Revitalizing Your Retail Space. CALED March 2018

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2 Revitalizing Your Retail Space CALED March 2018

3 Pete Grant City Manager Cypress, CA Mr. Grant took the position of City Manager for the City of Cypress, CA in He previously served as the Assistant City Manager in the City of Redondo Beach. In that capacity, he was responsible for the City s economic development initiatives, labor relations, special projects, and capital improvement budget. Prior to working in Redondo Beach, Mr. Grant worked for the cities of Burbank, Manhattan Beach, Huntington Beach, and Irvine. He also spent five years working the private sector for LINC Housing in Long Beach and The Olson Company in Seal Beach, partnering with cities to create in-fill and affordable housing developments. Mr. Grant graduated cum laude from the University of California, Riverside, and was honored as a Harry Hufford Fellow while earning his Master s in Public Administration at the University of Southern California.

4 Lacy Beasley President Retail Strategies Retail Strategies is a full-service advisory firm that partners with municipalities to bring retail and restaurant businesses to the community. Lacy currently serves as President. She has been involved in retail real estate since Her experience with The Shopping Center Group and the Dickson County Chamber of Commerce prior to joining Retail Strategies provides her with the insight to understand the connections needed from the public and private side of the conversation. A graduate of Lipscomb University, she earned her B.S in Management. Beasley is the ICSC Public Private Partnership Committee member and ICSC AL Government Relations Chair. In 2018 Lacy was named to the Top 40 under 40 by the Birmingham Business Journal. Her articles have been published in Shopping Centers Today, Site Selection Magazineand AL Retail Federation. She has spoken on retail trends and best practices in retail recruitment at more than 75 events

5 retail is a catalyst for economic development #trendingnow best practices lacy@retailstrategies.com 5

6 retail as a catalyst for economic development

7 Retail s Impact National Retail Federation study shows that one in four jobs are retail related. 1 in 4 jobs are Retail

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9 return on investment average fast food restaurant annual sales exceed $1M

10 Why Bring in Support?

11 Goals Challenges

12 Top 10 Retail States by Impact Per National Retail Federation Retail is 15% of GDP

13 #trendingnow 13

14 Jeff Bezos, Founder Amazon Eddie Lampert, President, CEO & top shareholder of Sears Holdings

15 Catalyst Apocalypse

16 9% of overall Retail Sales are conducted Online US Census Bureau

17 E-commerce % of Revenue E-Commerce Penetration by Category 15-25% Books 25% Home 19% Sports 17% Apparel 16% 10-15% Office 14% Dept. 13% Toys13% Hobby13% Shoes10% <10% Source: emarketer via JLL Bricks or Clicks? The Future of 13 Retail Categories

18 ADAPT or DIE Radio Shack in products advertised $3,055 $6,000+ Today Economic Apocalypse

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21 retail is not dying it s changing

22 Debunking the Retail Apocalypse

23 Retail Decline These 16 Retailers Represent 48% of Closings Many of these Retailers Have been Shrinking for a Decade Outdated Business Models or Market Issues? Source: Lee Holman & Greg Buzek, IHL Group, Debunking the Retail Apocalypse, August 2017

24 Retail Growth Fastest Growing Retailers: Dollar, C-Stores, Beauty, and Specialty Hardgoods What s Growing Mirrors the Incomes of Consumers: More Discounters Less Mid-Range Luxury Source: Lee Holman & Greg Buzek, IHL Group, Debunking the Retail Apocalypse, August 2017

25 Restaurant Looking Ahead Dollar Store Grocery

26 Restaurants vs. Grocery

27 Source: Nations Restaurant News

28 Every 5 hours in America a NEW Dollar Store opens.

29 Consumer Confidence Consumers Consumer confidence retreated in December after reaching a 17-year high in November, said Lynn Franco, Director of Economic Indicators at The Conference Board. The decline in confidence was fueled by a somewhat less optimistic outlook for business and job prospects in the coming months Despite the decline in confidence, consumers expectations remain at historically strong levels, suggesting economic growth will continue well into Year High The Conference Board Consumer Confidence Index

30 best practices for retail recruitment

31 Educate Council Members

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33 Interpret the Data Big data is quick and easy. Turning Big Data into information you can use is a challenge, expensive and time consuming. Do your homework before investing in data.

34 Cypress Market Analysis Trade Area Identification Drive Times Radius Rings Customized Trade Area Psychographic Consumer Profile Data Based Decision Making Tapestry Segmentation Market Opportunity Analysis Peer Community Analysis Void & Distance Tolerance Gap Analysis 87 3, ,555 category specific reports unique variables geographies per variable Variables to analyze 34

35 Cypress Market Analysis STRENGTHS Household Income Daytime population Traffic Counts Educational Attainment CHALLENGES Competing neighbors High Rent Rates Market Co-Tenancy Immediately Available Opportunities 35

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37 You are the boots on the ground in your community. Contact your property owners and agents. Learn as much as you can about the sites.

38 Homerun Real Estate Convenience High visibility / Strong signage Traffic counts Excellent access Parking Retail Strategies Webinar Series 2017: Grocery with Chris Miller, Assistant Real Estate Manager, Kroger

39 Cypress Real Estate Analysis Major Retail Aerial highlighting existing retail synergy and competition is the centerfold of marketing guide 39

40 Cypress Real Estate Analysis 17 Properties Cataloged New Development Re-Development Higher & Better Use Backfill opportunities Local Owner Outreach Over 20 Connections On Demand Demographics Site and Category specific report Assessment of Zoning 40

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42 Retail Real Estate Process - Terms Retailers Sites Corporate Real Estate Directors Tenant Representatives Franchisees Franchisee brokers Matchmaking Property Owners Brokers Banks Local Government Underperforming Businesses

43 Cypress Market Analysis Customized marketing flyer highlighting the information most important to retailers and developers 43

44 Connect with industry decision makers through International Council of Shopping Centers. Public Sector receives a discounted membership of $100/year. Dozens of networking events are held with thousands of retailers, brokers, developers and communities in attendance.. 44

45 Retail Recruitment Summary Retail Prospects 156 Original Retail Prospects 167 Current Retail Prospects 7 New to Market Retailers Focus Categories Strategically Targeted Growth is important! Recruitment Activity 120 Prospects Contacted 41 Retailers Provided Feedback 14 Leads Generated 45

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47 Community Preparedness No one knows your community better than you. The knowledge you have that saves the industry professionals time, is your most valuable asset. Stay in your lane. Know what you can and can not control. Add value by providing the right information quickly. Have the information prepared in advance. Do your home work before prospecting and follow up as promised.

48 Educate & Connect s p e a k i n g Our team annually speaks at over 20 local, State, Regional, and National conferences on Retail Real Estate. Retail Strategies interviews real estate professionals from leading organizations to capture their insights, expansion plans, and trends within the retail industry. ICSC RECON ICSC Southeast ICSC Texas ICSC Chicago ICSC Gulf South ICSC Charlotte National League of Cities Conway Great States Golden Shovel ICSC Nashville ICSC Dallas p u b l i c a t i o n s News outlets rely on and request input from our firm on topics relating to retail real estate. 48

49 retail IS economic development invest time & resources in retail

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