One Big-Box Store Or 120 Small Vendors: What’s Better For A Neighborhood?

One Big-Box Store Or 120 Small Vendors: What’s Better For A Neighborhood?

As part of the 2020 Citizens’ Agenda project, WBEZ is reporting on the issues you told us you care about most ahead of November’s elections. Many residents asked about investment in Chicago’s neighborhoods, support for small businesses and job creation. One place where all these issues intersect: the Discount Mall in Little Village. This reporting was driven by audience responses to our Citizens’ Agenda Survey.

The first thing to understand about the Little Village Discount Mall is that it’s not really a mall – at least not the sort of mall you may be picturing.

Imagine a permanent flea market inside an old Kmart.

“This mall is going to look like a tianguis, like a mercado — you’re going to feel like in Mexico,” said vendor Kocoy Malagon, who sells formal dresses for quinceañeras, weddings or proms from a 10- by-20-foot stall packed with sequins and satin. Dresses hanging high overhead form a ceiling of colored lace hems.

Malagon is right. You will be transported. She is one of 120 vendors in the Discount Mall who hawk everything from Western wear to piñatas to prayer cards featuring hard-to-find saints.

The mall, which has been in operation for the past 30 years, sits on a property that’s also home to a Walgreens, a storefront health clinic, a taqueria, a Mexican bakery, a laundromat and a huge parking lot.

And while plaza itself looks like dozens of other unremarkable neighborhood shopping malls, its location holds symbolic importance. It’s at the gateway to the Little Village neighborhood and the beginning of what’s been dubbed Chicago’s “second Magnificent Mile,” a two-mile commercial strip along 26th Street with hundreds of mom-and-pop businesses catering to Chicago’s Mexican community.

Stalls at the Discount Mall start at $250 a week for a 10- by-10-foot, floor-to-ceiling space – electricity and heat included. That’s an incredibly low barrier to entry for a business. Many vendors have worked in their spaces for years.

Kocoy Malagon works on alterations at the Discount Mall Little Village
Kocoy Malagon, owner of Source Fashion Corp, works on alterations inside her stall at the Discount Mall. Manuel Martinez / WBEZ

And while small businesses everywhere are hurting due to the pandemic, the Discount Mall vendors have an additional worry: They fear a possible redevelopment plan could replace them with a big-box store, possibly a Target.

The mall was sold earlier this year, and architectural drawings for a redevelopment showed mod new stores – but no Discount Mall. That set off panic among vendors and stoked community fears that their neighborhood is next for gentrification.

“This mall represents all our life,” Malagon said. “This is more than a business. This part of our life, our traditions.” She said vendors don’t oppose change, but want a say in it. “We want to be part of the progress. We don’t want to be disappeared.”

Ald. Cardenas: “Target’s not going to sell a quinceañera dress”

The alderman for Little Village, George Cardenas, 12th Ward, will have an outsized influence on whether the Discount Mall is eliminated and the vendors are wiped out.

His approval would be needed for any significant redevelopment plans. The property’s new owner, Novak Construction, is a northwest side company that has worked on nearly 145 Target developments and more than 200 Costcos. But Cardenas says the firm hasn’t shared any actual plans (though in June, he seemed to know more, commenting on precise locations for a new gym and bakery).

“I hadn’t made up my mind one way or the other, to be honest,” Cardenas said recently in an interview with WBEZ. He thinks a study should be done to figure out, “Where does Little Village shop? Where do they go to get, you know, anything related to the home, the towels, you know, the basic necessities that you have for the bathroom?” And “do we need to have something close by?”

While the line of questioning seems designed to produce support for an outlet that sells precisely those things – maybe like a big-box store – Cardenas insists the vendors can co-exist.

“Target’s not going to sell a quinceañera dress,” he said.

Cardenas said he’s fueled by environmental concerns and wants residents to be able to walk – instead of drive – to get items they need.

The vendors do seem to have some support from another big political player: Congressman Jesus “Chuy” Garcia. While the Democrat didn’t take a stand on the future of the Discount Mall or the exact fate of the vendors, he said the community should have a voice.

“A good developer will engage community stakeholders,” Garcia said. “The call for there to be engagement is a legitimate one, and one that should be heeded by the owner-developer in this instance.”

Garcia emphasized the importance of the site, at the gateway to this decades-old ethnic enclave. He said retail habits are changing — a trend accelerated by the pandemic — and that should inform any decision about how the property is redeveloped. And he underlined the importance of preserving the vitality of Little Village as an ethnic enclave, both for residents and for the city as a whole.

Novak Construction declined to speak with WBEZ. Instead, the company sent a nearly three-month-old written statement that said, in part, “rumors and misinformation have surrounded the plaza for months.” Novak is seeking to understand the market and neighborhood better, the statement said.

Oliver Miranda tunes a guitar at the Discount Mall Little Village
Oliver Miranda works on tuning a 12-string jumbo Takamine at the Caesar’s Music of Illinois stall inside the Discount Mall. Manuel Martinez / WBEZ

What’s better for a neighborhood?

So if the concern is neighborhood development, jobs and investment in Chicago’s communities, what is actually better for a neighborhood: 120 little businesses or a big-box store?

“There would be benefits of Target coming in, but there would also be losses,” said Eric Zwick, a finance professor at the Booth School of Business at the University of Chicago.

Zwick said turning the Discount Mall into a big box store would likely be a win for the city in terms of cold hard cash received in tax revenue, since it would likely generate greater sales volume and there would be fewer cash sales than there tend to be at small businesses.

And if property values go up? That’s more money still for city coffers.

And he surmises that property owner Novak Construction would come out ahead, because a store like Target would pay more in rents.

But Discount Mall vendors and customers are quick to point out ways that so many small business owners benefit the neighborhood – and economists echo many of their points.

Money earned by vendors stays local, said Irais Miranda, who sells and repairs guitars, accordions and other musical instruments at his Discount Mall stand.

“The people working here in this mall get the salaries, the money — and they spend the money in the neighbor[hood],” Miranda said. “Big companies like Target get the money outside of the city.”

The vendors figure about 400 people work at the Discount Mall, between owners and employees. Miranda and his son Oliver point out that most vendors earn modest incomes. “You’re helping out the middle class, versus like the 1%,” Oliver said.

The Discount Mall attracts Mexicans from across the Midwest, vendors say. Irais Miranda jokes that sure, visitors want to see downtown, but “the first place they want [to] come see and know is this place.” That helps other businesses in the neighborhood too, Miranda said.

Case in point: On a recent Sunday, a woman who identified herself only as “Eli” strolled through the mall with her three sisters, all from Skokie. She said she doubted she’d travel all the way to Little Village if it weren’t for the Discount Mall.

“I’m getting Mexican candy,” she said, outside a stand of floor-to-ceiling plastic toys and children’s blankets.. “It’s my daughter’s birthday, so I came all the way here just for candy. … We just love it. It feels like Mexico.”

Economists are not very good at measuring the value of things like culture and character, Zwick said. That’s where the political process plays a role, “sort of stepping in and saying, ‘Even if maybe there’s more economic value for switching it out, maybe the cultural value outweighs that.’ ”

And distinctiveness can be a draw that spurs neighborhood development, said Nate Anderson, an economist with the Federal Reserve Bank of Chicago.

“So if there’s something unique about a community, then, in general, a community should invest in those strengths, as opposed to going out and making itself similar to every other community,” Anderson said.

His colleague at the Fed, economist Maude Toussant-Comeau, said straight economics shouldn’t be the sole factor in deciding the future of the Discount Mall.

“What do people who live there think? That’s the question we have to ask,” said Maude Toussaint- Comeau, also an economist with the Federal Reserve Bank. “Even though I’m an economist, I don’t feel that I really believe as much in the science of numbers as much as I believe in the science of people and communication.”

Lately, in addition to selling dresses and making alterations, Kocoy Malagon has been organizing fellow vendors.

“We pay a lot of taxes,” she said. “I think we have the right to [have] somebody hear our petition.” She said there are lots of livelihoods at stake.

“This is our income for a lot of families,” Malagon said. “Why [does] one family, in this case Novak … have the power to remove all the community?”

Linda Lutton covers Chicago neighborhoods at WBEZ. Follow her @lindalutton.