New Living Spaces, New Shopping Spaces

Discussion
Mar 15, 2010

By Bernice Hurst, Contributing Editor, RetailWire

Foreclosures and closed retail premises all
over the U.S. are encouraging people to re-think where and how they live
and work. Add to that consideration of ways to reduce fuel consumption
and the result is a possibly new way of designing towns.

Around Washington D.C., The Washington
Post
reports, developers “want to capitalize on the demand for housing
from people without children and draw suburbanites to walkable communities
where they can live, work and socialize. Local governments see town centers
as a form of suburban renewal — a way to make over aging downtowns,
diversify tax bases and reduce traffic congestion — and some are providing
developers with incentives to help make it happen.”

Urban planners and other experts are coming
up with forecasts based on projections of growth in adult only households
including single people, empty nesters and millennials setting up home
independently for the first time who, they believe, “largely prefer densely
populated, walkable communities.”

Faroll Hamer, director of planning and zoning
for Alexandria, said, “We’re not abandoning the suburbs, but we’re providing
more choices.”

Robin McBride, of Federal Realty Investment
Trust, added, “Merchants have to figure out what works and what doesn’t,
who the customer is, where they are traveling from,” matching merchandise,
pricing and offerings to demand.

One development in the D.C. area is “still
taking shape” after three years with “the large space leased to the Superfresh
grocery chain” still empty, restaurants struggling and many stores that
were leased having changed hands already. The problem may have been timing
but may also be the combination of retail, residential and office space
and lack of car parking spaces. Despite being close to a metro station,
consumers apparently prefer the convenience of their own transportation.

Citing several other developments around
the district, some of the more successful were likened to destinations,
(“People want to be somewhere. There’s a ‘there’ there.”) while the failures
may feel “like a pass-through to other places”.

Meanwhile, a recent profile of Detroit in The
Guardian
looked at both its desolation and early signs of restoration.
Houses that are beyond salvaging are being demolished and replaced with
community gardens (some offering free vegetables), new shops and entertainment
and eating venues. One resident involved in a group called Blight Busters
refers to their objective as “right sizing” the city.

Discussion Questions:
Are town centers an expansion opportunity for retailers? What will
it take for town centers to succeed?

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10 Comments on "New Living Spaces, New Shopping Spaces"

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Dr. Stephen Needel
BrainTrust

The answer may be that it depends on the extent of re-urbanization and the ability, as McBride notes, to deliver the right assortment to the newly urbanized. Creating a neighborhood is more than just opening up some stores and saying “here we are”. However, a grocery store, for example, that caters to the new urbanites may have a great shot at success, especially if government is giving it tax breaks and real estate is relatively cheap. Keep in mind that this re-urbanization is less like gentrification and more like life-style change and that should direct the type of stores that would succeed.

David Biernbaum
BrainTrust

Urban centers definitely stand a chance of renaissance and rejuvenation for reasons of convenience, fuel and transportation costs, and pragmatism. However, success depends on three major factors: quality of schools, safety in neighborhoods, and availability of public transportation.

David Livingston
Guest
6 years 6 months ago

I’m seeing more and more of these projects being built. Sounds kind of neat to be able to live above Trader Joe’s in a new urban lifestyle shopping center. With more and more people working from home with mouse-pushing jobs, I can see a trend developing. I moved to a downtown residence/office 3 years ago. I can go days without getting in car.

Charlie Moro
Guest
Charlie Moro
6 years 6 months ago

The urban center may very well be a desirable destination for customers if they also tailor offerings to the shopping experience. This may be an opportunity to interact with customers on a level of personal interaction at the store but also create delivery options that tie the consumers, the neighborhood, and retailers together on various levels.

Sandy Miller
Guest
Sandy Miller
6 years 6 months ago

It seems to be a good idea–retailers logically go where shoppers are.

Ben Ball
BrainTrust

Urban planning is not in our portfolio–but we do work near one very successful example in Glenview, IL called “The Glen.” This is a ground-up, urban living center that was developed on the site of the old Glenview Naval Air Base. The integrated combination of living, dining, shopping and culture (Chicago Children’s Museum, etc.) makes this a compelling place to both live and visit. The retail climate there appears to be quite good, with very little turnover among either anchor tenants like Dick’s Sporting Goods or the smaller specialty shops such as Adriana’s Furs. And the restaurants, pubs and theaters are always busy, if not packed.

John Boccuzzi, Jr.
Guest
John Boccuzzi, Jr.
6 years 6 months ago

I am optimistic about this trend and what opportunities this move would provide entrepreneurs and residents of small communities. Small store formats brought together in the center of a town that includes parks/recreation, town buildings as well as professional space and restaurants is exciting.

This common format was eroded in the 1970s with the formation of malls that built high walls with no windows and very few exits to the street. Ultimately, this killed several thriving downtowns. Over the last 10 years we have seen malls now struggling to compete with Walmart and other box outlets open their buildings to the street to better incorporate them into the downtowns they once destroyed. Stamford, CT Town Center is a great example.

With “For Lease” and “For Sale” signs on retail space at an all time high, it will be interesting to watch how larger format retailers make a transition to fit into smaller spaces or if they leave them open for new start-ups that can form closer ties with the community and can provide greater customer service.

Mark Barnhouse
Guest
Mark Barnhouse
6 years 6 months ago
I would love to see this movement succeed. However, I have my doubts. Old downtowns became destinations due to the mix of uses they offered and because of the transportation alternatives available at the time (plenty of streetcars; only the rich could afford to keep horses and a carriage). They were organic–things grew or failed based on whether the “soil” of the urban environment was fertile or barren, and no one, central authority controlled their growth. In contrast, most of these new centers fail to offer enough diversity to truly be “urban.” In Denver we have several centers that fit the description “Lifestyle Center,” but none of them can be called “highly successful.” Some are retail-only, making them essentially outdoor malls, and they all have plenty of space for lease these days. One, at the former Stapleton airport, offers office space above stores. One, Belmar in the suburb of Lakewood, is still “under construction” after several years. It has the best chance of success because it incorporates a variety of residential products (condos, townhomes, apartments), non-retail uses (offices, a Bally’s, and a trade school), as well as a good mix of retailers and restaurants ranging from Whole Foods Market and… Read more »
Mark Johnson
Guest
Mark Johnson
6 years 6 months ago

Consolidation.

Drew McElligott
Guest
Drew McElligott
6 years 6 months ago
Color me skeptic. I’ve seen too many of these meet hurdles around the country like in Denver. One of the biggest problems with talking “town center” is the monkey see, monkey do effect where EVERY municipality wants a “town center.” That fervor has swept around parts of the country over the past few years and I’m afraid has put some cities in a tight spot fiscally, let alone the time and effort that cities have wasted with developers, at council, etc. That’s what has happened in parts of Denver–sorry, not every municipality can be Boulder, CO! I’m not an urban planner, but it seems to me the key component has to be an accurate understanding and reading of the true demand drivers in a given situation. For every successful such city center, one could find over the past couple of years several failed efforts that either never got off the ground or that’s stuck in a first phase. Lots of cautionary tales out there of the “town center” variety. I talk to a handful of developers that are still looking for potential locations for these types of developments but in extremely select markets. I think it will continue to be… Read more »
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