Retail in Provo

RW Retail-9075

Most long-term Provo residents will remember (and lament) the great debate about bringing a mall to Downtown Provo. As the story is generally told, we had a chance to have what is now called the University Mall in Downtown Provo. In summary, we blew it and the mall went to Orem taking with it any chance of Provo succeeding in retail for the rest of forever. (insert sarcastic smile and possible eye roll)

The story is as much lore as it is fact, but what is true is that Orem has been very successful attracting the traditional retail dollar. I meet many Provo residents who want us to be more like Orem (in a retail sort of way). I try to help them understand that what’s been good for Orem may not be what’s best for Provo. We are different cities with different cultures. The uniqueness found in our two cities brings strength to both of us. Just as we look over our fence and see things in Orem that we admire, they look over at us and see things in Provo to envy.

The cry for more retail in Provo is legitimate and I hope residents know I’m listening and taking action. I have personally met with brokers who represent retailers and property owners. These deals do not happen overnight, but they are in the works. As we have the retail dialogue, I hope all Provo residents will keep a few things in mind —

1-Although we don’t benefit directly from Orem’s sales tax revenue, we do enjoy many indirect benefits. Much of the $65,000,000 match for BRT is generated from Orem sales tax dollars, as are several of the roads and trails in the county. Many Provo residents enjoy Orem’s parks, soccer fields, Scera Shell, Story Telling Festival and other amenities that are enhanced with sales tax dollars generated in Orem. A strong Orem helps Provo and is part of our healthy economy.

2-It’s also important for Provo residents to understand that when they spend money outside of Provo, or on the Internet, we lose sales tax revenue. When a dollar is spent on a taxable item somewhere in Utah, one penny of the total sales tax goes to cities. Of that one penny half of it goes to the city where the item was purchased and half of it is collected and distributed to cities based on population. In Provo, this sales tax revenue is our largest source of income (roughly 30%). It helps us keep property tax low and pays for police, fire, parks and many other services offered by Provo City.

3-Left on its own, retail will locate where the free market will bring the most sales with the highest profit. By using incentives, government can entice free market forces and push retail to locate where it otherwise might not go. That said, incentives are a little bit like dynamite. They can be very effective but they also come with a high cost and high risk. For example, years ago Nordstrom was incentivized to come to the University Mall. When the incentives ended, so did Nordstrom’s interest in our community.

We attempted to incentivize Target into our community five years ago. The incentive package included free land, a 20-year sales tax wavier, and a commitment from the City to spend almost $6,000,000 to buy property and move part of the golf course. The incentives were borderline ridiculous and yet Target walked away from the deal. If not careful, incentives can wipe out all the financial benefit of bringing retail to a city. Over the years, Provo has concentrated more on job growth than on incentivizing retail. Provo has generated numerous accolades for this policy, even being ranked #1 for Business and Careers by Forbes. Nevertheless, state tax policy does nothing to reward cities that create jobs and instead fosters an environment that makes cities give more and more away to attract retail offerings.

4-No discussion about retail would be complete without mentioning the successes we are enjoying. Sales tax revenues have increased each year for the last five years. Provo’s retail base is growing at a slightly higher rate than that of the State. Downtown is a fabulous retail success as is the Shops at Riverwoods. These two areas have become a jewel and a source of much pride for Provo residents.

5-We know there are other areas in our community that need retail offerings, namely East Bay and Plum Tree Plaza on the Parkway. Long before Kmart left Provo we were working with the property owners to shift the momentum in East Bay. Shopko, to be honest, was a bit of a surprise, but if you shopped there you will know why it closed. Parking was too plentiful, the lines were never crowded and selection was marginal – three things that spell disaster for retail. Also, Shopko recently announced that it would be closing several stores nationwide and Provo happened to be on that list.

Provo Retail Summit

As we continue this community discussion, I would like to hold a Retail Town Hall to openly talk about the retail environment in Provo. Mark your calendar for Wednesday, February 11 from 7:00-9:00 pm in our Recreation Center.

At this event, I would like to discuss what the City is doing to attract sales tax dollars, some of the ins and out of incentives, what retail is doing on a more national scale, and how we are seeing the effects of it in our community.

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  1. Jason

    I agree that Provo has its own personality and destiny. I also feel that a high quality, sit-down restaurant with easy parking would be a HUGE asset to the City Center Provo Temple!! Where is the Master Plan for downtown Provo commerical district? We have a talented, dedicated mayor and I hope he makes the difference. East Bay and the Provo Mall are moving in the wrong direction, also. Solutions? Would subsidies to attract new businesses be appropriate?

  2. sharon

    Thanks for the info. I’m always wondering about this because I have to go to Orem or farther to buy almost anything. It would be great and amazing to get some retail stores in East Bay. So many empty spaces. Maybe a two-story Target in the old Kmart (although it seems that Target might be difficult to deal with but at least there is already a building space). That alone would re-vitalize the entire area and people and more eateries would come.

  3. Jen

    This is great.

    1. Jen

      Is the meeting 7 am or pm?

      1. John

        pm – just updated the blog post.

  4. Jared Dayley

    Too many students and renters means low income leaving retailers without a strong consumer. Housing that is aged with neighborhoods uninviting and high property values with little industry making renting the number one draw. Construction to me is no longer a true industry with supressed wages so material manufacturers can charge a premium. Without a consumer who can own a home, improve the neighborhoods and afford what’s being sold then the interenet sales will continue to empty the retail locations. Orem’s solution is to attempt to bring the people closer to the shops hoping they will buy. Adding office space when there is already for lease signs hanging is a crap shoot just like the convention center was. Closing off center street and investing millions into an area surrounded by low income won’t help until neighborhoods are leveled and new housing is built to compete with the North and South part of Utah Valley. The draw there is new homes with new infrastructure. But if we really want to start keeping the dollars here we need to restructure the pay scale in conctruction, have s real guest worker program rather than under the table illegal workers, and make an industry that supports middle class America. You don’t need tax incentives if you have s healthy consumer. Tax incentives are nothing more than a continuation of a failing government system. If a lanf swap could be done to get landlords to give up old real estate for low maintanance condos so those properties could be leveled and the new housing could replace the aging. New housing, put renters into condos, open up new neighborhoods close to downtown (North, West, SouthWest), restore housing to the Eadt and Northeast to preserve charm, then let the business and retail spaced tn rive naturally. Otherwise the growth and retail will go to the areas with new infrastructure and lower property values.

  5. Amy

    I’m sad that I can’t make the meeting! I’ve wanted a Target in Provo for years. But I’ll also take a Harmons or Trader Joe’s. If Provo had the first Trader Joe’s in Utah County, our sales tax income would skyrocket.

  6. India

    I’m pleased with how many grocery options are available to me within walking distance in Provo. Although grocery stores don’t carry everything, it’s nice to be able to bike or walk to most daily necessities, and my neighborhood has a great walk score. If we put a big box store in Provo that was a pain to bike or bus to, it would be as inaccessible for me as having it in Orem.

    1. Gail

      Not in South provo, the nearest grocery store is Smiths and that is aout 4 miles.

  7. Corey Folster

    I’ll be there. Big box retailer fulfill a need and are valuable to any community. However, shopping local and shopping small ads so much more to the neighborhood and keeps more dollars in the city. Come out and support locally owned and operated businesses and what we can do to further that great neighborhood feel.

  8. Cherie

    How about bring Trader Joe’s to the Shopko building? It would bring a lot of needed traffic to the Plum Tree Plaza.

    1. Rose

      I’d love Target or Winco. Many of us are missing having much in East bay. Something like that would really help that area

    2. Coby

      My husband and I agree trader Joe’s in the Shopko building would be great!

  9. Jason

    I agree that Trader Joe’s would be a fabulous addition in Provo. However, they do not utilize the space or want the overhead of a big-box footprint, which means they would not consider the old Shopko or KMart locations. The Trader Joe’s on 400 South and 650 E. in SLC does a BOOMING business and draws many shoppers to the Trolley Square area! We NEED those types of retail business winners in Provo!!! Where was the Provo City Council and Mayor when Costco was considering a 2nd location in the South Utah Country area?? Sadly, Costco selected Spanish Fork! Costco, Trader Joes, YogurtLand, Orange Peel, and Panera Bread are 5 of the hottest potential retail businesses that Provo should be courting right now! Who in Provo government is contacting these businesses and suggesting 2-4 different possible Provo locations?? Which commercial real estate agent is doing anything to help Provo? How aggressive is the mayor in seeking these possibilities? These are all good questions without many answers…

  10. Sylvia A

    Thanks Mayor for this – I appreciate you taking the time to keep us all in the loop

  11. Brian

    East bay seems to me to be in crisis mode and in danger of turning into a blighted ghost town. It also justifies serious efforts.

    As for downtown Provo it is way to optimistic to call it a success story. Provo has a unique challenge because there are few bars with few patrons. The entertainment options for most people: movies and that’s about it. Bars also feed the music scene which struggles in Provo. Downtown Provo needs a high end movie theater which would feed the restaurant business and increase traffic and life and energy.

  12. Kristin

    I have honestly driven all the way to SLC to buy my groceries at Trader Joe’s several times. The amazing prices on organic food is worth the travel (when I have the time) in my opinion! Having a Trader Joe’s here in Provo would be a dream come true.

  13. aperson

    Provo is a dump. Aside from a silver of north Provo, the entire town pretty much consist of dilapidated rentals. BYU requires students to live with in two miles of campus, which guarantees that landlords will be able find tenants. Why fix up your rental when it’s a matter of who, not if, you will find to rent. Additionaly Provo is caught between two worlds. It’s not hip enough to attract young professionals, yet it’s too urban for familIes seeking the suburban life. Provo needs to find a way to encourage the gentrification of it’s vast array of undesirable neighborhoods.

  14. Patricia

    Trader Joe’s
    Sweet Tomatoes
    These are the two places that I think would be a great addition to Provo, around the Towne Center Mall as both would bring shopper to the mall also.

  15. Martin

    A costco store close to the water west side, take the traffic out of the busy city.

  16. Pam

    ‘Wishing’ won’t make meaningful businesses materialize. Too many at Provo Chamber of Commerce are believing their own PR–get real, look around at what specific restaurants/grocers/retailers are thriving in AF/Lehi areas. We need Trader Joes, Sweet Tomato, Panera Bread, organic food hang-outs, not some ‘white=bread’ Utah County version of what the Chamber thinks is ‘hip,’ because they’re 20 years behind the curve. Living in AF/Lehi USED to be the ‘joke,’ now Provo is the unfunny joke.

  17. Scott

    I am not sure if I can make it on Wednesday night. Please don’t forget west Provo. We desperately need a grocery store in our area. I hope work is continuing to encourage Smith’s to develop.

    1. Kim

      I agree. Trader Joe’s would be the first business to turn Provo around.

  18. Vivian

    I seldom shop downtown Provo any more because it seems there isn’t anything but restaurants. However, I am excited to be able to partake of Coleman’s chocolate when it becomes available. I want a hardware store and a quality fabric store somewhere in northeast Provo. I am tired of having to drive to Lowes or Home Depot just to buy a few screws. I hope the Shopko building can house my wishes.

  19. Alice Hansen

    I would like to see a grocery store in the south west part of town.

  20. Chris

    I wouldn’t be shopping online if there were stores in the valley that sold affordable merchandise. What on earth will I ever afford at the Riverwoods? I don’ t need—or even desire—anything that is sold there and am often bemused that enough Provo city residents earn enough and “need” enough to patronize expensive stores like those at all, much less enough to keep them all in business. I’m no economist, so please forgive, but it’s hard for me not to wonder what $6,000,000 could do for the infrastructure of Provo of its own accord vs being used to entice more retail into our community. More retail??? Is that what America needs? Why does this feel like such an unsettling missing of the mark? Provo has so much to offer (life-long resident speaking here) and it just seems like there are so many better ways to capitalize (no pun intended) on our potential than asking people to go out and spend spend spend at shops we’ll have to spend spend spend to lure here in the first place. (I recognize that it takes money to make more money, but I just get sick in my stomach thinking that what Provo needs is more $300 suits for sale, for example.) I really appreciate hearing from the mayor with details like these and the fact that he cares about and seeks our perspectives. I also appreciate reading what others think. Thanks for all you are doing for Provo.

  21. Lisa

    I go to Orem all the time to TJ Max, Old Navy, Famous Footwear, Pier 1, Hobby Lobby and Barnes and Noble. I am sad about Shopko closing as I feel like Target is too far away. Plus I like Shopko. Provo needs a nice book store! I was very disappointed when Borders closed in Riverwoods. I would be thrilled to have a TJ Maxx, an Old Navy and the other above mentioned stores in Provo! I also miss having a craft store in Provo since Roberts Craft closed. I would much rather spend my money in Provo and would like these stores to be closer.

  22. Vickie

    I live in East Bay area and we are dying down here. It would be great to have a major grocery store (like Winco) come in where KMART used to be and some other types of family stores to fill in the gaps where Deseret Book, Roberts, and I.M. Home used to be. East Bay is a great place and really needs to have the chance to shine. As for the Provo Towne Mall, it is also dying. The stores that are still there are strong and can afford the rent that they are charged, but there are stores that are now gone that really didn’t have a chance. Perhaps the management company of the mall can take that into consideration when they are charging such high rents for some of the businesses.
    Is this meeting on Wednesday night open to the public, and do we have to have a pass to get into the Rec Center for this meeting?

  23. CR

    I believe they are building a hardware store by Macey’s. I would love to see a Trader Joe’s and that Target would have been wonderful. I like the Apple Store idea maybe it would draw more costumers to the Provo Town Center.

    1. Roger

      There are two vacant store fronts at the Provo Towne Center that would perfectly accommodate an Apple Store. I’m confident given the universities in the area, the pervasive use of Apple products (namely the iPhone), Provo’s location (and also the distance to the next closest store), and Apple’s store ROI, it would provide a much needed boost to the PTC.

  24. Cheesecake Factory and Target. Game-changers for Provo.

  25. Marvin

    My wife and I drive to SLC for the Pottery Barn at Trolly Square and the Restoration Hardware at City Creek. A Pottery Barn at Riverwoods would make a lot of sense with the Williams Sonoma that is already there.
    East Bay needs either a Wal-Mart or Target in the old K-Mart location. Even though Sam’s Club is there, I have seen Wal-Mart share the same parking lot with a Sam’s Club in other cities. Marshall’s and TJ Maxx would be another good choice for East Bay. A sporting goods store would be a good choice for the Plum Tree ShopKo space, and might keep some of the youth sports dollars in Provo. With the City Center Temple in downtown, someone should be planning a major redevelopment that keeps small shops on West Center street, including some “destination” retail such as an Apple store and Microsoft store and includes high-density housing on West 100 North and West 100-200 South that add synergy to the Front Runner station, new convention center, hotels, and restaurants in the downtown area.

  26. Claralyn Hill

    Trader Joes and Sweet Tomato would be great! Also, please make sure all commercial zones have easy access from the road. Some, such as where Walmart took Albertson’s place, are just too hard to get in and out of.

  27. This information is so helpful! I’ve wondered many-a-time about why I always spend most of my errand days in Orem.

    If we got a Harbor Freight, a Joanne’s Fabric, and a full-size Sephora, I’d never have to leave the city 🙂

    Hope I can make it to the meeting tonight!

  28. Alison

    Thank you for the conversation. Wild Oats please.

  29. Kay

    The rel need is for a COSTO as it heps keep gas down and also better inventory of goods

  30. Sue

    Trader Joe’s, please!

  31. Coby

    We hope to see a Winco in south in South Provo soon! Target and Trader Joe’s would be nice too. Also a Jo Ann’s in Provo would great.

  32. Stephen

    Whole foods is my recommendation.

  33. Jen

    I think the focus should be on retailers that are not already in Orem. For example… Red Robins is a place that has lasted in the provo mall since the malls construction. But i do not think that location would be as successful if there was a nearby location even as ‘far’ away as Orem. So my point is if we try to compete with orem we will not win the battle.

  34. Joseph Scott

    Mr. Mayor, I appreciate the well-written _straight talk_. Keep it up.

  35. Milly

    It is sad to see the gentrification of downtown Provo. It should have been retained as a historic main street with unique local shops, but it’s pretty much been destroyed – very sad to watch.

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