I think protectionism is the wrong word. It’s really looking for a free market.
The owners of big box development put 5% or less down on the property, and the sustainability of the property is mostly based on arcane tax and accounting rules. That’s why these developments rise and fall so quickly — after 15 years, the write offs for interest payments and depreciation are less valuable.
Additionally, in most cases the locality eats significant capital costs and indirect costs from storm water management, to water and sewer, to roads and traffic signals. Larger infrastructure costs like highway ramps, etc are paid for by the Federal government. There’s a vicious cycle as the big box development gets less valuable (and tends to fail) just in time for the maintence expenses associated with the infrastructure to start spiking.
That development model only works for large enterprises. Your small retail chain has to tie down real capital to lease or build, and has to pay higher taxes because they need the clustering effect of a business district to function. But they don’t get the subsidies — Congress isn’t building an access road to a small company parking lot.
The owners of big box development put 5% or less down on the property, and the sustainability of the property is mostly based on arcane tax and accounting rules. That’s why these developments rise and fall so quickly — after 15 years, the write offs for interest payments and depreciation are less valuable.
Additionally, in most cases the locality eats significant capital costs and indirect costs from storm water management, to water and sewer, to roads and traffic signals. Larger infrastructure costs like highway ramps, etc are paid for by the Federal government. There’s a vicious cycle as the big box development gets less valuable (and tends to fail) just in time for the maintence expenses associated with the infrastructure to start spiking.
That development model only works for large enterprises. Your small retail chain has to tie down real capital to lease or build, and has to pay higher taxes because they need the clustering effect of a business district to function. But they don’t get the subsidies — Congress isn’t building an access road to a small company parking lot.