News & Articles : Urban Land Magazine


Top 10 Selling Master-Planned Communities

Posted on May 27, 2011 in

By Jeffrey Spivak, UrbanLand

Residential sales in top-performing master-planned communities began to rebound in 2010, reversing a severe decline that began in 2006. According to Robert Charles Lesser & Co., which surveys these communities every year, the top 10-selling communities sold more than 7,000 units last year. That was slightly above 2009’s level but still far below 2005’s peak, when more than 22,000 homes were sold. 

Master-planned communities are large-scale developments featuring a range of housing styles and prices, plus a mixture of non-residential land uses such as retail shopping, schools and offices, providing full-service environments in which to live, work and play. Some communities target specific buyers such as older adults, while other developments target a wider range of demographic and market segments. 

As usual, the top-selling master-planned communities were clustered in the Sunbelt, and two development firms – Newland Communities and Focus Property Group – each had two communities represented in 2010’s Top 10.

For ULI members in the residential industry, the 2010 survey, published this spring, offers a snapshot of master-planned development trends going forward. First, the vast majority of survey respondents – 85 percent – believe community home sales will continue marching upward in 2011, albeit only moderately. Second, community developers are still adjusting product lines – such as town centers, green building and smaller lots – to enhance their market capture.

Here are the Top 10 master-planned communities in terms of 2010 sales:

chart

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On a side note - please take note that 32.74% of the Top 10 Sales are in Houston Texas.


http://urbanland.uli.org/Articles/2011/May/SpivakTop10MasterPlan

The Attention Economy

Posted on December 02, 2004 in

By: Blake Tartt III, CEO & President of New | Regional | Planning

For decades retail design drew its cues from Madison Avenue. Form followed fashion. Architecture became one of the largest reinforcements of brand identity in the retail realm. The focus was on product differentiation. As competition for market share increased, there was rising emphasis on creating shopping environments that “sell”. In an over communicated society, retailers were looking for every opportunity to capture a segment of the buyer’s “mind”. They were attracted to design that aligned with product placement and differentiation strategies. The architecture of retail spaces, from shops to malls, offered a dramatic canvas for showcasing a rapidly increasing range of products and services.

Along the way a subtle, yet important shift occurred in the marketplace. Consumers became obsessed with the value of their time. Efficiency and experience emerged as key metrics. As frictionless buying opportunities, such as cable television and the internet, gained momentum, retail designers were further challenged to reinforce the positive aspects of the shopping “experience”. Not since the advent of the mail order business, have retail developers been confronted with as great a test of how to attract and retain shoppers.

To capture and retain market share under this new dynamic, the focus needs to shift toward an “Attention Economy”. The spotlight is on how to attract and retain the consumer’s attention in environments that reinforce the benchmarks of efficiency and experience. A new design vocabulary (Exhibit I) that responds to these measures of success shifts away from the “tired” retail development terms of the recent past. Future retail environments will be evaluated on their ability to reinforce consumer’s needs for focus, access, flow, security, distinction, and continuity.

Consider the following Five Keys To Success in gearing retail development toward the Attention Economy.

Activate to Captivate
In order to captivate the attention of today’s consumer, retail developers need to activate as many of the customer’s senses as possible. The introduction of music allows the retailer to establish a mood and reinforce product positioning. Music can, and should change with the merchandising mix in larger centers. It should also change with the seasons to reinforce the shopping environment. Music should also vary with the time of day, upbeat in the morning and softer in the evenings. Music manifests marketing with the ability to inexpensively change on a moment’s notice. However, developers must plan this capability into retail centers with technology that accommodates variety, timing and flexibility.

Lighting offers another wonderful opportunity to captivate the consumer. It goes far beyond illumination in the ability to set the stage for retail. From the drama of neon to the ambiance of virtual canopies, lighting draws the consumer into the retail center and moves them from one merchandising zone to another. The ability to transition lighting from static to dynamic, and from “white” light to color schemes, enables the retail developer to engage the sense of sight and transition the customer through changes in the shopping experience. This may be as predictable as seasonal changes or as subtle as transitions inside the center. Lighting and music should be coupled to create shopping environments aligned with the target consumer – bright and blaring for teens, soft and subdued for seniors.

Environmental elements engage the senses as well. Landscape, shade, shelter and water offer respites from the rapidly increasing pace of the shopping experience. Water, both fixed and ambient, provides a calming, cooling effect. In dense environments, it takes on the aura of an “oasis” with a white noise effect that can drown urban clutter. In a suburban environment, water offers the opportunity for the customer to pause, relax and reflect. In a playful retail setting, liquid baby sitters entertain young and old alike in a refreshing, recreational environment. In a time where “extending the stay” has become a mantra, water is one of the elements that assist the developer in accomplishing this objective.

Hardscape is another area where the retail developer has the opportunity to engage the customer’s senses. Retail is inherently a pedestrian experience, yet, so often centers are designed with narrow walkways. Widewalks, fifteen feet or greater in width, offer the consumer a pleasurable pedestrian experience from the car to the center. When these widewalks are designed to meander through landscaped areas, introducing music, sight and fragrance along the way, the walking experience is further heightened. Rather than fighting through traffic to arrive at the center, the customer has an opportunity to transition out of traffic into a shopping experience. Shade, along the way and at key points on the center’s perimeter, offers relief from the elements and an opportunity to rest. Shelter, at key entry points, provides easy access, free from exposure to the elements. Restaurants learned this lesson years ago. Covered drop-offs, or porticos, increase restaurant sales by as much as 20% as customers gravitate toward convenient access when the weather reaches extremes of precipitation and heat.

Ease of access, mobility and circulation further activate the consumer experience. In the center of the future, retail developers will demonstrate a keen understanding of the levels of graphics and signage from center branding and identity to wayfinding. Customers will be drawn to retail centers that are easy to navigate, both at the vehicular and the pedestrian level. Consistency in identity programs will add clarity, and corresponding comfort, to the shopping experience. The retail developer will address the unique branding requirements of the retail constituencies while creating a synergy that unifies the center and promotes shopping efficiency. This will be accomplished through impeccable attention to detail in the planning, design and enforcement of graphic standards for the center and the retail tenants.

By working in concert with the retailers, the developer/owner will establish a shopping environment that promotes individual brand identity while maintaining an “umbrella” of graphic consistency. Wayfinding, at all levels, will be a major contributor to this success. The “Attention Economy” consumer will become a loyal customer if there is ease of access, clarity of circulation patterns from the car to the center and clear communication of the merchandising plan and amenities.

Think Inside Out
The ability to gain and retain the customer’s attention begins and ends with merchandise. The merchandising plan should set the business geometry for the retail center. Design of efficient retail experiences of the future will begin with delineation of the merchandising plan. By understanding the retailers’ product positioning goals and strategies, the developer can create environments that are conducive to each market segment. Whether the plan is focused on clustering like merchandise or establishing a random shopping pattern, the retail developer needs to acutely understand and respond to product placement.

The importance of a merchandising plan is readily apparent in the design of a new center. However, it is equally important in the redevelopment, expansion or repositioning of an existing center. Often, this is overlooked in deference to the existing architecture. There is a natural tendency to attempt to force a “square peg” into a “round hole”. This “solution in search of a problem” mentality restricts retail developers from matching center design to product positioning. This tendency reinforces the importance of flexibility in new center design. The retail center of the future will be a blank canvas awaiting the paint that the retailer brings to the design. The artistry will be in the synergy between the developer and the retailer as the center’s design is unveiled.

In thinking “inside/out” it is important for developers to consider the value of retail anchors and magnets. Ranging from traditional department store and “large box” anchors to non-traditional population generators, the anchors generate traffic. They are extremely important to the success of retail centers. However, this facet of retail development is changing as well. Who would have thought that Target would become an anchor of choice in malls? Yet, the trendy new age “Five & Dime” has become one of the most attractive magnets to centers across the country in both urban and suburban markets. Why? Upon close examination developers saw that Target’s customer profile is virtually a mirror image of the loyal Dillards, Foley’s and Sears shopper. This trend prompted a new development model that blends “cart” and “bag” shopping which heretofore seemed incompatible.

Magnets take on many shapes and sizes. Retail developers are examining a range of population generators from entertainment and recreational venues, like innovative theaters and competitive ice rinks, to cultural and educational centers. Community colleges, visual and performing arts centers are being considered as possible anchors as they generate traffic and extend the viable operating hours of the center beyond traditional schedules. Embracing these venues opens discussions of public/private partnership and incentives for developers to create retail environments in concert with spaces for public assembly.

Less is More
With a focus on capturing and retaining the customer’s attention it would be a natural tendency to deliver as many product offerings as possible. This penchant for “more” space works in a select few market environments. A more complex challenge is presented when the retail developer embraces the concept of “less” being “more”. This translates into developing less space, while better addressing the rigors of the Attention Economy. Less space creates the opportunity for the developer/owner to be selective in the retail mix while achieving higher revenues per square foot, one of the key measures of retail center success. It also offers the owner/manager the opportunity to operate the property with acute attention to detail at every juncture of the shopping experience. Larger centers often dictate management strategies oriented more toward operational efficiency than customer intimacy. More so than ever before, the retail environment in the Attention Economy will be planned, marketed and operated with the intricacies of the shopping experience in mind. Developer/owners will evaluate center performance on the quality as well as the quantity of the investment, based on customer acquisition, satisfaction, security and loyalty. Less space will mean a more manageable investment capable of withstanding the inherent vagaries of the retail economy both at the local and the national level.

The “less is more” mentality encourages centers developed around human scale and patterns of communication and interaction. Consumers are attracted to a Main Street shopping environment where product offerings are presented at a scale which is compelling not overwhelming. In conditioned environments, such as malls, scale will be reinforced by designing storefronts that replicate a Main Street setting. Two story storefronts with a virtual skyscape create the ambiance of an open air environment. Introduction of previously referenced lighting, streetscape and music will enable the retail developer to offer the customer a comfortable scale, where time will “disappear” as the shopper is immersed in a “familiar” sensory experience.

Good to Great
There will always be a number of “good” retail centers in every market. Yet, there will be fewer and fewer that perform at the highest standards. These “great” centers will have one common characteristic. They will understand the vital importance of center operation and the execution of the shopping experience. In order to dominate a retail market, developer/owners will need to place increasing emphasis on they way they operate their centers.

Retail developers will design, construct, market and evaluate centers based on indices of customer satisfaction as well as financial performance. Though it will be important to retain an investment perspective on all decisions, this perception will be balanced against measures of the customer experience. Emphasis will be placed on creativity, consistency and continuity of the retail environment.

The “great” centers will continuously infuse strategies that offer new opportunities to enhance customer loyalty and retention. Activity Directors will take a “seat” at the managerial table with key input into center positioning, marketing, and operation. The Activity Director will establish and maintain key linkages to the range of stakeholders that impact a center’s success. “Great” centers will actively initiate community and public relations programs to attract customers and gain market “attention”. Tied to a well orchestrated master schedule, these initiatives will reinforce the wants and needs of the target customer in areas such as education, entertainment, inspiration, recreation, and wellness. Strategic alliances will be formed with public and private sector partners capable of delivering these experiences on a “low” to “no” cost basis. The center will offer the setting in exchange for the partner providing the experience. Market research and customer profiling will provide the cues for determining the venues and experiences that will be most attractive to the target customer. Matching this to the merchandising plan and the retailers’ individual promotions offers an opportunity for variety and scale that enhances the potential for attracting and retaining consumer attention.

Reinvention for Retention
It takes far fewer dollars to retain a customer than to create a new one. This will be particularly true in the attention sensitive retail economy of the future. Given this premise, retail centers will need to “reinvent” themselves on a regular basis to respond to the changes in the consumer’s attention. Reinvention does not translate into redevelopment or renovation. Rather it is an operational mindset that revolves around responding to the changing attitudes and interests of the retail customer. This can be accomplished through continuous infusion of new concepts and venues in the activities program and through changes in the “soft” environment – lighting, landscape, fragrance and music. In existing centers, these changes are more challenging as the center’s design and technology may not readily lend itself to rapid change. In newly developed centers, this penchant for reinvention should prompt flexibility in design and in the technology that supports the sensory experience.

On a spatial level, reinvention may be accomplished more easily in the “negative” spaces than in the “positive” spaces. This means the programming of activities in the spaces “between” the buildings and outside of the center. For example, festival environments attract attention and create opportunities for reinvention in parking lots and open spaces. Where centers have the spatial opportunity, there should be designation of open areas to accommodate reinvention through displays, galleries and event programming. This may be as simple as an Art Walk or as elaborate as an Under the Stars Concert Series. Spaces for gathering and elevating the consumer’s senses are invaluable additions to the retail center plan. They also allow the developer/owner to break up long expanses of retail into sectors that are designed around optimum walking distances and alignment of retail zones planned for co-tenancy and clustering of like merchandise.

Reinvention is more of an attitude than an adjustment. It means a “real time” response to the market drivers to keep the Attention Economy consumer interested and attuned to the center. Innovative retail developers will seek new ideas rather than waiting for the trends to “reach” their market. This is best accomplished by regularly touring properties in diverse locations to see what’s happening in the retail markets. The Internet has significantly widened this vista on a virtual level. However, there is no substitute for touring centers, new and old, to get a first hand perspective of what works (and what doesn’t). In the United States, trends tend to appear on the coasts and drive toward the middle of the country. As the retail world “shrinks” through affordable travel and Internet access, this phenomenon has expanded. In the future, it will be as important to know what is “hot” in Paris and Milan as it is in New York and LA. The individual retailers will provide some of the “clues” to these trends. Yet, it will be imperative for the retail developer to be able to sift through the plethora of ideas to determine those that fit their market and have the potential for sustainability.

Contemporary music offers an excellent example of reinvention for retention. Madonna has reinvented herself a number of times, sometimes shocking, and always on the leading edge. She defines a new genre, and then reinforces it with sight and sound. Rather than responding in a “me too” attitude, Madonna steps out onto the stage in a manner that aggressively seeks, attains and retains attention. When that attention begins to “run out”, she reinvents herself into a new, compelling model. Though it may appear, on the surface, that Madonna is setting trends, in reality she is acutely “listening” to the marketplace and transforming herself in cycles of reinvention.

Retail developers are not afforded the mass market appeal of a music star. However, they are capable of listening to the market cues and reinventing their centers to respond to those “sounds” that resonate and differentiate. At a cost versus value level these cues are best heard in the operation of the center. Trendy changes in a center’s façade or décor often result in costly changeover. Smart retail developers of the future will learn to create stage sets for reinvention, much like Broadway and Hollywood create the illusion of an ever changing environment. Hollywood architecture that is easily and cheaply customized, erected, changed and demounted will be a trend for the future as retail developers seek to reinvent their centers to respond to the Attention Economy consumer.

There will be a natural tension between what is “timeless” and that which appears “trendy”. The successful developer will find unique solutions that allow the center to maintain balance – rich heritage (timeless) with dynamic innovation (trendy). Balance will become one of the tenets of stability. The retail developer will find constant tension in the balance between issues like driving and walking, young and old, traditional and innovative. With a focus on aggressively acquiring, expanding and retaining the customer’s attention, the balance equation will be more easily resolved. Developers will focus not only what is “missing” in the market, but also what is “misplaced” and should be in their center. In an economy gilded with the importance of efficiency and experience, retail centers will take on a new measure of market importance. Attention will be either “gained” or “lost” as developers compete for market share. Simple in concept, but complex in execution, the Attention Economy offers a significant opportunity for success. All that’s left for retail developers is seizing the opportunity – carpe diem!