Retail trends sputter in rural region
Jessica DiNapoli | Times Herald-Record | August 03, 2014
TOWN OF NEWBURGH — Just last year, Orange County got a brick-and-mortar shop dedicated to a craze that had already swept the nation: fancy schmancy cupcakes topped with treats like bacon crumbles and maraschino cherries.
The shop, Luscious Cupcakery, opened on Route 52 at the tail end of a trend that began about 10 years ago, and has since started to fade.
The official expiration date may have passed just a few weeks ago: Crumbs, a New York City bakeshop on the front end of the fad, closed all of its stores in July and filed for bankruptcy after losing millions.
The opening of Luscious Cupcakery, and a similar business in New Windsor, Antonio's Cupcake Factory, coming just as the fad that spawned them flares out, fits the trend of many retail and consumer trends in Orange County.
They arrive near the end of their lifespans.
Some breweries will fall flat
Craft beer breweries on Long Island and in New York City had been pouring artisan suds for years before the trend arrived in Orange County.
Now, Tommy Keegan, owner of Keegan Ales in Kingston, a forerunner of the trend in the Hudson Valley, predicts "the pendulum will swing a little bit," in the entire industry, wiping out some out of the breweries who only jumped in because it was "hot."
Bad times for bookstores
For years, Orange County bookworms longed for a major bookstore. Then Borders opened in the Galleria at Crystal Run in 2005, around the same time as Barnes & Noble debuted in the Town of Newburgh.
Six years later, Borders filed for bankruptcy. Barnes & Noble has been fighting declining sales.
Region's a 'secondary market'
Cabela's eyed the Town of Newburgh for a megastore more than 10 years ago. Orange County will now get one of the highly prized outdoor stores in 2016, but it will be much smaller.
"We get the trends later in the Hudson Valley," said David Livshin, president of the Dagar Group, a Fishkill real estate leasing and management company. "That's because the Hudson Valley is viewed as a secondary market, not a major market like Westchester County, or Fairfield County, Connecticut."
Crumbs targeted the tonier, more densely populated Fairfield County and northern New Jersey markets before filing for bankruptcy.
"They're looking for major population density in a regional location," Livshin said. "Those areas are proven."
Income a big factor
Those areas are also richer.
The U.S. Census Bureau estimates the median household income in Fairfield County was $74,634 in 2010. The same figure for Bergen County, N.J. was $77,059. Orange County's comes in at $65,512. The county's residents have less disposable cash to buy what was once one of Crumbs' most popular products — a $42, 6.5-inch by 6.5-inch colossal cupcake.
More densely populated areas, especially less car-centric New York City, have walk-in traffic that helps keep businesses selling small, trendy food items like cupcakes and frozen yogurt afloat, said Keisha Hudson, owner of Luscious Cupcakery and a New York City transplant. Hudson, who commutes into the city for part-time work as a nurse, still finds herself doing exactly that when she's walking in the city.
It's impossible to re-create the steady drum of passersby at her shop on Route 52. She has expanded her bakery offerings to cakes and pastries, part of her initial plan for Luscious.
"Cupcakes alone won't pay the bills," she said.
Population density is key
Livshin, whose work includes leasing out spaces in shopping centers in the region, has telephoned representatives for popular stores and asked about their interest in opening here.
He said their response is often that they were looking for an "area with more people than trees." The Hudson Valley still has more trees than people, plus the Hudson River, a major barrier breaking up the population and dividing up the region, Livshin said.
Retailers examine the population around potential developments, analyzing how many people live five, 10 and 20 miles away.
A 20-mile radius around Route 211 in the Town of Wallkill includes potential shoppers in rural Pennsylvania.
"There's no density," Livshin said.
The region's demographics could explain the late arrival of Five Guys Burgers and Fries, a burger joint with a cult-like following, and Chipotle, a Mexican restaurant attracting similar devotion from diners.
Five Guys opened first in the Town of Newburgh in 2010 and then in the Town of Wallkill almost two years later, nearly a decade after the company began a nationwide expansion. Chipotle opened last year in the Town of Wallkill, long after the Colorado chain had opened outposts across the country. Chipotle capitalizes on several other food trends, serving naturally raised beef, organic produce and dairy free of growth hormones.
Seeking more local focus
Orange County Commissioner of Planning David Church, whose department does demographic and economic research, said the county is the "outer circle of the economic ring" of one of the "biggest cities in the world," a factor that delays the arrival of fads and trends.
"We're still a bit rural," he said.
Orange County's distance from New York City seems to work against it when it comes to landing popular stores and trends. But, it's still close enough that people can arrive in Manhattan — "where it's really happening," Church said — relatively quickly by train or on a non-rush-hour car or bus ride.
Church, who grew up in a town where it was "absurd to drive more than 20 miles for something," has noticed that the county's residents are very willing to drive long distances, a habit that retailers may consider when scouting sites.
"They'll drive to northern New Jersey to go to the family dentist," he said. "That affects the choices here."
Church advocates for a more robust indigenous economy.
"We need and are working hard to have things more locally," he said.
Before cupcakes took the country by storm, there was Krispy Kreme.
The chain opened its doors to a doughnut-hungry mob in 2004 in the Orange Plaza in the Town of Wallkill.
About 18 months later, the conveyor belt that the glazed doughnuts rolled out on ground to a halt and the store was shuttered.
The shop was one of the outlets Krispy Kreme opened later in its rapid nationwide expansion, when the chain was already facing serious problems, like a plummeting stock price and a Securities Exchange Commission investigation.
When it imploded, "it imploded everywhere," Livshin said.
David Livshin, President/CEO of Dagar answers questions about a new project during a press conference at Fishkill Town Hall.
photo Spencer Ainsley, Poughkeepsie Journal
Reprinted with Permission
David Livshin was asked by Rabbi Yacov Borenstein to light a Menorah on the Walkway over the Hudson. It was a great honor and he was the first person to light a Menorah on the new WALKWAY. Mayor John Tkazyik participated in the unique event on December 14, 2009