January 26, 2018
By Dennis Kaiser
Connect Retail West brought together more than 300 commercial real estate leaders for an information-packed conference at the Hurley Surf Club’s new retail experience at Pacific City in Huntington Beach, CA. The immersive afternoon overlooking the Pacific Ocean included three one-on-one conversations with top brands, two panel discussions and a retail trends keynote.
Innovators in the retail space shared what’s drawing today’s consumers into spaces, how they are shaking up norms, and staying ahead of the curve. Connect Media will be sharing more in-depth reports over the coming days, but here’s a few key takeaways that stand out from yesterday’s conversations:
A keynote: Predicting the Future of Retail with JLL’s James Cook explored how human needs will define the future of retail, as time, touch and money drive decisions about what to buy.
Food, Fitness, Fashion: What’s Driving Experiential Retail and Impacting the Street Level
Intriguing one on one conversations with leading brands delved into what works, what consumers want, and how to create spaces that innovate, create community and change the way people think.
Hurley North America’s Jeff Hurley (pictured above on left) shared how the surf retailers’ model of wholesale-based sales led to the creation of an experiential space that serves as a way to connect with the surf community, and for customers to see what the brand stands for and believes in. The Hurley Surf Club space, where Connect Retail West was held, allows customers to get surf coaching, screen print a t-shirt or order a custom-fitted wet suit.
Equinox’s John Klein revealed how something as simple as knowing a customers name makes them feel good and return.
Pacific City’s developer, DJM Capital Partners’ Stenn Parton (pictured above on right) and Retail Design Collaborative’s David Sheldon explored the ways retail experiences are created today. That likely will involve ensuring relevancy by embracing community and separating the experience through customer service and technology. Parton believes for lifestyle retail centers to succeed they must fully embrace experiences, otherwise they will “get passed over.”
Pendry Hotels’ Azadeh Hawkins, which also operates the Montage brand, shared how the hotelier differentiates itself through service that’s aligned with customer expectations. By anticipating what guests want before they arrive, they build brand loyalty by “always delivering from the heart because it feels real.”
Neighborhood Centers: Finding Success in the Every Day
Panelists agreed, some retail will never go away, since people will always need to be able to run to the store or the dentist for the conveniences of everyday life. Coreland Companies’ Matthew Hammond noted the 2017 holiday season was “one of the best” experienced, and says that the fact that 4,000 new stores opened in 2017 reflects just how resilient the retail sector really is.
Irvine Company’s Peter Moersch shared the advantage delivered by its integrated model encompassing retail, office, and a mix of multifamily and housing components. That allows the company to create live, work, and shop environments that truly engage a neighborhood by addressing what a community needs.
Newmark Merrill’s Susan Rorison says technology has allowed the owner of neighborhood centers to mine data of customers who check in on Social Media. That information helps inform and guide its decisions to better serve customers and the overall community.
Investment Trends: What’s Driving the Deals?
Marcus & Millichap’s Bill Rose says the West Coast is a bit tighter from an investment perspective, while the Midwest is more open, and on the East Coast, properties are getting 5% caps and no one is balking because they know it is quality real estate and well-located. He notes, retail “always functions at the crossroads of population and income.”
CBRE’s Philip Voorhees believes the negativity clouding the retail space in 2017 will dissipate and 2018 will be viewed more positively. He notes the collaborative approach that surfaced in the 2017 holiday season between brick-n-mortar retail and the Internet will extend into the year.
Passco’s Alan Clifton notes, markets once considered “taboo,” such as the Southeast, are in the investment mix today. That’s mainly because of the growth being experienced in markets like Savannah and its Port. They provide investors with the yield they’re seeking, yet it is still “quality real estate.”
For comments, questions or concerns, please contact Dennis Kaiser