AgdaPkt 2019-10-14 Joint SA PFA - Laserfiche WebLink

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8.A. - Page 42 of 56 Large format retail space is generally defined as a space of 10,000 s.f. or larger. Many retail tenants that previously searched for spaces as large as 150,000 s.f. (Target Greatland), are now looking at ways to reduce space, yet maintain efficiencies with sales. Most grocery stores in the Bay Area have found that spaces as small as 10,000 s.f. cannot offer what the typical grocery store customer wants. Consequently, most grocers have ended up leasing spaces ranging between 25,000 sf to 35,000 s.f.. Often, large format retail tenants cannot be accommodated in vertical mixed use buildings because the ground floor space must conform to the space configuration of uses on higher floors. There are a few grocery store formats that have been accommodated in mixed use, high-rise development (such as Safeway) but not without parking, circulation and space configuration challenges. It is important to note that larger store formats serve as anchors in commercial districts and downtowns in order to attract a consistent flow of customers for smaller, in-line shops. The caution for cities planning for growth is that consideration needs to be given as to where large format retail tenants will locate in the future as projects become denser. Smaller Shoa Retail Tenants: With the proliferation of vertical mixed use projects, the availability of smaller shop space for retailers has increased. Many cities have experienced continuous vacancy in much of this new retail space. Typically, the reason for the failure of leasing smaller space in these projects is due to three reasons: 1) The vacant smaller shop space has a space configuration or location in the property that no longer meets the needs of existing and emerging retail tenants. 2) The vacant smaller shop space is located in a geographic area not desired by other retail tenants. 3) The vacant smaller shop space is located in an area where nearly every category of smaller shop retail is already represented. There are ways to insure that new smaller shop retail space gets leased by taking precautions early in development of the project. These actions include;: 1) developing standards of approval for vertical mixed-use space that allows the small shop space on the ground floor to be configured and located in the project based on the needs of retail tenants; b) identifying retail nodes in the City and not allowing retail on the ground floor of projects built outside of the nodes; c) engaging with retail experts to gather information on trends in the retail industry, including categories of retail tenants that are expanding. 262