Carson City, NV. Taxpayers To Pay $2 Million To Reuse Empty Wal-Mart
At any point in time, Wal-Mart Realty has between 300 and 350 ‘dark stores’ on its hands that Wal-Mart has abandoned. This has been the case since the late 1990s, when Wal-Mart began systematically shutting down discount stores that could not be expanded into supercenters. Since then, hundreds of discount stores—about a third of them over 100,000 s.f.--have been prematurely emptied to make way for larger stores across the street, or just down the road. Wal-Mart likes to boast that its real estate team is aggressively marketing its dead stores, but some communities have learned the hard way that public money ends up being involved to prevent blight when Wal-Mart abandons a store. Today, in Carson City, Nevada, the city’s board of supervisors gave initial approval to using $2 million in taxpayer’s money to support a private owner who bought an “old” 120,000 s.f. Wal-Mart building. The new owner has not found tenants to fill the store, but told city officials that the Burlington Coat Factory is interested in using just over half of the space---70,000 s.f. The $2 million in public funds would be used to offset the costs of improving the building. The owner, Robert Rothe, apparently has no problem with taxpayers subsidizing this private deal. After all, that’s what the ‘free’ market is all about. All Rothe has to date is a letter of intent from the retailer to rent part of the space. The letter of intent is an agreement to begin contract or lease negotiations, but the deal is far from final.
“The owner is going to require some help from us in order to secure the lease,” said Carson City Economic Developer Joe McCarthy. “He must begin to refurbish the interior and exterior of the building in a couple of weeks to have it ready by March, when Burlington Coat Factory is going to open.” Taxpayers will subsidize the heating, air conditioning and ventilation system. “You have to be able to entice nice retailers to town,” McCarthy told the Nevada Appeal newspaper. “Without this incentive, they’d go to other areas.” City officials say the funds to bail out the new Wal-Mart building owner would come from money set aside for economic development. The Carson City Wal-Mart moved out of its building five years ago. It was purchased one year after it came on the market, for use as a casino. But that gamble never cashed out, and the site was sold to another buyer, who then sold it to Rothe. During all these transactions, the building sat empty for five years, except for a few short-term tenants. This wasteful use of land and buildings was just so Wal-Mart could make more money in a bigger store.
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Posted by Al Norman on Friday, August 17 | 0 comments | Permalink
What’s Wrong With Wal-Mart
BNet’s analysis of Wal-Mart’s current challenges, how the company fell from grace, and what its doing to stem its losses. If you’d like to read (cough) nearly all (cough) of what’s in this article, please consult the growth report we released in June (PDF). For further discussion of Wal-Mart’s extensive problems, visit BNet’s feature.
Why Wal-Mart Needs Help [BNet]
The world’s most successful retailer needs help. Although Wal-Mart generated gross profits of $84 billion on $349 billion in revenue in 2006, its share price has stayed virtually flat since 2000. Domestic same-store sales crept up by just 1.9 percentage points in 2006 — the worst showing in Wal-Mart’s history. International growth has been beset by humiliating failures. Public relations gaffes continue to dog the company, and there are few inefficiencies left to squeeze from Wal-Mart’s hyper-efficient distribution system. The worst part is, all of these problems are interrelated, and they’re coming to a head just as competition from rivals like Target and Costco is heating up. Let’s take a closer look at the issues that are dragging Wal-Mart down.
1. Domestic Saturation
The Summary: After years of U.S. expansion, Wal-Mart is running out of real estate.
The Challenge: Opening new markets by overcoming opposition in U.S. urban centers.
The Key Fact: Half of all Americans already live within a 10-minute drive of a Wal-Mart store.Most retailers will tell you, “If you have the opportunity to grow, you take it.” That’s just what Wal-Mart did, opening 2,200 Supercenters — its largest and most profitable store format — since 1988. Now, however, the company is confronting the realities of domestic saturation as it becomes harder and harder to find spots to erect new stores. “It’s a huge issue for them,” says Philip C. Bonanno, a management consultant with Management Ventures Inc.
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Posted by Alex Goldschmidt on Thursday, August 16 | 0 comments | Permalink
California Site Fight: Wal-Mart Development Faces Lawsuit
Lawsuit challenges Perris Marketplace project [The Press-Enterprise (California)]
An environmentalist group is going to court to force developers of a Perris shopping center to do a thorough analysis of its greenhouse gas emissions.
In a lawsuit filed last week in Riverside County Superior Court, the Center for Biological Diversity alleged the Perris Marketplace project doesn’t do enough to quantify and reduce the gases, which are blamed for global warming.
A 520,000-square-foot project west of Perris Boulevard and north of Nuevo Road, Perris Marketplace is expected to feature a Wal-Mart Supercenter, a mega-store with a supermarket, a vision and hearing center, a photo center and gasoline pumps.
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Posted by Alex Goldschmidt on Thursday, August 16 | 0 comments | Permalink
Washington Site Fight: Council to Discuss Wal-Mart
Fircrest council candidates talk about Wal-Mart [The News Tribune, Washington]
Longtime Fircrest Mayor David Viafore is facing a primary election contest for the first time in his political career and the W-word seems to be hovering over the three-way campaign.
“I’m going door-to-door and I’ve had to be defensive because I’m hearing that my opponents have mischaracterized my position on Wal-Mart,” Viafore said.
The retail giant said on July 31 it was abandoning plans for a Fircrest store, but community concerns remain about how Viafore and the council handled the application, said his opponents for the Council Position 4 seat, Blake Surina and Leslie Rider. Some residents opposed the store, saying the retailer would have disrupted the community’s small-town lifestyle with traffic and potentially more crime.
Surina and Rider say residents are upset that the city kept them in the dark about Wal-Mart development plans.
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Posted by Alex Goldschmidt on Thursday, August 16 | 0 comments | Permalink
Arizona Site Fight: Battle Looms
Possible battle looms over planned Wal-Mart [The Arizona Republic]
A Wal-Mart is planned in Cave Creek, and town officials are gearing up for a possible battle royal over plans to build a Supercenter on nearly 20 acres southeast of Cave Creek Road and Carefree Highway.
The developer would need Cave Creek Town Council approval for a major amendment in the town’s general plan, followed by rezoning to commercial, from residential, said Cave Creek Planning Director Ian Cordwell.
The entire process could take months, even years, Cordwell said.
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Posted by Alex Goldschmidt on Thursday, August 16 | 0 comments | Permalink
America’s Largest Importer Exports, Too
Wal-Mart Ships Chicken, Spam to Fuel Overseas Growth [Bloomberg News]
For Wal-Mart Stores Inc., the road to a higher share price is paved with chicken feet and Spam.
The world’s largest retailer, long the biggest importer of goods into the U.S., last year joined a list of the top 100 U.S. exporters for the first time. It sent 39 percent more shipping containers overseas than General Motors Corp., and surpassed cigarette maker Altria Group Inc.
Although only a fraction of the $18 billion in goods it bought from China alone in 2005, exports will increase further as Wal-Mart targets a third of its sales growth from abroad amid the slowest gains at U.S. stores in at least 27 years.
International sales will expand to 30 percent of Wal-Mart’s total in 2010, up from 22 percent last year, estimates Citigroup Inc. analyst Deborah Weinswig.
International markets “could be like a savior for Wal- Mart,’’ said David Abella, an analyst at Rochdale Investment Management in New York, with $2.4 billion in assets including Wal-Mart shares.
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Posted by Alex Goldschmidt on Friday, August 10 | 4 comments | Permalink
South Carolina Wal-Mart Employees Granted Class Action Status
This is only the latest class action lawsuit that Wal-Mart systematically denied employees break time and due pay. A Wal-Mart spokesman added that there are even more cases like this one that are never awarded class status, implying that Wal-Mart’s unfair labor practices aren’t always systematic - sometimes they’re just random!
Wal-Mart workers win class-action status [Associated Press via Charlotte News & Observer]
Wal-Mart must face a class-action by South Carolina employees claiming the company forced them to work through breaks and off the clock, a judge ruled.
Current and former hourly workers from July 31, 1999, forward can sue in a single case, Judge Perry M. Buckner III in Walterboro, said. The group of about 100,000 workers is large enough and their claims similar enough to allow a class-action lawsuit, Buckner said.“Plaintiffs’ claims are typical, irrespective of varying fact patterns underlying individual claims, because they allege that they were not paid for work performed off-the-clock and were denied rest and meal breaks,” Buckner wrote.
Wal-Mart faces at least 70 U.S. wage-and-hour suits by employees claiming it failed to pay for all hours worked. The South Carolina decision is the fourth since May 1 allowing similar group lawsuits. The company won a ruling in New York in June denying the status to a suit there.
“Even more courts around the country have found that cases like this are not properly suited for class treatment,” said Wal-Mart spokesman John Simley. Wal-Mart doesn’t have a scorecard on which cases have been denied class status because the suits are in different stages of litigation, he said.
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Posted by Alex Goldschmidt on Wednesday, August 08 | 55 comments | Permalink
Greenfield, MA. Wal-Mart Developer Pulls Back Plans—For Now
A Connecticut developer, Louis J. Ceruzzi of Fairfield, has suddenly withdrawn his Notice of Intent (NOI) to build a 160,000 s.f. Wal-Mart in Greenfield, Massachusetts, on a site just across the street from where the giant retailer was defeated in 1993. That confrontation led to the founding of Sprawl-Busters. Fourteen years later, Wal-Mart is back---although the company has publicly made no commitment to the project. The NOI is a step in the process of getting approval for a project under the state’s Wetlands Protection Act. The developer must get local officials to approve their building plans, and to show minimal impact on the site’s more than 6 wetland areas. The problem for this project is that one of the wetlands lies where the developer wants to put the parking lot for the huge project—which is twice the size of any retail store in the town’s history. The town of Greenfield has a local wetlands by law that makes replication possible only as a last resort, putting the project in a legal swamp. To build the Wal-Mart, wetland 4 must be paved over, and replicated elsewhere on the site. But since replication is not allowed, the developer must try to get the town to ignore its own bylaw.
That may be easy to do, since the Conservation Commission is appointed by the Mayor, and the Mayor of Greenfield, the project’s biggest supporter, recently fired the chair of the Commission to clear the way for her own appointees. But the withdrawal yesterday of the NOI was simply a matter of maneuvering into position by the developer, because the new members appointed by the Mayor cannot vote on the project under state law, because they are arriving on the board in the middle of the case. When the Mayor canned the chair of the Commission, another member quit, leaving only 3 people in the Commission. The developer needed all three remaining votes for a NOI approval. To better the odds, and let the Mayor’s appointments start at the beginning, the developer simply pulled his plans “without prejudice,” and is expected to refile soon, ‘’These people will be back,” said Sprawl-Buster’s founder Al Norman. ‘’This is just a strategy the developer is using to get around a challenge it knew it would lose.’’ A couple of weeks ago, Norman requested in writing that the two newest members of the five-member commission excuse themselves from any discussions or votes concerning the project. The commission’s own rules and regulations state an ongoing issue should only be heard by members who have attended all portions of a wetlands hearing. He threatened that if the two new members voted, their votes would be contested. “A notice of intent requires three positive votes to be accepted,’’ said Norman. ‘’With only three original members sitting on the commission, I think everyone knew they wouldn’t get three positive votes and the issue would be dead.”
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Posted by Al Norman on Tuesday, August 07 | 0 comments | Permalink
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