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HomeMy WebLinkAboutCWS 2.a. Discuss Retail Strategies Opportunity EXECUTIVE SUMMARY City Council Special Work Session: February 20, 2018 AGENDA ITEM: Discuss Retail Strategies opportunity AGENDA SECTION: Discussion PREPARED BY: Logan Martin, City Administrator AGENDA NO. 2.a. ATTACHMENTS: Partnership proposal from Retail Strategies; Draft Contract APPROVED BY: LJM RECOMMENDED ACTION: Discuss opportunity to partner with Retail Strategies for consulting services and provide direction to staff. BACKGROUND The City Council received a presentation from a retail-attraction consulting firm known as Retail Strategies at its January 16 work session. In light of that presentation, it would be prudent for the Council to discuss its interest in working with this firm and to direct staff on appropriate next steps. DISCUSSION Retail Strategies is a private consulting firm specializing in retail recruitment and business attraction for municipalities. The firm uses data and analytics generated by GIS tools and other consumer profiling methods in order to generate an analysis of gaps and opportunities in a certain market area. A full description of their proposal for Rosemount is attached. As Council may recall, the City engaged a competing firm to conduct similar work starting in April 2014 to January 2016, when the City terminated the contract. After completing a data analysis of Rosemount’s market, the firm would begin targeting retailers, brokers, and developers on behalf of the City. As many of these conversations and decision making processes end up being lengthy, Retail Strategies proposes a three-year contract with the City. The fee for services is $45,000 annually in years 1 and 2, $40,000 in year 3. The draft contract (attached) has been reviewed by City Attorney Tietjen, and her comments have been provided to Retail Strategies for modification. This item was preliminarily discussed during the preparation of the 2018 Budget, and as such funds were allocated in 2018 for either this consulting agreement or the hiring of a full-time employee in the Community Development Department to engage in similar work. While that employee may not have the same market connectivity that Retail Strategies purports, an additional staff member would allow the Community Development staff to complete other business recruitment, marketing, public relations and outreach efforts that the Council has expressed interest in. CONCLUSION Staff recommends that the City Council discuss this opportunity and provide direction. If so desired as a result of the work session discussion, this item could be added to the regular agenda on February 20 for further action. Retail Strategies Proposal Strictly Private and Confidential 1 Rosemount, MN Retail Development Services October 2017 Strictly Private & Confidential Retail Strategies Proposal Strictly Private and Confidential 2 Technical Proposal DATA & ANALYTICS l REAL ESTATE ANALYSIS l COMMUNITY INPUT l RETAIL STRATEGY  Identify market retail trade area using political boundaries, drive times and radii and custom boundary geographies  Perform market and retail GAP analysis for trade area (i.e. leakage and surplus)  Conduct retail peer market analysis  Competition analysis identified target zones trade area(s)  Tapestry lifestyles – psychographic profile of trade area / market segmentation analysis  Aerial imagery of trade area(s)  Retail competitor mapping/analysis  Identification of at minimum 30 retail prospects to be targeted for recruitment in the first year of our partnership  Monthly updates provided on retail industry trends  Custom on-demand demographic research – historical, current, and projected demographics – to include market trade areas by radius/drive time, and custom trade area  Analysis of future retail space requirements in relation to the retail market analysis, the market’s growth potential and trends in the retail industry  Retail Real Estate Analysis performed by Licensed Retail Real Estate Professionals with 10+ years of collective experience  Identify/Evaluate/Catalog priority commercial properties for development, re-development and higher and best use opportunities  Identification of priority business categories for recruitment and/or local expansion  Perform competitive analysis of existing shopping centers and retail corridors  Active outreach to local brokers and land owners  Target List of Retailers and Restaurants (minimum of 30)  Customized Marketing Guide (four pages)  Target Zones for Development, Redevelopment, and Leasing  Focus Properties  Presented by the Team via Conference Call and/or Skype RETAIL RECRUITMENT l IMPLEMENTATION l NATIONAL REPRESENTATION  Pro-active retail recruitment for targeted zones  Will contact a minimum of 30 retailers, restaurants, brokers and/or developers each year  Updates on new activity will be provided to Client’s designated primary point of contact via Basecamp, telephone, or email on a monthly and/or as needed basis  ICSC conference representation- updates provided according to the yearly conference schedule  One market visit per calendar year included in agreement, any travel outside of the agreement shall be approved and paid for by the contracting entity  On Demand Reporting – by partnering with Retail Strategies we become your research arm providing data to our contracting entity as it is requested.  Retail trends, mergers, and acquisitions  Web Platform developed Retail Strategies Proposal Strictly Private and Confidential 3 Reporting, Invoicing, and Fee Schedule The agreement is year to year. However, we structure agreements with an option to renew for a total of thirty-six months (3 years). Project Fees The total fee for completion of work is $130,000 payable in three installments over the 36-month period:  $45,000 for the first year of service.  $45,000 upon contract renewal date for Year 2. An invoice will be sent 60 days prior to renewal date.  $40,000 upon contract renewal date for Year 3. An invoice will be sent 60 days prior to renewal date. Project fees are due within 30 days of receipt of the invoice. Should the Client request a special assignment, additional work, and/or additional travel needs not specifically referenced in the contract, we will prepare written authorization to be signed by the Client in advance of commencing any additional work. Pricing valid for 90 days. Client Responsibilities Rosemount, MN will designate a project liaison who will serve as Retail Strategies’ primary contact during the partnership. Rosemount, MN will provide information relevant to the project such as prior retail studies, current traffic count data, surveys, maps, aerials, infrastructure plans, and any other plans that may influence the development of the Retail Recruitment Plan. Rosemount, MN will provide city or organization logo and contact information as it should appear on the marketing material. “It’s not about what we are going to give you, it’s about what we are going to build together. “ -Robert Jolly, CEO Why invest in Retail Strategies?  Quality  Service  Value Progressive communities across the county have decided to be proactive in their approach to retail and retail recruitment. To effectively identify and attract the desired retail concepts to your community, you need more than data reports, a list of prospects, and prepared marketing packages. Our partnerships involve hands-on, person-to-person contact, with our clients, retail real estate decision makers, property owners, brokers, and a variety of other contacts. Let us connect the dots in this complex industry for you to create the meaningful results for your community. [BABC 3-7-16] 1 1/3930930.7 PROFESSIONAL SERVICES AGREEMENT TO PROVIDE CONSULTING SERVICES This Professional Services Agreement to Provide Consulting Services (this “Agreement”) sets forth the mutual understanding of The City of Rosemount, MN (the “Client”) and Retail Strategies, LLC, an Alabama limited liability company (the “Consultant”) on this the _____ day of February, 2018 (the “Execution Date”), for the provision of professional consulting services as more fully set forth below. R E C I T A L S: The Consultant possesses a high degree of professional skill and experience and is a unique provider of professional consulting services in retail recruitment. The Client desires to hire the Consultant to provide professional consulting services because of its professional skill and experience. NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements set forth in this Agreement, the Client and the Consultant, intending to be legally bound, do hereby agree as follows: 1. CONSULTING SERVICES. The Consultant agrees to provide the following professional consulting services to the Client (the “Services”): A. Research. The Consultant will identify the Client’s retail trade area using a blend of demographics, political boundaries, drive times and/or custom boundaries. The Consultant will perform market and retail analysis based on current industry standards at the time such reports are run. The Consultant will map retail locations and analyze opportunities given local and macro retail trends. B. In-Market Real Estate Analysis. The Consultant will analyze existing shopping centers and retail corridors and actively reach out to local brokers and real estate owners. The Consultant will identify, evaluate and catalogue priority commercial properties for development or redevelopment based on their highest-and-best-use. The Consultant will identify priority business categories to expand locally and to recruit to the area. C. Retail Recruitment. The Consultant will proactively recruit businesses for targeted zones through the contact of a minimum of 30 retailers, restaurants, brokers or developers. The Consultant will regularly update the Client Representative on retail recruitment efforts via email, telephone and the Consultant’s client web portal known as “Basecamp.” One market visit per calendar year is included in this agreement, additional travel outside of this agreement and requested by the Client shall be approved and paid for by the Client. The Consultant will represent the Client at International Council of Shopping Center conferences and provide updates according to the yearly conference schedule. D. Web Platform. Consultant will design and develop a web based platform to house and maximize exposure of information and demographics most relevant to retail decision making in the Client community (the “Web Platform”). E. Updates. The Consultant will provide the Client Representative with updates within three business days of receipt of a request from the Client Representative (as defined in Section 4 below). 2. TERM. The Consultant’s engagement and provision of Services will commence upon the Execution Date as set forth above. The Consultant’s engagement and this Agreement will terminate automatically on the third anniversary of the Effective Date (the “Term”) unless earlier terminated as provided in Section 6 below. At the end of the Term, the Client, acting by and through the Client Representative, may extend the Term at its option for successive one year periods on such terms and conditions as the Client Representative, acting for and on behalf of the Client, and the Consultant may agree upon in writing. 3. CONSULTING FEE. A. Consulting Fee. In consideration for providing the Services, the Client agrees to pay the Consultant a consulting fee (the “Consulting Fee”) in an amount equal to $130,000.00. The Consulting Fee will be paid in installments of immediately available funds as follows: Contract Period Payment Date Payment Amount Year One Upon execution of this agreement $45,000.00 Year Two On or before the 1st anniversary of the Effective Date $45,000.00 Year Three On or before the 2nd anniversary of the Effective Date $40,000.00 B. Payment Default. If the Client fails to pay any portion of the Consulting Fee on the requisite payment date, the Consultant will immediately cease all Services, including but not limited to: (1) negotiation of incentive agreements; (2) all recruiting and marketing efforts; (3) representation of the Client at trade shows; (4) booking meetings for the Client with prospective retailers; and (5) including the Client in marketing materials. C. Web Platform Service Fees. Consultant will update demographic information annually during the Term of this Agreement. Modifications, corrections, and/or additions to the Client’s Web Platform within the first thirty (30) days of delivery to Client are included within the Consulting Fee as set forth above. Should the Client request Web Platform changes, modifications, or corrections after the designated thirty (30) day Consultant will bill an hourly rate not to exceed One Hundred and no Dollars ($100) per hour for time spent (“Web Platform Service Fee”). Request for Web Platform service must be made to the Consultant in writing. Consultant will use good faith effort to complete such requests within ten (10) days of receiving written request from client. Upon completion of preforming Web Platform service the Consultant shall submit invoices to the Client supported by information in such detail as may be required by the Client and shall be sufficient to substantiate that the Consultant has performed the services. 4. CLIENT INFORMATION AND ACCESS. A. To the extent permitted by law, the Client will provide the Consultant with access to relevant personnel, facilities, records, reports and other information (including any information specified in the Consultant’s proposal to the Client) accessible by the Client that the Consultant may reasonably request from time-to-time during the Term. The Client acknowledges and agrees that the Consultant’s scheduled delivery of the Services is dependent upon the timely access to such personnel, facilities, records, reports and other requested information. B. To facilitate such access and Consultant’s delivery of the Services, the Client designates the City Administrator (the “Client Representative”), currently Logan Martin, The Client Representative will serve as the primary liaison between the Consultant and the Client. The Client Representative will have responsibility for regular communications between the Client and the Consultant, including providing updates in a timely manner through Basecamp. The Client Representative’s communications to the Consultant will include information regarding retail growth and development, such as actual and prospective business openings and closings, changes in economic drivers (e.g., significant increases or decreases in workforce of major employers, school enrollments, housing or healthcare services) and changes in the ownership of targeted real estate (e.g., transfers of real estate or changes in the finances of ownership). The Client Representative will also be responsible for disseminating updates relative to consultants activities related to scope of work to members of local stakeholder groups of the Client (e.g. City Council, Economic Development Boards, and Chamber of Commerce etc.). Initials of Client Representative: _____ C. The Client hereby authorizes the Client Representative (i) to act on behalf of the Client in the day-to-day administration and operation of this Agreement and the arrangements it contemplates and (ii) to execute and deliver, on behalf of the Client, such notices, approvals, consents, instruments, amendments or other documents as may be necessary or desirable to facilitate or assist the Consultant with the provision of the Services. 5. INTELLECTUAL PROPERTY. As part of the Services, the Consultant will prepare periodic and final reports including demographic and other research reports that will become the property of the Client upon delivery from the Consultant. Any other reports, memoranda, electronic mail, facsimile transmissions or other written documents prepared or used by the Consultants in connection with the Services will remain the property of the Consultant. With the Consultant’s prior permission, the Client may use other information provided by the Consultant, such as specifics related to retailers, developers, site information or other “confidential information” for internal purposes while taking reasonable steps to so limit the use of such materials and maintain its confidentiality. 6. TERMINATION. A. By the Client At-Will. The Client may terminate this Agreement at any time for any or no reason upon delivery of 30 days’ prior written notice to the Consultant. Any portion of the Consulting Fee paid prior to such termination of this Agreement is earned when paid and nonrefundable. B. By the Client Upon the Consultant’s Default. The Client may notify the Consultant within 90 days of the day that the Client knows or should have known that the Consultant breached this Agreement. The Consultant will have 30 days following receipt of such notice to cure any alleged breach. If the Consultant fails to cure any alleged breach within that 30-day period, then the Client may terminate this Agreement. Within 30 days of such termination of this Agreement, the Consultant will refund a pro rata portion of the installment of the Consulting Fee previously paid for the contract period during which such termination occurs based upon the number of days remaining in such contract period. C. By the Consultant At-Will. The Consultant may terminate this Agreement at any time for any or no reason upon delivery of 30 days’ prior written notice to the Client. Within 30 days of such termination of this Agreement, the Consultant will refund a pro rata portion of the installment of the Consulting Fee previously paid for the period during which such termination occurs based upon the number of days remaining in such period. D. By the Consultant Upon the Client’s Default. The Consultant may notify the Client within 90 days of the day that the Consultant knows or should have known that the Client breached this Agreement. The Client will have 30 days following receipt of such notice to cure any alleged breach. If the Client fails to cure any alleged breach within that 30- day period, then the Consultant may terminate this Agreement. Any portion of the Consulting Fee paid prior to such termination of this Agreement is earned when paid and nonrefundable. 7. NOTICES. Any notice or communication in connection with this Agreement will be in writing and either delivered personally, sent by certified or registered mail, postage prepaid, delivered by a recognized overnight courier service, or transmitted via facsimile or other electronic transmission, addressed as follows: Client: Logan Martin Address: 2875 145th St. West Rosemount, MN 55068 Email: logan.martin@ci.rosemount.mn.us Fax: 651-423-4424 Attention: Logan Martin Consultant: Retail Strategies, LLC 120 18th Street South, Suite 201 Birmingham, AL 35233 Email: Ashton@retailstrategies.com Fax: (205) 313-3677 Attention: ASHTON L. ARRINGTON or to such other address as may be furnished in writing by either party in the preceding manner. Notice shall be deemed to have been properly given for all purposes: (i) if sent by a nationally recognized overnight carrier for next business day delivery, on the first business day following deposit of such notice with such carrier, (ii) if personally delivered, on the actual date of delivery, (iii) if sent by certified U.S. Mail, return receipt requested postage prepaid, on the third business day following the date of mailing, or (iv) if sent by facsimile or email of a PDF document (with confirmation of transmission), then on the actual date of delivery if sent prior to 5 p.m. Central Time, and on the next business day if sent after such time. 8. INDEPENDENT CONTRACTOR. The Consultant, in its capacity as a professional consultant to the Client, is and will be at all times an independent contractor. The Consultant does not have the express, implied or apparent authority either (A) to act as the Client’s agent or legal representative or (B) to legally bind the Client, its officers, agents or employees. 9. STANDARD TERMS. A. Affiliated Services: The Client acknowledges that certain affiliates of the Consultant provide real estate brokerage and management services for which they are paid brokerage, development, leasing, management and similar fees. In connection with the Services and with the prior written permission of the Client, such affiliates may be engaged to provide such services in consideration for the payment of such fees. B. Applicable Laws: The Consultant will abide by all laws, rules and regulations applicable to the provision of the Services. C. Insurance: The Consultant will carry all employee insurance necessary to comply with applicable state and federal laws. D. Third Party Beneficiaries: This Agreement is for the sole benefit of the parties to this Agreement and their permitted successors and assigns. Nothing in this Agreement, whether express or implied, is intended to or will confer upon any other person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. E. Publicity: The Client agrees that the Consultant may, from time-to-time, use the Client’s name, logo and other identifying information on the Consultant’s website and in marketing and sales materials. F. Entire Agreement: This Agreement, together with any exhibits or amendments hereto, constitutes the entire agreement of the parties, as a complete and final integration thereof with respect to its subject matter. Any prior written or oral understandings and agreements between the parties are merged into this Agreement, which alone fully and completely expresses their understanding. No representation, warranty, or covenant made by any party which is not contained in this Agreement or expressly referred to herein has been relied on by any party in entering into this Agreement. G. Further Assurances: Each party hereby agrees to perform any further acts and to execute and deliver any documents which may be reasonably necessary to carry out the provisions of this Agreement. H. Force Majeure: Neither party to this Agreement will hold the other party responsible for damages or delay in performance caused by acts of God, strikes, lockouts or other circumstances beyond the reasonable control of the other or the other party’s employees, agents or contractors. I. Limitation on Liability; Sole Remedy: Each party’s liability to the other party arising out of or related to this Agreement or the Services will not exceed the amount of the Consulting Fee. The Client’s sole remedy in the event of any alleged breach of this Agreement by the Consultant will be the notice, cure and refund provisions of Section 6(B) of this Agreement. J. Amendment in Writing: This Agreement may not be amended, modified, altered, changed, terminated, or waived in any respect whatsoever, except by a further agreement in writing, properly executed by a duly authorized officer of the Consultant and the Client Representative, acting for and on behalf of the Client. K. Binding Effect: This Agreement will bind the parties and their respective successors and assigns. If any provision in this Agreement will be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby. L. Captions: The captions of this Agreement are for convenience and reference only, are not a part of this Agreement and in no way define, describe, extend, or limit the scope or intent of this Agreement. M. Construction: This Agreement will be construed in its entirety according to its plain meaning and will not be construed against the party who provided or drafted it. N. Prohibition on Assignment: No party to this Agreement may assign its interests or obligations hereunder without the written consent of the other party obtained in advance of any such assignment. No such assignment will in any manner whatsoever relieve any party from its obligations and duties hereunder and such assigning party will in all respects remain liable hereunder irrespective of such assignment. O. Waiver: Non-enforcement of any provision of this Agreement by either party will not constitute a waiver of that provision, nor will it affect the enforceability of that provision or of the remaining terms and conditions of this Agreement. P. Survival: Section 5 and Section 9(H) will survive termination of this Agreement. Q. Counterparts; Electronic Transmission: This Agreement may be executed in counterparts, each of which will be deemed to be an original, and such counterparts will, together, constitute and be one and the same instrument. A signed copy of this Agreement delivered by telecopy, electronic transmission or other similar means will be deemed to have the same legal effect as delivery of an original signed copy of this Agreement. [SIGNATURE PAGES FOLLOW] 1/3930930.7 IN WITNESS WHEREOF, the Client and the Consultant have caused this Agreement to be executed by their duly authorized officers to be effective as of the Effective Date. CLIENT: City of Rosemount, MN By: ______________________________ Name: Logan Martin Title: City Administrator Date: CONSULTANT: RETAIL STRATEGIES, LLC By: ______________________________ Name: Title: Date 1/3930930.7