Tuesday, October 2, 2007

For someone who rarely manages to leave his own store., I sure talk an awful lot about commercial real estate.

Yesterday, after picking up my car from Les Schwab (I had nails in both back tires, a real accomplishment), I decided to take a little driving tour.

First, I noticed that the space that I was going to rent on November 1, didn't look even close to ready. I'm going to be watching to see how long it takes for someone to fill the spot I was looking at.

Then I drove south on 3rd. Fred Meyer always seems busy, and the satellite stores are amazingly steady. There seems to be a fair number of vacant lots for sale on 3rd, both north and south, and signs mentioning retail. But none of them seem to be actually being built.

I came in from behind Cascade Village, and noticed that almost all the back and middle retail slots were empty. I took a look at the 'available' slots on the sign, and counted 13 spots open out of 43, with 3 more not yet open. Out of the 43, 10 were massive big stores like Best Buy which are a different case, so by my count 13 out of 33 spots where a small business could come in were empty.

What begins to sink in is that are plenty of retail spaces available, all over town, even in the downtown area. When you look out the windows of Pegasus and you see tenants who are actually being evicted even though they're willing to pay the rent, when you see cranes on every corner, and cars and passersby, and so on, you begin to think that everyone is just jostling for space. But there are plenty of spots open to rent.

But almost none of them are appropriate for walk-by traffic, which is kind of sad. Really, the big box centers are destination stores. The strip malls are destination stores. Both malls, which were once pedestrian friendly, have turned into big box centers.

I drove over to the west side, drove through N.W. Crossing, was again unimpressed by the traffic.

The car traffic is really bad on the west side, folks. And I saw 2 pedestrians in the entire west side; actually saw way more pedestrians on 3rd (though half of them looked homeless.) I actually saw more pedestrians on the east side. So I call B.S. to the pedestrian thing.

The trees on the west side are nice, though.

Still, there is a sort of unattractive hodgepodge to it all. As if grafting completely different styles to each other. Grafting in the word that came to mind. Old next to new, in a chaotic way. Sorry, not that great looking. And all the unfinished lots need to be filled in and cleaned up to reach any kind of potential attractiveness.

I poked my head into an office, and started talking to a long-time commercial real estate manager. About half way through the conversation, when I realized she was being amazingly candid, I informed her I had a blog where I talked about these things, but I could tell she didn't really get what I was saying, so I feel compelled to stay vague about her identity.

Suffice to say, that just about everything I had been assuming from the outside, she pretty much confirmed. And she had nearly identical views on many of the subjects -- so even though she had different experiences, she had reached many of the same conclusions.

One thing that surprised me was when she mentioned the 'lord of the manor' syndrome. She was talking about owners who felt they could hire managers and employees, and be an absentee owners.

I came up with the same phrase years ago, used to describe my own behavior. I thought, when I had 4 stores, that I could plug a manager in each one, and then float from store to store as needed. I would poke my head in the door and say, "How much money we make today, guys?"

Needless to say, it didn't work that way.

There were a lot of other parallels in our thinking. Not sure if that is just a reflection of long experience, or just a similar way of thinking about things. Always helps to know that I'm not very far off base. In fact, I was making conclusions about some of her businesses which were right on, even though I had very little information. I was just looking at common factors.

Very validating.

There is still plenty of unfinished business to Bend. Still plenty of locations that need to be upgraded. Still plenty of unfilled spots. Still vacant lots.

In a way, I find that comforting.

9 comments:

Anonymous said...

"There is still plenty of unfinished business to Bend. Still plenty of locations that need to be upgraded. Still plenty of unfilled spots. Still vacant lots."

So are you saying that there is plenty of work for the construction industry, and that's a good thing?

Or there is plenty of retail space to be had, and that's a good thing for retailers who want to expand?

Duncan McGeary said...

I'm saying, that there is still flex, still places that a newcomer could open a reasonable business.

I have an image of Aspen, for instance, that every spot is taken, every spot has been upgraded. Like aristocracy, there is no room for upward mobility.

Bend still has a variety that I think is healthy.

The Natives Are Restless said...

Some people seem to think that gentrification has a firm grip on Bend. I don't see it, and apparently you didn't either.

Duncan McGeary said...

Still a hick town, with a veneer of sophistication?

As far as the gated communities, a Masque of the Red Death analogy works for me. Who cares about them? They want to set themselves apart, they can just stay apart...

Duncan McGeary said...

Obviously, I don't like gate communities....

Jennifer (ponderosa) said...

You should try driving around the west side when the schools (High Lakes, Summit, Highland) are letting out. Because there aren't stop lights, the traffic just keeps a-comin'. Other times, as you say, it's quiet.

If you want a glimpse of old west-side Bend, turn from 14th onto Davenport. Some roads in that neighborhood are still unpaved. So I'd have to second your opinion that although SOME areas are gentrified, in most it's still hit-or-miss.

Duncan McGeary said...

The car traffic seems really bad to me, even worse than the east side. When I say quiet, I'm really referring to looking into the stores on N.W. Crossing seeing few people -- though that is a very admittedly fuzzy way of gauging business.

Partly, I think, its' all the narrow streets, and the traffic circles and the fact that there are only a few arteries.

Bend was never meant to be bigger than 20 thousand, I tell you!

Duncan McGeary said...

Rereading my blog, when I say, "Traffic is bad," in the context of everything else, it sounds like I was saying it was slow....

No...I was trying to say the traffic was extraordinarily heavy.

Not what you think of when you think 'neighborhood friendly' west side.

Jason said...

"First, I noticed that the space that I was going to rent on November 1, didn't look even close to ready. I'm going to be watching to see how long it takes for someone to fill the spot I was looking at."

I've been keeping a close eye on it also. Hard not to notice, since it's on my way to and from work. I wonder who's eventually going to end up renting it, and how long it'll take for them to get in?

What begins to sink in is that are plenty of retail spaces available, all over town, even in the downtown area.

I've been amazed for some years now that they continue to build new ones, and in the weirdest places. So much is still available.

One thing that surprised me was when she mentioned the 'lord of the manor' syndrome. She was talking about owners who felt they could hire managers and employees, and be an absentee owners.

I came up with the same phrase years ago, used to describe my own behavior. I thought, when I had 4 stores, that I could plug a manager in each one, and then float from store to store as needed. I would poke my head in the door and say, "How much money we make today, guys?"


The gentleman who owns our hotel is a classic example of this. Somehow, he makes it work (albeit barely), but he could be doing so much better if he was a little less disconnected from his business. I honestly believe that if the hotel industry weren't such a big deal here, he'd have gone out of business a long time ago.

Absentee owners = bad idea.