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The subject of a survey by a firm hired by the City of Malibu was to gauge residents’ opinions on local businesses and ask which kinds of services are needed in the town.
Applied Development Economics Inc. designed the survey with the help of a committee of local residents, which was mailed out earlier this summer to 8,900 Malibu households. According to its Web site, the company, an independent consulting firm, has worked with a wide array of groups, including other governmental bodies, foundations, economic development organizations, and other businesses.
Only 1,000 residents responded to the survey (a mere 11 percent), but despite the low number, the survey still has weight in front of the City Council since they originally commissioned the study.
The results: 61 percent felt “disappointed” with the retail selection in Malibu. These respondents felt that too many of the businesses in Malibu catered to tourists and residents with astronomical incomes.
The most sought-after business is a specialty grocery store, with 731 responses. Astonishingly, the selection at Ralph’s, How’s Market, PC Greens, and the soon-to-be-opening Pavilions and Whole Foods Market isn’t enough for local residents, even though many other types of services require a long drive to Santa Monica.
The second most-wanted business among respondents is a new hardware/home improvement store, with 626 responses. The now vacant Malibu Lumber seems to be sorely missed among residents, who must venture to the big box stores and through the canyon to meet those needs.
Restaurants came in third with 187 responses, indicating that some Malibuites aren’t exactly enamored with all of the five-star dining in Malibu. More price-conscious selections whose names don’t begin with “Mc” or “Jack” seem to be desired, along with hours that reach past the early evening.
All it takes is a trip to any shopping center in town and the point is made. The specialty shops and boutiques basically require you to be a millionaire, which, granted, do exist in large numbers in Malibu.
However, the number of such high-end clothing shops and boutiques seems way out of proportion, especially when other goods and services seem to be sorely lacking.
The report faults the poor business selection in Malibu to three main causes: First, zoning restrictions increase costs for any business looking to set up shop within city limits; second, rents are quickly becoming too high for basic services to survive without some sort of massive financial backing; finally, expensive real estate prices and low availability prove to be a big obstacle in encouraging new business in the town. This often restricts most businesses to be high-end retail— thus, you have boutiques.
But this is how free market economics evolves in a uniquely rich town such as ours, and this sometimes-bitter reality is the major challenge to making changes in Malibu to accommodate the more price-conscious consumer. As rents get higher, so does the exclusivity of business and the prices for goods.
With so many in Malibu making seven figure salaries, concern for those who do not necessarily have such disposable incomes, such as students and faculty, can easily be overlooked (no surveys were sent to Pepperdine student mailboxes).
The report gives an interesting suggestion as a way to reverse the trend of expanding services that cater to rich tourists and residents: Offer incentives to owners of shopping areas to lower rents. For example, business owners could develop a higher density of space in exchange for inviting services that normally would not be able to afford rent.
While this would certainly create a more diverse retail establishment for residents, it would be considered ‘bad business’ in the eyes of the profit-maximizing shopping center owner, since profit from rents would see a steadying off or a slight decline. Thus, it may be a tough sell.
While it may be painful for market liberals to imagine a system involving rent control, this seems to be the few practical ways to keep skyrocketing rents in Malibu in check, and thus keep below-market services from shutting their doors. Having a wide array of businesses in the end keeps more business in Malibu, in that people would no longer need to make weekly drives through the canyon to patronize establishments in other towns. For example, the study indicated that $86 million was spent in Malibu by locals annually, but $189 million was spent elsewhere. And with a big tourism industry, basic goods and services are essential to keep visitors coming and staying in our seaside enclave.
The survey results are currently in front of the City Council to await further discussion and what, if any, steps to take next. However they decide to tackle this growing problem, at least they are doing so cautiously and responsibly by first getting residents involved, and by looking to work with owners of current shopping centers instead of simply falling back to the easier option of approving more commercial development to a city already experiencing serious traffic and space issues.
Submitted 08-27-2007
MALIBU, CA
