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Archive for March, 2011

Is Retail Growth Really Economic Development?

Written by
Rickey Hayes
Retail Attractions, LLC

Last week I received an invitation to the Heartland Economic Development Course held in Kansas City next month. The course touts itself as the “highest ranked multi-state economic development course in the United States”. This course, like most of the regional ED courses held in different areas around the country, is accredited by the International Economic Development Council (IEDC). This course is a basic part of an economic development practitioner’s training program and is in fact required for the IEDC certification process. I attended the same course in San Antonio, Texas in 2001, and I can tell you the course is saturated with good, solid training and should be a part of every ED professional’s course of study. There is absolutely nothing wrong with the course. However, if you look at the course offerings highlighted on the marketing brochure you will find not one reference to or mention of retail recruitment. It’s all about the “smokestack” and industrial and manufacturing job creation. I would argue that there is more to economic development than this. There is a bigger picture.

Bottom line is this:when we were in school we knew we weren’t going to use half of the stuff we were being taught. And we were right. Education gives you a foundation, but economic development technique is not learned in a classroom. It is learned in the field. Successful economic development at its foundation is about improving the quality of life in a community. Real economic development is about relationships with the right people at the right time at the right location. Correct me if I’m wrong here, but I can point to some job creation successes that ultimately reduced the overall quality of life in a community. Is that successful economic development? Not in my book. I know this is sensitive stuff, but sometimes when we try to be sensitive and politically correct we lose sight of our goal. What is our goal? To face reality and move forward in a positive direction.

So what is reality? The fact is that when well planned national retail comes to a community, the quality of life in that city goes up. The adage “rooftops generate retail” is only part of the story. Just as residential growth can bring retail growth, retail growth can generate residential growth. When corporate America decides to relocate jobs from one geographic area to another, I can assure you that the retail goods and services offered and the overall quality of life in the prospective cities are at the top of the list of things considered when those decisions are made.

The following story is not fantasy:it is reality. I saw it with my own eyes in living color. From 2002-2007 the City of Owasso, Oklahoma experienced tremendous growth in both commercial and residential investment. Census data states Owasso grew 55% in population from 2000-10, and the city’s sales tax base and general fund revenue nearly tripled during that time. The sales tax revenue continues on an upward trend even in a “recession” economy. New commercial construction totaled more than 4.2 million square feet with over a quarter of a billion dollars in total value. The Owasso Independent School District built over $100 million in new facilities, and because of the increased property values, all this was done without raising taxes one penny. And a sleepy little bedroom community became what other cities have termed a “city on a hill”, a true regional shopping mecca. What is the driving force, the “reason”, for the continued growth and revenue? Retail. Well planned, incentivized retail.

Is that real economic development? I think so.

Our company teaches communities how to define their retail market and sales potential and then market themselves to the national retailers and restaurants. Our client cities that stick with us through the slow grinding process of retail development reap new retail, new revenue, and a new and improved quality of life for their citizens.

Is that real economic development? I think so.

Rickey Hayes is the principal of Retail Attractions, LLC, a firm dedicated to helping cities and developers successfully find retail sites, close deals and improve the quality of life for our client cities.

Action Steps for Cities

Written by
Rickey Hayes
Retail Attractions, LLC

Anybody who knows me knows that I am a plain spoken kind of guy. I have found in my five decades of living that people need to say what they mean. Sometimes being “politically correct” and “being careful not to offend anybody” makes us unable to discuss reality. And let’s be sure of one thing: Reality IS that cities around the country are in competition for their very lives. An Associated Press article on Feb. 22, 2011, stated that the 2010 federal census data had confirmed that 1 out of 4 counties across the country were literally dying: death rates exceed birth rates and in-migration is not making up the difference. That is reality.

Some myths, or non-realities, commonly believed by communities include that the future is already fixed in some kind of fatalistic matrix and whatever is going to happen is going to happen anyway (for good or bad) and that there is nothing we can do to change the way things are. Our view, indeed anyone’s view, of “the way things are” is shaped by how we interpret our surroundings and the events taking place. How about changing the fundamental way we think about those events? Of course things and communities can be changed for the positive. It has happened in communities all over the world. If it were true that nothing could be different, we would all still be riding horses to work.

So:what needs to happen?

  • First, face REALITY. If things are bad: streets, neighborhoods, tax revenue:.whatever the problem is:it has to be fully acknowledged and analyzed.
  • Second, somebody has to cast a vision. Maybe it is the mayor, city manager, or maybe it is a citizen or a student. What could our city be, unhampered by “what is” right now? A vision, properly communicated, is sometimes all the motivation that is needed.
  • Third, someone has to lead. In my humble opinion, leadership or the lack of it is what is wrong in Washington, in state capitols, and in city halls all over this land. I’m not talking about politics:there is no lack of that. I’m talking about leadership.
  • Fourth, communities have to devote time, energy, and yes, money to address issues. I can hear people saying it now: “that’s the problem:we have no money.” That situation alone should be enough to motivate communities to think differently about their circumstances. Being broke has motivated me many times to change my priorities.

Let me say one more thing. If you keep doing what you’ve always done:you are going to keep getting what you’ve always got. Changing your circumstances isn’t easy and it isn’t comfortable. But it’s necessary if you want your community to be a living, breathing, thriving city where citizens experience the quality of life, level of service, education, employment, opportunity and entertainment that makes your city the one they (and the businesses that serve them!) want to stay in and grow with.

Let Retail Attractions help you. We have helped dozens of communities in several states see and change reality. Our firm can help you cast a vision and set a course for a thriving community where people want to live, work, shop and dine. Contact us today to make a seemingly overwhelming task more manageable.

Rickey Hayes is the principal of Retail Attractions, LLC, a firm dedicated to helping cities and developers successfully find retail sites, close deals and improve the quality of life for our client cities.

A Wal-Mart For Every Town?

Written by
Rickey Hayes
Retail Attractions, LLC

It is official. Wal-Mart now has a store model that will fit every city, town and corner in the United States. According to building permits obtained by Bloomberg News, Wal-Mart is finally moving forward with their closely guarded secret, the Express store concept.

Construction on the 14,400 square foot store in Gentry, Arkansas, a town of 3,158 only 20 miles from the company’s headquarters, will begin on March 16. The company has also released that there will be 2 more Arkansas cities graced with an Express with construction starting in the next couple of week, and rumor has it that an existing 10,000 square foot building in a Chicago suburb is being built out as the first urban Wal-Mart Express. So what does this mean to your community?

If you are a community that has already been smiled upon by the Wal-Mart gods, you could care less. However, if you are a community that has been looked at as a potential site but just not quite made the cut: this is good news.

There are traditionally 3 formats for Wal-Mart stores:

  • Supercenter: 185,000 square feet
  • Discount stores: 108,000 square feet
  • Neighborhood Markets: 42,000 square feet

And now introducing (drum roll, please):

  • Express: 14,400 square feet

The Express will feature groceries, a pharmacy, three or four checkout counters and 75 parking spaces. They are expected to have about 12 aisles and include fresh produce, frozen food items, refrigerated food items as well as general merchandise. Wal-Mart plans to open as many as 40 units this year in rural and urban areas, and executives said to expect the first Express store to open as early as May. There are thousands of opportunities across the US for this model. All you need is leakage and 5 acres!

Retail Attractions has worked with Wal-Mart real estate and our development contacts in several of our client communities and has insight into what they need to see, hear and feel to make the decision to locate in a new community. If you would like to locate a Wal-Mart or a Wal-Mart Express in your community, we can help. Give us a call at (918) 376-6707 or contact us to put us to work for your community.

Rickey Hayes is the principal of Retail Attractions, LLC, a firm dedicated to helping cities and developers successfully find retail sites, close deals and improve the quality of life for our client cities.