Cities look to private developers to recruit retailers

If you're looking for a trendy retailer to open a store in the Corridor, don't expect city hall or economic development organizations to recruit them to your community.

City officials say private developers are best equipped to bring new stores to the Corridor.

"I think it's reasonable for cities or economic development organizations to work to attract retail, but that's not going to be the major focus for the City of Cedar Rapids," City Manager Jeff Pomerantz said. "Our focus is to have the strongest economy possible, where we're creating jobs and housing opportunities, we're fiscally sound, and we have the infrastructure. If you have all those elements together, retail will come."

Pomerantz was responding to a suggestion by Scott Olson of Skogman Commercial Real Estate that the city and Priority One, the economic development division of the Cedar Rapids Area Chamber of Commerce, become actively involved in recruiting retailers to the community.

"Besides recruiting industry, we also need to have a component that looks at bringing retail to the community to improve the quality of life and  increase the number of service jobs,"  Olson said. "There are a lot of people who don't qualify for the jobs that are being offered by our industrial expansions because they don't have the skill sets and have to go back for training.

"We have a lot of people who would love to work their way up to management jobs in retail chains or stores that have good benefits, good properties and new buildings. That would also produce construction jobs and increase the property tax base."

Olson, who is running for the Cedar Rapids City Council's west-side District 4 seat, pointed to Pomerantz's previous success involving robust retail development within a short period of time when he was city manager in West Des Moines and the success that Coralville has enjoyed with the development of retail around Coral Ridge Mall.

Pomerantz said he visited Costco Wholesale Warehouse representatives in Chicago when the retailer was considering a location in West Des Moines.

"It was really General Growth Properties as the master developer that got Costco to come to Jordan Creek Town Center," Pomerantz said. "A city can show up and say they want Costco in their community, but what they're mostly interested in working with the developer. There are often incentives offered by the developer in those kinds of situations."

Pomerantz said there were several instances where West Des Moines worked to attract specific retailers, but he credited the impact of Jordan Creek Town Center with helping to bring those stores to the community.

"We didn't recruit General Growth to the City of West Des Moines," he said. "Company representatives showed up on our doorstep and said they were interested in the metro area. That's whe we got competitive and commited to building the infrastructure -- water lines, sewer lines and the roads -- that allowed them to build Jordan Creek."

Coralville City Manager Kelly Hayworth credited partnerships with developers like Gerry Ambrose and the impact of General Growth's Coral Ridge Mall for the development of retail in the Johnson County community.

"Traditionally we have worked with the private sector to help them facilitate development of retail," Hayworth said. "The only caveat to that was the development of Iowa River Landing, where we have hired a consultant, OliverMcMillan of San Diego, to help us recruit retail. Our overriding goal for Iowa River Landing is to have it redeveloped from what it was before."

Hayworth said Coralville actively recruited a developer to partner with the city to make the contacts with retailers, architects and engineers.

"In the end, OliverMcMillan will not own anything," Hayworth said. "They are overseeing the development and infrastructure as well as putting together the plan for how that area develops.

"We had hoped that a local developer would step up, but that didn't happen. We had been able to purchase and aggregate the parcels of land, something that would have been a financial challenge for a private developer.

"When  a local developer did not emerge for Iowa River Landing, we began a national search for a developer with the experience and capability to handle the project. We initially engaged another developer, but we ultimately parted company with them and selected OliverMcMillan."

Priority One and the Iowa City Area Development Group have traditionally worked to recruit industry to the Corridor. Dee Baird, president of Priority One, said the organization likely will continue that focus.

"The Priority One board of directors met in December 2010 for its annual retreat. There were a half-dozen recommendations that came out of that session and retail was not one of them," Baird said. "Recruiting retail is not something that we have put into our strategic goals for the near future.

"Jeff Pomerantz is an expert in the area of retail development. As he continues to develop his plans for Cedar Rapids, we will look to see how we can play a supportive role in providing the data that is needed by private developers."

Hayworth said ICAD has provided similar support when private developers need statistical data to attract a retailer or other new business to the community. He expects the economic development organization to continue that role in the future.

While Olson is calling for Cedar Rapids and Priority One to take an active role in recruiting retailers to the community, Doug Laird, his partner at Skogman Commercial, believes that role should be left to private developers.

"Retailers are looking at the number of rooftops (houses) in a community," said Laird, chairman of the Developers Council of the Greater Cedar Rapids Home Builders Association. "Developers understand how much capacity a community has for new retail. Frankly, I'm concerned that we may already be overbuilt in terms of retail development because we have a lot of vacancies."

While agreeing that a segment of the community might like to see more retail employment opportunities, Laird said "tension" likely would develop if the city or Priority One were to engage in direct competition with private developers.

Neither the City of Coralville nor Cedar Development, the developer of the Coral North Shopping Center, recruited Bruce and Pattie Brooke, the local franshisees of national sporting goods chain GolfUSA to the complex on the north side of Interstate 80 at Highway 965.

"We were looking at locations in Iowa City when we became aware of Coral North," Bruce Brooke said. "We opened about five years ago as the second retailer in the shopping center. Buffalo Wild Wings was the first to open and we were next.

""We liked what we saw developing here and felt it would be a good location in terms of traffic and visibility."

Brooke, who grew up in his family's retail ventures, said a career in retail offers opportunities to learn skills that can be used in other occupations.

"Sometimes it's that smaller retail base you pick up while you're growing up in high school or college that gives you an idea of what the business is all about," he said. "It also helps you get a retail mindset if that's something that you want to pursue as a career.

"There are a lot of opportunities for a management career in major retail chains. It also can prepare you to own your own business someday."

While he hopes to pursue a career working in either American history and museums, Andrew Blessing is working part time at GolfUSA while he's a student at the University of Iowa.

"I wanted to work in something that was opposite of what I'm studying in college and this was very attractive," Blessing said. "I've been playing golf for most of my life, so this was really a good fit. The stuff behind the clubs is something new for me, but after that it's talking with customers and finding out what they want to do."

There were 174,200 retail jobs in Iowa at the end of May, according to Iowa Workforce Development. The agency was unable to say what percentage of  unemployed Iowans were looking for retail jobs, noting that individuals registering for unemployment benefits are asked, but not required, to list the nature of their previous employment.