Outdoor, walkable shopping districts in the hearts of major cities – places like Rodeo Drive, Fifth Avenue, and Miami’s Design District – offer a unique blend of shops, restaurants, and other cool hangouts. But while urban retail corridors used to be all the rage, many took a hit during COVID and have faced an uphill battle regaining their once-famous vibrancy.
So with the holiday season just around the corner, we dove into the data to find out what’s happening on the ground in retail corridors in urban centers nationwide. How have they actually been faring in recent months? And what strategies are they implementing to bring back the crowds?
Retail Corridors Regain Their Footing
Location intelligence shows that downtown shopping districts throughout the U.S. are experiencing something of a renaissance. While urban retail corridors still tend to draw fewer visits now than they did before COVID, many are experiencing year-over-year foot traffic growth, indicating that recovery is underway. As cities continue to struggle with economic headwinds and the ongoing impact of changing commuting and work patterns, municipalities nationwide are finding creative ways to bring people back downtown.
To explore the factors underlying this growth, we drilled down into the data for six specific retail corridors in very different regions of the country: N. Michigan Ave. in Chicago, IL (the Magnificent Mile); the Design District in Miami, FL; Midtown in Houston, TX; Fifth Avenue in New York, NY; Rittenhouse Row in Philadelphia, PA, and Rodeo Drive in Beverly Hills, CA.
Festivals, Parades, and Events – Oh, My!
One thing that cities seem to be doing right is investing in parades, festivals, and other special events that draw crowds to their downtown shopping areas. Chicago, for example, has been struggling with retail vacancies – and foot traffic to the Windy City’s famous Magnificent Mile (on N. Michigan Ave.) was down 30.7% in Q3 2023 compared to the equivalent period in 2019. But year-over-year (YoY), Q3 2023 visits to the Mag Mile grew by 8.3% – perhaps due in part to the concerted effort local stakeholders have been making to attract visitors with special pop-ups and experiential events. And nothing quite brings people to the famous shopping district like the city’s annual St. Patrick’s Day Parade – when the Chicago River is famously dyed green. Indeed, March 11th, 2023, when the parade was held this year, was North Michigan Avenue’’s busiest day of the past twelve months – with 128.7% more visitors than an average day. In Philadelphia, too, the revival of the Rittenhouse Row Spring Festival – defunct since COVID – brought the city’s main shopping drag 113.6% more traffic than usual. Fifth Avenue in New York, for its part, tends to be busiest between Christmas and New Year’s Eve, as people converge on the area to view the strip’s unique window displays and enjoy the special sights and sounds it has to offer. And for Beverly Hills’ Rodeo Drive – as well as Miami’s Design District – it’s fancy car shows like the Concours d’Elegance and the Miami Concours that bring in the crowds.
To be sure, many retail corridors also experience visit peaks during retail holidays like Black Friday: The Magnificent Mile, Miami’s Design District, and Fifth Avenue in New York saw foot traffic spikes of 84.2%, 74.7%, and 73.0% on November 25, 2022 compared to their daily averages. But while for malls, Black Friday is the busiest day of the year by far, visits to bustling downtowns appear to be propelled more by people seeking fun experiences than by holiday deal-hunters.
Hot Spots for Singles
Who are the consumers that are drawn to the unique experiences offered by retail corridors? Perhaps unsurprisingly, the captured markets of retail corridors in big cities nationwide have large shares of people from one-person households, and relatively small shares of families with children. While singles appear to be drawn to urban shopping districts’ experiential vibe, parents of children may be more likely to seek out the more practical offerings of local shopping malls.
The revival of urban retail corridors is yet another indication that cities are here to stay. With declining consumer confidence and still-high prices continuing to weigh on retailers nationwide, municipalities are stepping up by enhancing the experiential element of their shopping districts. Which retail corridors will draw the most visitors this holiday season? And what lies in store for them as the year progresses?