Changing demographics in the intermountain West are spurring a shift in commercial real estate development, with smaller retail stores thriving near residential development.
The Sonoran Institute on Thursday released an analysis of commercial development across the West, revealing a growing desire for a mix of smaller homes, stores, businesses and workspaces in a single neighborhood.
The swing back to Main Street-style retail defies the decades-old trend toward stand-alone shopping centers, big-box stores, strip malls and suburban office centers. That trend is dissolving as huge retailers like Sears and RadioShack shutter thousands of stores and traditional big-box retailers like Target and Walmart test smaller, urban locations.
The institute’s 50-page “Restore” analysis charts changing trends and attitudes in 32 large, mid-size and small communities in four Western states. The report details the changing commercial market landscape in Fort Collins, Loveland and Parker on the Front Range and Grand Junction, Telluride, Durango, Rifle, Glenwood Springs, Carbondale, Basalt, Eagle and Buena Vista on the Western Slope.
The report follows Sonoran Institute’s “Reset” study last year, which found that buyers were willing to pay more for a home near a downtown core, but the West’s supply of those urban-style homes was too small.
“Restore” reveals smaller retailers thriving as they adapt to an increasingly online shopping world by opening smaller shops in proximity to homes. “Restore” urges communities to develop zoning policies that encourage mixed-use development and to pursue partnerships with developers.
In many ways, “Restore” is a guideline for community leaders and developers eager to capitalize on the changing commercial real estate trends. It provides population requirements for particular retail categories — like an electronics store needs at least 4,800 households to support it — as well as checklists for developers and community leaders.
And “Restore” urges smaller communities to temper their push for mixed use. A lot of components — from population density, demographics, education and income levels and tourist traffic — play a role in successful mixed-use projects, said Clark Anderson, the Colorado director of the Sonoran Institute’s Community Builders program.
Several Rocky Mountain communities are already revising policies that enable mixed-use development in places like Eagle Ranch, Buena Vista, Durango and Grand Junction. The report outlines formulas for communities to scale the Main Street-type projects.
The report suggests multi-story mixed use projects would thrive in places like Fort Collins, Loveland and Durango but not so much in Buena Vista and Teton County, Idaho, where renovating historic main streets would be more efficient.
“We tried to provide the information that gives communities realistic expectations for what they can build and what they can achieve in their market,” Anderson said.
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