California Centers

MAR 2018

California Centers Magazine serves retailers, developers, shopping center owners, investment sales brokers and tenant representation firms throughout the state of California.

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10 California Centers Magazine | March 2018 C C J ohn Steinbeck once described Monterey's most famous retail destination as "a stink, a grating noise, a quality of light, a tone, a habit, a nostalgia, a dream." Cannery Row, to him, was a place where everyone from gamblers to martyrs to holymen might gather about in the restaurants and "little crowded groceries" any day of the week. Far be it for anyone to argue with Steinbeck's description, seeing as he is the original developer (in the literary sense, anyway) of the now-famous re- tail and restaurant waterfront destina- tion that is ever so popular with tour- ists. The last sardine cannery closed in 1973. Art galleries, clothing boutiques, restaurants and wine shops quickly sprung up in its place, attracting more than four million visitors a year. This is a great feat, considering the coun- ty's total population is a mere 435,000. "Cannery Row has a critical mass of tourists, so restau- rants and specialty stores offer charm," says Stephen Rush- er, senior vice pres- ident of Colliers in San Francisco. "The Monterey market is heavily dependent on tourists, which is an entirely differ- ent customer pro- file than traditional retail markets, and a retailer has the ability to be the big fish." Just Passing Through Situated 100 miles south of San Francisco and 240 miles north of Los Angeles, this Central California com- munity is a unique one for retailers. Outside of the standard barriers to en- try usually seen in coastal communi- ties, such as small populations, afflu- ent residents and an affinity for mom and pops, Monterey also contends with geographical barriers and an abundance of red tape related to land use, resource use and development. "Water morato- riums have been in effect for more than 10 years in Monte- rey," says Michael Schoeder, managing principal and ex- ecutive director of Cushman & Wake- field in Monterey. "Water is our po- litical hot potato, which means you won't see much built around here. Highway 1 is also in a Coastal Com- mission zone, which makes the entitlement process compli- cated. Being a peninsula, we are also topography challenged." While these barriers can make it more difficult to get deals done in Monterey, the area's abnormally high tourist-to-resident ratio keeps retailers and investors in search of the next op- portunity. "The increase in spending per vis- itor is an important economic factor and a key part of our strategy to tar- get high-value travelers," says Rob O'Keefe, chief marketing officer for the Monterey County Convention and Visitors Bureau. "That spending significantly impacts our community — local businesses, hotels, restaurants and attractions. And visitors enjoy a life-enriching experience. It's a win- win!" The 2016 Monterey County Visi- tor Profile Study found visitors spent an average of $157.37 per day in the county, up 10 percent from 2015. The top activities, naturally, were dining (87.1 percent) and shopping (62.8 per- cent). Though Monterey may be a small pond, it casts a wide net, attracting road trippers from California and Oregon; weekend warriors from San Francisco and Silicon Valley; literary Photo credit: City of Monterey The Monterey Convention Center has undergone a $60 million renovation, part of the area's effort to attract more business. MONOPOLY: MONTEREY EDITION The tourist destination made popular by beautiful coastlines, world-famous authors and award-winning television shows can be a retailer's dream, if they can make their way in. By Nellie Day Stephen Rusher Senior Vice President Colliers Michael Schoeder Managing Principal and Executive Director Cushman & Wakefield

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