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Is Walmart a deal with the devil for Novi?
May 12, 2010 by Michael Salemi

There is no question that Novi Town Center, a well-located and well-placed retail development, has suffered from fleeing tenants and vacancy that wasn’t right before our larger economic issues. Part of its problem is the lack of anchor stores, and once they go, the smaller stores are soon to follow. Yet, while the interior is largely abandoned, newly-built “pads” house new establishments like PeiWei, PotBelly and Oberweis (Chapter 11 since last September, by the way). That is a peculiar sight that defies logic: building MORE space on properly largely abandoned.

I am certain that the city will look at Walmart with dollar signs in their eyes for tax reasons. I am sure the property owners (how many owners since being built?) will consider it a coup to land such an anchor. Maybe, just maybe, this is what that property would need to “turn it around”.

But at what cost? The Walmart effect is real, and should be studied very carefully by the people of Novi and its government prior to just handing them the keys to a vacant Mervyn’s space. You could spend weeks studying (as many academicians have done) the impact of Walmart. Just Google “Impact on community of Walmart” or anything similar, and sit back and read.

Highlighting facts from other locales:

  • Increased tax revenue is often offset by reductions in taxes from other establishments.
  • Their buying power causes locally owned and operated businesses to fail.
  • “Job Creation” is largely illusory: low paying part time jobs.
  • States and cities often have to finance revitalization programs for areas devastated by Walmart.

Look at the struggling Sam’s Club. When located at Grand River and Haggerty, it was thriving. By moving to Wixom Road south of Grand River, they hoped to capitalize on the Island Lake growth. That barely happened, and that Sam’s Club, while open for business, is generally empty of customers, certainly when compared to ANY of the local Costco warehouses.

It should not be advanced academic science to realize that Walmart will not make the pie any bigger; it will just be divided up into smaller pieces. There is a reason why so many businesses have failed here in Novi —there isn’t enough business to go around, plain and simple. Have you noticed how EVERY commercial building in Novi has a For Lease sign on it? Did anyone scratch their head about hundreds of thousands of square feet of retail space at Fountain Walk (the grandest of grand, misguided ideas in Novi ) demolished before it ever was occupied? Do I need to mention “ Main Street ”? The vacancy rate is astounding here. There just isn’t enough business in this community, in this economy. Adding such a massive retailer will most definitely have an effect, but once you take everything into consideration, it probably isn’t right for Novi .

Be careful what you wish for.

Michael Salemi
Novi