November 2014

Executive Summary

Retail Market Analysis and Business Attraction Strategy for Fulton Street in Fort Greene and Clinton Hill, , NY

Submitted to the Fulton Area Business (FAB) Alliance By Larisa Ortiz Associates

Contents Project Overview ...... 3! Corridor Analysis ...... 4! Project Area ...... 4! Neighborhood Accessibility ...... 5! Business Mix ...... 6! Block-by-Block Analysis ...... 7! Non-Retail Destinations ...... 9! Competitive Districts ...... 10! Trade Area Analysis ...... 11! Overview ...... 12! Residential Population ...... 12! Workforce ...... 13! Income ...... 14! Employment ...... 15! Age ...... 16! Educational Attainment ...... 16! Race and Ethnicity ...... 17! Tapestry Segmentation ...... 18! Strategic Positioning Matrix ...... 19! Real Estate Trends ...... 20! Retail Opportunity and Leasing Recommendations ...... 22! Retail Opportunities ...... 22! Prospecting: “Like” Districts ...... 25! Leasing Plan ...... 27 Conclusion……………………………………………………………………………………...…28

2 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Project Overview

In May of 2014, the Fulton Area Business (FAB) Alliance hired Larisa Ortiz Associates (LOA) to conduct a comprehensive market study and to design a marketing plan for retail attraction for the Fulton Street corridor, from Rockwell Place to Classon Avenue in Fort Greene and Clinton Hill, Brooklyn, NY. This study identifies the types of businesses that the district can support today and in the near future. This information allows the FAB Alliance to shape the retail mix in a way that will meet the needs of the community and build Fulton Street as a strong daytime and a nighttime destination for shopping and dining. This information will also be used to help exiting businesses understand market trends and where there are opportunities to grow their offerings and customer base.

The team’s process involved the following components:

• Review of existing data, studies and surveys • Analysis of market, demographic, and psychographic data • Review of local real estate and development plans • Physical conditions analysis • Block-by-block retail analysis • Opportunity site identification • Competitive district analysis • Like district analysis

Each of these inputs informed the retail categories that Fulton Street should target for their attraction efforts. The analysis informed the selection of a targeted list of retailers in the categories with customer profiles that matched those found in the two trade areas of Fulton Street. Retailers were identified and pre-qualified by price point, lifestyle segment, expansion plans, size of space, and presence in the market. Under a separate cover, the Client received detailed sheets on each retailer for the purposes of outreach to property owners, brokers and the retailers themselves.

The strategy for retail attraction positions the FAB Alliance at the center of a collaborative partnership with the local real estate community and more importantly, property owners, whose buy-in is essential to the success of this effort. A PowerPoint presentation highlighting key demographic indicators and consumer demand has been created for the Client to use as a tool for sharing their vision with prospective tenants, property owners and brokers. This presentation is designed to be updated by the Client with new information over time so it remains a useful communication and outreach tool.

The Client was also walked through the mechanics of ongoing attraction. The session included a marketing plan and templates intended to aid in prospect database management. These templates include letters to prospective tenants and property owners, templates for prospect research, sell sheets, scout cards, and vacancy lists. The objective is to fully equip the Client to use these tools and keep momentum going over time.

3 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Corridor Analysis Project Area

The project area consists of the entire length of the FAB Alliance District: both sides of Fulton Street with Rockwell Place as the western boundary and Classon Avenue as the eastern boundary. The district spans , Fort Greene and Clinton Hill, Brooklyn. By taking the broader context into account, our analysis considered trends not only in the district, but also in similar districts (Fig. 20), competing shopping districts (Fig. 7), and the borough as a whole.

Figure 1: FAB Alliance Context Map, Brooklyn, NY.

4 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Neighborhood Accessibility

The Fulton Street corridor is served by multiple subway and bus lines, as well as the Railroad and CitiBike stations. It is one of the easiest commercial corridors to access in Brooklyn, with access to Midtown and Lower in under 30 minutes.

Toward the west end of the district, the subway stations and lines that are in closest proximity to the corridor are the 2, 3, 4, 5, B, D, N, Q, R trains at Atlantic Avenue-Barclays Center, the G train at Fulton Street and the C train at Lafayette Avenue. The center and eastern end of the district are served by the A and C trains, which stop along the Fulton Street corridor, as well as the G train to the north, running along Lafayette Avenue. The to also stops just beyond the FAB district at the corner of Franklin Avenue and Fulton Street.

The district is also served by the and buses, running along Fulton Street to East and Ridgewood, respectively. To the north of the district the runs along DeKalb Avenue with service to downtown Brooklyn from Ridgewood.

There is regional access to the district via the LIRR and Brooklyn- Expressway (BQE). The LIRR has two stops near the district, at Atlantic Terminal near the west end and Nostrand Ave. to the east. Washington Avenue acts as a main thoroughfare, carring automobile traffic to and from the (BQE), which runs just north of Fulton Street. CitiBike has 5 stations along Fulton Street, within the FAB district and many more in the immediate surrounding areas.

Figure 2: Fulton Street Transit and Access Map 5 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Business Mix

Fulton Street’s tenants are a mix of independent and regional businesses. The corridor has a significant dining and nightlife niche with 70 places to eat and drink, numerous services (real estate, doctors’ offices, beauty and laundry services), and a mix of retail uses. The graph below shows the number of retail establishments in each category for each end of the district. The west end of the district has more comparison shopping (clothing, furniture, and other retail) than the east. Both areas have strong eating and drinking clusters.

Fulton Street Retail

Figure 3: Fulton Street Business Mix (SIC codes). Source: FAB Alliance. Larisa Ortiz Associates There is also a mix of services throughout the district (Fig. 4). Amusement and recreation business, which includes gyms and arts spaces, are concentrated to the west, while social services (day care, rehabilitation center) are more prevalent in the east. There are currently few banking institutions on the corridor, however as new commercial spaces become available, these types of businesses may appear, as they are often able to afford higher rents than other types of businesses.

Fulton Street Services

Figure 4: Fulton Street Services Mix (SIC codes). Source: FAB Alliance. Larisa Ortiz Associates

6 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Block-by-Block Analysis

The stretch of Fulton Street within the FAB Alliance district spans 1.2 miles. Retail frontage along the street is interrupted by residential uses from South Oxford Street to , creating two distinct retail districts within the full stretch of the corridor. Each of these districts has its own anchor tenants, transit offerings, and character, and as such, the two districts each pull their customers from differing areas.

Looking more deeply at the retail mix beyond just the physical separation between the businesses in the east and west, there are variations, or “retail micro-climates” along the corridor, as illustrated below.

Ashland(Pl.(–(Oxford(St.( Vanderbilt(Ave.(–(Washington(Ave • Regional)destination)for)arts)and)culture Washington(Ave.(:(Classon(Ave. • Convenience)shopping • Upscale)casual)dining)options • Neighborhood)destination) • Take=out)and)delivery) • Fast)casual)dining)options for)arts,)culture)and)dining • Restaurants • Local)boutiques)and)retailers • Fast)casual)dining)options • Neighborhood=serving)retail • Bars)and)nightlife • Bars)and)nightlife

Residential)

Figure 5: Fulton Street Retail Micro-Climates. The retail micro-climates along Fulton Street are driven by a variety of factors, including the size of spaces available, proximity to major transportation thoroughfares, and the existing anchors on the street. Additionally, retailers typically cluster by use, lifestyle and price. These clusters of similar retailers, or co-tenancies, allow people to cross-shop and compare goods, strengthening the district as a strong shopping environment. Understanding these dynamics is critical to steering the right retailers to the right spot along the street.

Examining the variations in the business mix is also the first step in determining trade area. Trade area is defined as a geographic area from which the majority (70% or more) of shoppers originate. The International Council of Shopping Centers (ICSC) has created a classification system for shopping districts and centers, which estimates trade area size based on tenant mix and other characteristics.

The west end of the corridor, with its arts and cultural institutions and cluster of restaurants and bars, has many of the characteristics that the retail industry considers a “Theme/Festival” shopping district. Theme/Festival districts are often regional destinations that provide leisure and entertainment offerings. Because it also has neighborhood-serving businesses that meet local

7 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

needs, it also falls into the “Community Center” category. Community Centers typically offer general merchandise and convenience goods, but have a wider range of apparel and other soft goods offerings than smaller, more convenience-oriented districts.

The eastern end of the district, with convenience offerings, services, and varied mix of merchandise is also a “Community Center”.

In urban environments, the trade area size is typically smaller than the ICSC classification system suggests due to density of neighborhood retail, competitive offerings, and tendency to rely on walking, public transit, and bicycling instead of cars. This is reflected in the table below.

Description #(Stores Type(of(Anchors Trade(Area( Size Community)Center General'merchandise'or' 15040'stores Discount'store,' 306'miles convenience0'oriented' supermarket,'drug,' (5025'min' offerings.'Range'of' specialty'discount' travel'time) apparel'and'other'soft' stores'(toys,'books,' goods.' home,'sporting' goods,'etc.) Theme/Festival Leisure,'tourist,'retail'and' N/A Entertainment,' 25075'miles service0oriented'offerings' Restaurants (up'to'2' with'entertainment'as'a' hours) unifying'theme.'Often' located'in'urban'areas.

Fulton(Street(West Neighborhood=serving) 101)stores Restaurants/bars,) 0=25)min) (West(of(S(Oxford) convenience)retail)(mix) • 65)retailers food)stores,) walk/15)min) • Community'Center of)price)points))and) • 36)services apparel,)beauty,) bike)ride) • Theme/Festival dining;)Destination) entertainment (primary) dining)and) entertainment Fulton(Street(East Neighborhood=serving) 100)stores Restaurants/bars, <15)min) (East(of(Vanderbilt) convenience)retail) • 58)retailers Food)stores,) walk • Community'Center (low=moderate)price) • 42)services convenience)stores,) points))and)dining;) beauty) community)services Table 1: ICSC Shopping Center Classifications and Fulton Street District Classification

8 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Non-Retail Destinations

The western portion of the FAB Alliance district runs through the BAM Cultural District, which is home to many of the borough’s arts and cultural destinations, including the BAM theaters, Theater for a New Audience, BRIC, and two centers for dance instruction and performance: Cumbe: Center for African and Diaspora Dance and the Mark Morris Dance Center. There are also numerous arts organizations housed in offices in the district. These institutions are draws for the local community as well as the borough and broader region. The presence of these institutions has played a role in shaping the retail mix. Because patrons are coming from all over the City to visit these institutions, the local businesses, particularly the restaurants and bars, are able to pull in more customers than just people who live close in proximity. With significant employee populations during the day and visitation by night, they also contribute to the corridor’s presence of both daytime and evening businesses.

While the eastern half of the corridor is not part of the Cultural District, the Pratt Sculpture Garden and the JACK arts center maintain the arts and culture identity of Fulton Street to the east. In addition to arts and cultural destinations there are 62 religious institutions within the Fulton Street trade area. These are also places where people gather for community events, group meetings and contribute to the weekend and evening visitation to the corridor.

Figure 6: Arts and Cultural Institutions in and around the FAB District.

9 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Competitive Districts

Fulton Street shares its customers with a number of other shopping districts and centers, as illustrated in the map below. The street faces significant competition from commercial corridors immediately to the west and south. There are fewer retail offerings to the east and north, which allows Fulton Street to pull customers from further out in those directions, as illustrated in the map below. In , Manhattan, with its breadth of destination retail, dining, services, and entertainment, is always a source of competition.

Figure 7: Fulton Street’s Competitive Districts This retail attraction effort serves to help the FAB Alliance position Fulton Street as an alternative to these districts, where possible, and to influence the retail mix so that the street is able to compete with these other retail centers and districts.

10 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Trade Area Analysis

While west Fulton Street’s destinations have a regional draw, the primary customer of the businesses located on Fulton Street is the local resident. (The secondary customer for this portion of the district is New York City residents who attend programs in the area, however examining this customer requires a different type of analysis and is not included in this scope). While the west end has destination businesses that could pull shoppers from nearby neighborhoods, it faces significant competition from other shopping districts located in close proximity (see Fig. 7).

For example, while it is easy for a resident of Cobble Hill to travel to Fulton Street, the neighborhood has its own local shopping districts on Smith Street and Court Street that provide similar offerings. Destination shopping and dining districts in Manhattan and nearby neighborhoods also limit the area from which people come to Fulton Street to shop.

For the eastern portion of the district, the primary trade area is also the local resident coming from close by.

These factors suggest a primary trade area for each sub-district that is roughly half a mile from each end of the sub-districts. Therefore, data was obtained for residents and businesses located within these two circles. The demographic analysis that follows is based on the residents living in these trade areas unless otherwise specified.

East(Fulton(Overview Residents:)49,431 Households:)23,220

West(Fulton(Overview Residents:)48,737 Households:)22,427

Figure 8: Fulton Street’s Trade Areas

11 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Overview

Fulton Street’s trade areas are experiencing significant growth in population and income, however, at present there is only slight variation between the east and west ends of the district. To put Fulton Street into context, the analysis begins by comparing the demographics of residents living within the trade areas to the borough of Brooklyn overall.

Characteristics West(Fulton East(Fulton Brooklyn Population)Density)(Sq.)Mi.) 42,662.5 42,085.8 36,103 Pop)Annual)Growth)Rate)(2013=2018) 1.41 .92 0.83 Median)Age 35.5 35.4 34.5 Med)HH)Income $59,569 $57,343 $42,291 Med)HH)Income)Annual)Growth)Rate) (2013=2018) 4.97% 4.19% 2.40% Educational)Attainment)(Pop.)25+) with)Bachelor’s)+) 56.5% 55.5% 29.3% Table 2: Key Demographics. Source: US Census via Esri Business Analyst 2013 Fulton Street is strong in many key areas that retailers consider when selecting a site. Compared to Brooklyn overall, each of the of the corridor’s trade areas have high residential density, strong projected population growth rates, high and growing household incomes, and highly educated residents.

Residential Population

The population within the west trade area is 48,737 and 49,431 in the east. Between 2013 and 2018, the population is projected to grow at a rate of 1.41% each year in the west and 0.92% in the east, which are both faster rates than the borough of Brooklyn as a whole. With significant new residential development in the pipeline, this increase could be even greater than projections suggest.

12 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Workforce

In addition to its residents, Fulton Street has a strong daytime population due to the number of people 54,437 36,773 employed in and around the trade areas. 54,437 people come into the trade areas to work (dark green arrow) and 36,773 residents leave the trade area to work elsewhere (light green arrow). The 1,545 people represented by the circle both live 1,545 and work within the trade area.

Borough) Hall Pratt)Institute MetroTech

St.)Joseph’s)College LIU

City)Point Brooklyn)Tech BAM)Campus)&)Theaters

80)Arts New)employment)center: Atlantic)Terminal 470(Vanderbilt( Opened:(2013 Atlantic)Center Tenants:( • City)Agencies)(NYCHA,)HRA) • Small)Tech)Firms Visitation:(5,000)employees)+) visitors)daily

Figure 9: Concentration of Employment and Major Employers. Source: US Census: On The Map and FAB Alliance.

The darkest blue in the middle of the concentric circles in the map (Fig. 9) represents the highest density of jobs per square mile, with the density decreasing as the blues get lighter. The map identifies specific employers and schools that add to the daytime population of the trade areas.

13 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Income

The median household income is $59,569 in the west and $57,343 in the east. The charts below show in more detail how this income is distributed across the spectrum.

West Fulton East Fulton 32.4% of households make over $100,000 annually 28% of households make over $100,000 annually

Figure 10: Household Income Comparison. Source: US Census via Esri Business Analyst 2013. While the median incomes are moderate, the incomes of specific households within the trade area vary significantly. 15.3% of households in the west trade area make less than $15,000, while 32.4% make over $100,000, with the remaining households distributed between the two (see Fig. 10 above). In the east 12.9% make under $15,000 and 28% make over $100,000. As new high- end residential developments are built in the area, it is likely that the number of higher-income households will increase in the coming years, particularly in the west. Because there is NYCHA public housing in each of the trade areas (Lafayette Gardens, with 880-units located within the east trade area and the Whitman and Ingersoll Houses 1,636 and 1,802 units, respectively in the west), which provides housing for low-income residents, it is likely that there will be a stable low- income population, even as the housing stock in the area rise.

With shoppers making both very high and very low incomes, developing a leasing plan for the district requires a thoughtful attempt to cater to a range of populations.

Figure 11 shows how household incomes are concentrated throughout the trade area and surrounding neighborhoods by Block Group. Colors change from blue to red as the median income rises in each block group. As reflected in the pie charts above, the west trade area has a density of high-income households, while the east has more moderate income households.

14 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

West(Fulton:( $59,569

East(Fulton:( $57,343

Figure 11: 2013 Median Household Income by Block Groups. Source: Esri Business Analyst 2013

Employment Employment by Occupation People living in the two trade areas are employed primarily in “White Collar” jobs (Management/Business, Professional, Sales, Administrative Support). A much smaller share of residents work in “Services” (Food service, hospitality, retail), and “Blue Collar” jobs (construction, transportation, repair).

Figure 12: Source: U.S. Census Bureau, Census 2010 Summary File 1. Esri forecasts for 2013.

15 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Age Population by Age

Looking at the age groups in the trade area is helpful to identify any clusters that might shape the retail mix. For example, a high concentration of children may point to an opportunity for toy stores or children’s clothing stores. Fulton Street’s customers are a wide range of ages, distributed similarly in the two trade areas. Roughly 17% of the population in each trade area is under 20 years old, suggesting that there may be an opportunity to attract retailers that cater to families with children. In both trade areas, the largest segment of the population (roughly 25%) falls into the 30-39 bracket, an age group that tends to spend more on shopping and dining than older and younger shoppers.

Figure 13: Population by Age. Source: US Census via Esri Business Analyst Educational Attainment 2013.

Educational attainment in the trade area is strong. Over 55% of residents in both trade areas have a Bachelor’s degree or higher, compared to 29.3% of Brooklyn residents overall. This is an important metric for many retailers. Trader Joe’s is one example of a retailer that seeks out “the educated consumer” in its site selection process.

(56.5% (55.5%

Graduate/Professional Degree Bachelor’s Degree Associate Degree Some College, No Degree High School Graduate 9th-12th Grade, No Diploma Less than 9th Grade

Figure 14: Educational Attainment (Population 25+). Source: US Census via Esri Business Analyst 2013.

16 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Race and Ethnicity

The populations living within the trade areas are a mix of races and ethnicities. 17% of residents are of Hispanic Origin in the west, compared to 11.5% in the east. The chart below shows the breakdown of race within the trade area.

West Fulton East Fulton

17% of residents are of Hispanic origin 11.5% of residents are of Hispanic origin

Figure 15: Race and Ethnicity in the Trade Areas. Source: US Census via Esri Business Analyst 2013.

17 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Tapestry Segmentation

Esri Business Analyst, a leading provider of mapping, retail and market data, has created a psychographic categorization system called Tapestry Segmentation, which divides residential areas into segments based on socioeconomic and demographic characteristics. This analysis paints a more vivid picture of who is living in the trade area and what their habits and preferences are, and is a tool frequently used by retailers to quickly understand a community. There are 65 unique segments in total. The majority of residents in the Trade Area fall into the Trendsetters category (48.5% in the west; 56.3% in the east), followed by Laptops and Lattes (23.4% in the west; 11.7% in the east.)

Laptops)and)La'es:)Well) High)Rise)Renters:)Shop!at# educated,)single,)and) discount)stores)and)affordable) affluent,#that#shop#online,# department)stores.## at#Target,)or)at)high@end) Tight#budgets#limit#spending.# department)stores.#

West#

City)Strivers:)Young!and) diverse.#Shop#predominately# at)wholesale)clubs.)They#eat# Trendse'ers:)Young,)diverse#and#mobile,#oNen#shopping#at# fast)food.) Banana)Republic,)Gap,)and)Macy’s.)

East#

0%# 10%# 20%# 30%# 40%# 50%# 60%# 70%# 80%# 90%# 100%#

23.#Trendse8ers# 08.#Laptops#and#La8es# 61.#High#Rise#Renters# 45.#City#Strivers# 27.#Metro#Renters# 30.#ReFrement#CommuniFes# Other#

Figure 16: Tapestry Segmentation. Source: Esri Business Analyst.

18 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

The following brief summaries describe the segmentations that make up Fulton Street’s trade area. Full descriptions of each segmentation can be found at esri.com/data/esri_data/tapestry.

Trendsetters are young, diverse and mobile. They are spenders. Fashion-conscious, they shop at stores like Banana Republic, Gap, Nordstrom and Macy’s. They buy organic food, exercise regularly and own the latest electronics.

Laptops and Lattes are single, affluent and connected. They go out frequently, to the theater, bars, football games and restaurants. They buy essentials at Target and shop at high-end department stores for luxuries.

High Rise Renters are a diverse mix of race and ethnicity. They buy household items and apparel at discount stores. They do not dine out regularly. They buy necessary baby and children’s clothes; however, tight budgets limit their spending.

City Strivers are young families with little discretionary income. They shop at wholesale clubs for groceries and children’s essentials. They eat fast food and enjoy going to theme parks, professional sporting events and the movies.

Young, educated singles, residents of Metro Renters are just beginning their careers. They buy furniture from Crate & Barrel. They buy clothes from Banana Republic, Gap, and Amazon.com. They eat out and go to rock concerts.

Most households in Retirement Communities are single seniors. The median household income is below the US median but the median net worth is much higher. They spend time on leisure activities and hobbies and enjoy spoiling their grandchildren.

Strategic Positioning Matrix

The LOA Strategic Positioning Matrix is a proprietary tool for mapping psychographic profiles Figure 17: LOA Lifestyle Matrix. Source of Tapestry Segmentations: Esri in terms of lifestyle and income to better Business Analyst 2013. understand what types of retail offerings are a good fit for the consumers of a particular district (Fig. 17). When plotted on the Matrix,

19 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

customers fall primarily into two distinct areas. Roughly 78% of customers make a moderate to high income and have a trendy/hip lifestyle, while another 17% of customers are moderate to low-income and buy traditional (or basic) and contemporary goods. (The remaining 5% of residents fall into other tapestry segmentations, each containing less than 3% of the trade areas’ populations.) These two primary customer groups have distinct needs and preferences from one another. The prospective retailers that are recommended through this process were separated based on lifestyle and price, in order to serve both customer populations.

Real Estate Trends

Fulton Street’s neighborhoods are experiencing a significant amount of new real estate development, particularly at the west end of the district. Information on this new growth was cataloged and mapped to show:

• How much new demand there will be in the near future due to the growing residential population • Where there are new developments along the Fulton Street corridor with ground floor retail space that can potentially become part of the retail attraction effort

Number)of) residential)units) <100 101=299 300=699 700+

Planned Developments

Soft Sites

Figure 18: New Residential Developments and Soft Sites on and around Fulton Street

20 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

There are 11,152 new residential units planned on and around the Fulton Street corridor. In addition to this planned development, there are sites along the corridor that currently have no plans for development, but are likely to be developed in the coming years (parking lots, vacant land, and underdeveloped buildings that have recently been sold), or “soft sites”. As illustrated in Fig. 18 above, the most significant cluster of new developments is at the west end of the corridor near Downtown Brooklyn and the BAM Cultural District. Smaller developments are clustered between Washington Avenue and Classon Avenue to the east. The following table shows the amount of planned residential units and retail, office, and commercial square footage, as well as projections for soft sites in the area based on lot size and zoning for each half of the district.

Based on these figures, we estimate roughly $340 million1 in additional consumer demand, which can support an additional 572,116 square feet2 of retail space.

Residential( Commercial(Space(( (( Units( Retail(Space( Office(Space( (not(specified)(

West)(Planned)) 10,466) 695,000)sq.)ft.)) 70,000)sq.)ft.)) 156,000)sq.)ft.)) East)(Planned)) 659) 5,494)sq.)ft.)) n/a) 616,555)sq.)ft.)) West)(Soft)Sites)) 105) 13,683)sq.)ft.) n/a) n/a) East)(Soft)Sites)) 356) 34,326)sq.)ft.) n/a) n/a) Table 3: New Development Summary: East/West

1)Demand)Based)on)new)units)predicted)and)current)demand)per)household.) 2)Square)Footage)based)on)average)sales)per)square)foot)for)GAFO)categories)in)the)NY)Metro)area)($595),)2013;) Source:)ICSC)Research)) ) 21 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Retail Opportunity and Leasing Recommendations Retail Opportunities What is Retail Leakage? Retail Leakage is calculated as the An analysis of market data reveals retail leakage in a number difference between buying power of categories. In the tables below, a green number in the retail (demand) and retail sales (supply) with a gap column signifies that there is opportunity for additional defined Trade Area. When Retail Leakage retail in that category. A red number indicates surplus. This is a positive value there is unmet demand by residents in the trade area, representing means that shoppers are coming into the district from outside of opportunities for new or existing businesses the trade area to buy goods in those categories. to target. When Retail Leakage is a negative value there is either a healthy Fulton Street should focus retail attraction efforts in the concentration of retail to build from, or categories where there is a Retail Gap that fit into the retail there is a saturation of retail that indicates vision for the street (for example, because Fulton Street is a limited opportunity for business growth or expansion. pedestrian-oriented corridor, Motor Vehicle and Gasoline Station categories should not be pursued). The need for these types of retailers is reinforced by the results of the 2014 Fulton Street Neighborhood Shopping and Dining Survey, as well as the demographic analysis, which has illuminated what price point and lifestyle categories are appropriate for this attraction effort. New retailers will have the opportunity to capture spending that is getting lost to other districts, as illustrated in the Retail Leakage Analysis table below.

West Fulton Street Trade Area

)Industry(Summary) Demand( Supply( Retail(Gap( (Retail(Potential)( (Retail(Sales)( Total)Retail)Trade)and)Food)&)Drink) $680,320,631) $589,314,705) $91,005,926) Total)Retail)Trade) $607,973,220) $532,735,271) $75,237,949) Total)Food)&)Drink) $72,347,411) $56,579,434) $15,767,977)

Demand(( Supply(( Industry(Group( (Retail(Potential)( (Retail(Sales)( Retail(Gap( Food)&)Beverage)Stores) )$)))))))118,030,873)) )$))))))))97,294,133)) $20,736,740) Food)Services)&)Drinking)Places) )$)))))))))72,347,411)) )$))))))))56,579,434)) $15,767,977) Bldg)Materials,)Garden)Equip.)&)Supply)Stores) )$)))))))))16,929,332)) )$))))))))))2,360,429)) $14,568,903) Electronics)&)Appliance)Stores) )$)))))))))21,692,708)) )$))))))))21,383,857)) $308,851) Health)&)Personal)Care)Stores) )$)))))))))48,597,938)) )$))))))))48,476,328)) $121,610) Furniture)&)Home)Furnishings)Stores) )$)))))))))15,386,189)) )$))))))))23,971,976)) $8,585,787) Miscellaneous)Store)Retailers) )$)))))))))17,536,557)) )$))))))))26,479,565)) $8,943,008) Sporting)Goods,)Hobby,)Book)&)Music)Stores) )$)))))))))15,655,374)) )$))))))))50,110,632)) $34,455,258) General)Merchandise)Stores) )$)))))))))72,722,319)) )$))))))130,152,476)) $57,430,157) Clothing)&)Clothing)Accessories)Stores) )$)))))))))50,326,130)) )$))))))116,105,972)) $65,779,842) Figure 19: Retail Leakage Analysis. Source: Esri Business Analyst. 22 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

East Fulton Street Trade Area

)Industry(Summary) Demand( Supply( Retail(Gap( (Retail(Potential)( (Retail(Sales)( Total)Retail)Trade)and)Food)&)Drink) $660,835,996) $314,183,952) $346,652,044) Total)Retail)Trade) $590,892,047) $288,526,795) $302,365,252) Total)Food)&)Drink) $69,943,949) $25,657,157) $44,286,792)

Demand(( Supply(( Industry(Group( (Retail(Potential)( (Retail(Sales)( Retail(Gap( Food)Services)&)Drinking)Places) $69,943,949) $25,657,157) $44,286,792) Health)&)Personal)Care)Stores) $47,301,578) $17,547,165) $29,754,413) Electronics)&)Appliance)Stores) $21,040,856) $6,304,932) $14,735,924) General)Merchandise)Stores) $70,693,010) $55,979,994) $14,713,016) Food)&)Beverage)Stores) $114,929,291) $100,947,734) $13,981,557) Bldg)Materials,)Garden)Equip.)&)Supply)Stores) $16,204,700) $2,840,037) $13,364,663) Clothing)&)Clothing)Accessories)Stores) $48,686,043) $36,192,416) $12,493,627) Sporting)Goods,)Hobby,)Book)&)Music)Stores) $15,192,089) $13,766,117) $1,425,972) Miscellaneous)Store)Retailers) $17,055,722) $16,499,620) $556,102) Furniture)&)Home)Furnishings)Stores) $14,864,525) $15,380,873) $516,348)

In order to demonstrate what Retail Gap means in terms of retail space, the potential square footage was calculated3 for categories with significant demand that also fit the retail vision. The graphic below estimates the amount of square footage that can be supported along Fulton Street in each retail category.

3)Calculation)based)on)average)sales)per)square)foot)by)category)in)the)NY)Metro)area;)Sources:'ICSC'Research,' Sales'Productivity'for'Non0Anchor'Tenants'in'New'York'Metro'Area'Malls','Year0to0date'2014.'Food'Marketing' Institute.) 23 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Building)Materials)+) Food)+)Beverage)Stores Food)Service)+)Drinking General)Merchandise Garden)Equipment West:)28,734)sq.)ft. West:)12,766)sq.)ft. West:)Surplus West:)19,648)sq.)ft. East:)19,374)sq.)ft. East:)35,857)sq.)ft. East:)15,532)sq.)ft. East:)18,024)sq.)ft.

Electronics)+)Appliance Health)+)Personal)Care Clothing)+)Accessories West:)70)sq.)ft. West:)85)sq.)ft. West:)Surplus East:)3,335)sq.)ft. East:)20,751)sq.)ft. East:)19,997)sq.)ft.

The types of stores that survey respondents wish they could buy on Fulton Street generally align with the categories that show opportunity in the market data. The top five categories or retail include: clothing, shoes, organic/local produce, gifts, furniture/home goods.

24 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Prospecting: “Like” Districts

To find retailers that may be interested in coming to Fulton Street, we define a set of criteria based on Fulton Street’s demographics to uncover which neighborhoods have similar characteristics to the trade area. Retailers in these markets are likely to understand and cater to the Fulton Street customer. The criteria used are as follows:

) Criteria( West(Trade(Area( East(Trade(Area(

Density) 35,000)–)60,000) 42,662.5) 42,085.8)

Median)Age:) 30)–)40) 35.5) 35.4)

Median)Income:) $47,000)=)$90,000) $59,569) $57,343)

Bach.)Degree+:) 25%+) 56.5%) 55.5%)

The table below shows which neighborhoods (defined by zip codes) fall into the above ranges, and how they compare to Fulton Street.

(Population( Median(Household( Pop(25+(by(Educ:( ZIP(Codes Density Median(Age Income Bach(Deg((%) Downtown)Brooklyn/DUMBO) (11201) 38,504.10 36.4 $83,179) 33% Park)Slope)(11215) 36,465.70 36 $84,271) 35% Boerum(Hill/Fort(Greene( (11217) 48,902.30 35.7 $69,619( 31% Prospect(Heights/Clinton(Hill( (11238) 42,267.30 35 $57,219( 30% Little)Italy/Tribeca)(10013) 49,799.70 38.2 $73,579) 31% Herald)Square)(10001) 37,298.10 36.9 $65,621) 36% Hell's)Kitchen)(10019) 40,035.40 38.1 $80,102) 36% Midtown)(10036) 56,569.40 37.8 $61,048) 35% Astoria)(11103) 55,313.70 34.9 $49,235) 27%

25 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

As young families and other new residents move into the luxury housing that is currently being 10019 developed, it is likely that the 10036 11103 residential density and median 10017 income in the area will increase 10001 significantly. When the criteria for determining Like Districts is adjusted to account for these changes (see below), additional 10014 zip codes emerge in , the West Village and 10013 Midtown East. 10006 Criteria: 10005 Density: 35,000-70,000 Median Age: 29-40 Median Income: $47,000- 11201 $115,000 Bachelor’s Degree (Pop. 25+): 11217 25%+ 11238

11215 Current Like Districts Future Like Districts

Figure 20: Like Districts Map. Source: 2010 US Census, Esri Business Analyst 2013. Larisa Ortiz Associates.

26 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Leasing Plan

Together, the existing retail micro-climates, market data, sizes and characteristics of existing retail spaces, and stakeholder input have informed the list of prospective tenants to use as a starting point for ongoing retail attraction efforts.

These tenants are starting points, meant in part to inspire additional research and prospecting by FAB Alliance and PACC staff, property owners and the local brokerage community. Each prospect will need to be cultivated over time. In some cases, a retailer may not have any interest in immediate expansion, but it is recommended that every retailer be entered into a prospect database and followed up with at regular intervals. Retail attraction can be slow and tedious, and requires significant follow up to achieve desired outcomes.

The map below demonstrates where these retailers may fit along the corridor. Detailed sheets with information on the characteristics, target customer, and space requirements of each retail prospect have been submitted to the Client under a separate cover.

Ashland(Pl.(–(Oxford(St.( • Fitness)Facilities)(Blink)Fitness) Vanderbilt(Ave.(–(Washington(Ave Washington(Ave.(:(Classon(Ave. • Destination/sit=down)dining)(Fornino,) • Butcher/Grocery)(Fish)Tales,) • Family=oriented)businesses) Buttermilk)Channel) Meat)Hook,)Union)Market) (Painted)Pot,)Kids) • Apparel)(Brooklyn)Industries,)DNA)Footwear) • Fast=casual)dining)(Bare) Playhouse,)Engineering)for) • Higher =end)grocery)(Gourmet)Garage))) Burger) Kids) • Grocery/Butcher

27 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn

Conclusion

The Fulton Street corridor in Fort Greene and Clinton Hill is a strong and growing market with opportunities to strengthen the current retail mix. This can be done by recruiting retailers in the categories where there is market opportunity and community desire and building relationships with developers to ensure new spaces are in line with the FAB Alliance’s retail vision. The ground floor retail spaces in development along the corridor will create new opportunities for retailers to locate on the avenue; however there will likely be a shift in the types of retailers opening due to rising rents, and potentially larger floorplates on the ground floors of new large-scale developments. As is the case in all commercial districts in growing and changing communities, rent increases may pose a challenge for retailers who do not own their spaces or have short-term leases.

It is important to work with developers, property owners and commercial real estate brokers to help them understand local market dynamics, consumer needs, and what types of businesses will contribute to the long-term health of the corridor so that they can make informed decisions around leasing that benefit their properties as well as the district as a whole.

28 Fall 2014 - Market Analysis and Retail Attraction, Fulton Street in Fort Greene/Clinton Hill, Brooklyn Appendix Reports I. Demographic and Income Profile – East Fulton II. Demographic and Income Profile – West Fulton III. Retail MarketPlace Profile – East Fulton IV. Retail MarketPlace Profile – West Fulton V. Tapestry Segmentation Area Profile – East Fulton VI. Tapestry Segmentation Area – West Fulton VII. Detailed Age Profile – East Fulton VIII. Detailed Age Profile – West Fulton ! !