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Rewriting Business Planning for Urban Areas

Traditionally, retailers seeking new locations for their shops and stores look at consultants’ reports about the median income of the area. It’s an approach that doesn’t work for low-income, high-density urban neighborhoods.

Ten years ago, ShoreBank came up with another way to measure the economic strength of an inner-city neighborhood: by looking more closely at how population density translates into community buying power.

Rendering of The Shops and Lofts at 47th

Called MetroEdge, this market analysis approach looks at the amount of money spent by residents of a densely packed urban neighborhood. While a household’s median income might be low, taken as a whole, the neighborhood packs a solid economic punch.

The market analysis work was taken over by LISC nearly three years ago and paired with RetailEdge, a program that helps communities create marketing and development plans to use the MetroEdge analysis and attract new businesses.

In 2004, MetroEdge completed a study in the Quad Communities of North Kenwood, Oakland, Douglas and Grand Boulevard. Quad Communities Development Corporation (QCDC) took that information and a marketing plan developed by RetailEdge and headed out to Las Vegas for the annual meeting of the International Council of Shopping Centers.

The result: The Shops and Lofts at 47th will begin construction this spring. "It will be the first new quality retail development in this community in 30 or 40 years,” says Joel Bookman, director of programs for LISC/Chicago.

LISC MetroEdge also has completed or is working on market analyses for South Chicago, North Lawndale, Auburn Gresham, West Haven, Humboldt Park and Woodlawn. In addition to figuring out the buying power of a community, the studies point out “what steps need to be done to make a community competitive—
safety, security, amenities, parking, and other factors that a city community must deal with to be competitive with other areas,” Bookman says.

That’s where RetailEdge comes in, says Jake Cowan, business manager for LISC MetroEdge. “There might be a laundry list of things a community might need. RetailEdge can help sort those out.”

This article first appeared in the Winter-Spring 2008 issue of LISC/Chicago's newsletter, Working Capital, which can be found (along with previous issues) by clicking here.

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