A fresh take on ‘Retailtainment’ and future of fun
Retail has been the foundation of shopping centers throughout their existence, but new entertainment concepts are making inroads in traditional retail venues.
Even in mixed-use venues, it is generally accepted that a critical mass of traditional retail is the highlight, and that other uses are complementary pieces, designed to drive traffic and support the retail component. While the industry has been slowly evolving away from that traditional model for some time now (dining and entertainment uses in particular have emerged as more significant pieces of the commercial puzzle) that trend has exploded in recent years. A wide range of dynamic and engaging new entertainment uses have sprung up, and have functioned as increasingly prominent features on the development landscape.
Today, entertainment is no longer a side dish: it’s the main course. And it’s a meal that landlords and commercial development decision-makers are increasingly interested in ordering. Entertainment concepts have evolved well beyond the movie theater, and creative new brands like Momentum Indoor Climbing, Pinstripes, Punch Bowl Social, iFLY indoor skydiving and Topgolf have captured imaginations and dollars as they expand across the country.
Entertainment brands have the advantage of generally strong appeal with Millennials and other younger shoppers, and more owners and operators appreciate the degree to which a strong entertainment component can drive traffic and create valuable synergies with traditional retail tenants. Entertainment introduces a social element that gives a center status as a destination. It gives people reasons to come and reasons to stay, presenting a new and different range of engaging activities and memorable experiences.
With that in mind, it’s not surprising that landlords are increasingly open to new entertainment concepts. Some have been proactive about exploring creative ways to fill gaps in their tenant roster with compelling entertainment brands. For example, the Southdale Center in Edina, Minnesota repurposed a 40,000-sq.-ft. space on the third floor of the mall from an old food court into a new Dave & Busters. The transformation was not without logistical and operational challenges, but the results have been extremely positive.
The rise of “retailtainment” is also prompting innovative development concepts that are almost entirely entertainment-based. One such project is the forthcoming 94 West Village in Albertville, Minnesota. Developed by Black Forest LLC and iP2 Entertainment, the 94 West Village will feature a mix of dynamic entertainment offerings, including a 50,000-sq.-ft. indoor water park and a “Back-Lot edutainment experience.” The project also includes a 275-room Marriot Hotel and convention center. All told, the 94 West Village offers about 100,000 square feet of entertainment space on 100 acres along I-94. Favorably positioned 45 minutes away from the Mall of America and immediately adjacent to the heavily trafficked Albertville Premium Outlets, the project presents an entertainment complement to a range of existing regional retail options.
While extending visits and keeping customers on site for longer periods of time is always the goal, the 94 West Village has the potential to keep visitors around for multiple days at a time. The hotel component makes it possible for a project that offers the purest expression of entertainment retail to function as a true stand-alone regional destination.
While the 94 West Village may be (thus far, anyway) an isolated example, the project’s promise illustrates just how significant the “retailtainment” trend has become – and hint at some of the places where it might be heading next.
Ted Gonsior is vice president with Minneapolis-based Welsh Companies and Ben Brown is a broker with Baker Katz. Welsh Companies and Baker Katz are partners with X Team International. They can be reached at [email protected] or [email protected]. To learn more about X Team International, visit xteam.net.
CASTO takes flight with LeasePilot
Doing deals with real estate development and services firm CASTO just got easier thanks to the roll out of a new Web-based software platform called LeasePilot.
LeasePilot was developed by Gadfly Legal Technologies to streamline the lease documentation process and helps owners manage valuable lease information. CASTO is currently using LeasePilot to create the first drafts of leases.
"We are thrilled to be partnering with the CASTO team given their commitment to innovation and reputation within the real estate community,” said Jonathan Eskow, co-founder of Gadfly Legal Technologies. “Creating leases using LeasePilot delivers standalone value, and together with additional features designed to complete lease transactions faster, LeasePilot is changing the way lawyers and real estate professionals interact with leases.”
LeasePilot is Gadfly’s first product and the firm bills the software solution as the only end-to-end lease documentation and lease information management platform designed for the commercial real estate industry. LeasePilot helps owners and law firms get deals done quicker, minimize risk, and provide visibility into lease terms and documents, according to Gadfly.
"We have been focused on leveraging technology to improve the legal function at CASTO for several years. When I met Jonathan and Gabriel of Gadfly, it was clear that they have the same focus but have taken the technology to the next level,” said C.H. Waterman, VP and director of legal at CASTO. "We have already experienced a dramatic decrease in lease preparation timeframes and anticipate realizing a number of additional efficiencies as the software continues to evolve.”
Olshan shares insights on portfolio performance
Photo: Andrea Olshan, CEO of Olshan Properties
Retail transactions in the first half of the year are surging at Olshan Properties following a flurry of deal activity in late 2015, the private owner, developer and manager of mixed-used real estate reported.
Olshan said leasing momentum remained strong throughout its national commercial portfolio during the past six months and that its core retail portfolio continues to exhibit resilience despite the increasingly uncertain economic outlook that characterized the start of the year.
“Compared to the first quarter of 2015, our total leasing volume based on the number of retail transactions increased by approximately 24% during the first quarter of 2016 and much of that activity was generated by a flurry of late 2015 deals,” said Andrea Olshan, CEO of Olshan Properties.
Highlights from Olshan Properties’ retail portfolio over the past six months include the following transactions:
· At Bayshore Town Center in Glendale, Wisconsin, a new 17,000-sq.-ft. Old Navy store was constructed and officially opened in late 2015.
· At Kansas City’s Zona Rosa Town Center, Unite Private Networks (UPN), a provider of high-bandwidth, fiber-based communications networks and services, relocated its Kansas City headquarters office to Zona Rosa. The center also announced two new retail tenants to include Pure Barre and Google Fiber Store.
· The Shoppes at Webb Gin, located near Atlanta, GA, welcomed several new tenants, including Cigar Bar, Fuzzy’s Taco Shop and Orangetheory Fitness.
· The Greene Town Center, in Dayton, Ohio, announced new tenants, Ulta Beauty, J. Crew Mercantile, World of Beer, and Mattress Firm; in addition, Lululemon opened its doors for business in late 2015.
· At Mercury Plaza Shopping Center in Hampton, VA a new, 22,000-sq.-ft. Marshall’s opened in late 2015.
· In Midtown Manhattan’s Third Avenue at 60th Street, cutting edge fitness chain Flywheel recently opened a 4,500-sq.-ft. studio.
· At Siegen Lane Marketplace in Baton Rouge, La., bowling anchored entertainment chain Main Event Entertainment signed a 49,810-sq.-ft. lease for its first Louisiana location with plans to open for business in 2017.
· At Akers Mill Square, located in Atlanta, two new tenants signed leases – Bonefish Grill and Sport Clips.
“Our portfolio incorporates the strongest elements of each individual asset class into the properties that we own and operate, and, as a result, more than half of our retail properties are located in mixed-use environments,” Olshan said. “It is abundantly clear that this strategy resonates with our consumers and our tenants, both of whom see mixed-use environments as holding far greater growth potential than any single-use development could offer.”