Chasing Apple for Economic Development

With the opening of a giant 23,000 foot Apple Store in Grand Central Terminal last week just in time for the holidays, New York now has five Apple Stores. That ties the Big Apple and London as the only two cities with five Apple stores each – more than any other city in the world.

Apple Store in Grand Central Terminal, NYC

Photo credit - jcn (flickr)

That’s no mean achievement either, because Apple Stores are turning into anchors for affluent downtown areas, says Robert Gibbs, author of ‚ÄúPrinciples of Urban Retail Planning and Development.”

Gibbs told Forbes magazine that an Apple Store in the area boosts business in nearby stores by 15 to 20 percent.

He adds that Apple carefully chooses what city and location it wants to do business in. Gibbs adds that cities should stop chasing sports stadiums and go after Apple stores.

There’s no need to look hard for why Apple chose Grand Central for its 5th NYC outlet. The statistics for Grand Central:-

- 750,000 daily commuters with a mean household income of $95,800 per year.

- 326,000 office workers in the area earn more than $11.3 billion per year.

- 21 million visitors from outside NYC with a mean income of $62,000 per year.

What a host city gets from Apple is equally impressive. Taxes, new jobs and investment for new stores are the most direct benefits, with the halo effect cited by Gibbs adding considerably to the economic impact of a new Apple Store.

Apple’s average revenue per store is $43.3 million, and 300 million people have visited the 361 Apple Stores in 11 countries last year alone. Apple’s 2012 outlay for stores (including 40 new stores) is $900 million.

The Apple Store in Grand Central Terminal alone could generate $10.2 million a year in sales tax revenues, not to mention the new jobs created for its 315 employees.

But some cities apparently don’t yet know it’s better to chase Apple instead of stadiums. Or ashes, for that matter. Legislators in Virginia are debating offering a tax deduction for space burials to provide a boost to the Mid-Atlantic Regional Spaceport.

On the other hand, it turns out that Virginia is probably the only state in the US which has turned down an Apple request to open a new store. A landlord in Alexandria, VA refused to rent her store to Apple because she thought it was a “flakey” company. The city did not step in to intervene.

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