Posts Tagged Retail Development
Cities Must Own Their Development Process - Part 2
Posted by Rickey Hayes in Economic Development, Retail Development on February 24th, 2010
Written by
Rickey Hayes
Retail Attractions, LLC
To be successful in the development world, a city must have integrity, character, and be true to the promises it makes. Reputation goes a long way, and it also goes both ways. A community with a good reputation that is known for being true to the promises it makes and being pro-development has a head start in the recruitment of national retail. A city with a bad reputation in the development world has a tough time convincing anybody to invest. A city that changes directions in the middle of a deal or promises incentives and then reneges may laugh it off, but a developer won’t think it’s funny. In fact, it may cost that developer thousands of dollars in engineering and design costs.
In this economy, when retailers are really examining sites and new market entry, communities that understand the retail development process are miles ahead. Cities that can position themselves to partner with the private sector to alleviate problems and provide incentives for investment are ready to reap the additional revenues that new retail growth brings to cities.
Most cities that are striving to recruit retail investment into their communities make several common errors. Most assume that they are ready to market themselves just as they are and that retailers are going to come anyway in time. Nothing could be further from the truth. Cities can and should market themselves with every available tool and technology.
Another fundamental mistake is the notion that a city can have no positive influence on a potential retailer’s site selection. Communities can and should work to influence the retailers decision to invest by providing the right data and having that data organized and easily understandable. But before sending the same old city propaganda to a potential retailer, it would be wise to take a good long look at the foundational development philosophy that currently exists in the governmental bureaucracy of a community’s development department. Perhaps the most important thing that a city can do is to make absolutely sure that the regulatory arm of the organization is “development friendly”. If a city is touting their market strengths, traffic counts, and disposable income to developers and retail site selectors, they need to make sure a pro-development atmosphere exists in the local governmental infrastructure; otherwise no matter how much marketing they do, an internal foe is sabotaging their efforts. Like I have said before… All it takes is one rogue building inspector to kill a retail deal potentially worth millions.
Cities Must Own Their Development Process - Part 1
Posted by Rickey Hayes in Economic Development, Retail Development on February 17th, 2010
Written by
Rickey Hayes
Retail Attractions, LLC
I grew up in a community surrounded by crops and fields that depended on an agricultural economy. Anyone can plant a seed and rely on circumstance and Mother Nature to produce a harvest, but prudent farmers leave as little to chance as possible. If you want a sure harvest, the wise thing to do is build a greenhouse and create the optimal environment for growth and development.
In the retail world, wise cities are working to create that same “greenhouse environment” for their retail marketplace. As with farming, controlling as much of the process as possible will increase the odds of success. Ensuring the development process is as uncomplicated and trouble-free as possible is potentially worth millions of dollars to cities seeking retail investment. I am sure there are exceptions to this statement, but in almost every circumstance I have experienced in dozens of communities, it is my conviction that a city needs to be in control of its own economic development and retail recruiting efforts. Chambers of Commerce and other economic development organizations can help, but it is the city government that must control the process.
One key reason why the city must control the development process is because the city (or public trust empowered and managed by the municipality) controls public infrastructure including transportation, water, storm water, and sanitary sewer systems. Public infrastructure has a direct impact on development costs and timing, and ultimately the success or potential failure of a development deal may hinge on the public infrastructure. A proactive city looking to grow will maintain an infrastructure that can support growth and have a long-term plan for their future infrastructure.
Part of controlling the development process is anticipating problems and eliminating them before they become an issue. In this very competitive time, cities need to have as many of the potential development problems taken care of in advance as possible. Communities need to do everything in their power to make the development process as painless and efficient as possible. A rogue building inspector or fire marshal can impair development or delay it enough to actually kill a retail deal.
The typical development process including zoning, platting, and site plan review can move painfully slow in good economic times. The old adage “time is money” is true. Delays, unexpected fees, and arbitrary or changing requirements or standards can kill a potential deal just as quickly as financing issues or site problems. Government at all levels has the reputation for being slow and difficult, and communities need to examine their development processes and make absolutely sure any and every foreseeable problem is identified and remedied before the action begins. No reputable development group is going to try and get by codes, life safety issues, or development standards. But when a city is bureaucratic and unwilling to partner with a retailer or a development group to solve an issue or a think of a solution to the inevitable problems that arise in the complex world of retail development, even the easy deals can break down and progress slow to a crawl or stops completely.
Is there a benefit to ICSC membership?
Posted by Rickey Hayes in Economic Development, Retail Development on September 10th, 2009
Written by
Rickey Hayes
Retail Attractions, LLC
Cities and towns across America, and really, globally, compete for a limited number of retail store openings each year. The past two years’ economic challenges mean the number of new retail store openings, refurbishments or expansions is significantly smaller and therefore more hotly contested than ever. More and more communities are waking up to retail growth as an economic development strategy and are trying to attract new businesses.
Not only can retail growth add jobs and improve the quality of life in a community, but sales tax revenue from retail sales also drives the economic engine of just about every community in the country. Attracting retail isn’t as easy as it often seems…. Cities must stay on top of market trends, technological tools, development rules and regulations, and still find time to effectively market themselves to the right people.
One of the best tools we’ve found to help cities who want to grow their retail sector is membership in the International Council of Shopping Centers (ICSC). Each year more and more communities are taking advantage of the great networking possibilities that exist at the ICSC events held regularly around the country, especially the annual spring convention in Las Vegas. Although the economy has recently affected the attendance at the national and regional events, ICSC events are still one of the most effective ways a community can broadcast its retail needs and market its strengths. ICSC research provides crucial data on market trends, both globally and at the local level. Being able to think and plan ahead and react in a timely way helps a governmental entity stay on top of sometimes unpredictable market trends. For that reason alone, cities should encourage key staff members to become ICSC members.
Attendees at the events, whether local, regional or national, are always from a broad spectrum of the retail world. Real estate professionals, brokers, lawyers, consultants, site selectors, developers, architects, engineers, and others all share their wares with retailers and communities who are represented at the events. The ICSC organization also does a great job of providing cutting edge data relevant to the needs of the retail community and governmental entities involved in the various disciplines of retail development.
Now is the Time for Cities to Plan Their Retail Future
Posted by Rickey Hayes in Economic Development, Retail Development on August 19th, 2009
Written by
Rickey Hayes
Retail Attractions, LLC
Even casual observers of the news media can’t help but notice the coverage on the retail industry over the last few months. Scores of national retailers have announced bankruptcy in 2008 and 2009. Retailers who were growing aggressively only a few months ago have stopped looking for new sites and are re-evaluating growth plans for the 2010-2011 development cycles. Unfortunately, the consensus among industry leaders is that it is not over yet. However, many in the retail and development communities understand the cyclic nature of their industry, and are quietly planning growth strategies for the future.
So what does this mean for a city trying to recruit retail in order to boost over-all quality of life and generate much needed sales tax revenue?
It means growing cities must understand the basics of retail development and how to pro-actively position themselves at the top of the list for when future retail growth opportunities present themselves. One of the first things a community can do is to analyze and verify their true Trade Area; once the consumers in that trade area are identified, specific sets of information must be communicated to the retail world. In the past, a “concentric ring” approach was used to determine the strength of a retail market. For many cities, a one, three, or five mile radius does not even begin to accurately describe their retail market and potential draw. Cities should be aggressive in defining and marketing their retail potential to site selectors, retailers/restaurants, and brokers.
Even in the current economy, many retailers and restaurants are still expanding, and working to fill their real estate pipeline for 2010, 2011 and 2012. But they are also paying special attention to their real estate decisions. National retailers are prioritizing their investments and picking markets where the best return is available. Fewer deals mean more competition and cities must be their own advocates to the retail marketplace.
To land new retail in your community, you need to be providing the right information. Things to include in your marketing strategies are:
• Clearly define and verify your trade area using third-party data
• Be able to identify and describe the consumers within your trade area
• Provide the most current demographics and psychographics to specific retailers you are targeting
• Realize the retail potential within your community
• Analyze leakage and then target retailers who could fill the missing niches
Retail Attractions, LLC provides its client cities with valuable data and strategies to harness their full retail potential. Communities that are aggressive in marketing themselves to the retail world will be strategically set when the economy begins to strengthen.
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Retail Attractions provides a suite of services to the retail development world, including cities, developers, retailers, site selectors, economic development trusts and authorities.
Rickey Hayes
918-376-6707
www.retailattractions.com
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