Page E1.1 . 16 May 2012                     
ArchitectureWeek - Environment Department
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Designing the Neighborhood Retail Center

by Robert J. Gibbs

Developing and managing retail centers remains one of the most financially risky of all real estate categories.

In 2006, the United States had 20.22 square feet (1.88 square meters) of gross leasable area (GLA) of retail space per capita, far more than any other nation in the world.

Retailers must respond to ever-changing consumer trends and demands while constantly fending off new competition. As a result, the retail industry relies upon proven methods and techniques to minimize the risk and to earn a market rate of return on their investment.

This risk may be felt more acutely in mixed-use urban areas, where vacant storefronts or undesirable retailers can significantly disrupt the quality of life for surrounding residents and nearby office workers.

Most of America's shopping centers fall into one of seven proven building types: the corner store, convenience center, neighborhood center, community center, regional center, lifestyle or town center, and outlet center. The GLA of each of these center types can be increased 30 to 50 percent to create supersized centers — for example, the super neighborhood center, super community center, or super regional mall.

Each type of center appeals to a distinct market segment and has specific tenant types, size ranges, location criteria, and site plan standards. Although there are always exceptions to these types, centers that deviate from these industry standards and sizes are often considered economically risky and thus difficult to finance or lease.

For example, a 50,000-square-foot (4,600-square-meter) convenience center is generally too large to support 20 to 25 small stores without the pulling power of a supermarket. On the other hand, a 50,000-square-foot (4,600-square-meter) supermarket-anchored neighborhood center does not have enough GLA to support the below-market rents affordable to modern supermarket operators.

Neighborhood Centers

The neighborhood center is considered the core of the traditional neighborhood and a staple of the shopping center industry. Anchored with a supermarket, pharmacy, and restaurant, a neighborhood center offers the complete array of goods and services needed by households on a regular basis but not available at smaller or larger centers.   >>>

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This article is excerpted from Principles of Urban Retail Planning and Development by Robert J. Gibbs, copyright © 2012, with permission of the publisher, John Wiley & Sons.

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Small businesses that maintain extended hours and sell goods and services desired by their respective communities tend to be the most profitable and contribute to competitive business districts. Pictured is a hardware store in St. Andrews, Scotland.
Photo: Robert J. Gibbs Extra Large Image

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The town of Rosemary Beach, Florida, was master-planned by Duany Plater-Zyberk & Company. A collection of small shops and restaurants is clustered around Barrett Square.
Photo: Robert J. Gibbs Extra Large Image


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