In 2016, a large institutional client was looking to design a long-term redevelopment plan for a vacant parcel of land near its existing facility. The intent was to build a mixed-use destination with housing, retail, and other services complementary to their business and create a better atmosphere around its facility for existing patrons and the larger community. The client had an initial vision, and wanted to determine whether there was adequate market support for the proposed uses included in the plan.
The research scope of work had a series of components:
- Demographic and market analysis. CERC examined the projected changes in demographic patterns and purchasing capacity of the area, including the shifts anticipated as a result of the new housing, to determine the area’s anticipated ability to support additional retail and service enterprises. Analysis included psychographic characteristics and the spending patterns of the target population to determine the potential demand, as well as an assessment of these demographics in relationship to standard industry guidelines and ratios for retail establishments.
- Retail sales analysis. CERC conducted a retail sales analysis for the area, focusing on purchasing trends of the existing population and whether there is an opportunity for new retail to capture a portion of the existing market, in addition to any new populations. A sales gap analysis examined local expenditure data, comparing existing retail sales to the retail potential of the study area’s population to determine the types of goods and services that are over- and under-represented in the area.
- Gravity Model. CERC constructed a gravity model to estimate potential sales at a new retail center to determine whether new retail may be able to attract consumers from other competing shopping centers. Such a model took into account the size, type and quality of the new retail center, nearby competitors, drive times, consumer expenditures in the market area, and type of goods sold to project where customers are likely to make their purchases.
The result was a key findings report that the client is utilizing to refine their redevelopment plans and inform their business attraction and marketing strategy to ensure the future project’s success.