Main Street isn’t dead. It’s being refreshed, rebranded and reimagined. Creating a compelling experience in today’s retail environment is a critical element to being successful. Property owners are working hard to make their retail sites attractive and relevant. This includes placing emphasis on curb appeal and redeveloping spaces that may previously have been occupied by big box tenants.
Many landlords are turning larger vacancies into multiple spaces to accommodate junior anchors and smaller tenants at as retailers are rightsizing and working to maximize efficiencies. At the same time, landlords are replacing building façades and updating landscaping, parking areas and lighting to enhance visual appeal.
Main Street in Westport, Connecticut, represents a prime example of this retail renaissance. This area is in the midst of a complete reboot. Over the past year or so, the talk of the town was that the storefronts along Westport’s commercial corridor are not as lively as they had been in the past. But appearances can be deceiving, and perception isn’t always reality. The truth is that Westport’s retail scene is very much alive and is being revived with new and fresher brands.
Kathleen Fazio, Cushman & Wakefield
New Players
We’re seeing brands like Sundance, an apparel catalog company created by actor Robert Redford, take storefront space at 97 Main Street on the site of the former Ann Taylor store. Lululemon, which was already on Main Street, is expanding into a bigger space due to its popularity with the town’s fitness-minded residents.
Other “athleisure,” fitness- and health-focused stores like Peloton opened in what had been a Sperry’s shoe store. It seems as if almost every brand of athleisure wear is interested in Westport’s fashionable downtown.
The restaurant industry continues to be a mainstay, but a focus on healthier cuisine has emerged and become quite prolific in Fairfield County. The market demand has increased for fast casual, healthy restaurants, like True Food Kitchen, and we are seeing health-minded restaurant tenants looking for space all over the county.
Shifting consumer preferences for convenience and variety have become key drivers for brick-and-mortar retail. And when it comes to creating co-tenancies that drive traffic to retail properties, dining, personal services and fitness are among today’s most desirable categories.
Main Streets and city centers are being curated to attract affluent millennials in the current “same-day delivery” world. Many apparel stores are insisting on having dining options in whatever center they go into. We’ve had apparel clients tell landlords, “Come back when you have a café or come back when you’ve got a coffee shop.” It’s important for these retailers to have people stay, spending time in a center and spending time on Main Street dining and shopping.
This evolution was long overdue in certain towns and leases are now being signed. Marine Layer, Serena and Lily came into downtown Westport with fresh, coastal chic clothing and home furnishing options for residents of this sound shore town.
Then there are those who are expanding their previous spaces, like Williams Sonoma, which has relocated to a larger space in Bedford Square. Anthropologie, too, went from roughly 13,000 square feet to over 30,000 square feet due to the success of its Westport store.
The SoNo Collection mall in Norwalk is still under construction but has set an opening for one of the anchor stores, Nordstom, at the site. The new three-level, 140,000-square-foot store will be the retailer’s second in Connecticut, following Nordstrom Westfarms in Farmington.
Leasing, Development Rise
One factor impacting retail leasing in the area is ‘percentage-rent-only’ deals. Some of SoNo’s space falls into this category. This is a phenomena where the landlords are willing to bet on a tenant’s success in order to get higher rents. While not new, it is changing the manner that these retail spaces are leased and financed.
High Streets, such as Main Street in Westport, Elm Street in New Canaan, Purchase Street in Rye and Greenwich Avenue in Greenwich have seen an uptick in activity as landlords have been forced to reset their rents a bit. These streets a thriving again as retail tenants who do not consider themselves “mall tenants” want a presence there.
In Westchester, there is much more going on construction-wise. Chappaqua Crossing, a newly constructed mixed-use development, is definitely a highlight in the retail sector. This older-style campus was completely reimagined and repurposed, creating a city center-type place from scratch with a new authentic-looking Main Street.
It looks like a typical, high-end suburban downtown now with commerce on two sides, currently open includes Lifetime Fitness, Whole Foods, Chase Bank, Pet Value, Rocks and coming soon is Verizon and Compass others to come with leases to be finalized include food establishments.
In Closing
Fairfield and Westchester counties have displayed strong senses of creativity in the e-commerce era, and these markets know how to reinvent and reimagine. Things are certainly changing, and at times, it seems as if people are afraid of that change. But what doesn’t change over time?
One thing is certain above all else: there will be no retail demise or apocalypse in Fairfield and Westchester counties. The market is just evolving into something different.
In many cases we’re seeing smaller footprints, different types of tenants and more curated centers. For landlords and commercial real estate brokers alike, undertaking these measures takes a lot of careful thought and imagination.
We all must think strategically with an eye for what the needs of our communities are and what the market is demanding. We’re signing leases and we’re doing deals. The traditional retail sector is rapidly learning to capitalize on the efficiencies and excitement delivered by ever-new manifestations of the retail experience.
— By Kathleen Fazio, senior director, Cushman & Wakefield. This article first appeared in the June-July issue of Northeast Real Estate Business magazine.