Retail investment fails community

Kristopher A. Fortin

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The Chesterfield Square in South Los Angeles has done little to raise housing value and sales, reduce crime and stimulate job growth since it opened in 2001, stated a study published by a CSUN professor in December.

John Sides, CSUN history professor and research coordinator, detailed crime rates, housing value, home sales and job stimulation in five zip codes surrounding the Chesterfield Square from 1996 to 2006 in a 46-page document.

The square opened on the corner of Western and Slauson to high expectations from city officials and the media. Sides said there was a mentality to look away from government and look to private investors for answers.

Katell Properties, the urban planer for the square, posted on their website, “[Chesterfield square] functions as a ‘tipping point,’ spurring job growth and further investment in the inner city; and it fulfills real needs in an underserved community by providing requested resources in a safe and accessible landscape.”

Mark Ridley-Thomas, senator of the 26th district and former Los Angeles City Councilmember, and former football player Keyshawn Johnson invested in Chesterfield Square’s installation.

“There was a grander claim and it hasn’t been able to support that,” Sides said.

Daniel R. Blake, economics professor and San Fernando Valley Economic Research Center director, said that redeveloping a community with a focus on retail investment doesn’t accomplish much.

“There is a possibility that by bringing a new retail center, if it improves the shopping conditions or the shopping environment over what was the community before, it can have a marginal effect but not a huge effect,” Blake said.

A similar model created by Harvard professor Michael Porter drove the Chesterfield Square plan.

Porter looked at a poor communities potential purchasing power and concluded that if businesses invest into them, people will start spending close to home, thus bringing more investments into the community.

“As long as you’re just serving that local community, you are not bringing new stuff into the community,” Blake said.

There must be “something that sells product outside that community. Create jobs in the community with revenues that come from outside of the community continuously, Blake said. It’s very hard to get that effect with retail or personal services because you’re not attracting clientele from outside the community.

“The way these spillover affects help is economics spillover benefits, if there are sales to people outside the local community . . . it gets their money and brings it into the community,” Blake said.

The Chesterfield Square immediately created 650 jobs but was offset by the loss of jobs in the other sampled zip codes. “Evidently, the affect was way too small,” Sides said.

Regardless of the inactivity, some local resident appreciated the addition of major retailers.

Thomas Webb, a South Los Angeles resident for 30 years and Home Depot employee in Chesterfield Square, said, “This shopping center has been a valuable asset to the community.”

Julio Hernandez lived in the area for eight years and said, “It’s close by our house. We can get it from close by.”

Philip Decoud has lived in south L.A. since 1961 and said there were more liquor stores in the area where the square is now. Ducoud said, “It’s convenient for me really, I walk out my front door and walk to the store.”

The survey, which focused on low-income communities, emphasized African-Americans.

“It may be too soon to see what happens,” Sides said.

The Chesterfield Square was one of the first major retail investments in South Los Angeles prior to the Los Angeles riots in 1992.

The square has 19 stores including Food For Less, Home Depot, Walgreens, Starbucks and McDonalds. While a Big Lots and Pizza Hut opened on Slauson, across the street, John’s Market, open for 40 years, hinted at closing down.

Patrick Chueng, an employee of John’s Market, said that the square has cut business at the store. “We’ve been suffering for a few years. Every year it gets worse.

“I think in a few years, we’ll close down,” he said.

“Now that we’re in a recession, now that the real estate market has tanked, will people remember south L.A.?” Sides said.

“It was my hope that it did work. Results were not what I expected,” Sides said.

Sides was awarded a $12,000 grant from the John Randolph Haynes and Dora Haynes Foundation to conduct his research.

Katell Properties and Sen. Mark Ridley-Thomas did not reply to requests for an interview.