Wednesday, July 27, 2016

Emerging Ideas in Community Tourism Planning - Part 2

This is the second in a three-part series exploring ways communities are playing a greater role in planning and developing their tourism industries. Guest blogger Joe Bly is a former documentary producer and writer, going beyond film and television to tell stories of social and urban progress.

Before the drama of the Olympic games in Rio de Janeiro can begin on August 5th, and the Paralympics in September, another drama has to conclude:  preparing the city to host one of the biggest and highest profile events on the planet.  Of course, when selected in 2009, Rio was already a premier tourist destination, with tourism revenue representing 67% of the city’s GDP.  It hosted about 1 and a half million foreign tourists that year, a third of those for a single event, Carnival. 

But since then, Brazil has spent almost $12 billion upgrading nearly every level of infrastructure required to host the games.  That’s not just for specialized sports facilities and team dormitories.  The city has struggled to completely revamp its train and subway systems, water and waste management systems, and amid controversy, relocate entire residential neighborhoods.  This to host what is essentially a single, unique visitor attraction.  And every effort is stalked by questions of what is the ultimate benefit, and for whom. 

Here is where we can draw parallels and lessons for any location scaling up tourism capacity.  Even at the other end of the spectrum, a locale with little or no tourism infrastructure or resources, the issues of effective capacity building and community benefit remain the same.  So what does launching a tourism industry from scratch look like?

Community-Based Tourism

Community-based tourism (CBT) is a model in which often remote communities host visitors in the homes of residents and provide access to their unique attraction and cultural events.  The most familiar form is ecotourism.  2800 miles northwest of Rio, the Manaus region of the Amazon is home to numerous community-based ecotourism projects.  There is little tourism infrastructure deep in the jungle, but trekkers can homestay with local families, hire guides and riverboat excursions and buy local foods and handicrafts.  The cultural access is as unique an offering as the setting.  Most programs are planned and administered entirely by local residents with training and guidance provided by the government or NGOs.  The emphasis is on creating direct and sustainable economic benefit for local residents and enhancing their autonomy, while requiring little capital.  This approach to tourism is found in nearly every developing country in the world.
Yet CBT in this form is virtually nonexistent in the United States.  Could this approach be adapted to locales here that wish to develop a tourism industry where none existed before.  I found one rare example in a very small community that shares a communally held resource as exceptional as any Olympics – a cultural heritage of quilting. 

Tourist economy built by hand – Gee’s Bend, Alabama

In the heart of Alabama, there is a bow in the Alabama River wrapping around the area of Gee’s Bend so as to almost make it an island, nearly inaccessible, but for one road and a ferry.  It is a very rural home to about 200 mostly African American residents.  What puts it on the map is a long history of exquisite quilts made by generations of Gee’s Benders.  These quilts have hung in museums and art galleries, and have sold for as much as $20,000.  But Gee’s Bend had almost no ability to accommodate visitors interested in quilting and local heritage; there was little coordinated marketplace where quilts could be found, no eateries or overnight lodging, and no related cultural or historical programming.  Development grants from the Ford Foundation and tremendous assistance from groups like Sustainable Rural Regenerative Enterprises for Families (SURREF), and Auburn University, have allowed Gee’s Bend to decide collectively how to develop a community based tourism industry, physically and in expertise.

The Gee's Bend Quilt Mural Trail 

The highlights:

The Gee’s Bend town of Boykin already had a quilting collective established during the Civil Rights movement that met and worked in a community building.  This collective and building has been developed into the hub of quilt visiting, serving as a shop, museum, information center, and classroom.

An organized quilting trail and maps now help guide visitors through the area. Quilters offer overnight stays in their own homes. Staffing is local.  Marketing, sales, tours, visitor services, retail are all staffed by trained local residents.

The Gee’s Bend area now has a cafĂ©, renovated guest houses, a calendar of events, and is promoted regionally and statewide.  Through community-based planning and implementation, residents are able to capture more of the economic benefits, while preserving and promoting a unique heritage.  The takeaways could apply to any locale in the US starting from scratch, and maybe even Rio.  CBT emphasizes collective decisions about how a community exploits its communal resources, and as in Gee’s Bend, every development has to maximize benefit.  More than just raise tourism revenue, any effort or investment has to cultivate ability and entrepreneurship within the community, adding mutually supportive, interlocking pieces of capacity.  I can think of no better metaphor than a quilt.

The Gee's Bend Quilting Collective in Boykin, AL

It has never been easier for a community, lacking any accommodations, to market themselves and host visitors from anywhere within their own homes – now that Airbnb and short term rentals are almost instantly ubiquitous.  Yet we do not yet see widespread community-based tourism facilitated by Airbnb.  What’s missing - the coordination.  My next post asks ‘Is any locality or community coordinating short term rental as a tourism development strategy?’

Tuesday, July 19, 2016

Emerging Ideas in Community Tourism Planning

This is the first in a three-part series exploring ways communities are playing a greater role in planning and developing their tourism industries. Guest blogger Joe Bly is a former documentary producer and writer, going beyond film and television to tell stories of social and urban progress.
Community Tourism Planning in Hood River, Oregon, has benefited downtown through increased economic activity
As we are arriving at a tourism or vacation travel destination, what often goes by in a blur, at first, is the community that surrounds it.  Other times, unique neighborhoods themselves are the destination, and we’re alert to every nuance.
In either case, we eventually leave with lasting impressions, whether we realize it or not, that are rooted in the relationship between the attraction and the supporting community.  Did we feel welcomed as visitors?  Were the residents and the area benefitting broadly from tourism, or was all the business captured by a single attraction?  Did we feel exploited by a “tourist trap”, or did we go unnoticed, our getaway about being able to pretend for a little while that we lived there ourselves?  How do we feel about tourists in our own town?
Increasingly, attention is being paid to the relationship between the community and its tourism industry.  Community Tourism Planning is a planning approach that recognizes the contributions of the host community:

  • Local residents are the owners, operators, and workers of the tourism base.
  • Communities are the source of the culture or character that attracts visitors, the “flavor”.
  • More than ever, residents are literally the hosts, using Airbnb or other means of private short term rental to physically host visitors in their own homes.

Therefore, Community Tourism Planning, or Community Tourism Development, encourages greater input and determination from a community in the strategic planning of local and regional tourism, in order to:
  • Ensure that tourism plans are aligned with overall community values and goals. 
  • Create a collaborative partnership between residents, businesses, resources, and planning authorities.
  • Work with communities to balance the positive and negative effects of tourism
  • Ensure that the whole community is the ultimate beneficiary of sustainable tourism activity.

Municipal governments, visitors bureaus, and tourism development groups find that communities involved in planning remain active participants and are also supportive of initiatives, regulations, or changes to policy needed to pursue the collective mission.  As tourism becomes more diverse in its offerings, spread out geographically, and democratized by attractions and visitors interacting on social media, community tourism planning will be a way for planning authorities to continue to provide leadership and coordinate their goals.
The University of Minnesota Extension has created a community tourism development project that publishes resource material articulating guidance particularly well.
In many ways, the process is similar to other kinds of cultural or business development assessment and planning.  The quality of community engagement is the key factor to success.

Inventory – The Community Identifies its Tourism Assets

Hood River Fruit Loop Map
The Hood River Valley of Oregon has long been a center of apple, pear, and cherry farming.  It is also situated in the scenic Columbia River Gorge.  When the area’s agribusiness base began to fade in the 1990s, communities focused on what they felt were their two most valuable assets:  local food products and scenic environs.  From this inventory, Hood River County growers associations and state development grants created a wildly successful agritourism zone known as The Fruit Loop.  The Fruit Loop is now a 35 mile road route guiding visitors to farms, farm stands, and wineries of the Columbia River Gorge.  The Hood River Chamber of Commerce Visitor Council publishes maps and coordinates a calendar of events to bring tourists to harvest and blossom festivals year-round.  In 2014, approximately 125,000 visitors spent almost $88 million dollars in this rural county.  The Fruit Loop has become a model for inclusive and sustainable food tourism because its development is anchored in what the community believes it does best (
Mt. View's Fruit Stand, open each harvest season from July through November, is the not-so-hidden treasure of the Hood River County Fruit Loop 

Participants - Harness Community Initiative and Identity

Washington D.C.’s Neighborhood Heritage Trails are official walking tours of the District’s historic neighborhoods, illuminated with historical markers, signs, photographs, and audio tour guides.  Cultural Tourism DC is the nonprofit group that coordinates the funding and technical assistance to implement the tour routes – but the historic themes, research, and planning are articulated and conducted by the neighborhoods themselves.  Prospective communities submit proposals for routes and points of interest.  If selected by Cultural Tourism DC’s committee, they receive funding to organize and conduct their own historical research and receive guidance in assessing and developing the neighborhood’s capacity to support a permanent tour offering (transportation, available public restrooms, businesses on the route are informed and can answer questions).  Enticing visitors to explore, eat, and shop “beyond the monuments”, the tours become economic boons to neighborhoods further away from D.C.’s most iconic landmarks.  But the benefits also go beyond financial.  Supporting communities in their own heritage tourism development stimulates a conversation, taps the knowledge and memory of life-long residents, and fosters a sense of neighborhood identity.  The program now boasts 17 distinct heritage trails on historic themes from art history to civil rights (

Knowledge partner case studies of developing neighborhood cultural tourism include:
Future posts in this series will take a closer look at issues related to community tourism planning. 
Community Based Tourism:  CBT is a tourism development model that relies entirely on the host residents and resources where little or no tourism infrastructure or authority exists.  At the moment, this kind of thinking is applied to very poor or isolated communities possessing a unique attraction, like a village in Tanzania that hosts wildlife tours.  Couldn’t these same principles be applied to any locale here in the U.S. with a natural or cultural attraction, but few resources to develop them?
Airbnb as economic development plan:  Platforms that facilitate short term rental make any property owner a participant in their local tourism industry.  Municipal governments across the country are responding largely with regulations and restrictions on private short term rentals.  Is there a municipality doing the opposite – embracing, supporting, or even helping coordinate short term rental as part of economic and tourism development?
These and other stories from where the rubber meets the road, or the comfortable street shoe meets the walking tour. 
joe bly

Wednesday, July 13, 2016

Retailer Spotlight of the Month: 365 by Whole Foods

Whole Foods recently opened in Silver Lake, California the first of its smaller and budget-conscious new format stores: 365.

365 Store in Silver Lake, California

The new store format offers simple and clean design infused with many high-tech features to enhance offerings and streamline store operations (i.e. customers weigh their own produce to accelerate cashier transactions). At the center of the store is a section with prepared foods where customers can pick from the typical buffet but also order through an online kiosk and pick up at a window as well as an automated tea/coffee kiosk where customers can customize their own coffee and tea blends.  

The automated tea and coffee kiosk

The store main customer target are millennials, and the first store in Silver Lake includes a craft beer bar and vegan offerings from a local restaurant. However, its accessible layout and lower price point has also attracted an increasing number of seniors.

365 stores will generally measure 25,000 to 30,000 square feet, small compared with traditional Whole Foods locations, which average 38,000 and can go well beyond 50,000 square feet. They will also have roughly a quarter the number of products – reducing real estate and merchandise-related costs. Staffing is leaner and no longer specialized. An iPad app replaces wine experts, while meat, cheese and fish are in “grab-and-go” packages – meaning no butchers or cheese and fishmongers.

In addition to the first location, in Silver Lake, Calif., two more 365 stores are scheduled to open in 2016 (in Oregon and Washington), and 10 more are scheduled to open in 2017.  Stores will all have similar layout and design aesthetics, but for each, Whole Foods is planning to add local flavor through the addition of different local retailers. Still in the planning stages, Whole Foods says that shoppers may find bike shops, music stores, barber shops, pet supply retailers, or knife-sharpening services inside 365 stores.

For more info you can contact one of the company's regional offices. You can find their phone number and email here:

Wednesday, July 6, 2016

Want to know how to make quick friends in the retail industry, and maybe even keep rents reasonable at the same time?

Have you given much thought to what is arguably the most important metric in retail attraction - the sales volumes that retailers can realistically achieve in your district? This data is like the holy grail - everyone is looking for it but very few people know how to find it. Brokers need this information to attract retailers. Retailers need this information to understand what kinds of rent can be supported, and property owners need this information to know what kinds of rents are rooted in reality when setting rental rates. In the commercial real estate industry, the term used to describe and measure a retailer's sales is known as sales per square foot. This "apples to apples" metrics allows us compare and contrast sales figures between markets and retailers. To give you a point of reference, sales productivity in 2015 for non-anchor tenants in U.S. Malls was $474 psf annually. To put this in context, base rent to sales ratio varies from 4-30% depending on the type of business, but for most retailers, base rent should be no more than 5% to 10% of annual gross sales. Assuming a retailer making $474 psf is paying 10% of their sales to rent, their rent would come to $47.40 psf annually. 

Flagship environments are special
It is helpful to keep in mind that in some markets rent has very little to do with how profitable the actual location is. Retailers treat these locations as extensions of their brand, and they will pay what amounts to a marketing fee for what they consider critical brand recognition. For example, along 5th Avenue in New York, one of the world's most coveted retail address, the bag maker Coach recently signed a lease for $4,000 dollars a square foot. That is a big number - a REALLY big number. In fact, not a single publicly traded retailer, with the exception of Apple stores with an estimated $5,626 sales per square foot, sells enough of anything to pay rent levels that high. Not even Tiffany & Co., which is the second most profitable retailer at $2,974 per square foot. But I digress…most districts are not vying for retailers who can pay these kinds of rents. 
The Coach flagship store on 5th Avenue is paying $4,000/sf in rent.
Do you think the sales at this location can support that?
Image Source:
What kind of rent is reasonable?
So what kinds of rents are fair game, and how can you tell whether your landlords are asking rents that make sense and will allow a retailer to make a profit?

Let's consider Marshall’s on 125th Street in Harlem, NY. Reported annual sales are $33.9 million dollars spread over 57,000 square feet. This comes to $595/sf in sales. Assuming that Marshall’s is paying between 10% to 15% of sales on rent, their ideal rent would fall in the  $53 to $80 dollar range. When Harlem Center where Marshall's is currently located was signing initial leases in 2002, the landlord was asking between $80-100/sf for the ground floor. Marshall’s, located on an upper floor is undoubtedly paying less, putting the rent in the 10-15% ratio sweet spot.

So where do you find this information?
Well, the good news is that this information can be found for publicly traded companies. InfoUSA is the go to source for sales volume figures. Both ESRI and Claritas use InfoUSA for their business list data. However, private retailers are not obligated to share this information. For most of the districts we work in that means there is no sales data of which to speak. Instead, what both ESRI and Claritas do is model estimated sales figures for these privately owned businesses based on sample business data for millions of other retailers. While is is generally OK, in some cases this ends up giving you clearly inaccurate information. For one high end apparel brand in a flagship district where rents have peaked at $1000/sf we were given an annual sales figure that hovered around $278/sf. Unbelievable and highly unlikely, especially when other similar retailers report selling up to $1,500/sf. But then the algorithm that ESRI uses did not take into account the unique characteristics of this store and its hyper luxury nature. They treated it like any other apparel store and spit out data that wasn’t commensurate with what we know and can determine from what we see.

Overcoming this information gap takes perseverance. It means asking businesses, brokers and property owners what kinds of annual sales their stores are doing. It means keeping a spreadsheet of this primary data alongside the SF of each store and maintaining calculations that keep you informed. This alone will make you and your organization an invaluable resource to your retail real estate partners.