Three Reasons Why Retail is Crucial to Transit-Oriented Communities

The Role of Retail within Transit-Oriented Communities
Real estate prices, gas prices, and record-breaking resignation rates have many people looking to their governments for solutions. One consideration is Transit-Oriented Communities (TOC). TOCs are a long-term city-of-the-future model aimed at developing existing areas to benefit current and future residents in a socioeconomically sustainable way.

What is a Transit-Oriented Community (TOC)?
The Transit-Oriented Community is a type of planned community closely connected to transit infrastructure. With the combined effort of a plethora of city departments, major transit stations become self-contained mini-cities, leading to increased ridership, reduced traffic congestion, affordable living costs, and more jobs with access to transit. TOCs also aim to reduce pollution, increase economic stability, and save taxpayer dollars.

The following are three lessons about the role of retail in transit-oriented communities.

1. TOC’s Maximize Demand and Profitability
TOCs intend to contain everything a small city would, therefore there are numerous stakeholders involved. By including retail as a major use in mixed-use venues (e.g., condos), the cost of development and operation will be offset by the retailers that operate there, which can extend to recreation spaces (previously considered loss-of-profit areas).

Our observations indicate that TOC planning traditionally focuses on singular transit station planning; we believe there is opportunity in planning retail over a number of stations and using the transit as the link of the combined retail community.

Our team uses a proprietary demand tool to predict the retail revenues and square footage allocations by category, based on elements such as ridership, commuting percentages and surrounding retail presence. This tool creates a demand model to attract developers, partners, and retailers. With the key players lined up, it is easy to get all stakeholders on the same page about the community/profitability balance. This, in turn, speeds up development, and ultimately ensures that the needs of the residents are met in a quantifiable way.

2. TOC’s Improve City-Wide Infrastructure
Once the demand for retail is established, the next stage in retail planning is infrastructure. Traditional storefronts, distribution centers, pop-ups, showrooms, are all part of retail infrastructure and need to be considered when planning and signing leases. While this is a challenge that any planned community faces, TOCs should position retail in and around the transit stations where it is most effective.

A key consideration that needs to be made is to the retail categories. Depending on proximity to the station and commuting population, there will likely be a high demand of convenience and grab n’ go retail concepts. Equal consideration should be given to indoor and outdoor linkages. For example, if the retail concept is meant to be gathered prior to boarding, it is ideal to have indoor linkages to the station and/or platform so the customer and products are not subject to inclement weather.

In a traditional retail center, smaller shops rely on anchor stores to draw in car-driving customers to their stores. In a TOC, retail within the station, as well as main street sidewalk storefronts, can provide a larger customer base for smaller shops. Anchor stores can then be positioned in residential clusters farther away from the station; walkable for a larger portion of the population.

3. TOCs Require Retail Innovation
The ideal TOC will be a fast-paced powerhouse of efficiency, which means residents will be expecting the same from its retail. That means that retailers should be considering modern store models to better suit TOC residents’ needs, including new technologies such as online ordering.

The nature of public transit means there are large swells when it comes to ridership; typically, a large influx of commuters in the morning and evening, with very few people accessing the services between 9:00 am and 4:00 pm on weekdays. These peak-time commuters will make up the majority of ridership, and will be interested in convenience options. This likely leaves stores empty during the balance of the day as they aren’t as necessary for leisurely riders. Flexible retail spaces that can easily be transformed to increase dwell times can allow for more experiential concepts.

Along with flexible spaces, cross-functional employees, and retail spaces; training employees on various retail functions in one retail space. For example, transforming the morning grab n’ go coffee shop, into a restaurant space for lunch, or a workshare during the day. In the evening, the space can transform again to home meal replacement or even a dinner spot.

Final Word on Retail in Transit-Oriented Communities
A successful TOC benefits the environment (decreased pollution), its residents (increased quality of life), and protects its own future (resilient economy), with retail as a cornerstone of that success. Without sufficient retail, the “transitability” of the TOC collapses as consumers return to their cars to get what they need. However, with the right planning and the right retail, TOCs have the potential to be the city of the future.

J.C. Williams Group has extensive experience in developing retail strategy for transit has resulted in a team well-versed in the benefits of TOCs, including the unique challenges that they pose for retail. To learn more about retail in transit, please contact us at info@jcwg.com.