Opinion: Lowe’s – Demographics, Costs etc.
The recent decision by Lowe’s to not complete building a new location in Huntington Station had something to do with the economy not getting better as soon as had been hoped, that is a given. What is not a given is why a billion dollar corporation chooses to continue building in one location and not build in another. They have not pulled the plug on all their new building projects.
This is where the art of demographics research and cost analysis come in. When any major corporation wants to figure out where they are going to build a multi million dollar store and have it be profitable they do this kind of research. They try to figure out what the population that will travel to that site has as expendable income, they try to figure out what the per capita income is, they try to figure out what the need for their products are for the population they intend to serve. Their expenses like taxes and employees costs are then factored in to arrive at an acceptable anticipated profit. Companies will do this before they commit to an expensive project such as this one. Lowe’s spent $35 million to acquire the property and probably a few more million for the work done so far to prepare the site and for the engineering company.
What is clear is that at the time they bought this property (2007) the demographics and costs (employees, taxes, utilities etc) must have been acceptable to them. What is also clear is that the demographics and costs must not look good today. Why are they choosing to walk away from this large investment? What has happened to make the corporate heads at Lowe’s hesitant?
Is it the crime? Is it the depleted per capita incomes? Is it the lower standard of living brought about by illegal multi family housing? Is it the lack of code enforcement? Is it less expendable income? Is it because the Town told them that their taxes would be higher than they originally thought? We might never know because Lowe’s is not likely to let anyone know how they decide where to build a store.
What we do know is that our politicians were quick to claim victory for bringing this company to Huntington, some even spoke about it in campaign literature, so now they must take some of the blame for them leaving Huntington. Don’t forget they are not leaving everywhere they intended to build.