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HomeMy WebLinkAboutContract 1606 . . _ U ( 11 MCCOMB GROUT Ltd. ® 1 J R E A L E S T A T E A N D / ( 1 1 1 1 1 R E T A I L C O N S U L T A N T S Revised June 27, 2001 Mr. Walter R. Fehst, City Manager ' ' 2 ' CITY OF COLUMBIA HEIGHTS �,�� 590 — 40 Avenue NE Spa Columbia Heights, Minnesota 55421 Dear Mr. Fehst: In response to your request, we have prepared a work program to conduct an evaluation and market analysis of retail areas in Columbia Heights. The focus of this analysis will be the area in the vicinity of Central Avenue between 37 and 45 Avenues. Other retail uses along Central Avenue between Fourth Avenue and I -694 will also be evaluated to determine the scope and character of retail establishments in the area. Objectives for this analysis include the following: • ♦ Evaluate physical characteristics of Columbia Heights retail area and identify changes to improve how the area looks and functions. • Identify retail and service uses suitable for Columbia Heights that would complement other stores in the market area. The objective of this engagement is to identify actions that will position Central Avenue as an attractive location for retail and service uses. WORK PROGRAM The work program outlined below is designed to fulfill the above objectives. Specific work tasks are summarized. ♦ Central Avenue Evaluation Central Avenue and environs will be inspected to evaluate its physical characteristics, design, relationship of uses, and physical condition. Factors to be studied include, but are not limited to: tenant mix, location, size, access, ingress and egress, vehicular traffic patterns, and relationship to other commercial and residential uses. in the area: • Business Interviews Owners or managers of retail establishments located in Columbia Heights will be interviewed to determine where their customers come from and their impressions of the area's retail strengths and weaknesses. 3001 Hennepin Avenue South Suite 301B Minneapolis, Minnesota 55408 • (612) 339 -7000 Fax: (612) 338 -5572 Mr. Walter R. Fehst June 27, 2001 Page 2 • Competitive Centers Evaluation Competitive shopping centers and retail clusters serving the market area will be inspected and evaluated to determine competitive impacts on Columbia Heights. Principal competitors will be identified and evaluated for tenant mix, retail GLA, and anchor stores. Future retail developments that will affect either Columbia Heights or its retail trade area will be identified. To the extent possible, the impact of new competitive retail development will be identified. • Customer Survey Selected businesses along Central Avenue will be asked to participate in a survey of their customers to determine where their customers live and work. This information will be used to identify a trade area for Columbia Heights. The survey is designed to be executed by employees of each firm as customers pay for their goods or services. The budget assumes ten to twelve business participants. ♦ Trade Area Analysis Based on business interviews and consumer research, the trade area for downtown Columbia Heights will be delineated. The economy of the trade area will be analyzed to identify and quantify those factors that generate support for retail establishments. This analysis will include demographics of the trade area including population, households, age distribution, income levels, employment, and other pertinent data using the latest census information and updated estimates. Trade area population and households will be adjusted to reflect the recently released 2000 Census data. Daytime population of the - employment trade area will be identified by industry group and occupation, and payroll. Retail purchasing power available within the trade area will be estimated by major merchandise category for a ten -year period to determine future trends in retail spending. ♦ Columbia Heights Competitive Position Information obtained from the previous task will be utilized to evaluate Columbia Heights' competitive position and its ability to compete effectively with other shopping areas and withstand the impact of future competitive retail developments. ♦ Retail Sales Potential Future retail sales potential for the study area will be estimated taking into consideration competitive impacts, _ trade ._area _demographics,__purchasing power, and recommended_ renovation and/or remerchandising of retail and service establishments. Based on analysis of purchasing power, competitive shopping centers, and current retail trends, future retail sales potential for the study area will be estimated by store type. Mr. Walter R. Fehst June 27, 2001 Page 3 ♦ Redevelopment and Remerchandising Recommendations Based on the foregoing analysis, recommendations for renovation and redevelopment will be prepared. This task will focus on all potential uses and will include addressing future use of other commercial parcels in the area. The results of our work will be documented in a final report designed to meet client needs. The report will contain appropriate graphics and explanations of our principal findings, conclusions, and recommendations. MEETINGS Three meetings are planned during the course of the evaluation to keep the client informed of our progress and findings. These meetings include the following: ♦ Start - Up Meeting will be held at the beginning of the engagement to define the study area, finalize research objectives for the engagement and obtain client - provided information. ♦ Work Session will be held to review trade area analysis, competitive evaluation, customer survey results, retail sales analysis, competitive position, and preliminary findings and recommendations. ♦ Report Meeting to discuss results of all work tasks and recommendations. This meeting will cover all aspects of the research program. 6p/ill& Heil The budget provides for three client meetings as described above and up to threemeetings u e z Additional meetings will be billed at our normal hourly rates plus expenses. i 1 SCHEDULE Work tasks described in this proposal can be completed within a three -month period. A preliminary report will be provided at that time, a final report will be completed within ten days following receipt of client comments on the draft report. Ten copies of the report will be provided to the client. ADDITIONAL SERVICES Following completion of the above report, Columbia Heights may wish to utilize the following services. - ♦ - Marketing Brochure Results of the previous research will be summarized in a marketing brochure that highlights trade area characteristics using photographs, maps, and descriptive text. The objective is to produce an easily readable document that relies primarily on color maps and graphics to convey the demographic strengths to the Columbia Heights trade area. Mr. Walter R. Fehst June 27, 2001 Page 4 This brochure will take the reader on a visual tour of the Columbia Heights area and will contain a map and driving route. Individual pages will feature segments of the driving tour with color photographs of homes, parks, and other positive features key to specific locations along the driving route. Important demographic characteristics will be displayed in color graphics. ♦ Development Consulting McComb Group personnel will be available to provide Columbia Heights with development consulting, as needed. Services could include assisting with developer and retailer solicitations and other issues related to development. The scope and budget for these additional services can be determined following completion of the initial work tasks. QUALIFICATIONS AND EXPERIENCE McComb Group, Ltd. is a full- service retail and real estate consulting firm specializing in market research and financial feasibility. The firm has extensive experience in the retail industry and has conducted market research for retail stores and shopping centers of all types including regional malls, community centers and specialty centers. McComb Group, Ltd. has a team that is qualified to conduct the research described in this proposal. McComb Group's professional staff associated with this engagement include the following: • James B. McComb, President, founded the predecessor of McComb Group in 1974 following six years as a member of the corporate staff with Dayton Hudson Corporation. His experiences at Dayton Hudson and daily association with merchants and shopping center developers provided the impetus for McComb Group's approach to shopping center and retail market research and financial feasibility, which includes strong elements of design and merchandise sensitivities. The firm's approach to shopping center research and marketing has undergone continuous development and refinement over the past 20 years. ♦ Mr. Garrett S. Trapnell, Associate, conducts demographic and consumer research, trade area studies, and evaluates competitive developments. He also manages and is responsible for updating the firm's databases and digital information systems. Mr. Trapnell directs and analyzes McComb Group consumer survey engagements. This process -includes -the - creation -of- survey instruments,- data- input, data- aggregation as well as final cross - tabulations and output. Mr. Trapnell holds a B.A. degree from the University of Minnesota in Geography. He is a skilled cartographer, producing McComb Group's digital and hard copy maps. Mr. Trapnell has planning and zoning consulting experience in the public and private sectors. His knowledge and experience contribute to our demographic and spatial analyses using Mr. Walter R. Fehst June 27, 2001 Page 5 the McComb Group's national demographic database and geographic information system. Mr. McComb will be responsible for managing and directing the overall research program and will participate directly in findings and conclusions. Individual work tasks will be assigned to personnel within the firm based on qualifications and experience. BUDGET The professional fees for the services and expenses outlined in this proposal total $17,700 and will be performed at a price not -to- exceed that amount. The budget is based on the amount of time required to perform the work tasks and our normal hourly billing rates of $220 for principals, $110 for senior associates, $90 for associates, and $65 -$85f for cor1s Rants. �lq walk f (Y Company policy requires a retainer of approximately ...ene-hfilf the budge: for the project or f/24, -$8 8'00-' The retainer will be applied to the final invoice as a credit for billing of professional services and expenses. Invoices for professional services and expenses will be rendered at mid- " month and month -end as our work progresses. Standard billing terms are net ten days. A finance charge of 1.5 percent will be charged on all unpaid balances outstanding more than 30 days. REPORT PURPOSE This proposal was prepared with the understanding that the results of our work will be used by the client to evaluate retail potential in the study area and may be shared with retailers, developers, lenders and other investors. Our report will be prepared for that purpose and will be subject to the following qualifications: ♦ Our analysis will not ascertain the legal and regulatory requirements applicable to this project, including zoning, other state and local government regulations, permits and licenses. No effort will be made to determine the possible effect on the proposed project of present or future federal, state or local legislation, or any environmental or ecological matters. ♦ Our report and analysis will be based on estimates, assumptions and other information developed from research of the market, knowledge of the industry and discussions with the client. Some assumptions inevitably will not materialize and unanticipated events and circumstances may occur; therefore, actual results achieved will vary from the analysis. ♦ Our analysis will not evaluate management's effectiveness or be responsible for future marketing efforts and other management actions upon which actual results are dependent. ♦ Our report will be intended solely for the purpose described above and should not be used for any other purpose without our prior written permission. Permission for other use of the report will be granted only upon meeting company standards for the proposed use. Mr. Walter R. Fehst June 27, 2001 Page 6 These qualifications will be included in our final report. If the report is used for purposes other than specified above, we reserve the right to review the materials for proper use of our work. ACCEPTANCE PROCEDURES To indicate acceptance of the proposal, please sign a copy of the proposal and return it to us together with your check for the retainer as authorization to proceed with this engagement. We appreciate the opportunity to submit this proposal and look forward to hearing from you soon. If you have any questions concerning the proposal, please call me at (612) 339 -7000. Accepted By: d McComb Group, Ltd. Company: 6: / v(6/ .4 1 ,1 / Title: 4ffkAri Pr Jaynes B. McComb Date: President 1 MCCOM13 GROUP Ltd. I I•n R E E T A I L I L E REE TATE AN E TAIL Revised July 18, 2001 Mr. Walter R. Fehst, City Manager CITY OF COLUMBIA HEIGHTS 590 40 Avenue NE Columbia Heights, Minnesota 55421 Dear Mr. Fehst: In response to your . request, we have prepared a work program to conduct an evaluation and market analysis of retail areas in Columbia Heights. The focus of this analysis will be the area in the vicinity of Central Avenue between 37 and 45"'. Avenues. Other retail uses along Central Avenue between Fourth. Avenue and I -694 will also be evaluated to determine the scope and character of retail establishments in the area. Objectives for this analysis include the following: ♦ Evaluate physical characteristics of Columbia Heights retail area and identify changes to improve how the area looks and functions. - ♦ Identify retail and service uses suitable. for Columbia Heights that would complement other stores in the market area. The objective of this engagement is to identify . actions that will position Central Avenue as an attractive location for retail and service uses. WORK PROGRAM The work program outlined below is designed td fulfill theabove objectives. Specific work tasks are summarized. ♦ Central Avenue Evaluation Central Avenue and environs will be inspected to evaluate its physical characteristics, design, relationship of uses, and physical condition. Factors to be studied include, but are not limited to: tenant mix, location, size, access, ingress and egress, vehicular traffic patterns, and relationship to other commercial and residential uses in the area. • Business Interviews Owners or managers of retail establishments located in Columbia Heights will be interviewed to determine where their customers come from and their impressions of the area's retail strengths and weaknesses. 3001 Hennepin Avenue South Suite 301B Minneapolis, Minnesota 55408 • (612) 339 =7000 Fax: (612) 338 -5572 Mr. Walter R. Fehst July 18, 2001 Page 2 • Competitive Centers Evaluation Competitive shopping centers and retail clusters serving the market area will be inspected and evaluated to determine competitive . impacts on Columbia Heights. Principal competitors will be identified and evaluated for tenant mix, retail GLA, and anchor stores. Future retail developments that will affect either Columbia Heights or its retail trade area will be identified. To the extent possible, the impact of new competitive retail development will be identified. • Customer Survey Selected businesses along Central Avenue will be asked to participate in a survey of their customers to determine where their customers live and work. This information will be used to identify a trade area for Columbia Heights. The survey is designed to be executed by employees of each firm as customers pay for their goods or services. The budget assumes ten to twelve business participants, ♦ Trade Area Analysis Based on business interviews and consumer.. research, the trade area for downtown Columbia Heights will be delineated. The economy of the trade area will be analyzed to identify and quantify those factors that :generate - support for retail establishments. This analysis will include demographics of the trade area including population, households, age distribution, income levels, employment, and other pertinent data using the latest census information and updated estimates: Trade - area - population and - households will be - - adjusted to reflect the recently released: 2000 Census data Daytime population of the . employment trade area will be identified by industry :group and occupation, and. payroll. Retail purchasing power available within the : trade area - will be estimated by major merchandise category for a ten -year period to 'determine future trends in retail spending. ♦ Columbia Heights Competitive Position Information obtained from 'the previous task will be utihzed to evaluate Columbia Heights' competitive position and its ability to compete effectively with other shopping areas and withstand the impact of future competitive retail developments. ♦ Retail Sales Potential Future retail sales potential for the study area will be estimated taking into consideration competitive impacts, trade area demographics, purchasing power, and recommended renovation and/or remerchandising of retail and service establishments. . Based on analysis of purchasing power, competitive shopping centers, and current retail trends, future retail sales potential for the study area will be estimated by store type. Mr. Walter R. Fehst July 18, 2001 Page 3 ♦ Redevelopment and Remerchandising Recommendations Based on the foregoing analysis, recommendations for renovation and redevelopment will be prepared. This task will focus on all potential uses and will include addressing future use of other commercial parcels in the area The results of our work will be documented in a final report designed to meet client needs. The report will contain appropriate graphics and explanations of our principal findings, conclusions, and recommendations. MEETINGS Three meetings are planned during the course of the evaluation to keep the client informed of our progress and findings. These meetings include the following; ♦ Start - Up Meeting will be held at the beginning of the engagement to define the study area, finalize research objectives for the engagement and obtain client - provided information. ♦ Work Session will be held to review trade - area _analysis, competitive evaluation, customer survey results, retail sales analysis, competitive position, and preliminary findings and recommendations. ♦ Report Meeting to discuss results of all work tasks and recommendations. This meeting will cover all aspects of the research program. The budget provides for three client meetings as described above and up to three additional meetings without .charge. Additional meetings will be billed at our normal hourly rates plus expenses: SCHEDULE Work tasks described in this . proposal can be completed within a three -month period. A preliminary report will be provided at that time, a final report will be completed within ten days following receipt of client comments on the draft report. Ten copies of the report will : be provided to the client. ADDITIONAL SERVICES Following .completion of the above report, Columbia Heights may wish to utilize the following services. ♦ Marketing Brochure Results of the : previous research will be summarized in a_ marketing brochure that highlights trade area characteristics using photographs, maps, and descriptive text. The objective is to produce an easily readable document that relies primarily on color maps and graphics to convey the demographic strengths to the Columbia Heights trade area. Mr. Walter R. Fehst July 18, 2001 Page 4 This brochure will take the reader on a visual tour of the Columbia Heights area and will contain a map and driving route. Individual pages will feature segments of the driving tour with color photographs of homes, parks, and other positive features key to specific locations along the driving route. - Important demographic characteristics will be displayed in color graphics. ♦ Development Consulting = : • McComb Group personnel will be available to provide Columbia Heights with development consulting, as needed. Services could include assisting with developer and retailer solicitations and other issues related to development. The scope and budget for these additional services can be determined following completion of the initial work tasks: QUALIFICATIONS AND EXPERIENCE McComb Group, Ltd.. is a full- service retail and real estate consulting firm specializing in market research and financial feasibility.. The firm has extensive experience in the retail industry and has conducted market research for retail stores and - shopping_ centers of all types including regional malls, community centers and specialty centers McComb Group, Ltd. has a team that is qualified to conduct the research described in this proposal. McComb Group's professional staff associated with this engagement include the following: • James B. McComb, President, founded_ the predecessor of - McComb Group in 1974 following six years as a member of the corporate staff with Dayton Hudson Corporation. His experiences at Dayton. Hudson and daily association with merchants and shopping center developers provided the impetus= for McComb Group's : approach to shopping center and retail market research and :financial° feasibility, which includes strong elements of design and merchandise sensitivities. The firm's approach to shopping center research and. marketing has undergone continuous development and refinement over the past 20 years. ♦ Mr. Garrett S. Trapnell, Associate, conducts demographic and consumer research, trade area studies, and evaluates competitive developments.. He also manages and is responsible for updating the firm' s databases and digital information systems. Mr. Trapnell directs and analyzes McComb Group consumer survey engagements. This process includes the creation of survey instruments, data input, data aggregation as well as final cross- tabulations and output. Mr. Trapnell holds a B.A. degree from the University of Minnesota in Geography.: He is a skilled cartographer, producing McComb Group's digital and hard copy maps. Mr. Trapnell has planning and zoning consulting experience in the public and private sectors. Mr. Walter R Fehst July 18,2001 Page 5 His knowledge and experience contribute to our demographic and spatial analyses using the McComb Group's national demographic database . and geographic information system. Mr.. McComb will be responsible for managing and directing the overall research .program and will participate directly in findings and conclusions. Individual work tasks will be assigned to personnel within the firm based on qualifications and experience. BUDGET The professional fees for the services and expenses outlined-in: this proposal total $17,700 and will be performed at a price not -to- exceed that amount. The .budget is based on the arnount of time required to perform the work tasks and ' our normal. hourly billing rates of $220 for principals, $110 for senior associates, $90 for associates, and $65 -$85 for consultants. Company policy requires a retainer of approximately one-quarter the budget for the project. or $4,400. The retainer will be applied to the final invoice as a credit for billing of professional services and expenses.. Invoices for professional services and expenses will be rendered' at mid month and month -end' as our work progresses . Standard billing terms are net ten days. A finance charge. of 1.5 percent will be charged on all unpaid balances outstanding more than 30 days: REPORT PURPOSE. • This proposal was prepared with the understanding that the results:of our work will be used by the client to evaluate retail potential in the study - area:- and may be shared with retailers, developers, lenders and other investors: Our report will be_ for that purpose and will be subject to the following qualifications: ♦ Our analysis will not ascertain the legal: and- regulatory requirements applicable to this project, including zoning; other state an d local. ,government 'regulations, permits . and licenses. No effort will be made to determine the possible: effect on the proposed project of present or future federal, state or- local:, legislation,. or any: environmental or ecological matters. Our report and analysis will be based on estimates, assumptions and other information developed from research of the market, knowledge of the industry and discussions with the client Some assumptions inevitably will not materialize and unanticipated events and circumstances may occur; therefore, actual results - achieved will vary . from the analysis. . . ♦. Our analysis will not evaluate management's effectiveness or be responsible for future marketing efforts and other management actions upon which actual results are dependent. ♦ Our report will be intended solely for the purpose described above and should not be used for any other purpose without our prior written permission.. Permission for other use of the report will be granted only upon meeting company standards for the proposed use. Mr. Walter R. Fehst July 18, 2001 Page 6. These qualifications will be included in our final report. `° If the report is used for purposes other than specified above, we reserve the right to review the materials for proper use of our work. ACCEPTANCE PROCEDURES To indicate acceptance . of the proposal, please sign a copy of the proposal and return it to us together with . your check for the retainer as authorization to proceed with this engagement. We appreciate . the opportunity to submit this proposal and look forward to hearing from you soon. If you have any questions concerning the proposal; please call me at (612) 339 -7000. Accepted By: City of Columbia - ig s McComb Group, Ltd. Mayor Date: '7 -3 / Ag e d r James. B, - McComb, President City Manager Date: 7