Grabbing a beer at your local pub could have just taken on a whole new significance.
Providing further impetus for shoppers to consider spending their dollars locally, new research suggests that thriving small businesses are helping buoy sagging real estate markets in some communities — including Hartford.
The Indie City Index, a study commissioned by the American Booksellers Association and conducted by economic analysis firm Civic Economics, ranked 363 metro areas in the country by the amount of retail business done by independent businesses, assigning scores and rankings with 100 representing the national average. Index scores above 100 indicate healthier independent retail markets while scores below 100 signal a more chain-dominated market.
The Hartford-West Hartford-East Hartford area fares relatively well ranking 118th overall with a score of 104.
Ocean City, N.J. is tops on the list with a 147.7 score, while Bridgeport-Stamford-Norwalk ranks 15th at 127.5. Other regional neighbors include: Springfield, 85th; and Worcester, 106th.
When categorized into sections of the country, Hartford-West Hartford-East Hartford sits in 10th position in the New England Region, which ranks third overall against the other sections of the country.
The Indie Index further reinforces findings from the American Express OPEN Independent Retail Index, a more focused study also conducted by Civic Economics, which revealed that while independently-owned small retailers and restaurants account for less total sales than they did 20 years ago, real estate values in neighborhoods with a strong local business presence have performed better than citywide markets.
Analyzing the country's small businesses on a national, city and neighborhood level, the OPEN Index investigated the strength of locally-owned retail businesses, dining establishments and bars over the past two decades in 27 neighborhoods where small businesses have thrived, so-called "indie hotspots," in 15 major U.S. cities, including New York City, San Francisco, Boston, Los Angeles, Miami and Phoenix.
The research found that home values in these neighborhoods have outperformed their broader markets by 50 percent over the past 14 years.
Dr. Jeffrey Cohen, associate professor of economics at the University of Hartford, sees a correlation between the research and the real estate climate in the area.
"In this day and age of spending long commutes in cars and on public transportation, people are relishing their free time and look for opportunities to be within walking distance of local shops and restaurants," Cohen said. "When you combine this with the fact that interest rates are near all-time lows, and available land for new construction is scarce in a town such as West Hartford, this has helped push home values slightly higher in areas with strong local businesses."
The sluggish housing market has given people much more flexibility and greater choice when deciding where to buy.
"As a result, they can be more picky and houses near thriving local businesses will be more popular than others," Cohen said.
The research highlights the importance of residents having a vested interest in the strength and success of their local independent businesses, according to Doug Kartsen, vice president of the Farmington Chamber of Commerce.
Kartsen said a healthy local business scene improves a community's character, supports local property values and expands job opportunities.
In fact, small businesses have accounted for nearly 65 percent of net new job creation nationally in the past 15 years, according to the Small Business Administration.
"Certainly many local municipalities are in a certain level of financial distress and many independent businesses have been having a rough time in the current economy. For years they've dealt with increased competition from larger retailers and offshore manufacturers," Kartsen said.
"We need a strong combination of high paying jobs, independent businesses and hospitality services to support a healthy economy. Where those combinations come together, along with good education and safety, we see strong communities with lower unemployment and higher property values."
James Varano, owner of Black-eyed Sally's restaurant in downtown Hartford, says connecting with his customers is paramount, but also important is developing solid relationships with other local businesses and organizations in the city.
Black-eyed Sally's, a fixture in downtown Hartford for more than 15 years, is comprised of a music venue, restaurant and catering business.
The restaurant hosts a weekly jazz show on Mondays, sponsored by the Hartford Jazz Society and the Charter Oak Cultural Center, as well as a community blues jam on Wednesdays — both events promote local musicians, including many professors and students from the University of Hartford's Hartt School who come to play each week.
Varano says the situation is really unique.
"Some nights you would think you were in New York City," Varano said. "To create that vibe takes a deep and broad connection to the local music community."
"Every year we host the Black-eyed & Blues Festival in Bushnell Park which draws thousands of fans for a night of free music under the stars — that wouldn't happen without the support of the Greater Hartford Arts Council, the City of Hartford and many other generous local grant organizations."
Varano said he isn't surprised that thriving local businesses are proving beneficial to real estate values, saying Hartford does a good job at promoting its many assets.
He said his Asylum Street neighborhoodhas a business improvement district and Business for Downtown Hartford, which that promotes small business in downtown. "BFDH has special gift certificates that people and corporations can buy and use at any participating business downtown," he said. "That encourages buying local."