The previous post generally described a retail ecosystem and the influence a retail power center (e.g., SouthPointe Pavilion) has on other markets within an urban space. This analysis gets more granular to quantify the market for retail site selection and development purposes. Specifically, What is the influence of a 15-minute drive on retail opportunities?
Retail trade areas formed by different drive time radii using Lincoln's SouthPointe Pavilion as the center are provided in the above map. In this example, 5-, 10- and 15-minute drive times define a broad trade area bounded by Interstate 80, NW 48th Street, SW 56th Street, S. 176th Street, and Olive Creek Road along Highway 77 (far southern point). This area encompasses Lincoln's downtown and Haymarket; Pioneers Park in West Lincoln; Capital Beach in NW Lincoln; and the towns of Bennett, Hickman and Roca in rural Lancaster County.
Of particular analytic interest is the influence of the SouthPointe Pavilion trade area on the Haymarket. The West Haymarket Redevelopment Project marks a significant investment in Lincoln's urban retail and entertainment space that is anchored by the 16,000 seat Pinnacle Bank Arena. This $339 million project is symbolic of Lincoln's growth in prosperity and attractive amenities.
Multiple data variables are used to quantify the retail trade area. The above charts show household characteristics and median household income for the drive time-defined areas. A few observations:
- Housing Units: The area marked by a 5-mile radius from SouthPointe Pavilion (27th & Pine Lake Road) has nearly three (3) times more owner occupied housing units than the same size area for the Haymarket (8th & P Streets). (Demographic data is projected for 2017.) The area marked by a 5-mile radius from the Haymarket (8th and P Streets) has over three (3) times more vacant housing units than same size area for SouthPointe Pavilion.
- Income: Median household income for the 5-mile area around SouthPointe Pavillion is three (3) times higher than the same size area for the Haymarket. That gap shrinks to near parity the further the drive times, as expected with movement away from the central business district (Haymarket).
Realize that two household characteristics is not enough analysis for retail site selection. Additional analysis of consumer segmentation is proprietary to Hoffman Strategy Group LLC (HSG). That analysis will include consumer lifestyles, personality, purchasing motives, and other socio-economic and behavioral characteristics.
Generally speaking, SouthPointe is typical of suburbs -- dual-income families employed in professional jobs. The Haymarket is a central business district and a few blocks from the University of Nebraska's city campus.
The Haymarket is a vibrant place for business, retail, entertainment, and cultural experiences. Redevelopment plans are built around the Pinnacle Bank Arena. There is so much excitement in the arena that Pink concert tickets sold out within 10-minutes. Other big-name performer's -- Michael Buble' and Jason Aldean -- are performing this fall, 2013. Support will come from the entire Lincoln community and visitors from other places. Similar consumer characteristics have made SouthPointe Pavilion a successful retail power center in south Lincoln.
The sustainability of the Haymarket as a retail and entertainment center is significantly influenced by SouthPointe's trade area, a 15-minute drive. In the context of the retail ecosystem, both trade areas are inter-dependent within the urban boundaries of Lincoln. That is why Michael Buble' and Pink are site selection criteria for a prosperous retail business and a happy community.
Hoffman Strategy Group LLC (HSG) recognizes that retail location involves significant resource investments. Your next location marks an important growth strategy for your business. Our economists extensive knowledge about the markets and know-how to quantify the markets can navigate you through a site selection due diligence process. We believe that working in an authentic partnership with you, in a transparent and accountable process, results in decisions well-informed by research. After all, you have a lot riding on this decision. Confidence matters!