CREJ - page 10

Page 10
— Retail Properties Quarterly — September 2015
R
eal estate opportunity, like
any other market-driven
discipline, goes through
cycles. For years the rolling
green open fields and subur-
ban parcels just waiting for an idea
were plentiful. New homes were
in demand with affordable financ-
ing and there was
an aggressive and
expanding stable
of national retail-
ers who followed
the housing and
filled retail devel-
opments. New
development was
build-to-suit and
retailers and res-
taurateurs would
knock out cookie-
cutter designs and
stores aimed at
keeping costs low
and operations as much the same as
possible.
Today’s real estate realities are
higher costs for all aspects of devel-
opment and construction, challeng-
ing financing and fewer retailers
to help populate new centers. It is
becoming more difficult to find clean
opportunity locations and, once
developed, to price it affordably. In
addition, the suburbs, traditional
hotbeds of development, are becom-
ing harder to be positioned where
and how people want to live. While
open-space development continues
in the outer edges of the metro area,
developers, retailers and restaura-
teurs are looking to older and pre-
viously underdeveloped neighbor-
hoods and cities as the location for
their next great idea or concept.
Enter urban and transit-oriented
development. As connectivity and
lifestyle choices become real deci-
sion points for today’s customer,
finding locations within the older
parts of the market is good business.
An urban infill project requires cre-
ativity and vision by all parties in a
development – developer, investor,
tenant, retailer and, in many cases,
the cities where the opportunities
lie. The most successful projects in
recent years have had a distinctive
urban flair to them – Lower Down-
town, Union Station, Highlands,
Stapleton and Lowry are examples
of crown jewels of development in
recent years. Newer projects like
River North and northwest Aurora’s
Westerly Creek area are poised to
offer developers and entrepreneurs
alike wonderful opportunities to cre-
ate livable, creative and profitable
projects.
The proliferation and success of
the light-rail system has opened up
new development possibilities in
many communities. In Aurora alone,
there are nine light-rail stations, all
with development opportunities for
residential, office or retail. Unlike
other urban infill projects, TODs offer
the retailers and developers new and
well-positioned space in established
neighborhoods. Because most of the
neighborhoods already are located
close to the core of downtown and
offer housing that has character and
mature landscaping, this is attractive
to young professionals. TODs can be
new while still offering what’s best
about an existing neighborhood.
Since many of the new residents to
Colorado appear to be living near
and around downtown, TODs meet
the needs for urban living, transpor-
tation and connectivity without hav-
ing to go to the suburbs to find an
interesting place to live.
For retailers and restauranteurs,
urban infill locations provide unique
challenges. While the suburbs offer
uniformity and space, infills and
retrofits tend to have irregular space,
parking issues and infrastructure
expenses needed to bring the best
locations to code. In the past, that
was not worth the hassle, but urban
neighborhood demographics are
changing and as the lack of quality
suburban locations become scarce,
many retailers are embracing the
challenges of urban locations, flexing
their design and operational muscle,
and looking for their place in serving
these markets. Sprouts built its first
urban store in Colorado on Colfax,
and it is one of its top stores in the
country. Nearby, Chic-fil-A designed
a new urban prototype, and it is
performing strong in sales. These
successes, in part, spawned a mini
development phase in the surround-
ing area.
Cities also have to be willing to
work with developers and retailers
to help make infill projects work.
Aurora is proactively working with
large and small developers who are
interested in updating potential
locations for retail and residen-
tial development, especially in the
northwest neighborhoods. Incen-
tives for major tenants, concepts and
developments aimed at growing the
surrounding neighborhoods, increas-
ing housing density and increasing
sales tax revenue are part of the
support and focus of the city’s pro-
gram. An example of urban infill
development partnership is Stanley
Marketplace, slated to open spring
2016. Located in a refurbished avia-
tion factory, Stanley Marketplace
will host restaurants, including
the newest Kevin Taylor concept,
shops, services and entertainment
venues. Like its national counter-
parts, Chelsea Marketplace, The
Ferry Building and Gotham Market,
Stanley Marketplace will offer metro
customers a regional destination,
while servicing the nearby needs
of the Aurora, Stapleton, Anschutz
and Lowry neighborhoods. Since
its announcement, Stanley Market-
place has served as the conduit for
new residential, retail, restaurant
and innovation office development
activity in the Westerly Creek and
northwest Aurora area. Couple Stan-
ley Marketplace’s commercial infill
development with the facts that the
immediate surrounding area is one
of the most affordable housing mar-
kets in the metro area and is less
than 30 minutes from downtown,
and you have a recipe for potential
development success.
Urban infill is a trend that is
expected to drive much of the metro
area’s new and most interesting
development growth over the next
few years.
s
Development
Tim Gonerka
Retail specialist,
city of Aurora,
Aurora
Photo courtesy: Mile High Development
The Regatta Plaza TOD redevelopment sits at S. Parker Road and S. Peoria Street.
Photo courtesy: Flightline Development
The Stanley Marketplace is a refurbished aviation factory.
Photo courtesy: Flightline Development
The Stanley Marketplace will host restaurants, service shops and enetertainment venues.
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