The Future of Retail in Downtown Columbus – Part II

Entrepreneurial Support — By on August 2, 2010 at 9:00 am

In November 2009, the Capital Crossroads Special Improvement District announced a new retail incentive program that included the creation of a dedicated Retail Recruiter for downtown Columbus. We spoke with Retail Recruiter Kacey Campbell in February to find out more about what exactly she’d be working on, and one of the things she mentioned was an information gathering process and retail analysis already underway by Chris Boring of Boulevard Strategies. That report was completed earlier this year, and we recently had the opportunity to sit down with Chris to further discuss the findings in that report and what it could mean for the ongoing retail recruitment efforts of Capital Crossroads.

(Note: Part I of this article can be found on ColumbusUnderground.com HERE)

Walker Evans: Having identified all of the spending potential in these six downtown submarkets, what sort of tangible, actionable efforts can the city of Columbus or the SID take to attract private investment and development?

Chris Boring: Let me first say that I think we are pretty early in the recruitment process. That being said, I did already have the opportunity to put this research into action. Joe Spinelli of Spinelli’s Deli was recently thinking about looking for another location and downtown seemed to be a logical choice. He called up retail recruiter Kacey Campbell (contact info) and she showed him several locations, and he settled on the space at 50 N. High St.

North High Street Submarket: 59,800 Workers 10,300 COTA Riders 200,000 Overnight Visitors/Year Millions of Arena District/Convention Center Visitors 1,300 Residents $135 Million/Year Retail Market $90 Million Spent by Workers/COTA Riders

Then, I sat down with Joe and took the numbers from the North High Street submarket and was able to work with him to come up with a pretty good estimate of how many transactions he could expect each day for breakfast, lunch and the afternoon. He used this information to put into his business plan to go out and get investors. I think that is great action. And, as you know, he is going to opening the new downtown location the day after Labor Day. I predict that he will be very successful there, even based on a pretty conservative market share.

So that’s one example that is currently under way. It will take awhile, but I think we are going to make a lot of progress with retail downtown. As I mentioned earlier, Cleve [Ricksecker] is working on an initiative to develop some smaller spaces that are affordable for retailers.

[Local Resource Database – Community & Neighborhood Resources]

WE: I’ve heard a little about those plans from Kacey and I hope they can happen very quickly. Currently, it seems like, for whatever reason, larger retail chain stores aren’t willing to take the risk on downtown at this point in time and the smaller entrepreneurs who are willing to take the risk don’t have the proper type of small space that they need or it is too cost prohibitive to bring it up to code. Is that accurate to say?

CB: Yes, that is very accurate to say. Chains are risk adverse. They are not going to come back downtown until the independents make it safe for them. We are just now seeing some chain retail in the Short North.That’s a common challenge for downtown areas all over the country.

Right now, I am working on a program with Heritage Ohio which runs the Main Street Ohio Program, Retail is Detail. I’ve done market studies in 30 or 40 downtowns across Ohio. They asked me if I could take a different approach, and start working more one-on-one with retailers. With a market study you are looking at aggregate demand and supply with more of a recruitment focus and more of a planning focus.

So, this technical assistance program works more with individuals and is focused on retaining businesses, and very much focused on implementation. So I think that is another thing that needs to be put into the tool box is finding some way to assist existing local entrepreneurs. I’m hoping that maybe the city of Columbus will look more like that in the future. One thing that they do have is the facade program.

WE: When I look at a downtown entity like The North Market, which serves entrepreneurs with small retail spaces, and see that it’s essentially operating at capacity, I can’t help but think that there’s a missed opportunity there. Do you think downtown could support a second facility, perhaps with more of non-food retail focus?

CB: When I was working with the North Market five years ago they weren’t full, so that’s great. I also kind of feel like Pearl Alley Market is full, or is filling up right now. That’s kind of what we are trying to do with this retail recruitment program− give those that want to graduate from North Market or Pearl Alley Market a space of their own. We have to be able to create that kind of space that they can move up to.

WE: What’s the challenge in finding or building the appropriate venue for that type of entrepreneurial growth?

CB: We’re not talking about building anything new for this. We’re talking more about getting larger existing spaces and breaking them down into smaller spaces. It’s easier and more affordable to divide up a space for small retailers.

[Local Resource Database – Retail & Real Estate Resources]

WE: Do you think the City of Columbus has recently missed opportunities with the two parking garages they’ve built, since they lack any sort of street-level retail component?

CB: I wouldn’t necessarily advise going out and building new retail space right now; we already have too much vacant space. But I would love to have that future flexibility perhaps in a retrofit. From a planning perspective, retail on the first floor is better than parking on the first floor.

WE: In Part I of our interview you mentioned that the RiverSouth area is lacking in retail space closer to the courthouse end of that district. Franklin County is wrapping up construction on their new annex project. Do you think they could have stepped into that role and built some retail space into that project to help fill that need?

CB: Well, I think it is kind of hard to sell anybody on building additional retail space right now.

WE: Even if there is a demand specifically for that exact block when you break it down by submarkets?

CB: Well, I think there is a demand. But we are still trying to get the word out there and convince other people that there’s that demand. I think you have to be careful of that you don’t make retail space too internalized. One thing I found when looking at the market for Spinelli’s Deli is that a good chunk of that market is taken up by company cafeterias. I recently attended the opening of the new downtown COTA Headquarters and one thing I was happy to see was that they decided not to build a company cafeteria because they want their workers interacting with the community both economically and socially in the rest of downtown. In some ways, I don’t think it’s a good idea to make it too easy for people to stay inside their own building all day.

WE: Going back to student demographic on the east side of downtown… Do you think that the educational institutions there should help develop retail facilities, or should students be pushed more into the center of downtown where these six submarkets exist?

CB: I think there is more opportunity to develop immediately around the schools because there is a lot of vacant land there. Right now, I think the students are going to Gay Street. I think there is a significant opportunity to serve the whole student population, especially if a retailer doesn’t just limit themselves to serving one institution.

WE: Your previously mentioned example of Spinelli’s Deli opening a second location downtown raises the question of whether there is a better opportunity to assist new businesses or to assist growing businesses that already have some experience and finances under their belts.

CB: We are going to try to do both. However, we don’t want to poach anybody. It has to be a strong enough business that it will be a second location, not a relocation.

WE: Gotcha. Personally, I don’t get out to Hillard too often, but I’ve often wondered if the popular Starliner Diner would consider expanding downtown.

CB: I think downtown is the most underserved retail market in all of Central Ohio. So for anyone who is looking to expand into future locations, downtown ought to be at the top of their list based on all of the unmet demand. For example, look at the student market. If I were a building owner that had vacant retail space on Gay Street, I’d walk up High Street next to OSU and go door-to-door and talk to every university retailer and ask them, “Why don’t you open another location downtown?” I think there are tons of small business owners next to OSU that either would or should serve the large student population downtown.

WE: The 2010 Downtown Strategic Plan featured several individual projects that focused on creating or changing the infrastructure to be more accommodating of retail such as the plan to restore on street parking to High Street and reroute bus lines to allow visitors and shoppers to park close to retail destinations more easily. Do you think this plan will help with retail recruitment efforts?

CB: Yes. I do think the bus stops are a real challenge for retailers. They put up a “wall” that blocks visibility of your storefront. The bus stop, the bus, the people congregated around the bus stop− it all really interferes with the visibility of retail storefronts. I guess I would want more details before I would endorse changes to that, but I’m glad somebody is looking into it.

WE: Thanks for taking the time today to share some of this information with us, Chris.

CB: My pleasure, Walker.

Interested in starting a retail business in downtown Columbus? More information can be found online at DowntownColumbus.com/Doing-Business.

Walker Evans Walker Evans (98 Articles)

Walker is the founder of ColumbusUnderground.com and co-founder of TheMetropreneur.com along with his wife and business partner Anne Evans. Walker has turned local media from a hobby into a full time career over the past decade and serves on multiple boards and committees throughout the community.


  • http://www.themetropreneur.com/columbus/members/andy/ Andy Dehus

    Has there been any investigation into the supply side of the commercial real estate equation?

    I ask because it seems as though most of the real estate holders downtown are quite large, and it strikes me that small businesses may not be perceived by them as being their ideal tenants. I’ve been amazed by how long these commercial space holders have been willing to hold out without lowering prices to the point that their spaces are attractive to small businesses… can that go on indefinitely?

  • http://www.themetropreneur.com/columbus/members/chrisboring/ Chris Boring

    Andy — You have identified a key challenge in leasing downtown’s first floor spaces. Most downtown building owners are focused on finding office tenants as their retail spaces account for a small percentage of the space they need to fill. They do not have the time nor the inclination to go out and find independent retailers. (The chains are history, at least, for now.) That’s where Kacey Campbell comes in. Most of them will at least listen if you a bring a potential tenant to them.

    Kacey’s role is to go out and seek out entrepreneurs, whether established or new, and match them up with brokers and landlords with vacant spaces. It’s a win-win for both parties.

    Also, Cleve is trying to address the cost issue by demonstrating the economics of sub-dividing large unrentable spaces.

    So while my work focuses on consumer demand for retail space downtown, there are efforts in place to address the other side of the equation, as well.

    • http://www.themetropreneur.com/columbus/author/walker-evans Walker Evans

      I’ve chatted with Kacey a bit about this in the past and what I’ve heard from her is that not only the ground-floor retail spaces a small percentage of the office building space that they need to fill, they’re also a small percentage of the financial solvency of the building/property. So the larger buildings that do have a property manager are generally more concerned with working on keeping their office spaces filled rather than worrying about their retail spaces.

      Of course… my common sense would lead me to believe that an office building with a full stock of retail services in the ground floor would make for a more attractive spaces for an office tenant on floors above… but maybe that’s just me. ;)

      • http://www.themetropreneur.com/columbus/members/andy/ Andy Dehus

        Thanks for the informative responses, Chris & Walker. And Walker, I’m definitely in sync with your ‘common sense’ on the matter.

  • http://www.themetropreneur.com/columbus/members/professor/ harlan schottenstein

    The real strength of the community is the local business people committed to serving the market place. I think that this effort by Kacey and Downtown Columbus is to be applauded and is a move in the right direction. There is interest out there in a downtown retail community.

    There is under utilized space out there, not always the most attractive but interesting with potential if approached creatively. Someone needs to help bring the owners of the space together with the small business people.