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— Retail Properties Quarterly — November 2016

T

he redevelopment of two

regional malls, Costco’s long-

awaited opening and a highly

unique retailer’s search for a

Northern Colorado site have

made for some interesting story

lines over the past several years.

The continued evolution of retail

has been ever present in how these

projects have taken

shape and provides

clues as to what

to expect in the

future.

Before delving

into the aforemen-

tioned projects,

it is important to

recognize three

big picture trends,

which have shaped

post-recession

brick-and-mortar

retailing: the con-

tinued growth in

online shopping, sluggish growth in

wages and an increase in personal

savings.

In her June 8, 2016 Wall Street Jour-

nal article, Laura Stevens reported on

an annual survey by UPS and com-

Score Inc. that polled shoppers who

made at least two online purchases

in a three-month period (exclud-

ing groceries) about their shopping

behavior. Some of the key results of

this survey were:

• 2015 marked the first year that

shoppers made more purchases

online (51 percent) than in brick-and-

mortar stores.

• Shoppers reported that only 20

percent of their purchases were

made in a store the conventional

way, which meant going to a store,

browsing and buying there – down

from 22 percent a year ago.

• 42 percent chose to search and

buy entirely online.

The continued growth of online

shopping has had a dramatic impact.

This major behavioral trend coupled

with sluggish post-recessionary

wage growth is changing the face of

retail development. While job growth

and unemployment have improved

since the recession, wage growth,

which typically is linked with the

former, has not rebounded at the

same rate. Average wage growth the

past two years is 33 percent below

the long-term average from 1983 to

2015, according to Daly, Hobijn and

Pyle’s March 7, 2016, Economic Let-

ter posted by the Federal Reserve

Bank of San Francisco.

The third big picture trend that is

impacting retailers is the nearly 130

percent increase in the U.S. person-

al savings rate since 2007 – 2.5 to

5.8 percent. While few would argue

that such an increase in personal

savings is a bad thing, when cou-

pled with rises in online sales and

slower wage growth, rising employ-

ment and population growth have

not been enough to support historic

per capita retail store expansion

rates, particularly in fashion and

apparel.

These bigger picture trends have

created many ripple effects, includ-

ing:

Retail follows 3 trends in Northern Colorado

Ryan J.

Schaefer

CEO, Chrisland

Real Estate Cos.,

Fort Collins

Market Update

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P: 303 745 5800 | F: 303 745 5888

| www.colliers.com/denver

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CONTACT:

JAY LANDT 303 283 4569 jay.landt@colliers.com LISA VELA 303 283 4575 lisa.vela@colliers.com

CONTACT:

JAY LANDT 303 283 4569 jay.landt@colliers.com LISA VELA 303 283 4575 lisa.vela@colliers.com

CONTACT:

JAY LANDT 303 283 4569 jay.landt@colliers.com LISA VELA 303 283 4575 lisa.vela@colliers.com

CONTACT:

JAY LANDT 303 283 4569 jay.landt@colliers.com BRADY KINSEY 720 833 4618 brady.kinsey@colliers.com

This document has been prepared by Colliers International Denver for advertising purposes only. The

information contained herein has been obtained from sources we deem reliable. While we have no

reason to doubt its accuracy, no warranty or representation is made of the foregoing information.

Terms of sale or lease and availability are subject to change or withdrawal without notice.

FOR SALE OR GROUND LEASE

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Scheels All Sports Store, at Interstate 25 and U.S. 34 in Johnstown, is a 250,000-square-foot sporting goods store that is anticipated to

open in October 2017.