COLLIERS INTERNATIONAL Retailer & Restaurant Continuum Customized Real Estate Services Strategy Portfolio Management Client Store Design & Delivery Accelerating success. Site Selection ‘‘ We offer retailers the depth and scale required to open and manage a portfolio of brandconsistent, productive stores with a regional to international reach. ‘‘ CONTENTS CONTINUUM OVERVIEW STRATEGY SITE SELECTION STORE DESIGN & DELIVERY PORTFOLIO MANAGEMENT Proven Success COLLIERS INTERNATIONAL This document has been prepared by Colliers International for advertising and general information only. Colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. Any interested party should undertake their own inquiries as to the accuracy of the information. Colliers International excludes unequivocally all inferred or implied terms, conditions and warranties arising out of this document and excludes all liability for loss and damages arising there from. This publication is the copyrighted property of Colliers International and/or its licensor(s). ©2015. All rights reserved. 2015_01 Continuum OVERVIEW Strategy Portfolio Management Site Selection Store Design & Delivery Retailer & Restaurant Portfolio Management At Colliers, we are guided by a spirit of enterprise with a human touch. We embrace even the toughest challenges, and are relentlessly creative in solving them. We are involved in all facets of store delivery and portfolio management, offering help from more than 450 highly skilled retail professionals in the U.S. alone—plus many more in key international markets in Canada, Europe, Latin America and the Asia-Pacific region. By being involved in all facets of store delivery and portfolio management we quickly learn what works best and incorporate those practices in the Continuum, thus continuously providing the ideal shopping experience to your customers in the most efficient manner. “ “ Our goal is to make your real estate a competitive business advantage and ensure your entire range of property needs are met. And through it all, our professionals go the extra mile in their attitudes and actions, allowing our values of expertise, community, service and fun to come through in everything we do. We offer our clients the depth and scale required to open and manage a portfolio of brand consistent, productive stores on a regional, super-regional, national and international scope. Strategy New Market Penetration & Realignment Whether you are trying to realign your store footprint, adjust your distribution strategy, develop a market optimization plan for a single MSA, or launch an international roll-out, Colliers has the expertise and resources to assist in developing your real estate strategies. >> >> >> >> Concept review/brand identification Competition/cotenancy Demographic/site criteria development/validation Space design and prototyping, building and FF&E cost estimates >> Evaluate support structure – HQ, distribution, call centers >> Capital strategies – lease, own, financing >> Submarket analysis Process STRATEGIC PLANNING & VISION >> Explore project success criteria and organization evolution >> Standardize key processes >> Identify customer profile, synergistic retailers, and competitors >> Forecast total sales volume for all U.S. regions, and identify markets of greatest opportunity >> Prioritize target markets for roll-outs >> Assist with setting goals and solutions >> Assist with optimizing efficiency in logistics, distribution, and management >> Provide design and construction value engineering TARGETING >> Implement timelines and accountabilities >> Locate and map clusters of target households LOCATION PERFORMANCE ANALYSIS >> Create customized site criteria heat mapping >> Model trade areas by rings, manual polygon or drive times >> Determine key demographic correlations between high-and low-performing stores >> Review distribution networks and management territories >> Maximize efficiency of stores based on square footage and SKUs >> Project spending of each target household to forecast sales potential >> Run “reverse demographics” to locate sites that best fit the profile >> Identify amenities and new developments located in or serving target markets >> Prepare a strategy for relocating or repositioning lowperforming stores SITE OPTIONS >> Review economic terms of leases to ensure alignment with real estate and operating strategies >> Identify new developments and new entries in the market CUSTOMER PROFILING >> Create aerial maps showing subject sites, comparable transactions, and competitors >> Link point-of-sale addresses to census and psychographic household data >> Identify new trends in population shifts and retail patterns >> Provide input for forecasting sales volumes >> Create alternative floor/space planning for various spaces >> Create detailed, household-level understanding of trade areas >> Identify and define signage strategies and options >> Forecast spending of each target household CAPITAL STRATEGIES >> Identify customer attitude toward select cotenants, brand positions, and area amenities >> Understand connections to preferred tourist destinations and activities MARKET OPPORTUNITY ANALYSIS >> Total the target customer population and spending to predict market capacity >> Divide market to understand total number of distinct submarkets P. 4 Colliers International >> Provide valuation services >> Provide financing through traditional lending sources, including SBA >> Assist with packaging and presentation for venture capital >> Pursue sale/leaseback strategy where appropriate to monetize existing owned assets >> Perform reverse build-to-suits >> Institute preferred developer program Retail Services Strategy Portfolio Management Site Selection Store Design & Delivery Resources Colliers has a deep bench of professionals who have broad experience in all aspects of the retail real estate spectrum, including serving as heads of real estate at national retail organizations, real estate managers, developers, site selectors, analysts, and brokers. We rely on the experience of this team to leverage the resources of our organization and create the optimal strategy for our clients. Our expertise in demographics, geographic information systems, retailing, market analysis, merchandising/tenant mix planning, project/construction management, project leasing, and sustainable consulting ensure the planning and execution of a winning retail strategy. IN-DEPTH RESEARCH >> Economic data collection and comprehensive market analysis >> Expansive databases housing detailed information on properties nationwide and globally >> Quarterly reports produced on market and economic conditions in virtually every major market >> Combined market knowledge and forward-thinking expertise to help our clients make the right business decisions and plan for the future GEOGRAPHIC INFORMATION SYSTEMS (GIS) >> Thematic mapping >> Comparative market analysis >> Market trends >> Market segmentation >> Demographics >> Employment and transportation analysis Site Selection Site/Space Selection Managing a multi-market roll-out is much more than simply “referring” a client to qualified brokers in other markets. A wellmanaged roll-out requires a clean strategy, process, systems, standardization and clarity of purpose. >> Complete submarket analysis >> Lease/purchase agreements >> Define technical site attributes (traffic, visibility, parking, etc.) >> Business advisory and facilitation >> Determine site/store options >> Due diligence >> Signage optimization/visibility >> Financing >> Letter of intent/negotiations >> Transaction management/pipeline reporting >> Real estate committee packages Process Standard Response & Negotiation Packages Draft & Negotiate Proposals >> Develop and prototype a set of standard documents for use by field brokers >> Draft and review LOIs and work letters with client >> Develop and initiate transaction pipeline tracking system >> Communicate and train field brokers on use >> Prepare documents with final negotiated deal points and site approval packages Submarket Analysis Lease Execution >> Communicate market strategy–maximum store count vs. cannibalization issues >> Present final, corporate-approved deal points for lease preparation >> Review site economics versus competitors and alternate locations >> Review and negotiate lease terms and conditions with client’s attorney >> Determine market lease rates and terms based on specific space delivery condition >> Coordinate execution of final lease documents >> Estimate delivery timing for each site >> Identify and resolve any local obstacles to market entry or operations Site Selection >> Identify specific alternatives >> Negotiate with landlord Construction Coordination & Hand-Off >> Review current space condition with construction >> Estimate costs and timeline >> Stage materials for improvements and fixturing >> Alert on timing of possession >> Complete site analysis forms and packages P. 6 Colliers International Retail Services Strategy Portfolio Management Site Selection Store Design & Delivery Store Design & Delivery Solutions Leveraging Diverse Expertise & Cutting Edge Technology In order to seamlessly deliver a built-out and fixtured store for our clients anywhere in the U.S. and Canada, Colliers International has developed a strategic partnership with Menemsha. Colliers has worked in close collaboration with Menemsha for over eight years. With the size and experience to handle thousands of retail projects per year, Menemsha has proven to be the best choice for high-quality, cost-effective delivery of retail stores. Menemsha’s capabilities include: Survey Build >> As-builts (Laser2CAD) >> Licensed nationwide >> ADA compliance sssessments >> Procurement and estimating >> 3DVR (360-Degree) photography >> In-house fixture installers Design >> Strong national subcontractor base >> Branding and prototyping >> Concept ideation >> Design and documentation >> 3D modeling and animation (Revit) >> Permit expediting and entitlement Process Program Development & Due Diligence Permitting & Procurement >> Program development schedule >> Final Landlord approval/permitting >> As-built site survey and existing conditions assessment >> Draft subcontractor scope documents >> Permit and entitlement evaluation >> Project out to bid >> Preliminary project budget, scope, and schedule >> Bids returned, qualified, and awarded >> Landlord work letter and LOD review Scope Development, Planning & Preliminary Estimating >> Concept test fit >> Design meeting and development >> Vendor selection (relating to owner-furnished items and preferred vendors) >> Develop estimate based on conceptual drawings >> Design review and value engineering >> Landlord approval of conceptual drawings >> Landlord scope integration >> Draft construction documents >> Develop construction schedule Construction >> Client reporting and resolution (continuous) >> Project and safety management (continuous) >> Project cost management (continuous) >> Quality assurance/control (continuous) >> Owner-furnished items coordination (for delivery and installation) >> Performance measurement >> Billing administration PROJECT COMPLETION >> Move coordination >> Punch list and sign-off >> Tenant improvement allowance management >> Municipal and city sign-off >> Close-out documents and as-built P. 8 Colliers International Retail Services Strategy Portfolio Management Site Selection Store Design & Delivery Resources Survey Division Menemsha’s Survey Division is a leading provider of highvolume site surveys for the purposes of assessing existing conditions, ADA compliancy, data collection, and development viability. The team utilizes cutting-edge technology (Laser2CAD) and tools to perform accurate high-volume site evaluations incorporating 3DVR (360-degree) photography. Menemsha’s diversely skilled surveying team often collaborates with the Design and Construction Divisions in performing field design services as well as project estimating relating to remodeling initiatives. Design Division Menemsha’s Architectural Division consists of world-class, nationally licensed, and LEED-accredited architects and designers. The full spectrum of design services include: >> Branding and prototyping >> Program roll-out construction documentation >> Minor retrofit programs to flagship projects >> 3D modeling and animation (Revit) >> Engineering >> Design peer review and value engineering >> Permit expediting and entitlement General Contracting Division Menemsha’s experienced General Contracting Division ensures that your individual construction needs are delivered on time and within budget. Construction experts at Menemsha combine the retail design intent with an understanding of construction practices within the retail industry to identify efficiencies in projects that ultimately reduce costs and time. The General Contracting Division collaborates with in-house survey and design experts, and also has the additional support of Menemsha’s procurement and estimating teams in ensuring successful project completion. Retail Services Colliers International P. 9 Portfolio Management Lease Portfolio/Administration & Facilities Management >> Lease abstracting >> Portfolio management >> Critical date tracking >> Renewal/extension/relocation >> Landlord CAM audits >> Excess space disposition/lease termination >> Property tax assessment – review/appeal >> ADA/legal compliance >> Real estate expense budgeting >> Physical “refresh”, repair, maintenance, remodel >> Lease payments Process Lease Administration Facilities Management >> Process and collect accounts receivables >> Engage fully-integrated real estate transaction team to address lease-related acquisition and disposition issues >> Manage subtenancies >> Create benchmarking reports >> Review leases and implement cost-savings initiatives >> Develop formal standards to ensure consistency and cost reduction >> Manage critical dates and lease options >> Leverage procurement process to consolidate vendors, provide volume discounts, and reduce operating expenses >> Process estoppels, SNDAs, and certificates of insurance >> Develop predictable and accurate costing models >> Review and reconcile invoices >> Implement state-of-the-art financial system to track costs and identify positive trends for replication throughout the portfolio >> Perform variance analysis >> Optimize resource allocations >> Implement state-of-the-art, web-based work order system and call-center help desk >> Engineering for major mechanical and electrical failures in existing facilities Strategy Portfolio Management Site Selection Store Design & Delivery Resources Lease Administration A lease means more than simply securing the space where you do business. For most companies, real estate represents the second-largest expense after personnel. Whether your company operates in one location or hundreds, we take the time to understand your concerns for cost, stability, and flexibility. Our services include lease abstractions and database management, monthly rent verification and payment schedules, lease audits, and equipment lease management. Colliers’ lease administration drives significant savings for our clients, saves time each month through the automation of rent payments from databases to accounts payable, and ensures you’ll never miss a critical lease date. >> Database selection and construction >> Lease abstractions and database management >> Monthly rent verification and payment schedules >> Lease audits >> Transaction project tracking Facilities Management Colliers’ approach to facilities management is unique in our industry. We have identified the subtle drivers that enable us to manage property at a higher standard and maximize asset value. While most firms just quantify asset value on a balance sheet, we take into account factors such as tenant loyalty, the relationship and regular contact between managers and tenants, top tenant service requests, and new opportunities for mutually beneficial tenant collaboration. These factors are proven to add asset value over time by reducing turnover and operational costs, and improving a building’s reputation in the market. Proven Success Moe’s Southwest Grille Kiehl’s Since 1851 Fidelity Investments Moe’s Southwest Grill is a rapidly expanding, fast-casual restaurant concept specializing in Southwest-inspired, healthy offerings served in a fun and comfortable atmosphere. Moe’s expansion plans were based on a franchise model primarily targeting markets east of the Mississippi. Challenge Kiehl’s Since 1851 has been a successful premium, yet accessible, skin, hair, and body care retailer, distributed through luxury department stores and independent shops in Canada. In 2003, Kiehl’s wanted to establish freestanding stores throughout Canada while maintaining its eclectic and independent image, but it did not have the internal real estate experience or resources to execute a national rollout. Challenge After receiving exclusive national Tenant respresentation for Fidelity, Colliers Boston faced the challenge of transforming the portfolio from first floor office space into highly visible office locations. Challenge The fast casual segment is exploding, and the competition for good real estate as well as capable, experiences licensees is fierce. There is often a lack of real estate direction and/or an overlap in the licenses that are awarded which can hurt in this competitive environment. Strategy Colliers performed Market Penetration Studies for those cities where Moe’s had not yet started to sell area licenses yet. This allowed Moe’s to have a specific idea of how many stores a particular city could support as well as where those locations should be. Results Colliers’ market studies gave Moe’s a clear focus for their real estate search immediately after licensees were in place. Moe’s gained a competitive advantage in terms of speed to market, the ability to pursue only quality locations, and eliminating the indecision often inherent in the franchise model. Moe’s authorized Colliers to perform Market Penetration Studies for all of their new areas, including nearly the entire Western U.S. P. 12 Colliers International Strategy In 2003 Kiehl’s retained Colliers Toronto to plan and implement a strategic retail freestanding stores program. Partnering with Kiehl’s VP/General Manager for Canada, Colliers Toronto developed and implemented a real estate plan that focused initially on High Street locations to support Kiehl’s brand positioning, and then drove sales growth through locations in top shopping centers. The Colliers plan, which identified target markets and centers and monitored centers on an ongoing basis, was driven by data and market knowledge and updated annually. Using Colliers’ internal brokerage network, Colliers Toronto engaged landlords and successfully secured premium locations across the country. Results Colliers Toronto has now worked with Kiehl’s for 11 years in a true partnership, which has resulted in 18 freestanding stores throughout Canada. Colliers continues to provide strategic planning (including monthly updates and a rolling three-year plan), handles site selection and negotiation, and manages all external owner leasing relationships. Strategy After being selected as Fidelity Investments first Strategic Partner, the Colliers team worked Fidelity to develop a demographic model that incorporated income, retail sales and daytime population, along with investable assets. The model was critical in identifying target submarkets. Colliers then selected a national scalable team of local retail brokers to pinpoint actual opportunities. Significant time was expended to educate the local brokers and the local landlords of Fidelity operation and needs. Results Colliers is now responsible for maintaining all leasing responsibilities for their entire retail portfolio. These responsibilities include new leases, relocations, expansions, and extensions Colliers has completed more than 700 transactions since the start of its relationship with Fidelity. Fidelity’s retail investor centers are critical in maintaining and growing their Omni channel client relationships. Fidelity is one of the largest investment companies in the world with over $4.5 trillion under management. Retail Services Retailer & Restaurant Representation (Sampling) 7-Eleven iPic Theater Pure Hockey Ashley Furniture Kiehl’s Qdoba Mexican Grill Atlantic Fish & Chop Kohler REI Audi Legal Sea Foods Rosa Mexicano Banfield Pet Hospital Lifetime Fitness Saltbox Barcelona Wine Bar Taco Lolita Cocina Shanghai Tang BJ’s Brewhouse Louis Vuitton Sola Salon Blo Blow Dry Bar Lumas SoulCycle Boston Nightlife Ventures LYFE Kitchen Staples Boston Private Bank Max & Leo’s Stephanie’s on Newbury Bowery Ballroom Max Brenner Sushirrito Citibank Mini Cooper Target Derek Lam Morton’s The Capital Grille Earl of Sandwich Mountain Equipment Co-op The Grove Eastern Bank Mr. Sid Towne Stove & Spirits Fidelity Investments New Balance Trader Joe’s Five Guys Nike Troquet Fresh City Palm Restaurants Verizon Wireless Glynn Hospitality Group Peet’s Coffee Urban Decay Guerlain Pieology Wagamama Haworth Pink Walgreens Hershey’s Plan B Burger Walt Disney Home Depot Pollo Campero World of Beer Ideal Image Porsche IKEA Pret a Manger Strategy Portfolio Management Site Selection Store Design & Delivery Retail Services Colliers International P. 13 Strategy Portfolio Management Site Selection Store Design & Delivery Enterprising Culture At Colliers, we’ve got you covered. We are a best-in-class provider of retail services, with more than 450 professionals in the U.S. alone, plus many more in key international markets in Canada, Europe, Latin America and the Asia-Pacific region. When you work with us, you work with the best. Our people are passionate about what they do; they’re highly skilled and are invested in our Clients’ success. This is evident throughout our platform—from Colliers University, our proprietary education and professional development platform, to our client engagement strategy that encourages cross-functional service integration, to our culture of caring. Our Services Colliers International offers a comprehensive portfolio of real Updated March 2015 estate services to Retailers, owners and investors on a local, regional, national and international basis. We offer years of direct experience in the local market. Our professionals know their communities and the industry thoroughly. We also provide a deep level of knowledge in specialized industries such as law, technical facilities and healthcare. P. 14 Colliers International Retail Services Colliers International At A Glance 2.3 $97 $ billion in Annual Revenue 16,300 billion in over 1.70 | 67 Countries | 502 Offices 84,000 Transactions billion Founding Member of the World Green Building Council Retail Services Professionals Square Feet Managed Member of World Economic Forum Recognized and ranked 10 consecutive years, more than any other real estate services firm. Colliers International P. 15 Accelerating success. For more information, please contact: Anjee Solanki National Director Retail Services | USA Colliers International +1 415 288 7871 anjee.solanki@colliers.com colliers.com/us/retail Kristin Poggi Retail Specialist Brokerage Services | USA Colliers International +1 213 532 3289 kristin.poggi@colliers.com