Revitalizing Retail Spaces: A Winning Approach

Scott Baumberger: Hello, and welcome to the Creative Viz podcast where we talk about topics in architecture development and visual design today. I'm pleased to have Alicyn Emerick - she is the director of Marketing and Communications with Greenberg Gibbons in Baltimore, Maryland. Welcome Alicyn, it’s great to see you. 

I understand Greenberg Gibbons is very focused on retail. I'd love to hear about your role and how retail is doing right now?

Alicyn Emerick: Well, Greenberg Gibbons is a premier real estate developer, owner and manager specializing in retail, mixed use, residential and commercial properties, specifically throughout the East Coast. I've been with the company now just over 12 years which is wild and really exciting to see us in this state of growth that we're in.

And a lot of it does have to do with the fact that retail is doing exceptionally well right now and I think that you're seeing that it's one of the best asset classes in our industry, and we're feeling the same way here at Greenberg Gibbons. Last year in 2023, we had the best leasing momentum that we've had in maybe over 15 years. And I think we're continuing to ride that wave now in 2024. 

Scott Baumberger: That's great. What a difference just a few years make because it was hit so hard, in the pandemic. So you're seeing strong growth?

Alicyn Emerick: We are, we are. And I think that, with some of the trends in terms of less new construction taking place in our industry. We're seeing this pinch where businesses need a home and a lot of the existing vacancy that's out there right now is really appealing. So I think we're seeing a lot of success with leasing for that reason alone. 

Scott Baumberger: So it sounds like it's a mix of existing properties that you're acquiring and potentially repositioning. Are there new developments as well?
 

Alicyn Emerick: Yeah. A fun fact is, coming out of the thick of the pandemic, our president actually saw an opportunity to really diversify our portfolio and expand as a company. So we started an investment fund, which allowed us to expand up and down the East Coast and step outside of just the mid Atlantic region, which is really exciting for us as a company and as a business.

But that being said, I think that it gave us the opportunity to really sit back and think about what our strategy is going forward. And so, despite some of the negativity that might be surrounding new development, we're still very bullish on new development, and we actually have about 4.7 million square feet of new development in our pipeline.

Scott Baumberger: That's great. I want to touch on the new markets here in a sec, but I am curious, how has the tenant mix changed over the last few years? I've heard anecdotally that experience retail is, performing especially well and restaurants, Are you seeing that?

Alicyn Emerick: Spot on Scott. The experiential factor, whether it's a tenant itself or within our center, is super important. We're seeing a lot more of that experiential. So whether it be a new restaurant, or a concept that bridges the entertainment with the dining experience. I think you're seeing companies like Dick's Sporting Goods coming out with House of Sport, which is a really cool concept right now. Bridging that gap between soft goods and experience. We're also seeing that convenience and service are huge for us as well. So, convenience, I think, whether you're talking about grocery store or that kind of retail that spills into service with medical, beauty services… pretty much those products that you can't get online.

Scott Baumberger: Exactly. I was gonna say the same thing.

Alicyn Emerick: You can't get it on Amazon. Yeah.

Scott Baumberger: Do tell us about some of the new markets that Greenberg Gibbons is working on.

Alicyn Emerick: So, as I mentioned, we started our first investment fund, back in 2021, which was a lot of fun just being able to access new markets outside of that Mid Atlantic territory. So we ended up in the Carolinas, as far south as Florida, and as far north as Rhode Island. We recently acquired a project just outside of Nashville called Cool Springs Point. So that is probably the furthest west our acquisition has gotten. 

Scott Baumberger: interesting. So what does Greenberg Givens look for with site selection, both existing or potential redevelopment?

Alicyn Emerick: So I think for us it really, it does depend. I mean, I think when it comes to our development projects, one of the things that Greenberg Gibbons is known for is this idea of revitalizing a site. So for us, community is huge. It's one of our core pillars. And so anytime that we can go into a market and take a hole in the ground or maybe it's a dilapidated site that no longer services the community. We want to take that and our vision is to turn that into what will become a mixed use gathering place for the community.

As far as acquisitions goes, we still really strongly believe in the grocery-anchored center. 

Scott Baumberger: So, I can only imagine there's a deep pool of distressed retail at this moment. So are you finding it not so difficult to find  acquisition opportunities?
 

Alicyn Emerick: I think there's ebbs and flows. I think that, there was this opportunity coming out of the pandemic to start the fund and really acquire projects that nobody else was going after. And then I think the rest of the world caught on and we saw this influx and a lot more friendly competition is out there buying these assets. I think there's still a little bit of that, but it only pushes us harder to make sure that we're going after the right deal in the right market. 

Scott Baumberger: Every site's a little different but, are there criteria,you look for access to transportation, housing, any kind of metrics like that, when you're looking at sites?

Alicyn Emerick: Yeah. For us, all of that's incredibly important. I think that, for us specifically, we do have a focus on retail led mixed use projects. So, our business is about partnerships. We have a robust mixed use development pipeline where we intend to build additional uses that help and compliment that mixed use environment.

So, just kind of going back, thinking about how we're expanding some of our capabilities, any time that there's an opportunity where we can develop mixed-use, whether it's partnering with another organization to do a residential piece at the site, or hotel or commercial, that's really appealing to us. As far as some of the criteria and then there is definitely a grouping of criteria that we use when acquiring a project. 

Scott Baumberger: So, I'm thinking of, say an old but well located, having seen a better day, retail center. You might come in, rehab it, reposition it and are you, possibly adding a residential or hotel, other uses?

Alicyn Emerick: Yeah, definitely. I mean, one of the things that I think is super important is that we've constantly got to reevaluate our portfolio and figure out ways that we can evolve. And so whether that's repositioning the center and remerchandising. The businesses that are there, and resetting what that merchandising strategy is, to an overhaul on the common area and even densifying the project.

So we have a project actually out of Baltimore County, Maryland, where we were able to add residential back. I think it was like 2014 and since, in the last couple of years have now added a senior living component and another residential component to that as well. And so those apartments that should be opening soon will really compliment the center. 

Scott Baumberger: That's an interesting observation. So the addition of those uses, obviously that's a revenue stream, but it actually makes the retail perform better.

Alicyn Emerick: Correct. From there it really plays into the overall retail strategy as well. It's who we are bringing that compliments those uses. So it comes full circle.

Scott Baumberger: I can imagine. So, tell us a bit about the challenges that you are running into. When we talk about densifying older sites that can be really challenging.

Alicyn Emerick: So when it comes to any kind of new development, I think that you're running up against rising interest rates. And so that's definitely been an issue for the industry as a whole. That being said, you're also seeing less new construction because of the rising construction costs as it relates to goods and labor. And so, we're seeing that just like anybody else. I think you're also seeing that permits and entitlements are sometimes delayed when it comes to that new development. But it definitely doesn't deter our company. As I mentioned before, we still have plenty in the pipeline and feel that there's no reason to slow down.

We do believe that construction costs will come down over the course of the year. Mostly for goods. I wouldn't say labor, that's probably gonna stay high, but, I would say those are probably the biggest challenges that we're facing. And I think all it does is force you to become more creative with your strategy. 

Scott Baumberger: Well, that is encouraging. That's great. Do you run into community opposition with some of these projects, issues like increased traffic increase, multifamily residents, and concerns from the existing community. 

Alicyn Emerick: Yeah, I think what helps Greenberg Gibbons is just how involved they are with the community, from the very beginning of a project. So if it's a development project, we're meeting with the community as we're going through these hearings with the county or city or municipality. And moving forward, if we're adding to the site , we're attending community meetings, or we're working with our elected officials. And so that's super important to us that we have the feedback from the community as we're working on a project.

And so, yes, sometimes you do have passionate individuals who have a reason as to why maybe they would oppose something. And it's up to us to really stop and listen to what their fears or concerns are and be able to work through whatever that is. And most times, I would say that, it's just a matter of communicating and exploring. Explaining to them exactly what's going to take place, that we've done the traffic study, and that we have more than enough parking spaces on site, and sometimes just hearing that, is helpful to understand for us, it is about the experience once you reach the site. So we want to make sure that, when we go into a plan, or, a design, that it is appealing, To the guest as well, and, with the tenant and their accessibility. So I would say we absolutely do get that kind of feedback. But luckily we've always been able to work through it, just by having those strong relationships. 

Scott Baumberger: Let's talk about marketing for a sec. When a new development or reposition is about to go live, what are some of your strategies? Does your outreach for potential tenants and any community outreach, reflect that they might be some of the same people who will shop there?

Alicyn Emerick: Yeah, absolutely. I mean, we're working on a few of those cases now -  those properties that are under development. And just recently we opened a self storage facility which is the first in our portfolio at a center of ours called Reisterstown Shopping Center. And I definitely think that visuals really aided us to be able to convey that this wasn't your traditional self storage facility. It's an aesthetically pleasing building that really slides into the retail setting. So far, we've had really positive feedback from the community, but without those renderings, I'm not sure that they could have really visualized what we were trying to share with them, which is that, not only is it an underserved market for self storage.

And so you're going to appreciate just how it helps on a day-to-day basis with coming to the center, but it was so visually appealing and it wasn't going to be this back of house with boats and cars and things like that. So, I think that definitely helps. When we're looking at, prospective tenants, we are putting together, marketing brochures and specialty marketing pieces that really show them, not only the success of Greenberg Gibbons and and how we're a great partner as a landlord, but also to show the positioning of the center in the market and what their positioning within the center will look like. And so, everything from, sharing the demographics and the co-tenancy of the project, but also, using visuals to show them how their sign will look and how that visibility from, the main access or highway, and how well that reads. So I think that visuals are probably one of our best friends in that capacity.

Scott Baumberger I couldn't agree anymore! That's great. So it really does come down to communication then. That's what I'm hearing.

Alicyn Emerick: And that's a big part of what I do at Greenberg Gibbons. I really enjoy it, but I think, with communication comes listening - it goes hand in hand. 

Scott Baumberger: Well said. Thank you. Well, I'd love to hear about some of your recent success stories. We were talking a minute ago about the Sea Turtle project in Hilton Head, South Carolina. Please, tell us a bit more about that.

Alicyn Emerick: So, a fun fact is, when we acquired Sea Turtle Marketplace on Hilton Head Island back in 2022, everyone at the company raised their hand that they would go down there and personally visit it  themselves. So if you've ever been to Hilton Head, it's a beautiful island. And,the site itself is beautiful as a 99,000 square foot shopping center. We acquired it, but it was only 46 percent leased, and it was capital starved. And so, we saw a lot of opportunity in filling some of these bigger, box vacancies. We were able to add Golf Galaxy, HomeSense, and there was an undeveloped parcel that we've now signed Aldi to.

So now we've gone from a power center that was 46 percent leased, to a 98 percent leased grocery-anchored center. And I think as I shared with you earlier in a couple of weeks, that'll be a 100 percent. Huge success, all in all for us. 

Scott Baumberger: Even better! 100 percent, you can't do better than that. I know Hilton Head can be really challenging: zoning and land use is very strict on the island. Signage is a particularly sensitive topic. Every project is different, but, this one, especially, I imagine it stands out. Were there any unique challenges associated with it?

Alicyn Emerick: I think we're still going through it. We just signed all these leases, and we're just underway with some of those plans. It's definitely a territory that our company is all too familiar with in terms of going through the process with the municipality. And so, I think that this is just the same for us.
 

Scott Baumberger: You're ready for it. Yeah, that's awesome. Well, as we start to wrap things up, I'd love to hear any other positive vibes that you might have for us. I know it's been a really challenging time for the development industry as a whole, but it sounds like you have weathered it especially well. What do you have coming up, in the rest of your pipeline for ‘24 and ‘25?

Alicyn Emerick: I think, like I mentioned, we have about 4. 7 million square feet of development in our pipeline. And, I think that overall, we're just really excited to be kind of ahead of the curve. I think that there are a lot of companies out there that have refrained and sat back from new development. I think we see it as an opportunity to continue on our path as usual. It's been, a few years since we've had a new development project. So being able to see these mixed use masterpieces from different markets come to life, I think is really cool.

We're really enjoying AI a lot. There's a number of ways that we're using it to our advantage. A lot of other companies are as well, but one of my favorite softwares is Placer.AI. If you're familiar with it, we've used it now several times to our benefit. There's a report on Placer.AI called “A Day in a Life” video. And so we're using that to help renew tenants. We actually had a situation where we had an existing tenant, they were against us bringing a fitness user to the center, because they thought that the hours would overlap and it would impact their parking. and we were able to use “A Day in the Life” video to show them that that wouldn't be the case, and so we got the waiver from them. I think that there's a lot of good out there coming up in the pipeline and looking forward to seeing how the industry turns. 

Scott Baumberger: That's great. So it's not just coming for our jobs!

Alicyn Emerick: I mean, as any marketer would say, I'm loving all of the means out there on AI right now, but I think AI does a lot of good. It’s fun to see, I mean, if you look at what's going on in our industry, JLL just worked with a company called Imaginuity to create a virtual influencer, and I've had a lot of fun following that. The more that these take place, I think the more accessible and affordable it will be for the rest of the industry. 

I think it was just the other day - there are things we love about ChatGPT or some of these other AI platforms, but we went to do an image. And the woman had three heads and three hands. So you have to be careful. You have to monitor.  It's a tool, but it's not a replacement. 

Scott Baumberger: No, not by any means. Oh my gosh. Well, I'm afraid that's all the time we have today. I could talk about AI and property tech for an hour, but thank you so much Alicyn it's great to see you and I really appreciate your insights. Congratulations. It’s really great to hear that you guys are doing so well.

Alicyn Emerick: Thanks so much for having us. I'm excited to speak with you again - a year from now and see where we're at. But I appreciate you having me.

Scott Baumberger: Awesome, let's do it. Thank you