1、September,2022How Population Growthis Impacting Retail in 6US CitiesThis report focuses on six cities Fort Myers,Denver,Las Vegas,Austin,Boise,and Phoenix that are seeing a rise in populationcoupled with a high-value retail real estate market.Brick-and-mortar retail is back.More than two years after

2、 the first COVID-inducedlockdowns,occupancy of new retail assets is now at an all-time highs.Storefronts made upthe bulk of new retail inventory added in Q2 2022,and cities with growing populations areseeing a particularly marked retail resurgence.The increase in residents is driving certain similar

3、 real estate patterns across the six citiesfeatured in this report.But as each region has its own unique character,their growth is alsocreating commercial opportunities specific to each locale.Certain cities are seeing movietheaters visits surge,while other areas are seeing a strong office recovery

4、and somedistricts are simply seeing grocery visits skyrocket.This white paper draws on Crexis commercial real estate data insights and Placer.ais foottraffic intelligence to show how recent migration trends and overall population growth areuniquely impacting the local retail space in six growing cit

5、ies.Keep reading to find outwhich up-and-coming markets made the cut,what is driving retail recovery in each area,and unique ways CRE players can capitalize on these changes.Population and Retail Real Estate TrendsPopulation growth is driving similar retail real estate and dining foot traffic patter

6、ns in thesix cities featured in this report.Population GrowthEach city selected for this report is located in a county that has experienced a substantialpopulation increase over the past three years.Though some gained more residents thanothers,all counties saw growth rates significantly above than t

7、he average nationwide rateof 1.4%.And,as this report shows,all six cities featured are seeing different facets of theirretail space impacted by the recent migration.Denver County,CO,Maricopa County(Phoenix),AZ,and Clark County(Las Vegas),NV,sawtheir populations increase between 2.3%and 2.9%from July

8、 2019 to July 2022.During thesame period,the population of Travis County(Austin),TX grew by 4.5%and the populationsof Lee County(Fort Myers),FL and Ada County(Boise),ID,climbed a whopping 8.3%and10.3%,respectively.U.S.Census Bureau data source:census.gov(NA-EST2019-01,NA_EST2021_POP)Retail Real Esta

9、te MarketAll six cities featured here have more in common than just their growing population according to Crexi data,the median asking price per square foot for retail real estate in allsix markets exceeded the national median in Q2 2022.Austin tops the list at$456 persquare foot,followed by Denver

10、at$390 and Las Vegas at$371.And in Boise,Phoenix,andFort Myers,retail real estate was sold at a median price of$234,$201,and$186 per squarefoot in Q2 2022 well above the nationwide median price of$152 per retail square footduring the same period.Phoenix and Denver also have some of the highest deman

11、d forindustrial real estate,which includes warehouses and distribution centers that cater toe-commerce shoppers indicating a high demand for both offline and online retail in thearea.As brick-and-mortar retail continues its comeback,the retail real estate markets in most ofthese fast-growing regions

12、 are becoming even more competitive.With the exception ofPhoenix,AZ,all cities saw a year-over-year(YoY)increase in the price of commercial realestate per square foot.Prices for retail real estate in Austin increased by 40.7%between Q2 2021 and Q2 2022.Retail real estate in Fort Myers and Las Vegas

13、jumped by 37.8%and 31.6%,respectively,and Denver and Boises retail real estate prices increased around 24%significantly morethan the nationwide 16%YoY increase.In Phoenix,on the other hand,retail real estate prices have dropped 10.7%YoY whichmay entail an interesting opportunity,since the positive m

14、igration into Maricopa Countyindicates that demand for retail in the city is likely to rise.This means that the drop inPhoenix retail estate may well be a short term phenomenon,potentially making this a goodtime for investment in the citys retail real estate market.While the retail and migration pat

15、terns in the six cities featured in this report share certaincharacteristics,foot traffic data also reveals some important differences.Fort Myers,FL-Growing Seasonal PeaksFort Myers,on Floridas Gulf Coast,is the most populated city in Lee County.The city is oneof the nations best places to retire pe

16、r U.S.News and World Report,and Floridas lack ofincome tax may be attracting remote workers looking to stretch their paycheck.Migration PatternsThe U.S.Census Bureau named Fort Myers the sixth fastest-growing area in the UnitedStates between July 2020 and July 2021,and as the population increased,so

17、 has themedian household income.So not only are there more people looking to shop in the area the current population also has more disposable income to spend.Fort Myers population has increased consistently in recent years and diving into themonthly figures reveals that migration to Fort Myers follo

18、ws a typical“snowbird”pattern.The city receives an influx of residents between October and May every year,with some ofthe YoY growth likely due to“snowbirds”settling in.How Seasonal Migration Patterns Impact Local RetailBetween March 2021 and July 2022,Yo3Y monthly grocery foot traffic in Fort Myers

19、 hasconsistently exceeded nationwide grocery average likely due to the overall increase inpopulation in the area.But while Yo3Y grocery visits in Fort Myers have exceeded the statewide and nationwidetrends almost every month since March 2021,comparing the baseline change in groceryvisits highlights

20、the impact of seasonal migration on the local retail space.Analyzing thechange in monthly grocery visits since July 2019 in Fort Myers and nationwide shows thatFort Myers overperforms the nationwide grocery visit average much more substantially inthe winter.While daily retail services in Fort Myers

21、are performing well year-round,the data indicatesthat the winter population boost is driving a seasonal increase in demand which may bevaluable information for shops deciding how to stock their shelves or allocate theirworkforce.And as these snowbirds decide to remain in Fort Myers,the growing popul

22、ationwill likely need more grocery and other retail institutions catering to their needs,presentinga window of opportunity for real estate investors.Fort Myers migration retail patterns highlight the value local businesses and real estateinvestors can find in diving into monthly migration patterns t

23、o identify both seasonal andlonger term spikes in demand.Denver,CO-Office Space Recovery and Retail GrowthDenver was a popular relocation destination even before the pandemic hit and COVIDonly accelerated the trend,as people flocked to the citys beautiful nature and thrivingmusic and art scene.And a

24、lthough the median retail real estate price in the city exceedsthe national benchmark,Crexi still named Denver(along with Phoenix and Las Vegas)oneof the six cheapest places in the U.S.for overall commercial real estate investing in May2022.The Denver Office RecoveryThe increase in population is not

25、 just driving a retail recovery in the area foot traffic toDenvers office buildings is also outperforming the national benchmark.A comparison ofthe performance of the Placer.ai Denver Office Index,which analyzes visits to 50 officebuildings throughout the city,to the Placer.ai Nationwide Office Inde

26、x that analyzes foottraffic to over 700 office buildings throughout the country yielded interesting results.In July2022,Denver office visits were down by 32.9%compared to July 2019,compared to a 38.6%decrease in Yo3Y nationwide office foot traffic.So while many of those who moved toDenver over the p

27、andemic likely came for the lifestyle rather than the employmentopportunities,it appears that at at least some of recent transplants have found local jobs and are helping the city fill its office space.And as the Denver office space slowly recovers,nearby retailers could see a significantuptick in v

28、isits.With more and more workers returning to the office,many are making quickstops at nearby stores as part of their office journey.The foot traffic data confirms thatretailers and shopping centers located in the center of the city or near business districts arewitnessing impressive growth in visit

29、s.The 16th Street Mall,a 1.25-mile-long pedestrian and transit mall located in the heart ofdowntown Denver,and central business district,saw significant growth in visits over time,in comparison to a January 2021 baseline.August 2022 saw visits to the mall grow by96.5%.The correlation between the rec

30、overing surrounding office buildings and the mallsfoot traffic is especially noticeable,with both seeing dips and peaks around the same time.periods.Denver is a perfect example of how a rising population,a recovering office space,and retailgrowth interact and contribute to a booming local retail rea

31、l estate market.Las Vegas,NV-Moving from Near and FarLas Vegas is one of the most famous tourist destinations in the world but over the pastcouple of years,the city has also seen an influx of new residents.Nevada,like Florida,doesnot have an income tax,so newcomers may find that paychecks from their

32、 remote jobs gofurther in the Silver State.And thanks to the citys endless culinary and entertainmentoptions,residents always have plenty of activities to choose from.Moving From AfarMost people who relocate tend to stay relatively nearby,so the top ten origin counties ofrelocation for any given reg

33、ion tend to be from the same state as the destination county.But migration data indicates that many people are moving to Las Vegas from all over thecountry.Between July 2019 and July 2022,3.3%of new Las Vegas residents came fromHonolulu,Hawaii,with relocation from Hawaii to Las Vegas becoming so com

34、mon thatsome have taken to calling the city“Hawaiis ninth island.”During the same period,1.6%ofnew Las Vegans came from Cook County(Chicago),IL not as far as Honolulu,but still afour-hour flight away.And an impressive 9.3%of new Las Vegas residents moved from LosAngeles,CA.Las Vegas ability to offer

35、 something for everyone and attract residents from distantcounties speaks to the citys ongoing cultural and economic diversification and is likelycreating a wide array of business and real estate investment opportunities.Local Tourists Boosting Retail PerformanceWhile international tourism to Las Ve

36、gas has yet to return to pre-pandemic levels,domestictourism is strong,driven largely by local visitors(visitors who live within 51 and 150 miles ofLas Vegas).Since April,the number of local tourists in the city has consistently exceededpre-pandemic levels,perhaps driven by strong migration to Las V

37、egas suburbs.The nearbycities of Henderson and Spring Valley have also seen their populations increase recently,and at least some of these residents are likely to drive in regularly and enjoy the variousretail and nightlife options Los Vegas has to offer.The increase in local domestic tourism seems

38、significant enough to power Vegas tourismindustry according to the Las Vegas Convention and Visitors Authority,the citys overalltourism(including both international and domestic)had already reached its pre-pandemiclevels by the end of 2021.As the current economic challenges subside,Las Vegas success

39、 in attracting both residentsand tourists from near and far will likely continue boosting and diversifying the citys retailsector in the coming years,providing ample opportunities for the savvy investor.Phoenix,AZ-An Emerging Tourism DestinationPhoenixs affordability makes the city particularly attr

40、active for those looking to reducetheir cost of living while remaining in a major metropolitan hub.And many millennials andGen-Zers are moving to the cities,perhaps attracted by the growing tech scene andstart-up friendly infrastructure.The recent drop in retail real estate prices along with thecons

41、istent population increase may make this an ideal time to invest in Arizonas statecapitol.Regional MigrationCharacterized by a seasonal trend that peaks in late winter and early spring months,Maricopa County saw a net population gain of 2.5%between July 2019 and July 2022.LasVegas saw new residents

42、relocating from all over the country,while many of Austins newresidents came from nearby counties in Texas.Migration patterns for Phoenix liesomewhere in-between,with a considerable share of individuals migrating to Arizonasstate capital over the past three years coming from around the southwest reg

43、ion.Tourism in PhoenixPhoenix is not just seeing a rise in residents.The city is also seeing an increase in domestictourism-particularly from national tourists traveling more than 150 miles to visit the city.So unlike Las Vegas,which saw a rise in national migration coupled with an increase indomest

44、ic tourism,Phoenix is seeing increased regional migration along with largernumbers of national tourism.But similar to Las Vegas,the rise in tourism in Phoenix creates even more retailopportunities for local business owners and real estate investors.Austin,TX-A Growing Hub for Experiential RetailAust

45、in is the state capital of Texas,and has been named one of the best places to live in theUnited States as well as a top relocation destination globally.And the city is fast cementingits role as a major tech hub according to LinkedIn data,between May 2020 and April 2021the city saw more tech-related

46、migration than any other city in the US.At the same time,Austin remains a center of creative and cultural experimentation,as exemplified byAustinites unofficial motto of“keep Austin weird.”Texans Flocking to AustinUnlike Las Vegas,most domestic migration to Austin has come from Texans choosing torel

47、ocate within the state.Almost two thirds of individuals relocating to Travis County whereAustin is located came from other counties in the Lone Star State.Around 10%of domesticmigration to Austin between July 2019 and July 2022 came from Harris County(Houston),while 8.9%of new Austinites moved to Au

48、stin from the citys northern suburb ofWilliamson.Whether people are choosing Austin for its growing job market,thriving artsscene,or beautiful weather,the citys growing population is driving a sharp increase inretail real estate demand and commanding the highest price tag of the cities in this repor

49、t.Austins Spectacular Theater RecoveryFoot traffic to most theaters and music venues nationwide has remained well belowpre-pandemic levels.But in Austin,likely due to the residents appetite for arts and culture,visits to these venues have skyrocketed in recent months.March 2022 was the first monthdu

50、ring which theater and music venue foot traffic exceeded 2019 levels,driven in part byAustins SXSW Conference and Festival.And since May,Yo3Y foot traffic growth hasremained positive,with July 2022 foot traffic to theaters and movie venues in Austin 25.1%higher than it was pre-pandemic while nationw

51、ide visits to theaters and music venueswas down 16.4%Yo3Y.Some of this boost is likely coming from people who relocated to Austin in recent years andare now participating in the citys cultural scene.As new Austinites continue to find their bearings in their adopted hometown,expect theretail recovery

52、 in the city particularly as it relates to arts and culture to continueoutperforming the nationwide average.Boise,ID-Expanded Retail OpportunitiesUS News&World Report ranked Idahos state capital the 15th best place to live and the14th safest city in America in 2022,so its no surprise that Boise has

53、seen its populationgrow over the past three years.Residents appreciate the citys mild weather,expansivenature,and family-friendly orientation.Boises Population ExplosionBoises population was already on the rise before COVID shut down workplaces and forcedpeople to rethink their living situations.But

54、 the pandemic accelerated the trend and drovea massive wave of domestic migration to Idahos capital that is creating major demographicshifts in the city.Between July 2019 and July 2022,the population of Ada County(whereBoise is located)rose by more than 10%slightly more than the Idaho statewidepopul

55、ation increase of 9.0%in the same period.This population growth,especially in thediversification of demographic groups,is likely creating significant business and retailinvestment opportunities in Boise and its surrounding suburbs.The Retail Impact of Boises Population GrowthPopulation increase is a

56、lso generating demand for retail services in Boise.As an example,electronics stores in the city and its metro area enjoyed higher foot traffic recovery ratescompared to the national average between March 2022 and August 2022,surpassingIdahos Yo3Y foot traffic recovery levels in most months as well.T

57、he increase in visits is likely driven,at least in part,by migration.This means that retailerswho understand how the recent migration wave is impacting local consumer habits andcater to the preferences of new Boiseans may be able to gain a leg up over thecompetition.Enhanced migration has also likel

58、y changed the demographic mix of the city.Zooming intothe trade areas of eight shopping centers in Boise between January and July 2022 showed adecrease in trade area median age,in comparison to those same months in 2019.Someshopping centers like Hillcrest Shopping Center and Country Club Plaza exper

59、ienceddramatic drops of 7.9%and 6.6%in trade area median age.The younger audience visitingBoises shopping malls may point to a wider shift in consumer habits and preferences inthe city.Boise is not necessarily the first place people associate with growing retail opportunities but investors may well

60、want to give the city a chance,as the areas significant in-migrationover the past few years is creating significant CRE potential.How Retail Stakeholders Can Leverage Migration DataDomestic population shifts are creating new retail opportunities across the United States.Retailers,retail real estate

61、investors,CPG companies,and other stakeholders can usemigration data to identify regions where a rise in residents is likely to translate into anincrease in potential consumers for their goods and services,improved retail valuations,and promising ROI.Foot traffic based migration data can show much m

62、ore than where people are movingfrom,and where theyre moving to.Using location analytics to segment population flows byage,household income,or even retail preferences can provide whole-picture,contextualized insights into changing markets and their budding opportunities.Theseanalyses offer a clear look into not just these cities,but any citys changing story,empowering relevant CRE stakeholders to make data-driven decisions that position theirbusiness and region for long-term success.