HomeMy WebLinkAbout4.b. Retail Strategies Presentation
EXECUTIVE SUMMARY
Port Authority Meeting Date: July 17, 2018
AGENDA ITEM: Retail Strategies Presentation AGENDA SECTION:
New Business
PREPARED BY: Kim Lindquist, Deputy Director AGENDA NO. 4.b.
ATTACHMENTS: Presentation APPROVED BY: LJM
RECOMMENDED ACTION: Information Item
ISSUE
At the last meeting staff briefly reviewed information from Retail Strategies and indicated that we would
receive a more detailed presentation, including information about the ICSC conference. Attached is the
presentation received. Staff plans to walk the Port Authority through the presentation at the meeting.
RECOMMENDATION
Information item only.
Retail Recruitment Plan
Rosemount, Minnesota
2Prepared for Rosemount_MN by Retail Strategies
Why Should a Municipality Invest Resources in Retail?
Challenges
Goals
3
Why Should a Municipality Invest Resources in Retail?
Prepared for Rosemount_MN by Retail Strategies
Success breeds success. Retail builds on retail. Retail economic impact adds up quickly. Retail
attracts the workforce that attracts the primary jobs. Retail influences executives looking to
locate their company in your community. Retail enhances quality of life that brings your children
home. Retail builds tax base. Retail adds jobs from entry level to managerial. Retail builds
communities.
4
Why Should a Municipality Invest Resources in Retail?
Prepared for Rosemount_MN by Retail Strategies
rise of the
millennial
7
Technology Changing Growth of Brick-and-Mortar
Prepared for Rosemount_MN by Retail Strategies
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Doom and Gloom?
Prepared for Rosemount_MN by Retail Strategies
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Seamless Integration is the Key to Survival
OMNI
CHANNEL
Experience
Shopping
Bricks
E-commerce
Clicks
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Returns –The Gift That Keeps on Giving
US RETAIL SALES ON TRACK TO REACH
$4.0 TRILLION IN 2017
9/100 IN-STORE PURCHASES ARE
RETURNED
IN 2017, PROJECTED US ECOMMERCE
SALES WILL REACH $440 BILLION
TOTAL RETAIL RETURNS IN 2017
PROJECTED TO EXCEED $460 BILLION
30/100 ONLINE PURCHASES ARE
RETURNED
70-80% OF SHOPPERS MAKING ONLINE-
PURCHASES RETURNED TO STORE TO
ALSO MAKE A NEW PURCHASE
Prepared for Dubuque_IA by Retail StrategiesPrepared for Rosemount_MN by Retail Strategies
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Brick-and-Mortar Still Dominate
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Retailers Are Still Expanding
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2017 Store Openings
Retailers Opened 42,000 Stores in 2017
Tenant mixes are becoming increasingly food-based.
Specialty food —fast casual & organic grocery are becoming mainstream.
Fitness/Health/Spa Concepts
Thrift Stores
Grocery (Smaller Format)
•Discount
•Ethnic
•Organic
•Upscale
Fast Food
Fast Casual
(~40% of restaurant growth)
Retail Growth
Automotive
Discounters
Dollar Stores
Children’s Apparel
Off-Price Apparel
Beauty/Cosmetics/Fragrances
Pet Supplies
Sporting Goods
Wireless Stores
Banks
Retail Contraction
Book stores
Video Stores
Do-It-Yourself Home Stores
Mid-priced Apparel
Mid-priced Grocery
Office Supplies
Consumer Electronics
Stationery/Gift Shops
Shipping/Postal Stores
Casual Dining –Older Concepts
Prepared for Rosemount_MN by Retail Strategies
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2018 Planned Expansion
16,500
14,950
2,300 1,800 1,400
750 450
Restaurant Other Apparel Dollar Store Home Grocery Drug Store
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Retail Strategies Overview
We are
retail real estate
professionals. We will
tell your story in a way
that matters to
retailers.
20
Licensed Retail Real Estate
Professionals
34
Team Members
130
Communities Served
4:1
Client to Staff Ratio
44
States Our Team has
Located Retailers
1 Goal
Create Success
for Our Clients
Prepared for Rosemount_MN by Retail Strategies
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Our Partnership
Beth Miller
Portfolio Director
Prepared for Rosemount_MN by Retail Strategies
Ford Fitts
Retail Development
Coordinator
Justin Lindsey
Business Development
Our Partnership
Executive
Team
Accounting
Prepared for Rosemount_MN by Retail Strategies
Marketing
& Research
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Retail Strategies Process
Prepared for Rosemount_MN by Retail Strategies
Market analysis-Data, Data, Data
We start where the retailers and landlords start.A retail site will only be
chosen if it meets all of a retailers’key criteria.This criteria is two fold:
market criteria and site criteria.Each retailer has its own formula for
determining what market characteristics are needed to allow for a
profitable store.Which is why this first step is central to formulating an
effective retail recruitment strategy.Through our comprehensive market
analysis process we have evaluated,consumer spending patterns,peer
communities,local commercial real estate asset,as well as the demographic
and psychographic make-up of your unique consumer trade area.Our
partnerships with pioneering data organizations allow us to provide the
deepest,most accurate,insight into your community and its consumers to
retailers and landlords across the country.
Strategic Planning –The Playbook
Every community offers unique assets and challenges to retailers and
developers.Taking the market analysis a step further we have sent a
experienced retail real estate team to Huron to view the market first hand
as a retail site selector would (Boots on the Ground).Then through
connecting with local city leadership and key stakeholders in Huron’s
commercial real estate sector we gain the insight and feedback necessary to
access the markets strengths and weaknesses.Many times what the data
shows is incomplete.Other critical factors such as co-tenancy,sight lines,
access and most notable success of existing retail are taken in to account in
creating your strategic retail recruitment plan.
Retail Recruitment-Connecting The Dots
This is where the real heavy lifting begins as we put the data and
underutilized real estate assets to work by connecting them with targeted
businesses.Retail recruitment is a complex business and involves multiple
parties.Our team has National connections that we will put to work on your
behalf.We currently know who to contact,their expansion plans,and their
site criteria for over 9000 retailers nationwide.
Time Resources Experience Connections
Your Research
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Research Partners &
Geographic Information
Systems
Memberships,
Subscriptions &
Customized Reports
Discover: Research
Prepared for Rosemount_MN by Retail Strategies
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where does all this information come from?
here are a few of the demographic data sources used
Discover: Research
Prepared for Rosemount_MN by Retail Strategies
22
9,703
retailers’contact
information & site selection
criteria
Discover: Research
Prepared for Rosemount_MN by Retail Strategies
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3,365
unique variables
7
different geographies
defined per each variable
87
category specific reports
23,555
variables to analyze
Discover: Research
Prepared for Rosemount_MN by Retail Strategies
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Discover
State of Minnesota
Population 5.58 Million
Rosemount, MN
Population 23,728
Prepared for Rosemount_MN by Retail Strategies
25Prepared for Rosemount_MN by Retail Strategies
Discover
26
Discover: Drive Time & Radius
Prepared for Rosemount_MN by Retail Strategies * Demographics pulled from city center as identified by internal GIS
Category 1-Mile Radius 3-Mile Radius 5-Mile Radius 5-Minute
Drive Time
7-Minute
Drive Time
10-Minute
Drive Time
Current Year Estimated Population 29,100 55,428 122,895 8,047 38,178 110,985
Number of Households 10,485 20,325 43,140 3,161 13,718 39,526
Projected Annual Growth (5 YR)6.66%7.22%6.63%7.19%6.96%6.46%
Median HH Income 2016 $87,488 $88,164 $90,628 $75,955 $92,498 $91,463
Current Year Average Age 36.9 36.6 36.8 37 37.2 37
Average Home Value $307,279 $309,449 $325,734 $280,615 $327,871 $329,450
Current Year % Bachelor's Degree 43%44%42%34%46%44%
Daytime Population 21,104 43,235 88,666 10,065 31,211 79,435
Labor Force 17,211 33,109 74,273 4,704 22,720 67,212
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Discover
Mobile Data Collection
The location tracked was
Aldi and Cub
for the time period of
March 31, 2017
To
March 31, 2018
Prepared for Rosemount_MN by Retail Strategies
This mobile tracking service uses data
collected from mobile phone users who
have agreed within their apps and
phone settings to enable location
information.By drawing a polygon
around a specific business or location
we are able to gather valuable data
about the customer base that has
actively used their mobile device while
in the identified location.This tool
allows us to see where customers are
coming from to shop in your market
using actual data.This information is
used to optimize your trade area,
analyze business locations,compare
frequency of visitors,and assist retailers
in site selection.This is intended to
support the trade area but does not
solely define the trade area.
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Customized Trade Area
Discover: Custom Trade Area
Prepared for Rosemount_MN by Retail Strategies
Each retailer has a specific formula of market criteria
they use to determine if they will have a profitable
store.Understanding your trade area is extremely
important because it sets the parameters for measuring
demographic criteria and spending potential sought by
retailers and developers.Municipal boundaries,radius
rings and drive times are a start to evaluating this
information.However,these predefined boundaries
are unable to take into account the unique aspects
affecting the actual consumer pulling power and local
geography of your community.For these reasons a
customized trade area is the next step to analyzing a
market.
A trade area is the geographic area from which a
community generates the majority of its customers.A
community can have more than one trade area.We
define your primary trade area the core base of
consumers highly likely to shop and eat in the market
at least once a month.Your primary trade area has
been created by combining the results from the mobile
tracking data with other factors such as:current retail
mix in your community,traffic patterns,destination
attractions and proximity to competing markets.
The time and distance consumers are will to travel to
shop is not “one size fits all”.Therefore retailers will
analyze their own trade areas differently taking in to
account things like existing store locations,
competition within their retail category,and
convenience.
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Our Research
Prepared for Rosemount_MN by Retail Strategies
201,049
2017 Estimated Population
Custom Trade Area
Discover: Custom Trade Area
39
female
average age
37
male
average age
5.1%
projected growth rate
2017-2022
211,359
projected 2022 population
30
5%
4%
5%
83%
3%
Race
Asian
Black
Latino
White
Other
Our ResearchDiscover: Custom Trade Area
Prepared for Rosemount_MN by Retail Strategies
CURRENT YEAR ESTIMATED POPULATION BY RACE
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Our Research
Prepared for Rosemount_MN by Retail Strategies
Discover: Custom Trade Area
78,032
number of households
$83,006
median household income
CURRENT YEAR ESTIMATED HOUSEHOLDS BY HOUSEHOLD SIZE
16,930
24,337
13,088 13,051
5,305
1,678 785
23%32%17%17%7%2%1%
1-person
household
2-person
household
3-person
household
4-person
household
5-person
household
6-person
household
7 or more person
household
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Our Research
Prepared for Rosemount_MN by Retail Strategies
Discover: Custom Trade Area
$331,881
average housing unit value
CURRENT YEAR ESTIMATED HOUSING UNITS BY TENTURE
2,858
75,174
59,552
15,622
Vacant Housing Units Occupied Housing Units Owner-Occupied Renter-Occupied
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Our Research
Prepared for Rosemount_MN by Retail Strategies
Discover: Custom Trade Area
2.66
people per household
23%
72%
58%
27%
30%
4%
2%
2%
10%
6%
4%
6%
1 Person Households
Family Households
Married-couple family
With own children under 18 years
No own children under 18 years
Male Householder: no wife present:
With own children under 18 years
No own children under 18 years
Female Householder: no husband present:
With own children under 18 years
No own children under 18 years
Nonfamily Households
34
Our Research
Discover: Custom Trade Area
218,969 daytime population
Prepared for Rosemount_MN by Retail Strategies
4%9%6%3%47%2%29%
DAYTIME POPULATION
Children at home Retired/Disable persons Homemakers Work at Home
Employed Unemployed Student Populations
35
Discover: Research & Analytics
Prepared for Rosemount_MN by Retail Strategies
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ESRI Tapestry SegmentationOur ResearchDiscover: Psychographic Profile
Prepared for Rosemount_MN by Retail Strategies
TAPESTRY HOUSEHOLD SEGMENTATION AREA PROFILE
5 mile Radius –Aldi, Rosemount, MN
25.8%
14.9%
11.8%11.3%
8.5%
Soccer Moms
(4A)
Professional
Pride (1B)
Savvy
Suburbanites
(1D)
Home
Improvement
(4B)
Boomburbs
(1C)
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ESRI Tapestry SegmentationOur ResearchDiscover: Psychographic Profile
Prepared for Rosemount_MN by Retail Strategies
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ESRI Tapestry SegmentationOur ResearchDiscover: Psychographic Profile
Prepared for Rosemount_MN by Retail Strategies
Focus Categories
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Discover: Opportunity Gap
Total Market Leakage
-$705,132,330
Prepared for Rosemount_MN by Retail Strategies
This number shows that supply Is
actually higher than demand. This is
common in suburbs of very large cities.
Finding the specific categories where
they are leaving the market is the key.
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Discover: Opportunity Gap
Prepared for Rosemount_MN by Retail Strategies
CUSTOMIZED RETAIL CATEGORY GAP ANALYSIS
Data Source: STI: Market Outlook
$17,117,035
$35,034,432
$67,338,475
$110,349,363
Electronic Shopping & Mail-Order Houses
Sporting Goods, Hobby, Book, Music Stores
Foodservice and Drinking Places
Clothing & Clothing Accessories Stores
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Discover: Peer Analysis
Prepared for Rosemount_MN by Retail Strategies
Address City State Residential Pop Daytime Pop Median HH
Income Market Supply
Dollar Tree Rosemount MN 54,604 41,767 $88,074 $483,764,319
5000 Chandler Ct Marion IA 51,628 46,807 $68,447 $959,231,172
1974 Vandalia St Collinsville IL 49,270 42,066 $63,070 $481,745,273
4400 W Elm St Mchenry IL 44,559 45,898 $67,421 $612,616,068
701 8th St Sw Altoona IA 56,659 43,094 $64,822 $718,250,875
66078 Van Dyke Rd Washington MI 48,636 41,583 $80,507 $645,218,187
1430 S Lapeer Rd Oxford MI 43,738 40,758 $79,788 $737,731,935
City Comparison Report –10 Minute Drive Time
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Discover: Peer Analysis
Prepared for Rosemount_MN by Retail Strategies
0
9
1
6
1
4
1
4
1
2
21
0 0
1
12
5
16
4
6
3
5
2
4
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1 1
Arts &
Entertainment
Automotive Clothing &
Accessories
Computer &
Electronics
Full Service
Restaurants
General
Merchandise
Grocery &
Supermarket
Hardware &
Garden
Hobbies &
Crafts
Home
Furnishing
Quick Service
Restaurants
Shopping Sports &
Recreation
PEER ANALYSIS BY CATEGORY
Rosemount Peer Average
Boots on the Ground
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Current Retail Overview
Prepared for Rosemount_MN by Retail Strategies
Current Real Estate Overview
Retail Prospects
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Discover: Top Categories for Recruitment
Prepared for Rosemount_MN by Retail Strategies
General MerchandiseRestaurants
Building Supplies &
Hardware
Clothing and Apparel
Outreach
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Connect
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Conference Representation
Retail Strategies represents our Client Communities at more than a dozen
Retail Real Estate Conferences Each Year.
At each conference we connect directly with industry leaders to discuss our
Client Communities and position them for growth.
Prepared for Rosemount_MN by Retail Strategies
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Marketing Guide
Prepared for Rosemount_MN by Retail Strategies
Implementing your Strategy
Contact developers,
retailers, tenant
representatives and
franchisee groups both
regionally and nationally
Make direct and indirect
connections through
conference representation,
in person meetings, phone
calls and emails
Coordinate and
communicate our efforts
with local brokers, property
owners, and city staff on
an on going basis
Follow industry trends as
well as changes in your
local market to
continuously adjust our
strategy and improve our
efforts to maximize the
retail potential in your
community
Discover Connect Implement
Focus
Prepared for Rosemount_MN by Retail Strategies
120 18th Street South, Suite 120, Birmingham, AL 35233 205.314.0386 retailstrategies.com
Thank you!