Signs of Strength, Reasons for Hope: Results of the Analysis

Some of the most promising results of the survey were the responses to questions on the status of the business, property ownership, the impact of the recent housing activities by the local CBOs, and length of operation for these enterprises. The responses indicate that the majority of businesses owned the property which they operate from, had been at their present location for more than 6 years, and were either stable or growing. A significant proportion of business owners surveyed live in the target area, showing real commitment to the community. Additional positive results were the respondents’ support of recent housing development in the area, and their strong interest in joining a merchants association. These findings form the foundation of the economic redevelopment strategy recommended in this report.

One of the major strengths identified in the business community was that most businesses were either growing or stable. Of the 44 businesses that responded to the question on the status of their business, 38.6% indicated that they were growing and 34.1% responded that they were stable (Chart 1). Only 27.3% indicated a decline in business.

The stable nature of the business owners is also demonstrated by their length of operation, the degree to which owners live locally, and the degree to which they own the property from which they operate. More than 60% of the businesses have been in operation at their present location under the same ownership for more than 6 years. Even more surprising is that 23.9% of the businesses have been in operation at their present location between 11-20 years, while 28.8% have been in operation for more than 20 years (Chart 2).

Another positive indicator of business owner commitment is the place of residence of business owners; nearly 30% of the owners surveyed live in the neighborhood, and another 18% live elsewhere in Newark. Slightly more than two thirds of the 56 respondents own the property from which they operate their business. Such a high level of local ownership should provide a resource for a solid core of community participation. The longstanding connection of the business community to the surrounding neighborhood indicates the potential for the development of a strong organization of merchants. Indeed, more than 51% of the businesses surveyed indicated an interest in joining a local merchants organization, while an additional 23% have some interest in participation (Chart 3).

The most telling sign of strength was the response to the question whether businesses had plans to expand in the next five years. Half of the 42 surveyed businesses responded positively to this question, while 16.7 % answered "do not know," and 33.3% said "no." While there is likely to be bias in the responses to these questions, this is still a positive sign for the neighborhood.

The data collected indicates that 76.2% of the surveyed businesses draw the majority of their customers from the city at large. This Newark customer base is equally distributed between the neighborhood and elsewhere in Newark, while only 19% of businesses draw the majority of their customers from the greater region. This suggests that local business support is strong, and there is the potential to revive the regional market base of the two commercial corridors.

The response of business owners to a question asking them to assess the effects of current housing redevelopment efforts was somewhat ambiguous. While respondents determined that the housing developments recently built by local CBO’s, including Corinthian Housing Development Corporation, has had a positive impact on their business in 38.5% of the cases, 31.8% of the respondents did not know if these new housing units were related to the status of their business. Although a causal relationship cannot be proven from this data, it is likely that the increase in housing stock has bolstered the customer base of these operations.

In sum, these survey results are promising. They indicate that a revitalization strategy based on the ties business owners have with the community should be pursued. Any redevelopment strategy for the West Side Park area should include business owners as stakeholders in the process.

Physical Inventory

The physical inventory consisted of a comprehensive assessment of all land-uses abutting Springfield and South Orange Avenues, and comprised 307 entries. This inventory recorded vacant land, the type of building uses, and the type of business occupying retail space. The physical inventory also included an assessment of street and building conditions, as well as a description of the crime-prevention techniques employed by businesses. One caveat in interpreting the inventory results is that data were not coordinated with the Newark tax maps. Therefore, an inventory entry of a single vacant lot may correspond with several officially registered properties.

Survey results confirm the striking images of under-utilization of land and deterioration of buildings in the West Side Park area. A significant proportion of the inventories (23%) consisted of vacant lots and buildings. 12.5% was comprised of vacant lots, and 12.8% was vacant buildings (Table 2). The spatial distribution of vacant lots differs along the two corridors. Springfield Avenue has nearly twice the percentage of land vacant when compared with South Orange Avenue. The higher proportion of vacant lots on Springfield Avenue is concentrated on its eastern half (Figure 3). On South Orange Avenue, vacant lots tend to be scattered toward the western end, where there are several large abandoned manufacturing sites.

Of the buildings that appeared vacant from an outside inspection, at least half could be rehabilitated. Once again, Springfield Avenue had considerably more vacant buildings than its counterpart. An explanation for this pattern is twofold. First, much of the land on South Orange Avenue is occupied by three large lots, the former Pabst Brewery, Fairmount Cemetery, and West Side High School. Secondly, New Community Corporation has constructed new housing and businesses in the area of Bergen Street and South Orange.

Despite the high vacancy rates, statistics on building condition showed some promise. Seventeen percent of all buildings were rated in good condition, 42.6% were deemed fair, and 29.6% were in poor condition (Table 3; see Appendix C for a description of the ranking). Therefore, the survey rated 11 percent of the existing building stock as able to be rehabilitated. A comparison of the distribution of building conditions on Springfield and South Orange Avenues indicates the benefits of New Community’s redevelopment efforts. On South Orange Avenue, buildings were three times more likely to be rated in good condition, while both Avenues had about the same percentage of buildings rated poor and bad. These results indicate that most buildings on these commercial corridors are structurally sound and can be restored to their former condition, preserving some of the historic architecture and character of the neighborhood.

Street condition was rated as fair in 45.4% of the 307 cases; 34.5% of the surveys indicated poor to bad street conditions. Both poor building and poor street conditions were evenly distributed along the Avenues. Poor street conditions often occur in the same locations as poor building condition (Figure 4).

While bus stops were not part of the official survey, it should be noted that all were in very poor condition, and have not been recently serviced by New Jersey Transit (See Picture 2). The renovations of these stops could make the Avenues a more attractive destination for incoming shoppers.

Another aspect of land use surveyed by the physical inventory was building type. The most prevalent building type on the two corridors was mixed use, with some form of retail use on the ground floor and residential use above. This is a traditional urban form for high-density areas. Retail on the first floor allows commercial activity to occur, and residential units above provide a market for the retail and encourages street activity beyond regular business hours. When occupied, such building forms can support the growth of community life and reduce crime on the streets.

An analysis of building use reveals several distinct patterns. The most frequent building use other than residential use occurred for religious organizations. Of commercial uses, dry cleaners/laundromats were most prevalent, and then eateries (fast food and restaurants) were the next most common business types. Contrary to popular perceptions, bars and liquor stores were not overly represented in the target area (Table 4).

As one might anticipate, certain business types are clustered while others are more evenly distributed. The business types that would tend to benefit from clustering include: 1) restaurants, convenience stores, and fast food establishments; 2) social clubs, bars, and liquor stores; 3) salon/barbers shops, laundries, and apparel stores; 4) auto-related services. Their spatial distribution in the study area indicates that they follow traditional patterns (Figures 5-8). In contrast, places of worship tended to be more evenly distributed along the corridors (Figure 9). Certain services, such as household/furniture, and professional, social, and medical-related services, had too few representative points to establish a spatial pattern (Appendix E).

The clustering of certain establishments, such as food services and salons/apparel/laundries is correlated in most cases with high pedestrian use. A map of these establishments can be used to determine where nodes of pedestrian activity exist along the corridors. These nodes occur on South Orange Avenue between 9^th and 12^th Streets, Springfield Avenue between 8^th and 12^th Streets, and Springfield Avenue between 17^th and 20^th Streets. Bars, social clubs, and liquor stores show a similar type of clustering, although they occur predominantly in one general area, on the western end of Springfield Avenue.

Survey results indicated that parking lots were most highly concentrated along the west end of Springfield Avenue, and were virtually absent elsewhere (Figure 10). Where parking lots do exist, they are for the use of one or at most two establishments, with the exception of the parking lots that serve strip retail developments.

An assessment of crime prevention techniques indicates an area in need of improvement. By far the most visible and utilized means of crime prevention is some form of roll down gate and/or bars on the windows, with 60% of the structures having one or the other. The use of these aesthetically unattractive physical barriers was supplemented next by the even more visible and unattractive means of fencing, including the use of barbed wire and concertina wire (29.3%). These low-cost techniques, while certainly obvious to a potential intruder, also degrade the overall appeal of the neighborhood.

The physical inventory of the neighborhood points to several improvement strategies. Reinvestment in the neighborhood should encourage mixed-use in-fill development, address the parking needs of businesses, and focus on streetscape investment such as bus stop renovation and the improvement of business facades. The social and physical benefits of the CBO’s working in the neighborhood are evident and suggest that they must continue to be actors in the process of revitalizing this distressed area.

While unemployment is very high in the neighborhood due to the structural problems of deindustrialization, institutional racism, global economic restructuring, and Newark’s image problem, the survey results indicate that local businesses contribute in a significant way to employment opportunities for neighborhood residents, and have the potential to increase this contribution.

Presently the businesses generate an average of 4.6 jobs per establishment. The modal employment range for the respondents is between 1-3 employees (Table 5). Strong community linkages are indicated by the fact that 41.9% of the businesses employ between 1-3 people from the neighborhood, and 11.6% employ between 11-25 neighborhood residents.

Though there are strong community ties, 32.5% of employers indicated that it was difficult to locate qualified employees and 22.5% responded that it was very difficult. The most common reason given for this difficulty was a lack of work ethic, followed by poor communication skills, and then potential employees’ fear of the neighborhood (Table 6). This reflects the lagging education system in Newark and the effect of the "Newark Mystique." The lack of potential employees’ work ethic and communication skills could be addressed through the creation of a job readiness program. Such a program could help both the businesses and community residents while building a stronger relationship between them.

Table 6: Reason for Difficulty in Finding Qualified Employees

Survey results on advertising strategies indicate that communication between employers and the public at large is not a problem. Only one employer responded that he did not know where to advertise. In fact, 59.1 % of employers locate employees through an informal word of mouth network (Table 7). The next most preferred method of locating skilled help was through classified ads in a city newspaper.

The demonstration of substantial employee recruitment from the neighborhood indicates that if the current linkages between the employers and the neighborhood remain stable, then the growth of these businesses should produce more jobs for the residents. Additionally, the stability of businesses in the neighborhood, based on tenure status, length of residence, residence in the neighborhood, and the high use of word of mouth for job advertising indicate the existence of a strong informal information network in the neighborhood. Any employment strategy in the West Side Park area should maximize the opportunities provided by the depth of businesses’ links with the surrounding community.

The survey identified improvements that business owners felt would benefit their business. Local problems identified by surveyed businesses included access barriers to basic business services such as insurance and financing, as well as the need for increased city services, particularly police patrols.

Survey results indicate that one of the most pressing needs of business owners was for information about financial and technical business assistance providers in the Newark area. Almost three-quarters of the 42 respondents were unaware of any business assistance program. Some of these problems could be assuaged through educating the businesses about available financial resources.

While these results indicate that the lack of information is a significant barrier to business owners’ success, those business owners who had applied for insurance and financial capital experienced additional difficulties. Over half of the surveyed businesses responded that acquiring insurance was "difficult" (42.5%) or "very difficult" (15.0%). Of those responding that it was difficult to get insurance, 35.1% linked the problem to the location of their business, while the cost of insurance was the second leading impediment.

The merchants also expressed concern about accessing capital for their businesses. Nearly half indicated that it was difficult or very difficult to acquire the necessary financing for their businesses. Merchants had many different reasons for why they had difficulty accessing capital, including business and bank policies adverse to certain business types. One quarter of the respondents indicated that they did not know why they could not get financing. These two responses suggest that the local merchants are operating with little knowledge of the financial market, how decisions are made, and how to present their requests to financial institutions. Here again, informing the merchants of available resources from other sources and the opportunity to share experiences with other individuals will help to solve the problem.

Nearly three quarters of the merchants indicated that a new bank in the neighborhood would more than likely receive their commercial accounts. It should be noted that a number of these businesses use the First Union Bank at the corner of Bergen Street and Springfield Avenue, on the edge of the defined study area. The primary banking service used by these businesses is checking accounts (68.1%). About one fifth of the business use their banks payroll services, have commercial savings accounts, or have some form of a commercial loan. The loans are distributed as 7.7% mortgages and 12.8% some other kind of loan. Though there appears to be a high level of interest in a neighborhood bank, this research effort did not attempt to quantify the capital accumulation of the neighborhood to determine the feasibility of establishing such an institution.

Table 8 breaks down the merchants’ perceptions of those improvements that could most enhance their businesses. Access to capital and a special improvement district received the most support, with 36% of businesses emphasizing those two needs. Merchants prioritized three other significant concerns. First, the merchants overwhelmingly indicated that some type of organizing (group merchant organization, neighborhood watch group, and/or special improvement districts) would benefit them. The spatial distribution of interest in a merchants organization clustered in areas with more intense use, areas of neighborhood strength. Interestingly, at least two merchants’ organizations already exist to serve the study area, one (South Orange Avenue Merchants’ Association) on South Orange Avenue, and the other (Greater Newark Merchants’ Association) based on Springfield Avenue.

Crime also ranked high among the concerns of business owners. Merchants often pointed out the need for more neighborhood policing, which was coded in the "other" category on the survey. The widespread fear of crime deters patronage of shoppers from the wider region as well as those several blocks away who may be unfamiliar with the neighborhood. Finally, 22% of the merchants indicated that additional parking would improve their business’ chance for success. Spatially this response was concentrated in the area of the most intense use near the intersection of Bergen Street and South Orange Avenue, where the physical inventory identified a lack of parking lots (Figure 11). One possible solution to this problem could be to create a community parking lot, though the location of such a lot should be coordinated by local merchants. Efforts in the past to develop a parking lot on South Orange Avenue ran into the problem of disagreement among local business people, although they received support from the City of Newark.

Until five years ago, the City of Newark had limited its economic redevelopment activity to the central business district. Since then, the city’s efforts have been broader, taking into consideration the surroun-ding urban fabric. However, models for development outside of Newark’s central business district seem to emphasize large-scale, strip-type developments that may not strengthen existing busi-nesses. Economic develop-ment strategies should attempt to bolster the strength of the small business community in the target area by addressing the high level of crime, increasing access to information and financing, and improving city services. In order to respond to the need for information about available financial and technical resources from the various organizations, a resource guide was developed for this area based on business ownership (see Table 9) and business characteristics (small, urban, retail) (see Appendix D). The distribution of this resource guide will make a significant contribution to this goal, while it may not be enough to link businesses with resources designed for them.

Table 9: Ownership Information

Assessment of Community Improvement Needs

When asked what resources would be the most useful for the West Side Park community,

businesses placed police patrols and more housing first. An overwhelming majority (75%) of businesses thought that more police patrols would be the best improvement for the neighborhood (Figure 12). Businesses listed housing second in importance at 62%, followed by improved city services, which received 34.1% of business support. Other responses included more street lighting, at 26% and more street trees, at 12%.

Businesses located along the entire length of both Avenues identified crime to be a major problem facing the community. This response was based on the real risk that the area’s businesses experience daily; one of the most notable findings of the survey is that nearly half (45%) of the businesses reported being a victim of a crime within the last year. Of those victimized establishments, 12% indicated that they were involved in armed robbery. The most prevalent crime was break-ins, with 31.7% of the merchants recording a break-in. Vandalism ranked second at 17.1%. Other types of crime reported, listed in descending order of occurrence, were shoplifting, employee theft, and assault. One merchant indicated that a delivery vehicle had been stolen.

As previously mentioned, businesses ranked the creation of more housing units second on the list of potential improvements to the target area. Any improvements that ranked after housing received less than half as many "votes." The housing solution would address a number of community issues simultaneously. Increased activity in the area from new residents has the potential to deter criminal activity. A second benefit of increased housing would be the increased political clout of the neighborhood through increasing the number of eligible voters from the area. A third benefit would be the growing market demand that would spur business expansion.

Business owners consistently listed the need for improved crime control and more housing units to benefit the West Side Park community. In their opinion, these two issues need to be addressed first in steps targeted to improve conditions for community residents.

The results presented in this section are from the data acquired through a survey of Corinthian Housing Development Corporation’s tenants (see Appendix B). Overall, the data describe a positive trend -- the majority of goods and services bought by the residents of CHDC housing are produced by Newark businesses, of which about half are located within the neighborhood.

Table 10: Residential Market Area

When residents were asked which establishments they would like to see in the target area, residents ranked a food/convenience store as the most desirable new type of business at 18.2%.

One-half of Corinthian restaurant users patronize establishments outside of Newark (Tables 10 and 11). Once additional housing is completed in the target area, there might be an opportunity for the development of more, or higher-quality eat-in establishments in the neighborhood.

Another significant result of the survey analysis is that even though Newark is a locus of medical, legal, and financial services, 45.5% of Corinthian residents left the city for professional services.

The results of this data should not be considered as representative of the neighborhood for two basic reasons. First, the small sample size (number of respondents) reduces the results’ efficiency as a predictor. Only 23 residents of the 45 households surveyed completed a survey. Second, the residents of the CHDC housing are of a different socio-economic class then the average neighborhood resident, and their small numbers make them unrepresentative of the target area population. The results suggest that residents patronize local business, and that there is potential for increased patronage. They also point to certain improvements that could occur in the quality or supply of local services. A more elaborate survey should be done of existing residents and future Corinthian residents to create a more sound basis for analysis. The results are generally inconclusive because of the small survey sample size discussed earlier. Therefore, they do not suggest a comprehensive market strategy for local businesses.