Q:
What do you anticipate as a driving trend in retail development for 2003?
Artech Retail David Hudson, Principal
The movement toward redevelopment of existing properties and revitalization of the urban core is a focus for many retail developers and town planners. Consumers are growing impatient with longer commutes and increased traffic. Governments are becoming more aware and averse to sprawl. The opportunities for mixed-use developments are numerous; and it only makes sense to capitalize on the unique character and density of a downtown and to use the infrastructure that is already in place.
What once were prime urban locations many years ago have since become undesirable. These sites will once again gain value as the availability of vacant land in suburbia dwindles and as consumers migrate toward the central city. There are many existing buildings in good locations that lend themselves easily to today's retail businesses. Many old malls will become outdoor centers with a focus on consumer convenience. New tenants and creative, sensitive aesthetic treatments make old strip centers fresh and vibrant again with very little infrastructure investment.
Urban retail will continue to grow. Cities will continue to entice developers and retailers in order to revitalize their downtown core. People enjoy the excitement of a unique downtown experience and retail is a key component to that experience.
Beame Architectural Partnership Lawrence Beame, President
Urban infill and great secondary markets will remain the targets of many retail developers in 2003. The markets are changing. The good suburban sites and those with few complications have already been developed. Retail developments that are part of mixed-use projects are getting planned in increasing numbers. They are dense, often multi-level and combined with multifamily residential, office and/or hotel. People can live, work and shop in the same place.
A growing population prefers the urban lifestyle and many are willing to pay more for it. People are moving back to the new urban areas. Tenants are responding to the needs of these customers by creating new merchandising concepts, and appropriately sized stores to serve their needs. A large part of our work for 2003 will be the planning and design of urban mixed-use developments with retail in high profile locations. This urban design is somewhat more complicated but the payoffs can be great.
Callison Architecture George Wickwire, AIA, Principal
The answer is three-dimensional — it's in the very weaving of the owners', customers' and the designers' perspective that the trend is defined. Competition for customers leaves shopping center owners with three imperatives: Focus on the right merchandise mix; revitalize their most precious asset — their real estate; and do it all with an eagle-eye on controlling development costs.
Getting that right merchandise mix means responding to what customers are looking for. Number one, they are watching every dollar. Centers with a value orientation will gain ground in the next year while at the same time, soft entertainment offers a leisure time alternative that feels rich but without the price tag of Disney-like proportions. Centers with a diverse collection of eateries, entertainment and localized, “browsing” retail will have the broadest appeal, from families to singles to out-of-town visitors. And then, lastly, make it integral to the community. If people see the center as “my place,” they'll be loyal. To get there, retail designers have to be a partner in the vision.
We do this by listening unequivocally to the owner, understanding the business goals of the development or repositioning, and subsequently doing a deep dive into the lifestyle and aspirations of the community served. With all this as a frame of reference, owners and their designers can deliver that most important criteria of success in 2003, the right product, at the right place, at the right time, for the right price.
Carter & Burgess David Moore, AIA, National Director of Retail Design
Two of the hottest trends we are seeing at our firm for 2003 continue to be the growth in town center/lifestyle center developments and a return to grocery-anchored neighborhood centers. Our clients have been doing some very exciting concepts, combining a dynamic mix of retail, entertainment and big-box elements with some pretty over-the-top elements. The mix is typically tenants you would find in a mall, but in an outdoor setting, and with a twist.
The really cool thing that has been happening within these centers has been the fusion of new attractions to bring more traffic and excitement to the retail. We are seeing sports-themed centers with baseball stadiums and ice rinks or entertainment attractions not typically seen such as IMAX theaters and cinemas. And then there are landscape/hardscape elements that will dazzle the senses, like water features that feature light shows. All of these elements are coming together to create places that are accessible, fun and that people will feel that they are a part of.
CMH Architects Everett Hatcher, Principal
Assuming that the economy is healthy and demand for retail remains strong, retail projects should continue at a good pace next year. I think that the open-air village concept as a retail format will be the dominant theme that runs through most retail venues regardless whether the project is a mixed-use, lifestyle, neighborhood or value-driven center. There's simply too much pressure from local communities as well as retailers for developers to ignore this trend. In our experience, the developers are aware of the recent successes of open-air village concepts throughout the United States. Coupled with a trend to combine retail with other uses including office, residential and community services, the village concept will take many forms.
We've designed successful lifestyle projects like the Avenue and Summit concepts which helped pioneer this village approach, but now we're designing small “Town Center” projects and neighborhood centers as well as the much larger value-oriented centers which aim at a “kinder, friendlier” design focus that can be embraced by local communities. Site plans are extremely varied — from the Main Street approach to modified strip center plans. All of the plans attempt to maintain convenience while minimizing the impact of parking areas on the village ambiance. Convenience and a pleasant shopping environment that ties into the fabric of a community will be the goal of most developments next year and beyond.
DLR Group Steven McKay, Retail Principal
Given recent economic trends, and feedback from our current clients, I think retail development in 2003 will focus on maximizing the value of existing properties — expansions, renovations and overbuilds being the best solutions. With the profusion of neighborhood and lifestyle centers popping up, city agencies and newly formed community development committees are shifting to a more reserved “lessens learned” approach to oversight and approval, their newer and tougher development restrictions prompting our clients to focus on potential in their existing portfolios to compete in the evolving marketplace and generate new profitability. This coming year will be less about squeezing the next new shopping center into the demographic grid, and more about taking existing properties to new levels of tenant and consumer draw. Overbuilds — the additions of new mall levels onto existing centers — may become especially popular due to spatial constraints. “Repositioning” seems to be the buzzword getting the lion's share of consideration.
Dorsky Hodgson + Partners David Parrish, Partner
Look for a dramatic increase in traditional retail developers tackling mixed-use lifestyle projects on more diverse sites. Market-driven developers, focusing on more mid-size projects with shorter development timelines, will adapt lifestyle concepts to a new range of products — from power centers and community centers to malls. Lifestyle retail developer Bayer Properties, for example, is currently working with DORSKY HODGSON + PARTNERS to design an exciting multi-level, mixed-use project planned in Birmingham, Ala.
Those few developers with the resources, expertise and time horizons to launch mega-centers will continue to take lifestyle environments to new levels. Our involvement with segments of Bowie Town Center helped veteran developer Simon Property Group achieve success with the 1 million-sq.-ft. project near Washington, D.C. Such market-shaping projects, many coming on-line after several years in development, will play a high-profile role in 2003.
The retail-to-lifestyle center transition responds to two factors. First, consumers are demanding more single-site opportunities to shop, work, live and play. Second, municipalities today recognize lifestyle centers can outdraw retail-only venues, and are holding developers to a higher standard.
Dougherty Schroeder & Associates Kevin Dougherty, Founder/President
Our firm is seeing several trends evolving in the retail market. The biggest trend is the continuing dominance of open-air projects in lieu of traditional regional malls. In many cases, local planning staffs are telling developers that an enclosed mall is not an option in their municipality. Pedestrian oriented, vehicular Main Streets — often combining retail with office, housing, and hospitality above — are quickly becoming the norm. From the developer's standpoint, it is imperative that the architect has an understanding of each use and how they can be properly integrated. With our experience in housing, office and hotel uses, we have been able to answer our clients' needs when a true mixed-use center is the preferred option.
Another strong trend in retail development is the creation of the hybrid lifestyle/big-box center combining the pedestrian aspects of the former with the parking orientation requirements of the latter. Again, a strong working knowledge by the architect of the needs of each tenant is necessary to ensure that these contradicting retail uses can successfully operate together.
Field Paoli Architects David Paoli, Principal
Does the shopping center industry believe that it is necessary to have a “driving trend” each year similar to advertising, fashion or automobile design? I am of the opinion that the latest design fad is not what the public is searching for in their downtowns. We believe that the public is searching for retail development that is authentic and expresses the unique character of their neighborhoods — a shopping area that becomes a part of their community. Individual retail stores can fulfill the role of showcasing the latest new direction in fashion design, or household décor.
2003 will see an increased focus on the rebuilding and densification of our existing communities. New communities will include a mix of uses and densities and a greater emphasis on the importance of civic and commercial centers as their symbolic focus. Transportation will be a key issue addressing a housing to jobs balance and include mass transit alternatives. Successful retail development will become an integral part of these mixed-use neighborhoods and new communities. Retail will return to its historic role as the focus of commerce, community facilities and a public gathering place.
JPRA Architects James Ryan, AIA, President
While a few new regionals will find their ideal demographic market, the trend in 2003 will be towards continued diversity in development. Many developers will return to their proven existing malls in the quest of expanding, renovating and upgrading leasing to meet market demands and stifle competition. While the future of the department store as a “must-have” anchor is in question, the trend toward non-traditional anchors in Main Street, lifestyle and enhanced strip center development is growing.
There is a trend for developers to pay more incentive money up front to retailers. This, plus the demand by communities and customers for a better environment to shop and dine, will require a sharper focus to be placed on more bang-for-the-buck by architects.
Also, there is a blurring of the difference in high-end to low-end merchandise that has the potential effect of eliminating the middle market. Architects will need to design appropriate places aligned with marketing goals as overabundant decoration and tour-de-force styling will not be affordable or enduring.
KA, Inc. Architecture James Heller, President
Sad to say, one of the primary drivers in the retail area, as in many other public assembly functions, will be security. Owners will need to proactively approach security, which will no longer be primarily concerned with vandalism, loitering or shoplifting. Checking lockers in retail environments will become a thing of the past as they have at most airports. A more vigilant security force will replace the minimal wage, minimal threat cross between a greeter and a school crossing guard and these forces may need to be supplemented with clandestine “plain clothes” personnel, concealed video surveillance equipment, electronic sensors and/or dogs to thwart those from even thinking of trying what has become common place in the Mideast.
Shopping is a pleasurable communal experience; fear of becoming a lunatic's target merely by assembling together, which is the definition of terrorism, must never be allowed to gain a foothold in this country or our way of life — our way to shop and our retail centers will become victims.
MBH Architects Raul Anziana, Director, Urban Solutions Studio
One's residence and workplace are now integral parts of all new retail developments. Mixed-use is becoming the preferred response to market and social demands in order to create vibrant “people-places.” Whether in a green field, a brown field or an urban infill location, MBH projects are incorporating office, recreational, civic, grocery and residential uses along with traditional retail, restaurant and cinema components. These projects are moving up — literally — as multi-story solutions are required for financial performance as well as to create richer physical environments. Parking is being solved in more creative ways to increase the pedestrian quality of new developments. MBH projects start as master plans that address many needs and bring these facets together. Project financing requires top performance and high quality at every level. This is the winning strategy for 2003 and beyond.
MCG Architecture Rick Gaylord, CEO
Current and future trends are three fold. First, there will be an emphasis on continuing the development of mixed-use projects based upon reduced sprawl and an increase in urbanization. Driven by the cost of land, transportation and the desire for more services and variety in a single location. Multiple-level developments will remain strong. Secondly, projects built in the 60s and 70s are showing their age and along with the changing demographics developers must redevelop these existing properties to stay competitive with more attractive recently built centers. Thirdly, we must all depart from the habit of immediately categorizing a project as a mall, power center, neighborhood or lifestyle center and start to ask ourselves what opportunities are present for a particular site and be open to a variety of hybrid solutions which are more responsive to the specific site.
Nadel Architects Steven Kohn, AIA, Associate, San Diego Office
Finding the balance between the demands of technology and basic human needs. While pragmatic reasons for social gathering diminish as automobiles expand our individual mobility, the innate need for congregating remains strong.
The new shopping experience must recapture the age-old quality of the town marketplace and sense of community that has steadily eroded since the days when public transportation and foot traffic fueled commerce. The architect's challenge is to assure the convenience and accessibility demanded by drivers, then transition them comfortably into a more social atmosphere. Accommodating modern technology will bring customers, while the inclusion of social amenities will increase their stay.
The human component to the design of a retail center requires a careful formula of pedestrian paths, plazas, Main Street or town square themes anchored by dining and entertainment retail. A stroll through well-planned landscaping offers the perfect release from stressful commuter traffic, or provides a connection with the community. Technology and the human response: The new retail center must answer to both.
Omniplan Architects Tipton Housewright AIA, Principal
Retail development in 2003 needs to reinforce a sense of community in the mind of the shopper. Recent events, both political and economic, have created an environment in which people are seeking out places where they feel connected to one another, where they feel encouraged and where they feel safe. Retail design and development needs to be focused on these issues in the coming year.
A sense of community has always been one of the fundamentals of success in any retail property. Whether it is an outdoor, Main Street project or an indoor regional mall, successful retail design must connect with the community, its specific place and its specific needs. This approach to design and development creates places of lasting significance, which create customer satisfaction, which ultimately drives sales. Success in the coming year will not be determined by trends of outdoor versus indoor or off-price vs. full-price. Success will be measured by how well we as an industry create and reinforce community.
OWP/P Belluschi Architects Anthony Belluschi, AIA, Principal
Partially due to changes in the economy, the shopping center industry will have some adjustments to respond to in order to capture consumers' reduced disposable income and time constraints. One of the trends I envision for the future includes some shopping centers being recreated as a destination, with more of a “sense of place.” Regional centers will eventually need to be repositioned and even renovated in order to accomplish this goal. Urban projects will continue to flourish as more and more Americans move back into cities. This again ties into the concept of creating a destination with an “experience.” Urban design will be at the center of these projects with retail and mixed-use opportunities complimenting the urban experience.
Traditional retail development will be more prominent overseas. As many of us have experienced in the United States, we face an over saturation in the retail industry producing many weaker centers and fewer successful anchor stores across the country. Many European, Middle Eastern and Far Eastern countries look to North American design firms and many will continue to have the opportunity to take their experiences abroad.
Perkowitz + Ruth Architects Sy Perkowitz, AIA, PE, President & CEO
Maximizing the use of valuable urban land provides architects the creative opportunity to design places that at once improve livability for cities and provide return on investment for developers. At Perkowitz + Ruth Architects, a trend in our current projects is an increased emphasis on mix of uses. In urban areas, we are tasked with reinventing existing sites, such as adding residential lofts over a retail store.
In newer areas, retail centers are more connected to the downtown, or heart of the community. What once might have been a plan for a retail center might now be an open-air urban district, where shops face wide pedestrian sidewalks, and entertainment venues are now a part. Office spaces may be offered on a second floor. Plans for access to public transportation and bike accessibility mark a desire to decrease our dependence on the automobile.
There is a greater emphasis than ever before on quality of design. Character is important to today's consumers who are well educated and well traveled. Shoppers looking for experiences are treated to new developments which may be designed to appear to have been in place for decades, or designed in an ultra-modern motif. Retailers contribute individualized storefront designs at retail centers today in much the same manner as they would if they were planning a store on a shopping avenue in New York City.
RTKL Associates Jeffrey Gunning, AIA, VP & Director, Retail/Entertainment Sector
Throughout the United States, there is very clear movement away from the traditional, enclosed multi-anchor mall format — a trend driven both by shoppers' thirst for more authentic, humanistic places and municipalities' adoption of smart-growth initiatives. What new development we are seeing tends to be either traditional Main Street developments, which replicate the organic growth of urban places, or a type of hybrid mall/Main Street that springs the old paradigm. While the Main Street idea has been around for some time, the big shift has been away from retail as the engine. These developments mix uses, tend to have residential as the driver, have a small but critical mass of streetscape retail and rely on a more affluent demographic. Multi-modal links to light rail or other commuter lines have also proven to be critical to embrace smart-growth initiatives and sustainability.
The other interesting trend comes from the tenant side. Today's ultra-sophisticated retailers are exploring bolder, multi-channel formats that mix bricks, clicks and off-line retailing. This drives more dynamic retailing environments that rely on a mastery of brand, advertising and sponsorship. These places aren't static; they are fluid, vibrant environments that will change the way we shop and re-define our notions of place.
TVS & Associates Mark Carter, Senior Principal
Certainly we will continue to see more and more of the open air pedestrian villages. I can't think of a single major developer in this country who isn't looking at or hasn't already built some version of a hybrid mall or Main Street concept. At the same time, I believe we will see developers take advantage of these nontraditional formats to explore alternative approaches and mixes that better connect with the lifestyles of their customers.
Demographically the two groups that will have the greatest impact on consumerism are the baby boomers and Generation Y. That presents a broad spectrum of ages, lifestyles and needs that must be satisfied. The old formulas have to change.
And I think one of the major components of change will be in what is used as an anchor: Less emphasis on the fashion department stores and more emphasis on creative uses of lifestyle, value and technology retailers; housing and office; maybe wellness centers and spas.