The TJ Maxx location on Fourth Street in downtown Cincinnati is closing its doors on Saturday, May 10, 2014. The business will relocate to the Newport Pavilion.
Downtown retail has struggled in recent years, with the demise of Tower Place Mall, the announced relocation of Saks Fifth Ave. to Kenwood and TJ Maxx’s decision to close its Fourth Street store May 10 for a new location at Newport Pavilion. Many observers think Tiffany & Co. could be next to leave downtown to join Saks at the Kenwood Collection, a retail and office project next to Kenwood Towne Centre.
But Downtown Cincinnati Inc. Chairwoman Jill Meyer doesn’t believe downtown retail is dead. It just needs to be different.
“Everything has its season,” said Meyer, partner in charge of the Frost Brown Todd law firm. “The downtown that those stores moved in for is a different downtown that we have now.”
Convenience retailers like CityTarget might fill the void. But at least one expert thinks a bigger shift is required, that downtown retail needs a new strategy and a new epicenter.
Monk analyzed demographics and compares Cincinnati's Downtown to other CityTarget locations.
Insiders can see what Monk found from the data and also learn more about a retail strategy that would build on Over-the-Rhine's resurgence, downtown's changing demographics and the streetcar.
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CINCINNATI - It’s a one-person campaign no more.
Downtown Cincinnati Inc. Chairwoman Jill Meyer said she believes she struck a chord at that group's annual meeting last week when she opined that a CityTarget would nicely fill a void in downtown retail.
“There were a number of people, residents and non-residents, who came up to me afterwards and said, ‘Ah, CityTarget. Wouldn’t that be great?’” Meyer recalled. “With TJ Maxx closing, it opens up a big opportunity for somebody paying attention on that front because we used that store for everything. You could pick up food items, things for the house, everything.
"When I lived downtown, the only time I left was to go to a place like Target.”
The Minneapolis, Minn. –based retailer has opened eight of its special urban-format stores in California, Chicago, Seattle and Portland so far. Former Target CEO Gregg Steinhafel told analysts in February that the company is “analyzing opportunities to reduce the size and enhance the flexibility of this format, opening up a wider universe of potential sites in dense urban areas.”
A Target spokeswoman said there are no current plans for a CityTarget in Cincinnati, but the company is “always analyzing locations.”
Downtown retail has struggled in recent years, with the demise of Tower Place Mall, the announced relocation of Saks Fifth Ave. to Kenwood and TJ Maxx’s decision to close its Fourth Street store in May for a new location at Newport Pavilion. Many observers think Tiffany & Co. could be next to leave Downtown to join Saks at the Kenwood Collection, a retail and office project next to Kenwood Towne Centre.
But Meyer doesn’t believe downtown retail is dead. It just needs to be different.
“Everything has its season,” said Meyer, partner in charge of the Frost Brown Todd law firm. “The Downtown that those stores moved in for is a different Downtown than we have now.”
Meyer visited a CityTarget in Los Angeles last summer and promptly “started my one-person campaign.” She said the store would be a great fit for downtown because it’s “designed for the person walking in off the street” and sells “everything you need to get through the week under one roof.”
Meyer sees a demand downtown for retailers that “provide something interesting to do” for 20 minutes while diners wait for the tables at downtown restaurants. She sees a need for retailers that offer clothing, food items and household supplies for downtown’s rising residential population and office workers.
“You have how many thousands of people who work here every day?” she said. “If you give them the opportunity to run out the front door and grab something before they leave for home, they’re going to do it. I watch people do it in my office all day long. They leave at lunch. They come back with Macy’s bags.”
There is demographic evidence to support Meyer’s anecdotal observations.
Cincinnati’s 45202 zip code, which is the zip that encompasses Downtown, has comparable demographics to several locations that already have CityTarget stores . In fact, it has 13,325 residents, nearly twice the population of the Portland zip code that welcomed a CityTarget last July, according to Census data found at www.zip-codes.com .
And the average household income is higher in 45202 than zip codes surrounding CityTarget stores in Los Angeles, Seattle and Portland. As for downtown office workers, the Census Bureau counts 64,775 people with an annual payroll of $4.8 million in 45202.
Those are better numbers than the zip codes surrounding CityTarget stores in Portland, Los Angeles and San Francisco.
“There’s an opportunity for a company that’s paying attention,” said Meyer. “There’s a niche here.”
Veteran Cincinnati retail broker John Heekin agrees there is untapped potential for downtown retail, but he argues city leaders should take a more strategic approach than its current plan to shore up Race Street as downtown’s main retail corridor.
PHOTOS: A look at the Tri-State’s retail districts
“Don’t fight for something you already gave away years ago,” said Heekin, principal and founder of Source 3 Development. That is a Cincinnati-based development company that was recently retained to plan and develop an $80 million corporate office campus for Marathon Petroleum Corp. in Findlay, Ohio.
Before forming Source 3 with partners Ken Oswald and Craig Gossman, Heekin was a retail broker specializing in regional shopping centers and urban mixed-use projects for Cassidy Turley Commercial Real Estate Services. Before that, Heekin was a vice president at Towne Properties.
Heekin has watched the development of new apartment and condo projects in Over-the-Rhine and Downtown. He has seen the epicenter of Downtown’s daytime office population shift in to the Southeast corner of the central business district. That means Downtown retail needs a new epicenter too, he said.
“Retail needs districts,” Heekin said. “You want to shop where you’ve got choices.”
Downtown’s strongest retail district was Race Street
for decades, where anchors like McAlpin’s, Pogues, Tower Place, Saks and Lazarus all peaked – and faded - years ago. Heekin thinks Cincinnati spent too many years chasing high-end retailers to preserve that district.
Now, he argues, is the perfect time for a new vision.
“Let’s cater to the person who lives downtown and works downtown,” he said. “Stop competing with Kenwood. You’re not going to win that war.”
Heekin thinks Central Parkway and Vine would be good new epicenter for Downtown retail because it’s a walkable distance for office workers and the new housing developments in the Southwest corner of Over-the-Rhine. It would also take advantage of the “shop local” retail district that the Cincinnati Center City Development Corp. has cultivated near Washington Park. It’s easier to access from interstates and it’s on the streetcar route, which Heekin thinks is laid out perfectly to support a retail district at Vine and Central.
“If you look at retail trends in the Internet age the number one thing you hear about its shop local,” he said. “So, be local. Create local. Have local. We think local is a restaurant. Well, it is, but that’s not shopping. Local was Gidding Jenny. Local was Gentry Shop. It was Herschedes. It’s Richter and Phillips.”
Heekin thinks 3CDC made some smart moves near Washington Park by not over-charging for retail space and encouraging smaller entrepreneurial concepts like upscale clothing store Sloane Boutique and gallery/gift shop Mica 12/v on Vine Street. By encouraging more of that activity, extending further south on Vine, he thinks the city might eventually find national retailers like Target more interested in downtown.
“You can talk to Target,” he said. “It’ll never hurt to try. But whether they come or not will be based on your ability to convince them that other stores will remain successful and this is a new opportunity for them.”