LAS VEGAS—Welcome to ICSC's RECon event here in Las Vegas! If you are one of the 40,000 or so individuals here, you might have attended last night's opening reception (as we did) at Encore XS Nightclub.
And to prepare for the event, we got a few retail thoughts from some of the experts in attendance.
Tony Cho, founder and CEO of Metro 1, tells us that his main purpose to attending the event this year is to meet the pioneers of the new retail market and to discuss how to work together to engage emerging consumers and millennials. “I want to collaborate with like-minded entrepreneurs, start-ups and business owners who share in the vision I see for the urban core of Miami as well as urban cores across the country.”
Ralph Ireland, vice president of Tavistock Development Co., tells GlobeSt.com that his company is showcasing the expansion of its Lake Nona Town Center, a million-square-foot-plus mixed-use development in Orlando and is expecting that there will be a lot of interest. He also says that the company will be unveiling a large-scale model of the Lake Nona Town Center.
As for trends he is seeing? Ireland says that “restaurant and entertainment uses continue to be significant drivers in the mixed-use retail environment.” He notes that he is taking this a step further and placing emphasis on other uses as well. “Our next phase, for example, will include over 350,000 square feet of additional office and 200 hotel keys.”
He adds that “Innovation in design, integration of uses, wellness and sustainability, plus connectivity, is critical to the success of retail.”
In the next few days, David Blatt, CEO of CapStack Partners, expects the sentiment to be generally positive in line with the real estate industry as a whole. The CEO of the boutique investment bank tells GlobeSt.com that retail landlords have dealt with retailers going dark before and have successfully navigated this phenomenon. “The retail industry is dynamic, and experienced property owners are able to evolve as trends shift.”
GlobeSt.com was also in attendance last night at Marcus & Millichap's client party at the Wynn's Intrigue nightclub. And in a recent retail roundtable with GlobeSt.com sister publication, ALM's Real Estate Forum, San Diego-based Bill Rose, first VP and national director of Marcus & Millichap's national retail group, net leased properties group and the retail division of the firm's Institutional Property Advisors platform, said that grocery, amongst all other retailers, is experiencing the greatest number of growth.
Rose explains that Aldi, Lidl, Kroger, Sprouts, Whole Foods, Walmart Neighborhood Market and more are all opening many new stores, “trying to tap into markets they have yet pursued.”
He adds that the Internet has not yet impacted them “simply because you can easily convert to an Internet provider and deliver groceries onsite just as AmazonFresh is trying to do, but they're way, way ahead of Amazon on that end.”
The fast food restaurants, Subway, Five Guys, KFC, Pizza Hut, Chick-fil-A, he added, all have revealed a number of new openings. And discount retailers such as Dollar Tree, Family Dollar, he explained, have been announcing consistently each year some 500 to 600 new store openings. “We do see a lot of growth in some of those stores that are not impacted as much by the internet, i.e., hard goods, electronics, apparel, footwear, accessories.”
Also in that roundtable discussion, John McNellis, co-founder of Palo Alto-based McNellis Partners, said that he doesn't think the Internet is ever going to really have a significant effect on grocery markets.
“We've had home delivery since the day of the first grocery market. It's always been around. It's never been profitable. It's not profitable today,” he explained. Amazon is in effect waving the white flag on this issue. They are now opening their little Amazon markets. At Amazon's new market, you, the consumer, have to pick up your groceries yourself during a given window and then have essentially no choice on grocery items–the stores are only 10,000 feet and have only one kind of Oreo instead of the 54 that you can get at the regular market. Most folks are going to continue going to Safeway or Whole Foods.”
What's concerning the markets today is the deflation, McNellis continued. “Virtually commodity is selling for less today than it did a couple years ago and as a result, it's hitting the grocers' bottom lines. They're selling the same volume, the same number of pounds of beef and rice and so on, but with lower prices, their margins are lower.”
He adds that “all the supermarket chains are suffering right now from these deflationary trends. And, as a result, they're being very aggressive on the rent numbers. It's not an easy time to be a developer of a neighborhood supermarket center.”
Hear more from experts in the next few days as we fully cover the RECon event, with thoughts not only from attendees and panelists, but coverage of sessions, parties and more.
LAS VEGAS—Welcome to ICSC's RECon event here in Las Vegas! If you are one of the 40,000 or so individuals here, you might have attended last night's opening reception (as we did) at Encore XS Nightclub.
And to prepare for the event, we got a few retail thoughts from some of the experts in attendance.
Tony Cho, founder and CEO of Metro 1, tells us that his main purpose to attending the event this year is to meet the pioneers of the new retail market and to discuss how to work together to engage emerging consumers and millennials. “I want to collaborate with like-minded entrepreneurs, start-ups and business owners who share in the vision I see for the urban core of Miami as well as urban cores across the country.”
Ralph Ireland, vice president of Tavistock Development Co., tells GlobeSt.com that his company is showcasing the expansion of its Lake Nona Town Center, a million-square-foot-plus mixed-use development in Orlando and is expecting that there will be a lot of interest. He also says that the company will be unveiling a large-scale model of the Lake Nona Town Center.
As for trends he is seeing? Ireland says that “restaurant and entertainment uses continue to be significant drivers in the mixed-use retail environment.” He notes that he is taking this a step further and placing emphasis on other uses as well. “Our next phase, for example, will include over 350,000 square feet of additional office and 200 hotel keys.”
He adds that “Innovation in design, integration of uses, wellness and sustainability, plus connectivity, is critical to the success of retail.”
In the next few days, David Blatt, CEO of CapStack Partners, expects the sentiment to be generally positive in line with the real estate industry as a whole. The CEO of the boutique investment bank tells GlobeSt.com that retail landlords have dealt with retailers going dark before and have successfully navigated this phenomenon. “The retail industry is dynamic, and experienced property owners are able to evolve as trends shift.”
GlobeSt.com was also in attendance last night at Marcus & Millichap's client party at the Wynn's Intrigue nightclub. And in a recent retail roundtable with GlobeSt.com sister publication, ALM's Real Estate Forum, San Diego-based Bill Rose, first VP and national director of Marcus & Millichap's national retail group, net leased properties group and the retail division of the firm's Institutional Property Advisors platform, said that grocery, amongst all other retailers, is experiencing the greatest number of growth.
Rose explains that Aldi, Lidl,
He adds that the Internet has not yet impacted them “simply because you can easily convert to an Internet provider and deliver groceries onsite just as AmazonFresh is trying to do, but they're way, way ahead of Amazon on that end.”
The fast food restaurants, Subway, Five Guys, KFC, Pizza Hut, Chick-fil-A, he added, all have revealed a number of new openings. And discount retailers such as Dollar Tree,
Also in that roundtable discussion, John McNellis, co-founder of Palo Alto-based McNellis Partners, said that he doesn't think the Internet is ever going to really have a significant effect on grocery markets.
“We've had home delivery since the day of the first grocery market. It's always been around. It's never been profitable. It's not profitable today,” he explained. Amazon is in effect waving the white flag on this issue. They are now opening their little Amazon markets. At Amazon's new market, you, the consumer, have to pick up your groceries yourself during a given window and then have essentially no choice on grocery items–the stores are only 10,000 feet and have only one kind of Oreo instead of the 54 that you can get at the regular market. Most folks are going to continue going to Safeway or Whole Foods.”
What's concerning the markets today is the deflation, McNellis continued. “Virtually commodity is selling for less today than it did a couple years ago and as a result, it's hitting the grocers' bottom lines. They're selling the same volume, the same number of pounds of beef and rice and so on, but with lower prices, their margins are lower.”
He adds that “all the supermarket chains are suffering right now from these deflationary trends. And, as a result, they're being very aggressive on the rent numbers. It's not an easy time to be a developer of a neighborhood supermarket center.”
Hear more from experts in the next few days as we fully cover the RECon event, with thoughts not only from attendees and panelists, but coverage of sessions, parties and more.
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