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Retail Mixed Use Market Study Update 1 January 6, 2010 CASE STUDY LESSONS LEARNED In August of 2009, Strategic Economics, with the Steering Committee and Main Street Property Services, visited several mixed -use developments around Hacienda, including the Shops at Tralee Village, Avalon Dublin Station and the Shops at Waterford. The purpose of this visit was to examine the factors that have led to mixed -use success in the area, and leam from the shortcomings of projects that have struggled to fill retail space. The lessons learned from these case studies will be incorporated into the final recommendation for mixed -use retail in Hacienda. The Shops at Tralee Village The Shops at Tralee Village are part of a mixed use '� -p development including 35,000 square feet of 1/ commercial space and 233 residential units. Tralee N opened in 2008, and was significantly impacted by the II � collapse of the housing market and the broader —Jr l - ' economic downturn. Although a few small shops and 4 _ 11 services have moved in, including Nothing Bundt ], Cakes, Extreme Pizza and Dublin Smiles, the - commercial space at Tralee Village remain primarily 1 t ••- ' ' vacant. ; W _ Figure 8: Shops at Trolee Village Site Location The brokers who participated in the site visit cited several key factors contributing to the poor performance of the project, including: • Project timing. The project opened during the current economic downturn. • Poor design of the retail component. The retail space is not easily identifiable as retail - the stores are not delineated from one another and could easily be mistaken for offices. • Location and relationship to the street. The location of the project is not appropriate for this kind of pedestrian- oriented development. Tralee is next to a gas station, on a wide, auto - oriented street, which accommodates six lanes of traffic. Although locating next to a highly- trafficked street is typically a retail advantage, the poor visibility of the Shops at Tralee puts tenants at a distinct disadvantage. In addition, brokers reported that the retail component was an afterthought to a primarily residential project, included to satisfy mixed -use requirements in the City of Dublin. Avalon Dublin Station Avalon Dublin Station is a mixed use development �t • F 1 • located just north of the Dublin/Pleasanton BART 14' ' F station. The project includes 15,000 square feet of +' 4 1 retail space, in addition to 305 residential units. a I`j Opened in 2007, the residential portion is completely leased, while the retail space remains t i vacant. Market timing and design issues were the main z ;- reasons cited for poor performance of the retail at ': Avalon Dublin Station. Like Tralee, the project Figure 9: Avalon Dublin Station Site Location opened on the cusp of the current economic downturn. Although the retail facade does illustrate clear delineation between storefronts, design issues include the single -sided nature of retail at Avalon Dublin Station and the project's location 57