I wasn’t sure exactly what to expect this year at ICSC RECON. With the mounting number of retail closures and downsizings, it could have been pretty bleak or sheer panic. As it turned out – it looked like business as usual. The national guys were there, the locals were there, the mom and pops were there, the seminars were overcrowded and the line at Starbucks was about 20 minutes. I was on the floor for about three minutes before I ran into a developer client and his posse from NYC who was running back and forth between appointments with new deals.
While the crowd was the same, the subject matter was a little different. I got caught up in a number of programs and sessions that were zeroing in on the integration of health and wellness into retail projects and conversely, retail components into health, wellness and medical projects. Healthcare’s delivery approach is seen as becoming more of a retail experience for consumers and for them to be able to provide a convenient service in proximity to other consumer needs. There were also a couple of sessions on the impact of cannabis in the retail marketplace – which is not new to the Las Vegas Market.
Some of the other noteworthy and critical topics that were covered:
- Get prepared for change. Owners need to think critically about the tenant mix and appropriately sized tenants. There needs to be a variety of goods and services offered that will keep customers coming back and staying longer on site. Walkable, mixed-use developments with office, medical or hospitality anchors provide a steady potential customer base. Combine uses on existing sites: live-work-play, medical-wellness, office-entertainment, etc.
- Think outside the box. Experiential retail was the buzzword for excitement in centers and as a driver for new customers. These tenants could be entertainment based, hospitality based, food based or could be a product that cannot be experienced on-line. Retailers and physical spaces need to be fresh and unique to attract and maintain customers. There were examples of stores changing their entire look every quarter to promote a new and exciting atmosphere and keep enticing customers back into the store. The tenants for Area 15 had a “hands-on” booth to experience their concept.
- Refresh. Re-size. Many nationals are rolling out smaller footprints for anchor stores. Powerful providers are working in smaller (more strategic) space – but they must effectively leverage the space to optimize the experience. Target has an urban plan of 30-45,000 SF on multiple levels. Large, big box users that are down-sizing are being replaced with store-within-a-store concepts and (smaller) specialty grocers are becoming popular anchors. Consumers want amenities like shop on-line and pick-up at store with an onsite “click/collect” pick-up zone.
- Consumer data can be a friend. Data collection and analysis is becoming more critical to fulfill the needs of the consumer and to be able to respond to trends and the consumers’ desires. It’s an evolving market and will be driven by change in consumers’ needs, wants and attitudes. “One week you’re in – the next week you’re out.”
- International flavor. There is interest from international companies to expand into US markets. This niche isn’t reserved for high-end consumers – think Aldi or other specialty food providers that international consumers are acquainted with and drive strong brand loyalty. On the apparel front, Uniqlo and Superdry are coming into the US market from opposite sides of the globe (and have multiple stores locally).
Overall, I got the same excitement vibe and crowd crush as previous years. I saw deals being finalized all around me, I heard deals being discussed and there wasn’t an empty seat in the CBRE mega booth.