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Downtown Akron Partnership Akron, Ohio Downtown Akron Retail Market Analysis Retail Market Analysis for Downtown Akron Prepared for: Downtown Akron Partnership Akron, Ohio Prepared by: Boulevard Strategies Columbus, Ohio Final Report February 11, 2014 Downtown Akron Retail Market Analysis / CONFIDENTIAL © Boulevard Strategies, All Rights Reserved, 2014. 03.12.2014 1 Downtown Akron Retail Market Analysis Table of Contents Page 1. Executive Summary 3 2. Project Background & Objectives 9 3. Retail Market Analysis 16 4. Market Potential For Complimentary Uses 43 5. Downtown Retail Mix & Performance 50 6. Stakeholder Perspectives 66 7. Recommendations & Conclusions 72 8. Appendix 83 Downtown Akron Retail Market Analysis / CONFIDENTIAL © Boulevard Strategies, All Rights Reserved, 2014. 03.12.2014 2 Downtown Akron Retail Market Analysis 1. Executive Summary Downtown Akron Retail Market Analysis / CONFIDENTIAL © Boulevard Strategies, All Rights Reserved, 2014. 03.12.2014 3 Downtown Akron Retail Market Analysis 1. Executive Summary Downtown retail in Akron, like in many other Midwest cities, faces challenging trends. Since the 1980’s, big box superstores have sprawled across the northeast Ohio suburban landscape while total population barely grew. The latest threat is e-commerce, chalking up annual 15% increases year after year. Given this harsh competitive climate, it is not surprising that the number of independent retailers has declined by 14% over the past 10 years in Ohio. On the other hand, there are 5% more independent restaurant operators in Ohio today than 10 years ago. Downtown Akron’s retail mix, almost all independents, reflects this trend with 50 foodservice operators vs. 28 non-food merchants. Downtown Akron Partnership (DAP) and a Special Improvement District were formed in the 1990s by property owners to pool business recruitment, marketing, and other efforts, such as the Downtown Ambassadors Program, launched in 2009 to promote a safe and clean downtown. In 2013, DAP hired Columbus-based Boulevard Strategies to compile a Downtown Retail Market Analysis and Business Recruitment Strategy for Downtown Akron. As part of this effort, Boulevard Strategies worked with a Steering Committee made up of 15 DAP members and officials, met with over 40 downtown stakeholders, officials, and merchants, surveyed 443 downtown residents and employees about downtown retail issues. Best practices in ten similar Ohio and American cities were reviewed for applicable lessons to Downtown Akron. A few highlights of these efforts are summarized below. Downtown Akron Retail Market Analysis / CONFIDENTIAL © Boulevard Strategies, All Rights Reserved, 2014. 03.12.2014 4 Downtown Akron Retail Market Analysis a. Downtown Retail Market Study HiGhliGhts Overall, Downtown Akron retailers and restaurants collectively occupy an estimated 190,000 square feet of first floor space with sales of about $38 million per year (or $200/square foot). Downtown merchants employ about 400 full- time and 400 part-time retail and foodservice workers (including owners) in downtown Akron. Downtown Akron has five sizable and/or growing market segments for merchants to draw upon: • 26,000 Downtown Employees: Account for 40% of Downtown Downtown Akron has about 105,000 square feet of vacant first floor retail demand; primarily spend on food and beverages; 60% of space (37% of total). Rents generally range between $10 and $18 lunch business driven by “regulars” per square foot. Restaurants pay 30% more per square foot on average but require more upfront investment in equipment and • 24,600 UA Students + 5,050 UA Faculty/Staff: 85% of fixtures than do non-food retailers. students live off-campus, including Downtown Consumer surveys indicate that several desirable food and non- • 11,000 Close-In Residents: Only 1,500 live within DAP food retail concepts are missing or under-represented in Downtown boundaries; downtown housing for young professionals poised Akron, including more fast casual fare, a small grocer with fresh to take off similar to other Midwest cities produce, or a full-service breakfast café on the food side. On the non-food side, downtown consumers (especially employees) would • 530,000 Metro Shoppers & Diners: 65% of Summit County like to see a drug store, a card and gift shop, and an upscale thrift population resides in the suburbs and townships; flock to shop. downtown for events and attractions but not as much to shop or dine • Countless Visitors From Beyond Summit County: Convention Center, Towpath Trail, Canal Park Stadium, Locks 3 and 4, museums, library, theatres, seasonal festivals and events draw visitors; downtown hotel(s) and indoor entertainment venues needed to capture more visitor spending Downtown Akron Retail Market Analysis / CONFIDENTIAL © Boulevard Strategies, All Rights Reserved, 2014. 03.12.2014 5 Downtown Akron Retail Market Analysis b. Downtown Retail Market Study HiGhliGhts First, create a retail brand for downtown Akron that is unique, easily identifiable, holistic, memorable, and reflective of Akron’s heritage. Once created, this brand should be reinforced over and over. Marketing promotions will need to be developed to target each of the retail market segments outlined above. These efforts should be cooperative with local tourism groups, media, DAP, Chamber, and merchants assisting in getting the word out. Downtown Akron is physically large and has a difficult topography. It needs to be redefined into smaller, more cohesive districts that make sense from a consumer standpoint. The Steering Committee has proposed the following three districts as follows: • The Canal District: “Food Fun Energy” Accounts for 60% of Downtown sales; primarily food and beverage trade; serves UA students/faculty/staff, downtown event visitors and conventioneers • The Historic Cultural District: “Proud Progressive Friendly” Accounts for 30% of Downtown sales; mix of shops and restaurants, serves majority of office workers; attractions include Akron Art Museum, Main Library, John S. Knight Convention Center, and numerous historic buildings • The Northside District: “Design Décor Dining” Accounts for a 10% of Downtown sales; mix of familiar icons such as Luigi’s alongside bold new studio and culinary upstarts; has potential to become upscale destination for both locals and suburbanites Downtown Akron Retail Market Analysis / CONFIDENTIAL © Boulevard Strategies, All Rights Reserved, 2014. 03.12.2014 6 Downtown Akron Retail Market Analysis A marketing brochure (print/PDF) that targets retailers with details on the 3 districts, market data, how-to-get-started lists, and contacts needs to be developed and disseminated. DAP should be pro-active in encouraging downtown Akron merchants to form an association with promotion and marketing as its focus. DAP should encourage landlords to be reasonable with asking rents. Few chains will go into a retail area until it has been settled by independent pioneers. Downtown Akron must continue to be affordable for local start-ups to be viable in the foreseeable future. Also, entrepreneurs often need only small spaces to start their businesses and landlords willing to divide and sublet spaces will find many more potential tenants than with one large space. In fact, DAP should work with one or two property owners in a creating retail pop-up or incubator program with temporary leases at reduced rates. DAP should also continue to be active on a number of other downtown fronts that impact retailing conditions, including parking problems (both perceived and real), beautification, more outdoor patios and public art, signage/wayfinding, and blighted properties. Downtown housing, hotels, an indoor event facility, a permanent public market, an artists’ colony, and historic preservation are all types of development that will help retailers and restaurants. Downtown Akron Retail Market Analysis / CONFIDENTIAL © Boulevard Strategies, All Rights Reserved, 2014. 03.12.2014 7 Downtown Akron Retail Market Analysis c. Overview of Retail Recruitment StrateGies 1. Define Expectations 4. Market Downtown Akron Endorse and adopt this document. Encourage downtown Coordinate Internet marketing/collaterals with other local merchants to form an association to take the lead in marketing government/economic development/tourism agencies. downtown, assisting with special events, and advocating on Hire/assign full-time retail recruitment specialist to develop behalf of downtown. Develop incentives for property and business recruitment packet and contact property owners, business owners, including façade grants, loans, historic tax brokers, managers, and prospective tenants. Assist in credits, and others. marketing available properties through open houses, tours, and public events. 2. Involve Property Owners 5. Expedite Public Approvals Identify property and building ownership for all downtown properties. Create a detailed, searchable property facts base Create a Downtown Development Committee to review the for vacant/available and occupied spaces, organized by district, local approval and regulatory processes to identify size range, and asking rents. improvements. Educate/assist prospective tenants and building owners on code and design issues. Work with 3. Identify, Cultivate, and Attract Tenants appropriate government agencies on development programs and incentives. Develop and maintain a targeted retail business list. Market to targeted businesses through a coordinated program of e-mail and direct mail collateral contacts, store visits, meetings with brokers, social networking, and media coverage.
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