Inside Retail US - September 2023 | Page 45

PROPERTY

To understand why , it ’ s important to recognize that people left big cities during Covid for different reasons , and many of those who continued working for companies remotely are no longer within commuting distance of their corporate office .

Ann Natunewicz , senior vice president of retail services at Colliers in San Francisco , which lost about 7 percent of its population during Covid , divides the country ’ s domestic migrants into two groups .

“ Some people left the area to live somewhere else , maybe even with mom and dad in Idaho , in the knowledge that the job opportunities would be there for them if and when they wanted to come back ,” Natunewicz told Inside Retail . “ Then you had the people who wanted a real life change , who were tired of the lack of affordability , the crime and all the other problems , and who moved out for good to places in the Sun Belt . That kind is not coming back .”

US Census Bureau data shows that the largest counties – those with populations of 1 million or more – had their numbers decline much more quickly in the two-year period after the pandemic than before . They shed 1.724 million people .

The Washington DC area , New York City , Boston , the cities sprinkled across the southern shores of the Great Lakes , Miami , Seattle and the major metropolitan areas along coastal California all experienced net out-migration in 2022 .

Counties with fewer than 30,000 people enjoyed an unexpected gain , while those with 30,000-70,000 people experienced a marked acceleration of growth . For a while , so did the mid-sized counties with 70,000-1 million people , but in the second year of the pandemic , the growth rate in these counties fell back to the pre-Covid pace .

So , where did all the people leaving these big counties go ? Largely , they headed south . Secondary cities surrounding Phoenix , the Dallas-Fort Worth area , Houston and Austin – but not the urban cores themselves – showed notable growth , while further east , net in-migration gains were seen in Florida , the Carolinas and the Atlanta area .

Setting aside university towns like Santa Cruz , CA , and Medford , MA , which lost much of their populations in 2020 and 2021 , and regained them in 2022 as classes resumed , small cities in Texas and Florida were some of the big beneficiaries of Covid-related migration changes , and their numbers increased by large percentages .

Largely ‘ tertiary ’ rather than ‘ secondary ’ cities , these locations present some of the biggest opportunities for retailers today . But while they are not new to specialists like Aldi , drug stores and dollar-store chains , for many retailers operating in major markets , they require a lot of adaptation .

The population density is lower there , and in a lot of cases , so is household income .

However , residents in these cities are often more apt to shop in-store than online and may have unexpectedly high discretionary spending capacity because of lower housing costs . They also like to eat out .

Florida and Texas on the rise In terms of absolute numbers , it is better to look at in-migration and population growth on a county level . The biggest increases in head count were seen in counties just outside of major cities in the South , particularly in Texas , Arizona and peninsular Florida . The secondary and tertiary cities within these counties , many of which have been growing steadily for some years , received an extra shot in the arm from pandemic-driven migration .

Maricopa County , AZ , which encompasses most of the Phoenix metropolitan area , tops the list . But it wasn ’ t the city itself that gained so many new residents ; rather , the satellite cities on the outskirts of Phoenix , particularly Sun City , Goodyear , Buckeye and Queen Creek , spilling over into the San Tan Valley in Pinal County to the southeast .

In Texas , Collin and Denton Counties to the north of Dallas-Fort Worth experienced big gains , particularly around the city of Frisco , as did Richmond and parts of Katy in Fort Bend County near Houston . Williamson County , north of Austin , was also a high growth area , around the cities of Georgetown and Leander . ►

Source : US Census Bureau

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