Commercial development has come roaring back! As Chair of the Urban Land Institute Entertainment Development Council, along with my trusted Assistant Chair Brian Edwards, we are constantly planning programs to keep our members abreast of what’s hot, what’s new, and what to keep your eye on to stay current. And for our next meeting in May, our whole day is about new projects and formats. Two reports published lately help us understand what’s happening in the retail and restaurant marketplace.
National Retailer and Restaurant Expansions – 2013
This report, published by ChainLinks provides a comprehensive review of individual retail and restaurant brands by category. For instance, did you know that one of the largest expansions planned is by Fossil/Fossil outlet, with 75 new retail locations planned for 2013-2014? In the Family Apparel Category rue21 is planning 125 new stores in the next 12 months. Aeropostale/P.S. from Aeropostale is planning 75 new stores in the next 12 months, with a current inventory of 906 units. Shoes are led by Aldo at 50 new locations planned, as with Crocs at 50 (ick) and DSW (hooray for Designer Shoe Warehouse where I could get lost for the day) at 40. Best Buy plans 140 new units and is downsizing to 20,000 to 30,000 square feet. (The brand hit hard times, but will push a new mobile phone concept which may help a revival.) Forever 21 is planning 15 new stores; they take shuttered department store locations opportunistically swooping up available real estate. Dollar General and Family Dollar are planning from 500 to 600 new units each, which tells us the recession has permanently altered consumer shopping preferences.
In the entertainment category, which includes cinemas, bowling, family entertainment and the like, the big expanders include Village Roadshow Gold Class Cinemas, Pump it Up, Ocean Cinemas, Movie Tavern, Monkey Joe’s, Kerasotes ShowPlace Theaters, Cinemark USA and Carmike Cinemas. The moviehouse expansion is led by the premier cinema market.
Restaurant Marketplace and Expansions
Nielsen tracks each metro and micro statistical area in the United States through their data base of population, number of restaurant units, per capita income, and out-of-home food sales. The 2013 analysis shows weakening restaurant sales and more new restaurants, which is not good news. According to Nielsen, total industry sales dropped about $4 billion in 2012 with almost 50,000 new restaurants opened in 2012. Per capita sales also dropped from $1,533 to $1,509. The GOOD NEWS – Among the top 50 markets by size of population, there are some big winners as shown in the table below which summarizes performance in top markets with population over two million as follows:
Source: The Nielsen Company
Metro and Micro areas not mentioned do not provide an opportunity, according to the Nielsen analysis. New York and Los Angeles are saturated, according to this study. But we all know that a good new restaurant in either of these markets will do well, by stealing market share from other food and beverage venues. However, for developers and restaurateurs looking to expand, this list can provide some guidance.
Now to the fun part, trends, what are people eating, what do they like, where is their dollar going when they decide to take a night off from their worries about money and the kids? According to Restaurant.org/Food Trends, the top five spots are held by the following genres (drum roll please…..) 1. Locally sourced meats and seafood. 2. Locally grown produce 3. Healthful kids’ meals 4. Environmental sustainability 5. Children’s nutrition 6. New cuts of meat (pork flat iron, teres major, etc.) Good health is playing a big part in the “hot” items which include hyper-local sources such as restaurant gardens; gluten-free cuisine; non-wheat noodles/pasta (quinoa, rice, buckwheat) and fruit/vegetable children’s side items
So who are some of the big players in the expansion of our lovely places to eat and buy food and drink? By category, the top by number of new units for the next 12 months include:
- Asian – Panda Express (115) and Genghis Grill (25)
- Bakery – Bruegger’s Baked Fresh (50) Panera Bread (105)
- BBQ – Dickey’s Barbecue Pit (100) Shane’s Rib Shack (50)
- Casual Dining – Cracker Barrel (25) Golden Corral (40 ) Honey Baked Hams (20) Houlihans (20) IHOP (45) Tilted Kilt (40)
- Chicken (buffalo Wild Wings100), Chick-Fil –A (90), KFC (130), WingStop (65)
- Seafood/Steakhouse – Arthur Treacher’s Fish and Chips (25), J. Gumbo’s (20), Logan’s Roadhouse (20), Red Lobster (50)
- Supermarket, Hypermarkeet – Costco Wholesale (28), Food Lion (Delhaize America (22), Okey Dokey Grocery Markets (25)
What these data do not track is the creative arm of our industry, the new minds generating delicious and beautiful concepts that keep our world exciting and moving forward. These are the ideas that are extremely proprietary and that we cannot discuss. But believe me, they are out there and in the next wave of project openings you will see new retail formats and chef inspired restaurants all over the United States.
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