Small-format British grocer leaving US market...

Small grocer seemingly tailor made for urban communities exits the U.S. market, cites Bloomberg news (TESCO exits U.S market. (Bloomberg News, 12/5)

This story caught my eye...perhaps because a few years ago, Fresh & Easy Neighborhood Market, a 14,000 square foot grocery store concept by British-based TESCO was all the rage. The company had reportedly spent $1 billion (yes, with a B) on R&D and was looking at extremely rapid US expansion. Lots of communities were clamoring to sit down with TESCO to see if they could convince them to fill the smaller retail spaces typically found in older urban communities. In fact, I was part of a few of those conversations at ICSC Dealmaking in Las Vegas in 2008. But apparently, no more. "Fresh & Easy was let down by poor execution, clinical stores, a predominance of own-brand products in a brand-loving U.S. market, and a lack of understanding by consumers" says Bloomberg news. Not to mention bad timing...the end of 2008 saw the collapse of the economy as well. I wonder what the plan is for existing Fresh & Easy's....

Not anymore....

Fresh & Easy was a cool concept that worked in urban neighborhoods...

Commercial districts need facelifts too....

I just love this article in the WSJ...and it applies to commercial districts as well. Malls Get Facelift to Pull In Shoppers (Wall Street Journal, 12/18). Here are a few choice quotes that inspired me to think about how these same principles apply to urban commercial districts and traditional downtowns.

The good news....

• "Making what you already have as good as it can be is the best way to go." My thoughts...Commercial districts need to continually improve and upgrade. It's critical to remain relevant to your customer base. 
• "Landlords and analysts say the improvements can generate annual income of as much as 10% to 12% of the cost of the upgrades." My thoughts...this is a great argument to use with local property owners and business owners. 
• "Mall owners are adding more restaurants, upscale movie theaters, supermarkets and other tenants that offer goods and experiences that can't be found online." My thoughts...the good news is that downtown and urban areas already offer the experience and tenant mix described here...it's an asset to build from!

...and the bad.

• "The retail-property industry has a long history of throwing good money after bad by trying to save shopping centers facing tough competition and growing vacancy rates." Does this meant that already flailing commercial districts may not make good investments??
• "most redevelopment is taking place at the country's top-performing malls" Convincing mall owners to invest in lower performing malls proves as challenging as convincing property owners to invest in properties in communities that are seemingly struggling...

Improving Your Signature Holiday Events: Cookie Tour Keeps it Simple and Local

Every year the Joy of Cookies, Cookie Tour in Lawrenceville, Pittsburgh brings thousands of visitors to neighborhood. Local business owners say that Cookie Tour weekend is the neighborhood’s busiest shopping weekend. Here is what we love about this event...

• Simple - The concept is simple. During the Tour, which runs the first weekend in December, participating businesses put out plates of unique kinds of cookies along with recipe cards for visitors to collect. 
• Steady - The Tour has been going on for the past thirteen years. Many visitors said they've gone every year and have the recipe cards to prove it.
• Getting around -Visitors are provided an itinerary in the form of a colorful map that merchants give out.
• Fun signage - Each stop along the places a numbered gingerbread man in their store window. 
• Strategic - Many of the businesses put trays of cookies in the back of their store or at the register, so guests browse and shop as they snack.

But the event is not without its challenges - which are probably familiar to many of you charged with planning events in your district. As a volunteer-run event, its success depends heavily on the time and energy of event organizers, who themselves manage their own businesses. Therefore it is critical to grow event revenue through sponsorships and fundraising, without losing the local feel that makes this event so unique. Another issue is keeping costs down for participating merchants (baking enough Cookies to feed hungry visitors from Thursday though Sunday is expensive!) in order to encourage increased participation from merchants.

In the coming weeks, our team will work closely with event organizers to tackle these, and other challenges related to growing, while at the same time maintaining the character of this successful community event. So stay tuned - and in the meantime, enjoy these great pictures from the Cookie Tour!

Retail Insights: ICSC leaders report tight market

As the New York State Public Sector Co-Chair for the International Council of Shopping Centers (ICSC), I have the benefit of meeting and learning from a fantastic group of colleagues in the retail industry. This morning at the Eastern Division Committee Meeting, held during ICSC's National Conference and Deal Making in New York City, State director's representing 12 northeastern states and the District of Columbia came together to discuss trends in the market in each of their respective regions. Some interesting themes dominated, and a few trends suggest opportunities - as well as challenges - for those managing traditional urban commercial districts. Here are some highlights for those of you in these markets...

Pennsylvania/Southern New Jersey/Delaware

• The "new" "normal": smaller and tighter ("less, less, less") fewer retailers doing smaller and less stores. (i.e. we did 50 Target stores over the past 5 years in the region, there will be only 5 more!)
• There is no development spigot (it is not even dripping!)
• Existing "quality" in-line space is getting mopped up!
• Many states are passing or have passed tax fairness legislation, a major initiative of ICSC to ensure that brick-and-mortar retailers can fairly compete with on-line retailers. 

Mass/Maine/New Hampshire/Rhode Island/Vermont

• Notable retailers expanding include Wegman's, Health clubs, Frozen Yogurt, Chef-driven restaurants, Darden, Pharmacies, TJX
• Shuttered locations (Borders, Filene's Basement) have been mostly absorbed
• Relative to other major regions, Boston remains a top 5 market for retailer expansion nationally
• Urban core, densely populated, transit-friendly cities, like Boston, Quincy and Somerville, MA continue to experience steady retail growth/activity [personal comment - this was one of my favorite updates yet!]
• On-line sales are hitting apparel retailers less than they are hitting hardline products

New York/Northern New Jersey

• Hurricane Sandy hit the supply chain of retailers hard. Many final shipments to stores in advance of the holiday season were affected. If shipments were missed, retailers must either send products by expensive air freight, pay a penalty for late shipment of face canceled orders.
• The storm is expected to shave up to half a percentage point from growth in the fourth quarter. 
• In Manhattan, average asking rents are at record highs. Downtown Manhattan rents grew 28 percent in the quarter, to $213/ per square foot. 
• Fulton Street in downtown Brooklyn continues to lease with national tenants. 
• In New Jersey, landlords left with large spaces vacated by retailers like Borders and Filene's are finding creative solutions, like dividing space for gyms or re-positioning some space for medical or health uses. 
• Leasing activity continues to be driven by average size retailers opening shops in the 1,000 to 5,000 sf range. 
• A host of new retailers are entering the New Jersey market for the first time, including national and regional brands - Hobby Lobby, The Tile Shop, Harbor Freight, Fairway Market, Millers Ale House, Arhaus Furniture, Brio Restaurant, Dinosaur BBQ, Doctor Dental, Doctors Express, Lazzoni Furniture, Noodles & Company Restaurants, Pei Wei Restaurants, Quaker Steak & Lube. 

Professional Development Opportunities for Economic Development Professionals

Excited to share with my readers some upcoming training programs that I will be co-leading. If you are in the NYC or Philly markets, don't miss these great opportunities to gain new skills, expose yourself to best practices, and network with a fantastic group of colleagues. 

COURSE: NEIGHBORHOOD DEVELOPMENT STRATEGIES

International Economic Development Council Date: January 17 - 18, 2013 Location: Sheraton, Brooklyn This practitioner-driven course uses the case study method to complement current neighborhood development theory. Participants will learn how to identify the major neighborhood actors, their objectives, and strategies for redevelopment, in addition to understanding the process for creating a strategic economic development plan to meet the neighborhood development goals. Specifically, this course will examine social capital (e.g., linkages, networks, talent, etc.), environmental capital (e.g., stewardship, residual management, etc.) and economic capital (e.g., investment and reinvestment) facing distressed neighborhoods and offer solutions to address local needs. Applicants will be eligible to receive 16 APA CM credits. Course Highlights: Asset creation, wealth creation, and enterprise development & expansion Housing development, real estate speculation, and tax-base stabilization Public and private sector role in combating inner city unemployment Examining historical and current neighborhood trends Performing leakage assessments and gap analyses Aligning strategic plans for multiple neighborhood groups Understanding the underserved needs for banking and grocery Working with media to share success stories Registration Links:  For more information and to register, click here.  Course Instructors: Larisa Ortiz, President, Larisa Ortiz Associates Colvin W. Grannum, President, Bedford Stuyvesant Restoration Corporation (Restoration) Kevin McQueen, Managing Director, Community Development Finance Project, Milano School of International Affairs, Management and Urban Policy, The New School for Public Engagement Ms. Diane Lupke, CEcD, President, Lupke & Associates COURSE: IDENTIFYING AND ATTRACTING RETAILERS AND DEVELOPERS (for economic development professionals) International Council of Shopping Centers  University of Shopping Centers Dates: Wednesday, March 6 Location: Wharton School, University of Pennsylvania, Philadelphia, PA What does it take to get your community on a retailer's radar? In this session you'll learn what retailers want to see in terms of a full market analysis of the retail area, how to assess the needs and desires of retailers and how to approach them, what consumer demographics should be highlighted, and what incentives and subsidies are likely to sweeten the deal and get them to sign on.  Course Highlights:   What it takes to get "retail ready"-what kinds of amenities help make your community more attractive, such as parking, lighting, highway and road access, and retail competition Case studies of successful municipal retail attraction programs and development projects that have sparked investment at both the downtown and neighborhood levels and walk participants through exercises that will help participants immediately begin applying lessons learned  Course Instructors  Lawrence E. Kilduff, CDP, CSM, ICSC Distinguished Service Award Recipient, President, The Kilduff Company, Saukville, WI Larisa Ortiz, Principal, Larisa Ortiz Associates, Jackson Heights, NY   Registration Links Click here for more information and to register.