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HomeMy WebLinkAbout[02] Section 2 - Exhibit BEXHIBIT B: McCOMB GROUP, LTD. FINDINGS Future De~elopmenl St..loseph has four other areas for potential retail development, as shown on Map 1-?. Other potential sites or developments include: • Coborn's has purchased a site in the northeast quadrant of County Road 133 and TH- 75. This site has excellent visibility and access. • Proposed strip center with 10,000 square feet of space at Eighth Avenue and TH-75 on the southeast quadrant. This development is in the conceptual stages. • I-94 and County Road 2 is owned by a developer and is awaiting completion of a corridor study. A concept plan has been approved for mixed commercial and residential developed. • Commercial land is offered for sale at 20`h Avenue SE and TH-75. Summary The central business district contains a mix of commercial, residential and government land uses with little rhyme or reason other than in the Minnesota Street arcs. If a business wanted to locate downtown, there arc no recognizable available development sites. The college students and faculty represent a significant market for existing and future businesses along Minnesota Street and the soutltcrn central business district. The southern central business district area will likely remain a convenience-oriented retail area for students and faculty. It should broaden its food service and retail offerings to sen•c a broader segment of young adults from the St. Joseph trade area. The northern portion of the central husiness district is suitable for retail and service establishments that do not or cannot find acceptable sites along TH-75. Commercial development along TH-75 is occurring in a haphazard manner. Newer commercial buildings have good visibility, but convoluted access. The Highway 75 retail area will appeal to large retail uses and other businesses that benefit from the highways regional traffic. Both of St. Joseph's retail areas would benefit from land planning that would focus on creating convenient access and tie these evolving commercial areas together in a coordinated manner. Construction of a supermarket on Coborn's site is the most important retail development that is on the horizon. It is extremely important that St. Joseph initiate the planning activities that will permit other businesses in St. Joseph to benefit fiom this investment when it occurs. I.5 B-1 EXHIBIT B: McCOMB GROUP, LTD. FINDINGS and currently ha 9 retail stores and 18 service establishments, anchored by a 60,000 square foot Cohorn's Superstore. This area currently serr•es as a convenience goods shopping area for the growing residential areas in and around Sartcll. The Cobom's Superstore serves customers from St. Joseph's trade area. • Cold Spring is located ten miles southwest of St. Joseph. This small, scrvicc-oriented community has 32 retail stores and 58 scrvicc establishments. The largest concentration of establishments is in the full service food category• (7 restaurants) and financial services category with ]0 establishments. Convenience retail is represented by eight stores including Cold Spring SuperValu, Snyder's and Do It Best Hardware. Cold Springs' 90 retail stores and services make it the largest commercial area outside the St. Cloud area. • Richmond is located on Highway 23 and State Highway 22, 13 miles southwest of St. Joseph. This community has 33 retail stores and 25 service establishments. Five convenience goods stores include Food Pride grocery store and Do It Best Hardware. • Rockville is a small community seven miles south of St. Joseph with 18 convenience driven business establishments including nine scrvicc and nine retail merchants. Rockville's limited convenience goods indicate that residents would need to leave Rockville to purchase day-to-day items including groceries and for medical/dental services. • Albany is located on 1-94, about 14 miles west of St. Joseph. This community has 31 retail stores and 39 service establishments to serve its residents and interstate travelers. Seven convenience goods stores include Amby's Foods and True Value Hardware. Interstate travelers benefit from Albany's five convenience gasoline establishments and food services. • Avon is a small community about tight miles west of St. Joseph. It has 26 retail stores and 23 service establishments, primarily to meet the com~enience retail and service needs of area residents, as well as travelers on 1-94. Food service is the largest category with 1 1 establishments. Convenience retail includes Dahlins Supermarket and Avon's True Value Hardware. St. Joseph retailers compete with retail stores and services in all of these communities. With fewer retail stores and services, St. Joseph has less of a competitive impact on these communities. This will change when a Coborn's store opens. Coborn's store would be larger than the competitive supermarkets in these towns and would attract grocery shoppers to St. - Joseph. St. Joseph retailers are competitive with stores in St. Cloud as well as the surrounding communities. St. Cloud, however, presents the strongest competition due to its size, number and wide variety of stores. 2-4 B-2 EXHIBIT B: McCOMB GROUP, LTD. FINDINGS Chapter ~'1 "TRADE AREA Two trade areas were delineated for St. Joseph. The current trade area, shown on Map 6-1, covers a smaller geography based on existing businesses in St. Joseph. The second trade area reflects the expanded trade area for a large supermarket. The current trade area represents St. Joseph's existing retail trade arcs. The supermarket trade arcs represents St. Joseph's trade area after the development of a supermarket in St. Joseph. The trade areas were delineated by McComb Group based on the location of competitive shopping areas, arterial road nerivork, natural boundaries, St. Joseph business owner comments, and previous experience. The current trade area includes St. Joseph and Avon. This trade area is served by I-94, TH-75, County Road 2 and County Road 133. St. Joseph's supermarket trade area extends further west, north and south to include the communities of St. Anthony, Freeport, Albany, Holdingford, Richmond, Cold Spring, Rockville and a portion of St. Stephen. This extended trade area is served by I-94, County Road 75 and TH-23, which are major arteries for commuters that work in the St. Cloud Metropolitan Area. County Roads 2 and 133 provide access from the north and south. Population and Households Population and household growth trends for both trade areas and the St. Cloud Metropolitan Area arc shown in Table 6- l . Tablr 6- I ST JOSEPH CURRENT ANU SUPERMARKET TRADE AREAS 1'OPL:LATIOK AND HOUSEHOLDS: 1990 .4ND 2000 CENSUS: 2006 AND 201 I Fti"rIMATED Population 1990 2000 2006 2011 Annuul Growth Rate 1990-2000 20(N)-21N16 2006-2011 Ho^seholds 199(1 20011 2006 2011 Annual Growth Rate 199h-2000 2000-2006 2006-2011 Suw.c 1. 1 f'm.in. Sran'US Inc and Mc(-umhGrout~ LL: Currcnl Supermarket SL Cloud Trade Area Trade Area MSA 12,979 30,001 149,901 14,982 34,541 167,392 16,818 38,684 184.998 18,718 42,309 199,089 1.4~ °0 1.42 io III °o 1.9t 1.91 168 2.16 I.RI 1.48 3,288 8,925 51,1168 4,072 10,984 60,669 4,989 13,364 72,120 5,886 15,478 81,759 2.16 °0 2.10 °.° 174 °o 3.44 3.32 2.92 3.36 2.98 2.54 The population of the cunent trade area increased at a rate of 1.45 percent from 12,979 in 1990 to 14,982 in 2000. )3etween 2000 and 2006, population continued to increase by 1.95 percent to 6-1 B-3 EXHIBIT B: McCOMB GROUP. LTD. FINDINGS -~ t P21 0~ i l` ~~~.. _ ~r .~ ~ 'S ,~ ~ ~~ `--~sf r~ .~, 11 ~~ i` ' _ ~~, ~ - _ naa~ uoouceo wim acarow q '6 '\ ~ ~ ~~ ~ .,. ,.Y 1 ~ ' ,} ,.. :.~°~ -._ _' N r, T~ ., - ,~ - ~\ `; I - f , Q ~ i ba o~ ~'^.. ,~ ~ - - ~ -- _ t ~ ' ~ ~. J Y i. ~ ',, ~,.:. t S `~ M ~ ~ C ~ ~ ~ ~ ~ r _ C \` , \ l ~ r fn ~' ` < ~ - 3 c - - '~ .. ~ '- ~ a 'o ~:k~' - _ ~ _ n „` Y Q E x. ~ `' a ~A ~- - 'O i :a e< q ~ ~ ~ ~~ ... ;, v ~ L A ~ ~ N .. C ~~ 4 ~ O t P~~"y ~ y _ s. +, h ~ Z ., ~ ^ ^ N CO O B-4 EXHIBIT B: McCOMB GROUP. LTD. FINDINGS 16,818 people. Population i. estimated to increase at a raft of 2.16 percent to 18,718 by 2011. Current trade area households were estimated at 4,989 in 2006, a growth rate of 3.44 percent from 2000. In the future. households are expected to increase to 5,886, a growth rate of 3.36 percent. Thcsc growth rates arc above the MSA household growth rates of 2.92 percent between 2000 and 2006 and 2.54 percent for the next five years. The supermarket trade area population is increasing at a faster rate than the current trade area. This larger trade area experienced a growth rate of 1.91 percent from 2000 to 2006, increasing its population from 34,541 l0 38,684. Population is further increased at a rate of 1.81 percent to 42.309 by 201 1. Supermarket trade area households have been increasing at a slightly slower rate than the current trade area. From 2000 to 2006, supermarket trade area households increased at a rate of 3.32 percent from 10,984 to 13,364 households; while the current trade area increased at a rate of 3.44 percent. Supermarket trade area households are expected to increase to 15,478 in 201 I , a growth rate of 2.98 percent. Population and households in the current and supermarket trade areas are growing at rates faster than the St. Cloud MSA. Adding a supermarket to St. Joseph's commercial area will expand the trade area by about 140 percent. Residents from this expanded trade area represent potential new customers for current and new businesses in St. Joseph. Household Income The distribution of household incomes above $75,000 is shown on Map 6-2. Average household income of $65,448 in 2006 in the current trade area is 12.5 percent higher than the St. Cloud MSA of $58,143, as shown in Table 6-2. In 2011, average household income is expected to reach $69,641 in the current trade area compared to $62,284 in the MSA. Average household income in the supermarket trade area was $60,501 in 2(106 and is estimated to increase to S64,568 by 201 1. Supernmarket trade area average household income is slightly lower due to the larger rural population. Table 6-2 ST. 1(ISF.PH CURKEN7' AND Sl.'PERR1ARKET TRADE AREAS AVERAGE AND MEDIAN HOCSFHnI D INCOME 1990 AND 2000 CENSUS: 2006 AND 201 1 ESTIMATED Current Supermarket SL Cloud Trade Area Trade Area )\1SA Average Household Income 1990 S 36,990 $ 33,657 3 32,705 2000 59.133 56,482 51,966 2006 65,448 60,501 SR,143 2(111 69,641 64,568 62,284 ~rediyn Household rncome 1990 5 33,785 $ 30,314 b 27,851 2000 49,265 45,929 42,752 2006 55,558 51,491 48,425 2011 60,145 55,724 52,119 Source: ~1cComb Group. Ltd. 6-3 B-5 EXHIBIT B: McCOMB GROUP, LTD. FINDINGS with KS percent of the sales being derived from the primary trade area. Food service market share is estimated at 35 percent with 75 percent of the sales derived from the trade area. [n the shopping goods category, market share ranges from 15 percent to 35 percent depending on store category. In the shopping goods category, most stores are estimated to receive 75 percent of their sales from the primary trade area with 25 percent represented by inflow sales. Market share in the services and health care categories are estimated at 25 to 35 percent wish RS percent of the sales being derived from the primary trade area. Supemarket trade area market share ranges from 25 to 40 percent in the convenience categories with KO percent of the sales being derived from the trade area. Food service market share is estimated at 25 percent with 70 percent from the trade area. Shopping goods market share is estimated at 15 to 35 percent. Services and health care market share is 20 percent. In some categories, market share is lower in the supermarket trade area because of the larger number of households. These categories will still have larger sales potential. Sales Potential Estimated retail and service space demand is a two-step process. Sales potential for each retail or service category is estimated first to determine if retail sales arc sufficient to support a store. Next, store size is determined based on sales productivity and typical store size for each category. This methodology is illustrated for 2010 in Tables 7-4 and 7-5. These tables use convenience goods stores in both trade areas as examples to illustrate how a supermarket increases supportable square footage of retail stores and services. Table 7-4 ST. JOSEPH CURRENT AND SUPERMARKET TRADE AREAS RETAIL PURCHASING POWER, MARKET SHARE AND SALES POTENTIAL; 2010 BY MERCHANDISE CATEGORY (In Thousands of lkillars) 7 rade Area Resident Estimated Trade Purchasing Market Arca A1erchandisc Category' Power Share. Sales Current Trade Arca Grocery stores $ 25,067 35.0 % $ 8,773 Drug 6c proprietary stores 5,893 40.0 2,357 ' Hardware 1,381 40.0 552 Liquor 3,352 60.0 2,011 Flurisi 737 35.0 258 Supermarket Trade Area Grocery stores $ 64,755 40.0 °!o $25,902 Drug & proprietary stores 15,226 35.0 5,329 Hardw•arc 3,568 30.0 1,070 Liquor 8,659 40.0 3,464 Florist 1,903 25.0 476 Source: McComb Group, Ltd. Trade Estimated Area Other Sales Percent Shoppers Potential 85.0 ;r° $ 1,548 $ 10,321 85.U 416 2.773 85.0 97 649 85.(1 355 2,366 85,0 46 304 8(1.0 °r~ $ 6,476 $ 32.378 80.0 1,333 6,661 80.0 268 1,338 80.0 866 4,330 80.0 119 S95 Using grocery stores as an example, resident purchasing power in 2010 in the cutrent trade area is estimated at $25.1 million, as shown in Table 7-4. Market share of 35 percent results in $8.8 7-4 B-6 EXHIBIT B: McCOMB GROUP, LTD. FINDINGS million in trade area sales. Adding inflow sales ofS1.5, results in total estimated sales of about $10.3 million. In the supermarket trade area, grocery store purchasing power is $64.8 million, a 158 percent increase from S25.1 million in the current trade area. Sales potential is estimated at $32.4 million. Estimated sales potential is about 52.8 million for drug stores and 52.4 million for liquor stores in the current trade area, compared to $6.8 million and 54.3 million, respectively. A supern~arket is likely to have both a pharmacy and liquor store to capture some of this increased sales potential. The same approach is used for other retail and service categories. Sales potential for other retail stores and services is contained in the Appendices (under separate cover). Supportable GLA for grocery stores in the current trade area is based on sales potential of $10.3 million divided by $400 per square foot, resulting in supportable square footage of 25,802 square feet, as shown in Table 7-5. Supportable grocery store space in the supermarket trade area is based on sales potential of $32.3 million and sales productivity of $450 per square foot. This indicates sales support for about 70,000 square feet of grocery store space. Not all of this would he new sales for the supermarket operator. A store in St. Joseph would result in sales transfer from supermarkets in St. Cloud and Sartell. The proposed supermarket will also capture sales transfer from smaller supernarkets in communities to the west and south of St. Joseph. Table 7-5 ST.IOSEPH CURREi~"r AND SUPERMARKE7 TRAD)r AREA RETAIL SALES POTENTIAL AND SUPPORTABLE SPACE; 2010 BY MERCHANDISE CATEGORY Estimated Sales Sales Supportable Median Merchandise Catcgury Potential Per Sq. Ft. Square Feet Store Size Current Trade Area Grocery stores 5 10,321,000 S 400 25,802 42,228 Drug & proprietary stores 2,773,000 360 7,703 11,153 Hardware 649,000 185 3,508 7,857 Liquor 2,366,000 375 6,309 3,850 Florist 304,000 225 1,351 1,700 Supermarket Trade Area Grocery stores ~ 32,378,000 $ 450 71,951 42,228 Drug & proprietary stores 6,661,000 360 18,504 11, 153 Hardware 1,338,00(.1 185 7,232 7,857 Liquor 4,330 375 11,345 3,850 Florist 595,000 225 2,644 1,700 Suurcc: Mc('omb Group, Ltd. The last column in this table contains the median store size from Doilurs & Cents of Shopping Centers, published by the Urban Land Institute, for each store type. Median store size indicates a typical size for a store in each retail category. To the extent that supportable square footage is shout the same as the median store size or larger, sales potential exists to support that store type. Complete tables showing supportable square footage by retail and service category for each target year are contained in the Appendices. 7.5 B-7 EXHIBIT B: McCOMB GROUP, LTD. FINDINGS Store types and median store sizes used in this analysis are based on current retail formats and store size. Since this study extends over a 20-year period, store types and concepts may change during this period. Recent trends have been for many store types to increase in size to accommodate a larger selection of merchandise and increase customer attraction. Ketail gross leasable area (GLA) supported by estimated sales potential for each retail store category is based on estimated sales per square foot (in 2007 dollars) by store type. Sales per square foot estimates are derived from median store sales per square foot for each tenant type contained in Dollur.~ 8 Cc~nl.c ojShoppinK Ccnle~s, and have been increased to reflect sales per square foot in 2007. Supportable GLA is calculated by dividing sales potential by sales per square foot. This analysis was used to provide an estimate of the supportable square footage in each retail store category. College and lJniversity Impact Students at CSB and SJU represent spending potential for a w•idc variety of retail goods and services in St. Joseph. College students living in St. Joseph are included in St. Joseph's population, but are not considered households. As a result, they arc not included in trade area purchasing power based on households. Student spending potential is included in inflow sales. Survey research contained in Chapter III, indicated that the student body at CSB and SJU has spending potential of about S2 million for entertainment and about $1.5 million on clothing per school year. These students also have spending potential for a wide variety of other retail and service categories that can be tapped by businesses in St. Joseph. Supportable Square Feet St. Joseph development potential for retail stores, food service, and services is closely related to the number of trade area households and future growth. Current trade area households are shown at the top of Table 7-6 and illustrate how trade area residential development is projected to increase. Households in the current trade area are estimated to increase from 4,730 in 2006 to 5872 in 2016. In contrast, households in the supermarket trade area are estimated to increase from 13,105 in 2006 to 16,797 in 20l 6. The current trade area for downtown St. Joseph can support an estimated 135,900 square feet of retail goods and services in 2010. The major retail categories, with more than 20,000 square feet of space, include convenience goods, food service, and services. Categories in this table were summarised from Table 7-7 at the end of this chapter, which contains supportable square footage for a wide variety of stores and services and the range of store sizes for each category. This list contains sales potential and supportable square footage for a wide variety of store types, some of which are feasible in St. Joseph today, but are not located in the community. In other cases, sales potential is insufficient to support a store in that category, but this could become a merchandise category in a store selling related goods. In this way. sales potential from two or more categories can be combined in one store or added to an existing store in St. Joseph. The supermarket trade area, due to its larger number of households, has supportable square footage of 328,3.50 square feet in 2010. Convenience goods represents almost 30 percent of this total and includes a large (60.000 square foot) supernarket. Shopping goods is the second largest category with 67,350 square feet of supportable space. This square footage is distributed 7-6 B-8 EXHIBIT B: McCOMB GROUP, LTD. FINDINGS over a wide variety of stores shown in Table 7-fi. Categories with over 30,000 square feet include food service, services, and health care. Tahle 7-h CURRENT AND SUPERMARKET TRADF. AREAS SUPPORTABLE SPACE BY MLRCHANDIS)r C'ATEGORI' ((~rncc Leasable Area) ,ti1erchandisc Category 2006 2010 2016 Current Trade Area Trade Area Households 4,730 5,254 5,872 Convenience Goods 17,000 22,3011 27,900 Food Sen~ice 19,500 23,300 30,500 Shopping Goods 6,700 14,300 26,400 Building Materials 7,500 10,000 12,60(1 Auto Pans & Accessories 11,000 13,700 18,500 Services 19,000 22,200 31,900 Health Care 13,600 17,600 22,500 Other Services 10,000 12,500 17,000 Total 104,300 135,900 187,300 Supermarket Trade Area Trade Area Households 13,105 14,846 IG,797 Convenience Goods 87,900 105,000 138,000 Food Service 29,800 38,200 50,000 Shopping Goods 5(1,100 67,350 87,000 Building Materials 21,500 23,100 25,200 Auto Parts & Accessories 17,000 26,000 28,000 Services 26,700 30,500 44,200 health Care 26,300 35,600 43,800 Other Services 18,000 26,W0 29,000 Total 277,300 351,750 445,200 Source: McComb (,mup. Ltd Downtown Downtown, due to its limited size and location away from the heavily traveled streets, is most suitable for retail, specialty stores, restaurants and services that cater to students, staff and young adult customers. This area is also suitable for personal services, business services, medical offices, and financial services where the service providers have a personal or business relationship with their customers. Examples include, but are not limited to: beauty salons, doctors, dentists, insurance agents, real estate agents, lawyers, and other professionals. Highway 75 Highway 75 retail area is suitable for auto-oriented uses, convenience goods retailers, retail specialty stores that cater to trade area residents, services and large retail stores. bxamples include, but not limited to: supermarkets, fast food, gasiconveniencc stores, building materials, auto parts, auto services, furniture, floor coverings and other similar stores. 7-7 B-9 EXHIBIT B: McCOMB GROUP, LTD. FINDINGS Cc-Ilegc Community' Opportunities Both CSB and S.IL have college bookstores on their campuses to serve students and faculty. These bookstores carry far more than just college text books and college supplies. Other departments include limited selections of trade hooks, stationery and writing supplies, convenience fiwd and beverages, and general merchandise including logo clothing and gift items. If the Saint Benedict's bookstore were located on Minnesota Street, it would be far more accessible to St. Joseph trade area residents. This becomes a potential sourer of additional revenue for the bookstore. For example, sales potential analysis indicated support for the following types of categories that are consistent with the bookstore merchandise mix. These included: Category Dollars Music, computers and other electronics $ 791,000 books 1 ti4.000 Stationer} and office supplies 199,000 (irccting cards and gifts 265,000 Total $ 1,439,000 Thcsc three categories represent $1.4 million of sales potential in 2010. Not all of this sales potential can be captured in a bookstore, but some of it could be. St. Joseph has very limited or no offerings in these categories that are consistent with bookstore merchandise mix. Expanding these departments within the bookstore would fill a merchandise void in St. Joseph and become a convenience shopping alternative for trade area residents. Students at Saint Bencdicts and Saint John's expressed the desire for a wide variety of merchandise that they would like to see offered in St. Joseph. While not all of these categories can he accommodated in a trade arcs the sire of St. Joseph, there is merchandise that could he offered by businesses in St. Joseph to meet student and resident needs. Businesses should review survey results and sales potential estimates by store type for merchandise and service ideas. Land Demand Land necessary to support the estimated retail development potential in St. Joseph is shown in Table 7-8. These allocations include existing square footage in St. Joseph. This analysis suggests that based on its current trade area, St. Joseph needs about 21 acres of land area in 201 1 and about 26 acres in 2016 to support its existing retailers and future potential. These estimates are based on the assumption that each acre will hold approximately 10,000 square feet of retail space, excluding area required for water retention. The actual amount of space needed by individual store types or shopping centers may be more or less depending on the efficiency of the land use. Supern~arket trade area land demand increases from an estimated 43 acres in 201 1 to about SS acres in 2016. 7-R B-10 EXHIBIT B: McCOMB GROUP. LTD. FINDINGS Tahle .-ti ST. JOSEPH RETATI LAND DEMANU: 2006, 201 I AND 2016 Category Current Trade Area Convenience Cioods Shopping Goud. Other Retail Stores Sen i ces Health Care Total Supermarket Trade Area Con~~enience Guuds Shupping Goods Other Retail Stores Services Health Care Total 2006 2011 2016 5 6 R 3 4 5 ~ 3 3 2 ? 4 4 5 6 16 Zl 26 14 16 21 9 II IS 6 g 9 3 4 5 3 4 5 35 43 55 Source- ~1eComb Cirnup, lad It's unlikely that all of these store types with feasible sales potential are likely to locate in St. Joseph. On the other hand, store types that have not been identified may choose St. Joseph for a store location. However, growth is not going to stop in St. Joseph in 2016 and additional growth in the future will make it possible for additional stores to locate in St. Joseph. Therefore, these land area estimates appear reasonable to accommodate the 2011 and 2016 commercial land demand in St. Joseph. 7-y B-11