Shopping Center Business

SEP 2018

Shopping Center Business is the leading monthly business magazine for the retail real estate industry.

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WILMINGTON September 2018 • SHOPPING CENTER BUSINESS • 69 on the workforce that is here, and we discovered that over 67 percent of the population has bachelor's degree or above and that the average salary is more than $75,000. Twelve percent of the res- idential base in the downtown core has a household income of over $100,000. There is a lot of disposable income here that really hasn't been captured. We have a number of restaurants; there's a food cluster here that is really starting to grow. Wilmington is becoming a food cluster and a dining destination. The other thing that has emerged in this market is a cre- ative economy. We have over 71 tech- nology and creative companies that we have discovered are located here. Many of them are in locations like The Mill. The banks are starting to attract a lot of technology companies to service them, so we're getting a huge Fintech growth here, and in fact from 2010 to 2015, this market had the highest percentage of tech job growths in the entire Phila- delphia region and a lot of that is being fueled by what is happening with the banking industry. What we're looking at is burgeoning on the population that's growing, bringing in that convenience good retail — a grocery store, a hardware store, basic goods and services that you need which will help start to stabilize the retail market here. SCB : I would like to ask the two insti- tutional investors here, what attracted you to the Wilmington market? What attributes to this market piqued your interest? JEFFREY GANNETT : Rob and Chris Buc- cini, who started BPG 25 years ago, were Wilmington natives. They both went to college, worked in New York for 15 years, and then decided to come back home knowing how well located the city is. They also started their invest- ments here — they bought the Delaware Trust building in 1999 when they did the first residential units in downtown Wilmington, and then have built on that from there. This is our core market. Del- aware is our core market, but Wilming- ton specifically. ROBIN ZEIGLER : Cedar Realty Trust is an urban, mixed-use developer. We saw Wilmington fitting right into our strategic plan of what we do, which is revitalize urban neighborhoods. As we look at opportunities to acquire assets up and down the 95 corridor, we have a large footprint in Philadelphia already, so when we saw what was happening in Wilmington — piggybacking off of every- thing that Catherine [Timko] just said — we saw this as an area that has a lot of growth that we could get a toehold in from a retail perspective. There is prob- ably about 4 million square feet of retail trade area in Wilmington now, and there has been little growth in retail in the last 10 years in this market. With all of the economic growth that is coming, we felt like we could get in on the ground floor. SCB : From the city's perspective, do you want to talk about the economic development and how important retail is overall? JEFF FLYNN : Right now, the develop- ment of restaurant and entertainment amenities is one of the mayor's priori- ties. We know that's a way for us to dif- ferentiate from the other retail offerings in suburban and regional mall markets. We're focused on attracting talented op- erators and getting as many restaurants and experiences into the corridor as possible. As far as retail, the purchase of actual goods is a little less important in the long run. I don't know that we'll ever compete with the regional malls or big boxes, we don't have the space. We're looking for more boutique, local or regional offerings that you won't find in the suburban markets. SCB : For business owners, what do you like about the market? What attracted you to it, and where did you see the need? ROB SNOWBERGER : Being vice president of development at BPG, I have seen the leasing and the strength of our apart- ment portfolio. That showed me there is a strong demand to live in downtown Wilmington, and that's going back to BPG's investment here. We do have a lot of disposable income and a lot of jobs, and we are the only major city in the entire state of Delaware. The governor, senators and congressmen and congress- women are all here. It's on the Interstate 95 corridor, on the Amtrak in the middle of it all — New York, Washington, D.C., Philadelphia. The numbers are what at- tracted me to open my first restaurant, Stitch House Brewery, and then a seond reason is that there are lots of incentives. There is a CRF fund, which is backed by JPMorgan, that gives up to $50,000 for potential retailers. There is downtown development district funding from the state, which helps with physical fit out to building. When you have incentives, the strong numbers of people moving down- town, and the fact that Wilmington isn't going away because of the political pow- er and force of the state of Delaware. All of those factors set you up to where you can sign a 10-year lease there. ANDREA SIKORA : My husband is a chef, and when he was getting back into ownership about five years ago, we spe- cifically knew we wanted to be in Wilm- ington because we wanted to be able to capitalize on the lunch opportunity here because so many people come into the city for work. We knew that we had a very rich pool of potential customers that we could capture. The art venues that are specifically located on Market Street were also very appealing to us. A few blocks up the street was The Grand. There was also The Playhouse, museums and art installations very close by, so we felt like all of those things support a restaurant as well, but there wasn't much going on on Market Street when we came into town. We were told not to do it, but we felt we could succeed with the support of those opportunities and the daytime work population. We also liked the historic spaces, the deep character that we were able to find in the buildings. FLYNN : Rob [Snowberger] mentioned two incentives have been pretty key over the course of the last few years; they're both relatively new. The state of Dela- ware's downtown development district

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