Making Downtown Retail Work

By Dees Stribling
Globe St. Retail
March 2, 2005

GRAND RAPIDS, MI-Attracting retailers to suburban and small-town CBDs is both a matter of keeping focused on the details as well as the big picture, according to panelists at the third annual International Council of Shopping Centers West Michigan Alliance meeting on Tuesday.

“A lot of communities focus on the multimillion-dollar developments, but you also have to take care of the dead flies in your merchants’ windows,” said Bryan Crough, executive director of the Traverse City (MI) Downtown Development Authority. “If you’re the kind of place that doesn’t worry about the dead flies, then you probably won’t get the multimillion-dollar developments either.”

The panelists spoke in front of a packed auditorium at the Pew Campus of Grand Valley State University in downtown Grand Rapids. Bob Trezise Jr., managing director of the Michigan Economic Development Corp.’s Community Assistance Team, moderated the panel, which also included John Heiney, executive director of the Birmingham (MI) Principal Shopping District, and Kevin Shaw, VP of real estate for the Coffee Beanery, a Flint, MI-based chain of coffee houses.

“In economic development, retail sometimes takes a back seat to attracting industrial or other jobs, and there’s the perception that retail involves only low-paying jobs,” Trezise began. “There’s also the perception that retail is a wild animal—amazing but unpredictable, and that might make the public sector step back a little. Yet retail is the lifeblood of the economy. Should we in the public sector pay more attention to it?”

The panelists clear answer was yes. “There was a tendency to chase industrial jobs, but that model is changing,” said Crough. “The new model is to create a wonderful place, and then the jobs will come. But a community has to know what it wants.”

Traverse City is generally acknowledged as a downtown development success. Currently, according to Crough, there are no vacancies in the city’s downtown, despite growth in retail square footage there in the last decade and a half; in fact, there’s a waiting list of retailers who want in. “In 1990, we began a retail market analysis, and it told us that we could grow apparel, food to take home, restaurants, and home furnishings, so we concentrated on attracting these kinds of merchants.”

Those merchants in turn have proven successful because, he said, “successful merchants were recruited. You need to know who the brilliant ones are, and work with them. Also, you need to make downtown a place that locals love. Tourists are gravy.”

Heisey, whose bailiwick is a thriving downtown in suburban Detroit, agreed that working with the right merchants is key. “You need a quality of retail that helps create a quality of life,” he noted. “People will want to live in your community if you’re able to do that.”

He stressed that his role in encouraging retailers to locate in Birmingham was partly one of information gathering and dissemination. “We need to know who’s interested in coming here, and build relationships with them.” Among other things, his office publishes—both on paper and on line, new every two weeks—information for the local retail brokerage community regarding the particulars of space available in downtown Birmingham.

Shaw, who represented the private sector perspective on the panel, said that the single most helpful action a municipality could take to encourage franchise operations would be to put them in contact with potential franchisees. “Community leaders contact us, and I say to them, ‘I need a franchisee!’ In many cases, local business leaders know best who potential franchisees might be, people who wouldn’t necessarily seek a franchise opportunity out on their own.”

According to Shaw, Coffee Beanery is currently looking for non-mall locations, and in some places has located in suburban downtowns. “All together we have about 180 stores now,” he said, “with 150 in mall locations. To grow, we have to look more closely at suburban downtowns.”

He did note, however, that not all suburban downtowns are right for his kind of coffee shop, which in its larger version (1,400 sf) serves light foods, and also has a coffee-and-pastry version (800 to 900 sf). “We need a certain level of activity, especially on the weekends,” he said. “Nine-to-five Monday to Friday might be great, but in some places the weekend would be dead—but you’d still have to pay your rent and other operating costs on Saturday and Sunday.