• Mahoning Valley

    The Future of the Southern Park Mall

    May 12, 2019

    In 1970, the Youngstown based Edward J. DeBartolo Corporation opened the Southern Park Mall. The Boardman mall, which will be celebrating its 50th anniversary in 2020, is now owned by Columbus based Washington Prime Group (WPG). The publicly traded REIT
    [WPG – Yahoo Finance] considers the Southern Park Mall a Tier I asset for the company.

    Photo courtesy YoungstownLive.com

    Closings of Sears and Dillard’s

    The Southern Park Mall features 1,198,000 square feet of space. Of that total space, there are four large anchor spaces which for much of the new millennium were occupied by JCPenney, Macy’s, Dillard’s, and Sears. However that all changed in July 2018 when Sears closed their Boardman location.

    The closure of Sears [SDLDQ – Yahoo Finance] was not unexpected due to their struggling financials and ever-growing number of closures across the county. Sears itself has closed 260 of its roughly 700 stores according to CNBC. The future of the 133 year old company remains in jeopardy as it looks to rebound after entering Chapter 11 bankruptcy.

    A day after the announcement of the closure (April 6, 2018) of the store, WPG released the following statement, “The Company is in discussions with new tenants, which will be announced in the future, for the high visibility anchor space currently occupied by Sears. The Company proactively negotiated an early termination of the lease to gain control of the real estate and commence redevelopment efforts.” As of today, WPG has not made any announcements regarding the future of this particular location. However, in an interview with WKBN, Southern Park Mall General Manager Brian Gabbert stated, “That could be anything from using the store that’s there to actually tearing it down and putting other stores in place on the outside and redeveloping the portion of the lot beyond that as well.”

    Less than 9 months later, on February 13, 2019, Dillard’s, Inc. [DDS – Yahoo Finance] announced the closure of their location at the Southern Park Mall. What is interesting about this closure is the fact it was the only store closing announced by Dillard’s thus far in 2019. Furthermore, their stock is trading at $67.21 as of the close on May 7, 2019 and the company had net income of $170 million for their fiscal year which ended on January 31, 2019. The company released the following statement, “Following the announcement to store associates at Southern Park Mall this morning, we are confirming the upcoming closure of the location. The store is expected to close no later than May 14, 2019. Including Southern Park Mall, Dillard’s currently operates 14 locations in Ohio.” The release stops short of mentioning the performance of the store, but this closure, coupled with the fact they converted their Eastwood Mall location in Niles to an outlet store, may signal the company does not view the Mahoning Valley’s changing demographics favorably and are not where they need to be for the markets they serve.

    Local Mall Developer (and WPG Competitor) Cafaro Purchases Dillard’s Building

    What complicates this situation is the fact a newly formed entity affiliated with the Niles based mall developer Cafaro Co. purchased the Dillard’s building at the Southern Park Mall. Upon review of the Mahoning County Auditor website, the Dillard’s building, coupled with the parking lot across the street on California Avenue, were separate parcels owned by a subsidiary of Dillard’s. The rest of the Southern Park Mall complex is owned by Washington Prime Group. Thus, there are now two competing mall developers that have a stake in the future of the mall. Cafaro Co. spokeman Joe Bell said, “We learned quite a while back that Dillard’s was interested in closing that particular store location. So, our executives inquired about it and saw this as an opportunity to perhaps redevelop and revitalize that side of the mall. We are looking forward to working with the mall ownership to do this.” In an article from the Youngstown Business Journal just last week, Joe Bell went on to say, “Right now, we’re very far from a determination of how we’re going to use that space.”

    When Cafaro announced the purchase of the building, people on social media were wondering if the local mall developer was looking to purchase this competing facility, or whether they purchased the Dillard’s building in an effort to keep Dillard’s, or perhaps expand Dillard’s presence, out at the Eastwood Mall. Time will certainly tell, but it will be interesting to see if the Cafaro Co. has any success in landing a tenant or tenants in what I viewed as one of the most well maintained stores at the Southern Park Mall.

    Redevelopment Efforts at Other Malls

    As bad of a picture as this news paints the facility, the Southern Park Mall is not the only mall facing similar difficulties. According to the WPG 1st quarter 2019 financial results, the company faced 22 department store vacancies in their Tier I and Open Air properties. In the 1st quarter alone, WPG stated they were able to address 11 of the 22 vacancies. The vacancies were filled by unnamed national home furnishing, off-price, and sporting goods retailers, as well as named retailers such as Dunham’s Sports, The RoomPlace, and Round1 Entertainment. In a transcript of their 1st quarter earnings call, WPG CEO Lou Conforti did mention Southern Park at one point, but did not dive into details. Here was the exchange between Conforti and Melissa Indest, WPG Executive VP of Finance.

    Louis G. Conforti, Washington Prime Group Inc. – CEO & Director [107]
    … And you mentioned Southern Park, I’m champing at the bit to — and Lisa just gave me the — she gave me the evil eye.

    Melissa A. Indest, Washington Prime Group Inc. – Executive VP of Finance & CAO [108]
    Next quarter or two.

    Louis G. Conforti, Washington Prime Group Inc. – CEO & Director [109]
    She gave me — a quarter or two, okay. So Mark?

    Transcript of WPG earnings conference call presentation 4/25/2019

    Since Conforti did not have an opportunity to elaborate, one could only speculate that within the next quarter or two we may have a better idea of WPG’s plans for redevelopment at the Southern Park Mall?

    Cafaro has also had success in their redevelopment efforts for their properties. At the Erie, PA Mill Creek Mall, Round1 Entertainment replaced the former Burlington Coat Factory location, while Boscov’s, a regional department store that some compare to a Macy’s, recently replaced Sears at the complex. Cafaro has also had success landing some new tenants at their Paducah, KY facility, the Kentucky Oaks Mall. The company recently announced HomeGoods would be coming to the complex, joining Burlington and Ross Dress for Less as new tenants in 2019.

    Vindicator Sneak Peek

    In the April 28, 2019 edition of the Vindicator, Jessica Hardin wrote a front page column entitled Fall of the Mall and the New Vision. In this feature article, Ms. Hardin had an opportunity to speak directly with management from WPG on their plans for the redevelopment of the Southern Park Mall. The article showcased renderings, which as is noted in the caption from The Vindicator below, are illustrative only and are meant to show the potential redevelopment opportunities of SPM and are not indicative of the final project.

    The renderings show the Sears building being torn down and being replaced by green space for community events, as well as some newer stores/restaurants built in the front portion of the mall just to the south of the current food court. WPM has not officially announced their intentions for the former Sears building, so it will be interesting to see if they do opt for tearing down the anchor building, or whether they are able to find a replacement for it.

    The Vindicator article takes a dive into two other WPG facilities in Columbus (Polaris) and Mentor (Great Lakes Mall) and some redevelopment efforts that have worked in those two facilities. I would encourage you to check out the article to hear more about WPG’s vision for Southern Park.

    Renderings from Vindicator Article Fall of the Mall and the New Vision

    The Next 50 Years

    In this day and age with Amazon and e-commerce sales growing rapidly year-over-year, some argue that shopping malls are the way of the past. I tend to think brick and mortar retail is right-sizing to the new demands of customers shopping preferences. I think there will always be a place for brick and mortar retail, but the composition of the shopping mall of the past will have to reinvent itself in order to survive. Malls with combinations of retail, restaurants, lodging, entertainment, events, as well as business and residential spaces could be the means of the future. WPG loves using the terminology town center, and those elements truly embody that line of thought.

    In a statement back in March, WPG CEO Lou Conforti said, “Our promise is that we will make Southern Park Mall as dynamic as ever and maintain its longstanding presence as a gathering place to shop, play, eat and drink. We are in active planning and negotiations for redevelopment alternatives, including new entertainment and dining options, as well as local, regional and national tenancy, which provides differentiated goods and services.”

    Time will certainly tell whether WPG will, as the old adage says, put their money where their mouth is when it comes to all of the statements throughout this article, but one thing I do find encouraging is how much attention and focus WPG has placed on the Southern Park Mall in the past few months. CEO Lou Conforti requested a March meeting with the Boardman Township Trustees to discuss his plans for the mall with upper level management from WPG, Conforti took a tour of the mall and discussed changes he felt were necessary for the facility with The Vindicator, and then just last month, Jessica Hardin of The Vindicator was given exclusive access to discuss the future of the facility in greater depth with the company.

    A lot of people in the Mahoning Valley had concerns, rightfully so, as to the future of this facility with the closings of Sears and Dillard’s in the past year. However I think the Mahoning Valley is on the radar screen of WPG management now more than ever. As the Southern Park Mall enters its 50th anniversary in 2020, let’s hope WPG comes through when it is needed the most and invests the necessary time and money to make SPM the Tier I property that not only the company can be proud of and showcase, but one that we in the Mahoning Valley can embrace and support for the next 50 years.

    If you enjoyed this article, please consider subscribing to MVRed.com today. Enter your name and email address in the subscription form here to be notified via email of future posts on this topic, or other topics, impacting Youngstown and the Mahoning Valley. Thanks!

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  • Mahoning Valley

    Valley Public School Enrollment Figures Declining Faster than Ohio Rate

    December 1, 2018

    As a graduate of Ursuline High School, I often hear calls from those in the community about the need to combine Ursuline with Youngstown’s other Catholic high school, Cardinal Mooney. There is no question the Catholic schools in town have been hurt with declining enrollment over the years, much in part due to rising tuition, leading to the closure of a number of the parish grade schools. Such closures have hit the grade schools that my wife (St. Luke in Boardman) and I (St. Joseph in Austintown) attended from K-8. It is unfortunate to see such great schools close down, but those closures are inevitable with fewer students in the desks each year. The issue of fewer students isn’t just a Catholic school issue anymore, it is quickly becoming a public school issue as well.

    Everyone in town is aware the population of the Mahoning Valley has been declining for four decades due to the decline of the steel industry and an overall economy that seems to consistently lag state and national levels. That population drop can only mean one thing… fewer kids. With fewer children comes a diminishing enrollment base in this community. This led me to asking the question, how big of a drop in enrollment have the public schools experienced in recent years?

    I visited the Ohio Department of Education Enrollment Data website and was able to access the October public school headcount figures for fiscal years ending 2010 through 2018. I captured this district-wide (K-12) enrollment data for all 14 of the public school districts in Mahoning County, as well as the 20 public school districts in Trumbull County.

    For reference sake, over this period of time the state of Ohio has experienced a decline in the number of students attending public schools as well. According to the Ohio Department of Education, the state has seen a 5.02% reduction in students in the public school system from FYE 2010 through 2018. In addition, on the chart below, the % Change (2010 to 2018) column is color coded with the red shaded cells designating districts that had worse % declines in comparison to the state, with the few in yellow representing districts that have seen declines at a rate less than that of the state. 

    District Enrollment in Mahoning and Trumbull (FYE 2010 – 2018)

    As you can see above, all of the public school districts in Mahoning and Trumbull County have seen district-wide enrollment declines from 2010 through 2018. The district that saw the smallest % decline was Girard (-0.36%), with the district seeing the greatest % decline being the tiny Bloomfield-Mespo (-32.18%) school district. Overall, 31 of the 34 districts saw declines at rates outpacing than the state decline.

    The numbers I found most alarming were in the combined county data. In FYE 2010, there were 65,042 students enrolled in the public school districts in Mahoning and Trumbull County. In 2018, that figure was 54,336. That is a decline of 10,706 students, or 16.46%, in under a decade. Another interesting statistic was the large 23% decline in enrollment in one of the more affluent communities in Mahoning County, Poland. 

    Thanks to open enrollment, the decreases for some school districts were not as substantial. In Mahoning County, three districts that have open enrollment, Austintown, South Range, and Western Reserve were able to keep their declines in check by attracting out-of-district students into their districts. 

    What is Next?

    With the recent news of General Motors idling the Lordstown assembly plant in March 2019, there certainly does not seem to be any major positive economic changes in the immediate future that would help slow down the enrollment declines being experienced in the Mahoning Valley. We can very well see school districts be forced to cut their number of staff, reduce their number of school buildings, and go back to the taxpayers with additional tax levies to be able to make their financial ends meet.

    Seeing the list above of 34 (!) public school districts in Mahoning and Trumbull Counties, 14 of which were under 1,000 students in their entire district in the FYE 2018, could the topic of consolidation of school district come into play? Will this be something the state could push down on local school districts under a certain number of students? Geographically speaking, there are certainly some school districts on this list neighboring other school districts that could possibly work on the surface, such as Lowellville with Poland, Sebring with West Branch, and Weathersfield with McDonald just to name a few. A good discussion on this very topic is being debated on the popular Ohio HS sports forum Yappi. The thought of consolidation would likely be met with great resistance, but perhaps some good ideas could come out of such discussions, even if the number of districts would remain unchanged.

    I hope you found this piece interesting, especially the telling data shown in the chart above. Unless things change drastically on an economic and jobs front, I think the issue of the declining public school enrollment will come to the forefront and be on the minds of the taxpayers in the next five years.

    What do you think? Please share your thoughts in the comments section below.

    If you enjoyed this article, please consider subscribing to MVRed.com today. Enter your name and email address in the subscription form here to be notified via email of future posts on this topic, or other topics, impacting Youngstown and the Mahoning Valley. Thanks!

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  • Data,  Mahoning Valley

    Is the Mahoning Valley Moving to the Middle?

    November 9, 2018

    Is the once dark blue Mahoning Valley moving towards the middle politically? That is the question being asked after the Mahoning Valley, for the second straight major election, failed to deliver the wide margins needed for the Democrats to be successful at the statewide level. This piece will analyze the election results in the valley from the 2016 Presidential election and the 2018 Midterm election.

    Historical Election Background

    Before I jump into the 2016 and 2018 elections, I thought it would be important to provide some context for this article by using some historical data. I went back to the 1960 Presidential election and the 1990 Gubernatorial election, the oldest years countywide election results were readily available on the web, and compared the margins at the state level to the margins at the county level for Mahoning, Trumbull, and Columbiana County. The y-axis of the charts below shows the Republican margins exceeding the Democrat margins as positive percentages, while the Democratic margins exceeding the Republican margins as negative percentages. These charts are fully interactive as you can hover over the stars for each election year to see the margin of victory for the GOP (+ %) or Dems (- %).

    As is evidenced by the Presidential chart above, since 1960, Mahoning and Trumbull County have always been more Democratic at the county level when compared to the state level. For the most part, the same was true of Columbiana County until the 2004 Presidential election, when the county was slightly more Republican (4.7% GOP margin) than the state, which saw a 2.1% GOP margin. Since 2004, Columbiana County has gone from what Dave Skolnick of the Youngstown Vindicator described as a 50/50 GOP/DEM county, to one that is now deep red. The county had a remarkable 41.7% margin for Donald Trump in 2016, while Ohio went by 8.13% for Trump. It appears that Columbiana County will remain dark red for years to come.

    Now to the two larger counties in the valley, Mahoning and Trumbull, which in 2016 again trailed the margins at the state level. Nonetheless, the margins were much closer than in most recent elections. Trumbull County, for the first time since 1972 when it delivered for Richard Nixon, went Republican by 6.27%. However, Mahoning County was victorious for Hillary Clinton, but by just 2.99%. Furthermore, Hillary Clinton failed to get to 50% of the total vote in Mahoning County. The failure of Mahoning and Trumbull to deliver the typical 59-62% Democrat total share of the vote, compounded by the rural GOP surge across the rust belt, led to Trump greatly outperforming the Buckeye State polls in 2016 on his way to victory.

    At the Gubernatorial level, the results have followed a similar trend as the Presidential level. Columbiana has become much more Republican than the state over the past two elections, while Mahoning and Trumbull continue to lean more Democratic. It is worth noting that the two latter counties have backed Republicans for the governorship during this span of time by supporting George Voinovich in 1994 and John Kasich in 2014.

    In the two charts above, it is noticeable that the red and yellow lines representing Mahoning and Trumbull have narrowed much closer to the statewide figures in blue in 2016 and 2018, signalling a more competitive political environment in the valley. The question remains, will that trend continue into 2020? If it does continue, the Democrats fortunes of winning this state may become more challenging as they will have to make up for these votes elsewhere.

    Success in Local Races

    I would be remiss not to mention the newfound success of the Mahoning County Republican Party, which is becoming a player in area politics. I have to give credit where it is due, Chairman Mark Munroe has recruited some stronger candidates to make that happen. In 2014, Republican Ralph Meacham, CPA edged Democrat Michael Sciortino, who was under indictment at the time, for Mahoning County Auditor. This was a major victory for the Mahoning County GOP who had failed for 30 years to deliver a victory in a partisan race at the county level. This year, the Democrats failed to even run a candidate against Meacham. As quoted in an August 17, 2018 piece by Dave Skolnick in the Youngstown Vindicator, Dave Betras said “I tried to recruit a number of people, and no one wanted to run… They said, ‘I can’t beat him. He’s done a good job.’”

    In the Ohio 33rd State Senate seat currently held by term-limited Democrat Senate minority leader Joe Schiavoni, valley businessman Michael Rulli (R) knocked off veteran politician and current OH 59th State Representative John Boccieri (D) 52.51% to 47.49%, or 6,269 votes. The district is comprised of all of Mahoning County and Columbiana County. It is true that Boccieri won the Mahoning County portion of the district 54% to 46%, but Rulli ran it up in deep red Columbiana County, where he makes his home, by a 69% to 31% margin. Although this district has had different geographic make-ups since 1950, it has always encompassed Youngstown and has never been won by a Republican during that time. Based on Rulli’s name recognition and anecdotal evidence of his yard signs all across the suburban portions of Mahoning County, I felt Rulli had a chance to win if he could run it up in Columbiana County and keep it somewhat close in Mahoning County, and he did just that.

    In my eyes, the upset of the night was Don Manning (R) defeating Eric Ungaro (D) for the OH 59th State House seat currently held by John Boccieri. Ungaro, son of former Youngstown Mayor Pat Ungaro, seemed to be a victim of the geographic footprint of the district. The 59th encompasses all of Mahoning County, with the exception of the City of Youngstown and most of Austintown Township. Without those two communities, the district is a bit more favorable for the Republicans as it contains all of the rural portions of the county, as well as Canfield and Poland where Republicans can be quite competitive. The following map from the Mahoning County Elections website provides a visual depiction of the results. The blue areas went to Manning, while the green areas went to Ungaro. In the end, Manning defeated Ungaro by a razor thin 50.39% to 49.61% margin, or 409 votes. 

    The wins by Meacham, Rulli, and Manning, coupled with Bill Johnson’s victory in the 6th congressional district, mean four Republicans are now representing all or part of Mahoning County at the county, state, and federal level in races that were all partisan on the ballot.

    2018 Gubernatorial Results by Municipality (Mahoning County)

    The following table is based on an export of the 2018 election results courtesy the Mahoning County Elections website. By providing this data in a stacked bar format, you can see the stark contrast between the more urban parts of the county that are more Democratic and that have more votes vs. the rural portions which tend to lean more Republican and have fewer votes.

    Final Thoughts

    It is far too soon to determine whether Mahoning and Trumbull County will continue the trend of the past two major elections (2016 and 2018) in which each county has moved from being dark blue to a lighter shade of blue or purple in competitive local, state, and federal races. In each county, Democrats were still successful in winning by larger margins (Mahoning D+21%, Trumbull D+16%) for Senator Sherrod Brown (D) in a race that ended up much closer than the polls had indicated. Also, outside of the seats mentioned above, Democrats hold most other state and county seats in each county and have party registration advantages as well.

    With the cities of Youngstown and Warren being the largest population centers in Mahoning and Trumbull and also being the most Democratic areas of each county, the suburban/rural areas will need to move further right in the years ahead to enable the GOP to have further success in the valley. In my opinion, that will be the most interesting dynamic to watch as we move forward to the 2020 Presidential election.

    In my next posting, I plan to take a dive into the Republican Party’s success in winning most of the state office contests dating back to 1990.

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  • Mahoning Valley

    MVRed is Back

    November 9, 2018

    I am happy to report the return of MVRed.com. Although this website has been down for going on 8 years, my love of politics has never diminished. So much has happened politically over the past few years in the Mahoning Valley, Ohio, and at the Federal level that I was eager to bring the blog back. I look forward to adding my thoughts on political news and campaigns in the months ahead, as well as analyzing election data to identify potential geographic trends in voter tendencies. I hope you enjoy the new site and that you spread the word to others. Thanks!

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