The idea of a shiny new Apple Store right around the block is certainly appealing. For many local authorities, the appeal is so great that they are willing to offer the tech company major incentives to set up shop in their neck of the woods.
City officials and shopping centers have been known to lure Apple in by waiving rents and cutting taxes for the company—and while the breaks might seem unfair, such moves could be good for an entire local economy’s bottom line, reports The Next Web.
Apple will soon open up a second store in downtown Salt Lake City, Utah and local sources believe the company scored one very sweet deal. While the transaction isn’t yet public, authorities are rumored to have offered the company an “unprecedented” five years of free rent in the City Creek Mall.
This isn’t the first time local officials have offered Apple what seems to be the better end of a bargain. The Apple Store’s lease in Grand Central Station is reportedly only a third of what is paid by other retailers and restaurants in the same area. The store is also reportedly not required to share any of its revenue with the Metropolitan Transportation Authority, unlike almost every other retailer in the Terminal.
So why such great deals for the tech giant? Many authorities count on traffic from the Apple Store to flow into nearby shops and restaurants, ultimately boosting the economy of a given area.
The Next Web reports:
A staggering 71 million customers visited Apple’s retail stores between January and March, an increase of 28 million from a year earlier. Apple’s impressive footfall is proving to be a catalyst for retail spending in the areas in which they are located, pushing the money spent back into the local economy.
The principle certainly seems to be working in Grand Central. In just under two months, the arrival of the Apple Store boosted sales for a neighboring restaurant by seven percent. The Steakhouse, which is co-owned by basketball star Michael Jordan, credits its new neighbor for the increase in traffic as the other owner says the uptick occurred only after Apple’s debut.
[via Ars Technica, The Next Web]
Image: Peter Alfred Hess/Flickr
This post was originally published on Smartplanet.com