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August 2017 — Retail Properties Quarterly — Page 25
year retail growth of 2.6 percent,
Greeley has seen growth of 3 percent
and Grand Junction has seen growth
of 2.7 percent.
So is Colorado immune to the prob-
lems hitting the retail sector? Not
really. Already in 2017, Fort Collins
saw the closing of at least one Safe-
way, and Boulder saw the closing of a
Whole Foods. Over the last two years,
Colorado Springs saw the closings of
122,630 square feet of retail stores,
including Sports Authority and Golf-
smith. The same two brands closed
stores in Denver along with Haggen,
Kmart and Neighborhood Walmart
stores. Altogether, Denver has seen
440,100 sf of store closings of major
brands.
If these metros are seeing store
closures and yet little to no change
in vacancy rate along with positive
employment growth, this suggests
that other retailers are leasing the
empty store space. This should not
come as a surprise when considering
how well the overall Colorado econ-
omy is doing. Year to date through
May, the state has added 18,800 jobs
in the seven main metropolitan areas
(Boulder, Colorado Springs, Denver,
Fort Collins, Greeley, Grand Junction
and Pueblo) that make up 89 percent
of the total state employment. This
rounds out to an annual growth rate
of 2 percent. Most of these added
jobs – 12,300 – were added in Denver.
Fort Collins added 2,500 jobs year to
date; Boulder added 1,400 jobs, Gree-
ley added 1,300 jobs, and the other
markets have added fewer than 1,000
jobs each. More jobs means more
demand for retail.
Still, although the economic news
is positive, many of the added
employees are young – the demo-
graphic that prefers to shop online.
What can we expect given the cur-
rent state of the retail market?
One interesting analysis is mea-
suring retail employment per 1,000
residents. We calculated this mea-
sure for all 82 metros that we track,
and we found that the U.S. metro
average ratio of retail employees per
1,000 residents was 50. How do the
Colorado markets compare? For the
four counties in the Denver area, the
measure averaged 47, healthier than
the U.S. average. However, it was
above 50 in Arapahoe and Jefferson
counties.
In Boulder County, there are 53
retail employees per 1,000 residents,
46 in Colorado Springs (El Paso Coun-
ty), 54 in Grand Junction (Larimer
County), 34 in Greeley (Weld County)
and 46 in Pueblo County. Thus, most
counties in the state are not over-
retailed.
In sum, Colorado has not (nor will
it) escaped the overall structural shift
that the retail sector is undergo-
ing with its shakeout of some older
brands of retail stores. The good
news is that Colorado is surviving
the changes better than most states
across the U.S. mainly due to the fact
that the economy in Colorado is on
sound footing. The good news is that
developers are not building retail
space as they had in past expansions,
which will keep a cap on vacancy
rate increases. Still, vacancy rates
could increase in the next few quar-
ters as the full impact of store clo-
sures is expected to hit in the third
quarter, but the increase should not
be too alarming given how the mar-
ket has survived thus far this year.▲
Representatives:
Jake Hallauer, CCIM
970-305-8113
Chrisland Real Estate Companies
Phone: 970-663-3150
Ryan Schaefer
970-295-4819
54,000 VPD
PRIME HARD CORNER PAD SITE AT 2534 | JOHNSTOWN, CO
• Anchored by 250,000 SF SCHEELS store (opening 9/30/2017)
• Highest concentration of mixed-use construction activity in Northern Colorado
• 1.508± Acres (65,689 SF) For Ground Lease
• U.S. Highway 34 frontage at signalized intersection - 54,000± VPD
2534 - SCHEELS ANCHORED MIXED-USE CENTER
AVAILABLE
1.508± Acres
Opening
Sept. 2017
RETAIL -
Under
Construction
236 Apartment
units coming
2018
254 Units
N
State of Retail
at the center level. Although large
indoor regional malls and open-air
shopping destinations have long had
customer service programs, own-
ers and managers of neighborhood
retail centers and grocery-anchored
centers now are realizing the essen-
tial importance of experience.
We employ the Engage program,
which encourages the property man-
agement team members and third-
party vendors to become active in
the cultivation of great experiences
through eye-contact, noticing oppor-
tunities for interaction, greeting,
assisting, going above and beyond,
and developing exceptional experi-
ences.
• Engagement. Most shopping cen-
ter owners have shifted marketing
budgets away from traditional brand
advertising to experiential and
engagement marketing. The tradi-
tional summer concert series, tree
lightings and other staple events
now are surrounded by year-long
creative programming aimed at driv-
ing foot traffic, which used to be
generated by traditional anchors,
and it works. Staying at the forefront
of creating exceptional events that
engage the community and partner-
ships that leverage community rela-
tions will be vital to the successful
shopping center of the present and
future.
As shopping center management,
operations and marketing teams
prepare strategic plans for 2018, it’s
time to zero in on what truly makes
us different and leave simply exist-
ing so consumers can buy things
behind, there’s a new expert for
that.▲
McCoy
NewMark Merrill Cos.
Over 5,000 members of the Longmont community engaged in an American Ninja
Warrior style competition with the Wolfpack Ninjas at Village at the Peaks.