpleasant place to spend time. People walk from one end of the block to the other as quickly as possible, especially in the summer when it becomes hot and at night when drivers are drag racing through.

If the City wants retail stores, property tax, and people to succeed here, and attract more jobs to New Haven, then it should narrow the street, widen sidewalks, improve the bus waiting area, add bike lanes, convert some of the existing parking spots in front of Dollar Tree into bump-out plazas like those that the City installed on Temple near the Omni Hotel or along Chapel near Yale, add trees and generally make it into a block where people want to linger for a few minutes, not one that they want to walk through as fast as possible.

Do we care about speeding traffic coming through here, or do we care about safety, jobs, people, revenue, health, and quality of life for bus riders and local residents?  For every City administration so far, the latter considerations always lose out to the former.

posted by: TheMadcap on June 27, 2014  2:50pm

This is only moving backwards if you think the poor deserve no place downtown except to transfer buses.

posted by: Pat from Westville on June 27, 2014  3:07pm

Actually there is already a Dollar Tree in New Haven, next to the Amity Rd Stop and Shop. The plaza is very close to the Woodbridge line but is in New Haven.

As for being a “true” dollar store, that means to me that everything, absolutely everything, in it is only a dollar (unless occasionally 2 for a dollar). And that is my experience with Dollar Tree. It is my source for toothpaste, mouthwash, deodorant, shelf-stable milk (comes only in quarts but where else can you get a half gallon of milk for $2 which keeps me in milk for 2 weeks), miscellaneous kitchenware,15packs of shower caps, and the list goes on.

So if it is just as good as the Amity Plaza one, the Chapel Street Dollar Tree is just what us less than high-end folks need in the downtown area.

posted by: ILivehere on June 27, 2014  3:27pm

@TheMadcap
I’d like to see the bus stops moved as well. I absolutely believe there should be no place for low end downtown housing or retail. The entire city is low end lets leave downtown, Wooster sq., and east rock to become places where people who earn over $50k a year would actually want to be. Otherwise who is going to pay the taxes when everything looks like Dixwell.

posted by: Atticus Shrugged on June 27, 2014  3:47pm

I’m not terribly impressed by the tenant but Dollar Tree is a strong, national chain that is willing to “gamble” on New Haven.  Unfortunately, it’s not much of a long-term gamble for Dollar Tree with the advent of LWP, the new Worcester Square apartments, and other downtown developments. 

As for the 100% corner moniker, that block is not it and hasn’t been since the 1980s.  That should be reserved for, York and Broadway, or Chapel and Temple or High.  The other end of gentrification. 

Still more or less dumbstruck by MN’s questioning whether the City should help steer economic development and pick “winners” and “losers.”  Setting aside the fact that having a preference is singling out a winner or loser, the answer is clearly: “YES.”  Does he think his job is just to watch the “market” speak and not try to corral it?  If he doesn’t think the City should be an active participant in it’s development, he needs to resign - like, immediately.  The City needs a visionary, who can act on its vision, and not a passive investor.

I’m sure Dollar Tree will be a great corporate neighbor.  And I’m glad that they are bringing 20-30 jobs to New Haven.  The City was right in trying to move the market.  Better luck next time and great deal by Dollar Tree.

posted by: anonymous on June 27, 2014  3:59pm

Agree with Atticus. By “not” picking sides when it comes to development, the city is effectively picking a side. Treating all things equally is how you reinforce the status quo. Want to increase inequality? Pass a flat tax.

It’s time for the city to stop it with the feigned neutrality, and start stepping up to the responsibility it has to democratize our urban spaces and land development. For one thing, that could mean bringing in retailers who agree to pay a decent wage. What will Dollar Tree pay?

posted by: Atticus Shrugged on June 27, 2014  4:16pm

And btw, MN, your job is to steer economic development.  By definition, you’re there to help pick winners and losers.

posted by: robn on June 27, 2014  4:52pm

The “winner-loser” bobbling is kindof schizophrenic coming from an administration that’s filled with true believers in large activist government.

If a high end retailer wanted the space, they’d pay more than a Dollar Store. Since they don’t, the Dollar Store gets it and people of limited means get a bargain store in a very convenient location. When access (transportation and parking) becomes less of an issue in the future that may change but for now the market has spoken.

posted by: fastdriver on June 27, 2014  5:23pm

Is Michael Schaffer Ann Nyberg’s husband? Just wondering.

posted by: Anderson Scooper on June 27, 2014  5:33pm

It’s be great if a NHI article like this pointed out the fact that 80% of the funding for the Centerpointe project was courtesy of the State and City governments:
http://www.cawhite.com/news.html

$13 Million of $16 Million came from the public, in exchange we got what? Luxury apartments unaffordable to most of us.

Fwiw.

posted by: Threefifths on June 27, 2014  6:55pm

Keep drinkng the kool-Aid

Discount Distortion: How Dollar Stores Actually Charge You More
Travis Hoium
Jun 25th 2012 1:07PM

But a discount is more than just the cost of an item—it’s the amount that item is discounted versus the competition.

A true discount retailer will make less money on each item it sells than its competitors. And this is where dollar stores start to look a lot more expensive than competitors.

For example, for every dollar it sells, Dollar Tree makes $0.35 in profit and $0.067 in net income for owners. At Walmart (WMT), just $0.24 of each sale is profit and only $0.035 ends up in the owner’s pocket. So who is the best discounter?


Dollar Stores: Top Link in the Sweatshop Chain Unpaid Overtime: Ripping Off Workers, Communities
by Kent Paterson, Special to CorpWatch
October 6th, 2010

http://www.corpwatch.org/article.php?id=15629

posted by: wendy1 on June 27, 2014  7:33pm

Instead of bribing “high-enders”, how about doing the right thing and help people like me create housing for the homeless with a free med. clinic on-site.  This race for the rich is inappropriate and futile considering the true makeup of our city.  We should focus on bringing up and enriching the poverty population that has been here for a long time and has put up with so much local hardship.

posted by: Lifer on June 27, 2014  8:41pm

This is very disappointing.  Not surprising, however, given the schlocky stores a block away on Chapel between Temple and College.  I don’t see how anyone could expect a high-end retailer to take that spot when there’s so little parking nearby.  Still, Dollar Tree is a big blemish on a major intersection in downtown.

posted by: New Haven Taxpayer on June 28, 2014  12:27am

You can’t get the Gap let alone Tiffany’s, so now it makes even more sense to sell that mini park to Paul Denz.
He has the money and an interest I doing so because he owns adjacent properties.
Quick Mrs Mayor sell it!

posted by: Jones Gore on June 28, 2014  1:04am

@ILivehere, obviously you don’t live in New Haven or have not lived here very long to remember we had a GAP on the corner of Chapel and College.

The city should not be in the busy of trying to steer the market. And I resent the fact that Mayor Harp was working to move the Poor from that part of downtown. If it were not for the shops on that end of Chapel street where would the poor purchase goods downtown?

posted by: Elizabethaiken on June 28, 2014  6:48am

I think the Dollar Tree is a great solution. I do not think that downtown New Haven should just be upscale. There are many residents who cannot pay upscale prices and it is their downtown too. Also, upscale retail in New Haven is not sustainable unless it is jammed up next to Yale University.

posted by: cedarhillresident! on June 28, 2014  7:44am

fastdriver
made me giggle, no he is not.

The schaffer family puts alot of thought into all their property’s. They are great landlords that truly care about this city.

As a life long New Havener I am happy the space is filled; a city with empty store fronts can prevent investment, and this space was empty for close to a decade.

posted by: Winston on June 28, 2014  4:27pm

Centerpointe is a private development on private land that received a $3 million grant from the city as a key part of its financing (more money that the developer invested, according to a YDN October 19, 2004 article.)  NHI should investigate what the terms of this grant agreement were.  Hard to believe it would not prohibit leasing the commercial space to a tenant that didn’t advance the city’s economic development goals.  Or was that $3 million provided for some other objective?  If so, what was it?

posted by: HewNaven on June 29, 2014  9:19am

Dollar Tree rips off customers by selling them disposable junk crafted by slaves in Mexico, then they do a double-whammy by subjecting their employees to wage-slavery right here in our own communities. If you haven’t already decided, you should boycott this store and Family Dollar.

http://www.dollartreelawsuits.com

http://hamptonroads.com/2007/10/growing-number-dollar-tree-workers-suing-recoup-lost-wages

http://www.glassdoor.com/Salary/Dollar-Tree-Salaries-E4033.htm

http://www.huffingtonpost.com/2013/08/29/dollar-stores-work_n_3786781.html

posted by: robn on June 29, 2014  10:28am

I was going to joke with 3/5 that the Dollar Store was a “gentrification vampire” but in an uncontrollable moment of unknowing self parody, he beat me to it. The circle is complete and that circle consists of one commenter; 3/5.

posted by: give43 on June 29, 2014  12:35pm

Michael Schaffer and his family are honest business people, doing their best to keep their properties ON the tax roles, and offer employment opportunities.  It is not their job to to raise the desirability of the city to potential tenants.  They waited five months before going ahead with leasing this property?  They deserve much credit for their willingness to forgo five months of rental income while the city tried to lure more upscale tenants.  It is the city’s job to begin to solve some of the problems keeping other tenants from wanting to lease these properties.  Blaming Michael Schaffer for increasing the tax base and providing employment opportunities is wrong, and misses the point.

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