A Glimpse into Virtual WLI Circles
One of our WLI Circles group met virtually this week. Their conversation touched on a lot of hot “COVID-19” topics; primarily how members...
I am honored to share my thoughts with you and hope that you and your families are all well. Through this collective and difficult experience, it brings me comfort to know that all of us are sharing ideas, being resilient, reflecting on what is truly important and hopefully finding grace in our new normal. As we consider the risks of our essential employees and healthcare workers, I want to express my gratitude for their efforts.
At Of Place one question driving our thoughts is: “What is the future of neighborhood activation in a post COVID-19 world?” The answer is certainly still unknown, with so many variables yet to solidify. That said we are working hard to gather facts and to formulate our organizational perspective which we hope will aid our clients moving forward. We would like to thank the brokerage houses and research firms leading the charge to reveal valuable data and trends for our industry.
Of Place protects the long-term value of places and improves the performance of mixed-use assets by focusing on placemaking in the ground plane and public realm. This unprecedented crisis will fundamentally change the many components contributing to the “groundplane,” from its design to its occupants and ultimately the public realm and streetscape. Owners who are willing to adapt their traditional development models, merchandising strategies, design principles and placemaking techniques will have an opportunity to capture market share, while others might struggle to manifest their legacy plans.
The umbrella of use-types categorized as “retail” will change and the market will need to adapt to accommodate the business models of these newcomers.
As an example, restaurants are rebuilding to react to lower volumes associated with lockdown. Some are finding success and even sustainability, but at the price of employment. The best operators are figuring out how to maintain their relationship with furloughed employees with programs that range from sustaining health insurance to offering safety nets for immediate needs like food. This will decrease reopening costs, but will these business owners be able to generate the sales volumes we were used to for the last decade? How might a landlord, in either 2nd generation or pre-development space, make itself more approachable to a restaurant tenant going through this transformation? Will more fluid forms of tenancy improve the ultimate experience?
Also, F&B demand is becoming less impulse driven. Customers are making intentional choices to schedule pickup and delivery times and recurring purchases. Therefore, customer engagement strategies really need to stand-out. Online social or educational web meetings paired with sale promotions, memorable and thematic ad campaigns, and out-of-the-box loyalty programs are helping some create an edge in a busy online environment. Can landlords and tenants find ways to work together to mutually amplify their marketing reach?
Retail is accelerating its shift from large and prolific bricks and mortar to a showroom model with technology driving purchases and delivery. This has been happening for a while at a slow pace, and now may be accelerated dramatically by this extended closure. How will this affect rent and percentage rent models?
All of this just confirms the importance of casting a wider net, considering many alternative uses to help create “eyes on the street” and a sense of community in our urban environments.
We urge you, if able, to support your favorite local small businesses during this time. We have listed a set of charitable entities on the Of Place Website should you have interest in supporting the restaurant community.
Additional resources we hope will be useful to you:
Stay strong, all. My husband and my favorite part of the day these days is connecting with my grandkids on FaceTime, so remember to reach out to those you love. We look forward to emerging from this crisis alongside you!
Managing Partner, Of Place
Member of ULI Placemaking Product Council
In ULI Washington’s new Leadership Insights column, ULI Washington will regularly feature member leader’s thoughts and insights as we adjust personally and professional to a “new normal.”