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Retail magnet: Birmingham to use data to pull in national, regional stores

Birmingham — home to a 96 percent retail occupancy rate and 60 salons — has hired a new consultant to target specific regional and national retailers to help create the right downtown mix. And luring more restaurants isn’t a priority.

The city’s Birmingham Shopping District employed Bloomfield Township-based CC Consulting starting March 7 to recruit prospective tenants, shopping district Executive Director Ingrid Tighe said. Shops that sell clothing, shoes or other goods are in the sights.

The retail recruiter approach isn’t new. Birmingham, with a walkable downtown centered along Old Woodward Avenue, has employed them for around nine years. But now the city is using a more “tailored” approach, City Manager Joe Valentine said.

The shopping district and CC Consulting are using data collected by Fort Worth-based Buxton Co. that identified market segments, target audiences and specific prospective retailers that would complement the Oakland County city’s existing mix. CC Consulting is on a yearlong contract not to exceed $25,000. Built into the contract, the consultant gets paid extra as more deals close and for signing high-priority retailers, Tighe said.

In a separate, ongoing project, Oakland County hired CC Consulting in late summer for its first large-scale retail attraction effort, focusing on drawing destination retail to downtowns and historic corridors. Birmingham got an OK from the county before hiring the same consultant, Tighe said.

When asked about potential overlap, CC Consulting principal Cindy Ciura said there’s “such different demographics and different vibes to the cities I’m focusing on that that doesn’t happen … the majority of folks I’m reaching out to for retail have very specific needs and wants and they’re not overlapping.”

The list of regional and national companies Birmingham is targeting is covered by a nondisclosure agreement, according to Tighe. But she said they’re aiming for women’s and men’s clothing, children’s stores, shoes and other buyable goods. Ciura added that she would “love to grab the top online concepts that are looking for brick-and-mortar.”

The city is in current discussions with a women’s accessories brand and outdoors retailer.

“I think it’s really important to have strong anchor stores that are nationally or internationally known, like (womenswear chain) Anthropologie (at 214 W. Maple Road in Birmingham). … Traffic will be driven to the national brands,” said Vicki Blazier, a longtime Michigan resident whose new business Willow and Fernn Boutique opens Saturday on North Old Woodward Avenue. “But you also have to have that sprinkling of mom and pop shops.”

The shopping district networks with Michigan entrepreneurs, too, Tighe said. But that effort is separate from this consultant-fueled push. Regional and national brands make up 20 percent of retailers in the district.  There are 26,214 households within a 10-minute drive of downtown Birmingham with a median household income of $88,559, according to Buxton’s data collected for the city, one of the region’s most affluent.  Shoppers “just want high-quality, beautiful apparel,” Tighe said. “I think people are not looking necessarily for expensive. They’re looking for high quality.”

96 percent full

Birmingham isn’t exactly hurting for retail: Both Tighe and Valentine said they weren’t worried about empty windows.

The area covered by the Birmingham Shopping District — funded through an assessment on commercial space — has 260 storefronts currently in operation: 115 retailers, 55 restaurants and 90 service providers (including the aforementioned salons), according to Tighe. The shopping district calculates occupancy rate by square footage; by that metric, it’s at 96 percent.

But there’s still turnover. And of the 26 vacant spots, just three are designated as target spaces for restaurants. The shopping district board decided not to focus on recruiting restaurants — the city is well-known for its plethora of upscale and fast-casual options.

Rental rates per square foot in the Birmingham area averaged $29 at the end of 2018, according to CoStar Group Inc. Tighe said that can vary from $35-$40s in the downtown center at Maple Road and Old Woodward to around $25 at the edges of the shopping district. The city is on the “higher end” for rents, Ciura said, along with Rochester.

“We are in a strong position right now … we have 96 percent (retail, restaurant and service store) occupancy,” Tighe said. “But our attitude is we want to continue to be proactive … There’s a lot of competition from other communities around us.”

Valentine echoed Tighe’s sentiment on needing to showcase Birmingham’s individuality among trendy downtowns. He said they’ve seen shoppers leave Birmingham for other cities’ downtowns, but they’ve also seen the opposite, as some argue urban centers are winning out over traditional malls.  Building mixed-use developments adds to that desirability, Valentine said. More than a half-dozen projects totaling more than $250 million are either under construction or in serious planning phases, including a new luxury hotel and upscale retail, Crain’s reported in November.

 

Posted By: Crain’s Detroit Business on March 13, 2019.  For more information, please click here to read the source article.

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