Shopping Center Business

MAY 2016

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

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Page 355 of 358

ANCHOR RESTAURANTS May 2016 • SHOPPING CENTER BUSINESS • 351 A t a time when attracting tradition- al department store anchors to a new or existing project is more difficult than ever before, one category that has continued to emerge as the next generation "anchor" is restaurants. Far from a complementary feature, restaurants have become an increasing- ly significant component of many retail and mixed-use destinations. Anchor restaurants provide an economic and ex- periential "win" for developers, projects and their communities. In some respects, restaurants have become the new go-to re- tailer, and establishing a critical mass of the right mix of food and dining is con- sidered to be a larger priority than ever before. Eating out is most definitely in: in fact, Bloomberg reported in August 2015 that for the first time in American history, we spent more money eating at restaurants than we did on groceries. While that is a largely symbolic milestone, it is indicative of the degree to which social norms have evolved, and the extent to which going out to eat — something that used to be viewed largely as a luxury or something for special occasions — has become a reg- ular experience in our daily lives. As developers and other commercial real estate professionals know very well, restaurants are often destinations unto themselves, in some cases pulling visitors from significant distances to visit, dine and — most importantly — stay. The degree to which restaurants have emerged as an integral component for all new and existing projects warrants a closer look at how and why these important ten- ants have continued to flourish and grow in retail and mixed-use environments. PRICE POINTS At Easton in Columbus, Ohio, the suc- cess of the project's 60 restaurant tenants — a diverse roster including names like Brio, Northstar Café, Café Istanbul, The Cheesecake Factory, Smith & Wollensky and Mitchell's Ocean Club — speaks to the power and influence of restaurants. Easton's restaurants are responsible for a substantial portion of the revenue for the project. While Easton's restaurants only make up 6 percent of the leasable space, they account for more than 15 percent of the project's overall revenue. Dining anchors have a number of char- acteristics that help explain their growing appeal to developers, owners and opera- tors. First, restaurants pay rent. Second, the inherently experien- tial nature of dining and entertainment makes them resistant to the same online competitive pressures that most retailers are experiencing. At a time when unique experiences are considered valuable cur- rency for increasingly animated and des- tination-driven brick-and-mortar projects, restaurants provide exactly the kind of active and engaging dynamism that drives traffic and boosts bottom lines. Additionally, today's extraordinary va- riety of restaurant types and categories makes it relatively easy to organize mer- chandising for consistent and comple- mentary co-tenancy. For example, Smith & Wollensky next to Tiffany's, and Mon- golian BBQ next to L.L. Bean. DESIGN CONSIDERATIONS While restaurants do not require ex- tensive accommodation from a design and development standpoint, there are some basic considerations that develop- ers should be aware of. Restaurant tenants must not be an af- terthought. They are a critical component in every vibrant mixed-use environment, and should be treated as such. At Stein- er + Associates projects, most restaurant tenants are located on corners or other prominent locations. Restaurants and ca- fes occupy nearly 80 percent of the cor- ner spaces in Easton and Liberty Town Center, and in virtually all cases provide outdoor seating. There are also some practical design and engineering considerations that must be accounted for. Restaurant tenants have higher power requirements — as much as Dining: In The appeal and use of anchor restaurants continues to grow as traditional big box retailers fade from relevance. Yaromir Steiner Steiner More and more, consumers are integrating dining out into their regular routines.

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