CREJ - page 6

Page 6
— Retail Properties Quarterly — September 2015
T
here’s no denying it. Restau-
rants and breweries are pop-
ping up everywhere around
Denver. It seems that all you
hear about these days are the
new restaurants and breweries that are
dominating the Denver marketplace.
There are even websites solely dedi-
cated to tracking new restaurant open-
ings. However, these areas still need
traditional service retailers as comple-
mentary pieces to provide a necessary
tenant mix.
Although you may not read about it
in the news, traditional service retail-
ers are, for the most part, expanding
rapidly and boding quite well in the
marketplace. Retailers like AT&T,Wells
Fargo, Rite Aid and Supercuts are open-
ing several new locations throughout
the Denver metro area.This activity
goes largely unnoticed; it’s simply not
as fun as talking about the new restau-
rant down the street.When was the
last time you met your friends at the
neighborhood drug store to hang out
for the evening? Despite the fact that
their story is not being told, traditional
retailers provide essential benefits and
services for neighborhoods and shop-
ping centers that restaurants cannot.
There’s no doubt that trendy restau-
rants make good tenants and provide
value to neighborhoods and shop-
ping centers. Everyone loves a new
restaurant, and they are essential in
generating activity and bringing life
to an area. One example is Tennyson
Street in Denver Highlands. Over the
past 15 years, this neighborhood blos-
somed into a restaurant mecca and a
desirable place to live.The restaurant
scene and the skyrocketing housing
prices go hand-in-hand; restaurants
create a sense of
place and can help
develop a neigh-
borhood’s identity
while attracting new
homeowners to the
area. Because of all
this good publicity
from restaurants,
it’s no wonder why
landlords, shopping
center owners, gov-
ernment officials
and the average
consumer want
more of them.
Despite all of the activity and excite-
ment restaurants generate, they tend
to be a higher-risk tenant. Restaurants
cannot provide the stable financials
that some traditional retailers can. Res-
taurants also require significantly more
parking, impacting adjacent retailers
and, ultimately, the surrounding neigh-
borhood.Take a look at DenverWest
Shopping Center, which largely is dom-
inated by restaurants. Parking has been
a challenge since the project opened,
and consumers may opt to go down
the street to avoid it all together solely
because of the parking situation.
Enter traditional retail.Traditional
retailers can lower the risk financially
and alleviate the demand for parking.
These retailers often are an after-
thought for consumers until they find
themselves driving further than they
want to for simple conveniences.Who
wants to sit in traffic to go to the bank,
buy dog food or get a manicure? The
Denver metro area and Colorado are
booming with growth – metro Denver
has seen the fastest-growing home
prices of large U.S. cities, according
to several reports.Traffic is becoming
more congested and the distance peo-
ple are willing to travel is decreasing,
which is especially true for millennials,
the key demographic group for almost
all retailers in the area.This warrants
a need for convenient service retailers
in neighborhoods. At the end of the
day, people need and expect services at
their fingertips, even though the idea
of this is less attractive than a trendy
new restaurant.
So what is the best mix for a neigh-
borhood? As we saw withTennyson
Denver Metro Update
Rhonda Coy
Partner, Crosbie
Real Estate Group,
Denver
Photos courtesy: Crosbie
Restaurants trigger shopping center activity and traditional retailers fill the gaps.
Neighborhoods require restaurants and convenient service retailers.
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