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President’s Message: The Collision of Physical and Digital Retail

For quite some time now, you have undoubtedly seen the exaggerated headlines about the death of brick-and-mortar retail. How ecommerce—led by Amazon—would put physical stores out of business. How ironic is it now that these digitally native retailers are aggressively moving into the brick-and-mortar world?

In fact, Amazon is very bullish on opening new physical stores in all its various formats (Amazon Grocery, Whole Foods, Amazon Four Star, Amazon Books, etc.). And conversely, while Amazon is adding new stores, traditional brick-and-mortar retailers are determinedly expanding and beefing up their ecommerce platforms as well. Why? Because it provides multiple avenues and touchpoints to engage with and satisfy the demands of the consumer. It’s like two trains coming from different directions colliding in the same retail space.

We’ve already seen many physical changes occurring in brick-and-mortar retail stores as a result. Retailers and retail property owners are shifting away from the one-size-fits-all model and curating more personalized and experiential environments, a change that has been occurring for quite some time. Consumer safety features, BOPIS (buy online, pickup in-store), curbside pickup and expedited pickup zones for fast-casual restaurant establishments have all become the norm, even consumers’ expectations.

Retail real estate has certainly evolved over the years, but those who believed that brick-and-mortar stores were dying failed to understand consumers’ behaviors and preferences. Sure, specific retail formats and retailer stores have or will die, but overall, brick-and-mortar retail is healthy and here to stay. The onslaught of the COVID-19 pandemic further accelerated trends that were already beginning to occur and even proved that some types of retail are actually essential to consumers. The COVID crises also confirmed that retail centers are more than just for shopping. They offer healthcare services, wellness clinics, fitness, entertainment, community gathering places and social connectivity—all things digitally-native brands are now trying to capitalize on.

Moving forward, retail centers will only play a more critical role in everyday living and bringing communities together, and retailers must recognize and adapt to their role in this transformation. So, what can we expect to see for the future of retail?

  • Rapid expansion of those retailers that have emerged as the winners. Grocery stores (value, ethnic and specialty) are performing exceptionally well and remain attractive tenants in retail centers. Off-price players, fitness, healthcare and digitally native brands will grow substantially.
  • Constant and substantial physical changes to retail centers. Retailers will continue to alter store sizes and formats to adapt to consumer demands, such as convenience and safety (some may be larger, some smaller), more convenient front-of-store operations for customer pickup and quick product collection.
  • Enhanced online ordering systems, technology integration and expedited pickup zones for fast-casual restaurants.
  • Activation of common areas and outdoor spaces for restaurant and dining uses, entertainment, community events, and social gathering places.
  • Emerging new retail and food concepts (e.g., food kitchens).
  • Creative ways for retailers to use data mining and tech advancements to better engage with and attract customers into the physical store.
  • Continual incorporation of brick-and-mortar in the supply chain as more stores are utilized as distribution and fulfillment spaces.

Brick-and-mortar retail is definitely not dead, but it will continue to evolve and transform at a rapid pace—and the collision of physical and digital uses of retail space will drive most of this transformation.

Understanding the implications of these changes and being ready and able to adapt will be critical for retail owners and operators. And, for those able to do so, there will be many opportunities in the future.

As the physical and digital retail worlds continue to collide, retailers and property owners will be forced to get on board or get crushed!

June 2, 2021|Blog, President's Message, Retail|

Canal Place Welcomes PJ’s Coffee

O’Connor Capital Partners Signs Deal with PJ’s Coffee for 2021 Opening.

O’Connor Capital Partners today announced that PJ’s Coffee would open a new location this year at Canal Place, New Orleans’ premier luxury retail destination. 

PJ’s Coffee will open their Canal Place location this Summer in a 527-square-foot space on the first level of the center fronting Iberville Street.

“We are very excited to welcome local favorite, PJ’s Coffee, to Canal Place,” said Winter Warren, Marketing Director of Canal Place. “Both institutions have a long-standing heritage of serving New Orleans residents and visitors, and we are thrilled to now have PJ’s Coffee as part of the Canal Place family.”

Stirling Properties’ commercial advisors Carly Plotkin and Lauren Ryan serve as the leasing agents for the property and worked with the team at O’Connor Capital Partners to secure the location for PJ’s Coffee at Canal Place.

“Our goal is to target best-in-class local and regional tenants to complement the strong national tenancy already present at Canal Place—and there is no better brand to represent the local culture than PJ’s Coffee, a New Orleans original,” said Plotkin. “Stirling Properties is proud to continue our partnership with O’Connor Capital Partners, and we look forward to welcoming even more great retailers to the tenant mix at Canal Place soon.”

PJ’s Coffee delivers a unique coffee experience by sourcing the top 1% of Arabica beans from over 14 origins around the world. Their Southern hospitality, superior roasting techniques, and passion for making coffee are what make PJ’s Coffee so special. PJ’s Coffee at Canal Place will serve a wide variety of hot, iced and frozen coffee beverages, as well as organic tea and fresh breakfast pastries, including its new beignet program.

“PJ’s Coffee of New Orleans is excited to open at Canal Place as we extend our reach within our community. Providing New Orleans food, beverage and hospitality at the most preeminent shopping venue in the city is something we are absolutely looking forward to,” said David Mesa, Chief Development Officer.

Canal Place is Downtown New Orleans’ premier destination for luxury fashion and beauty brands, boutique clothing stores, home goods and much more. Canal Place is home to the notable WITH LOVE FROM nola moss wall, one of New Orleans’ most Instagrammable spots. Additionally, the lush landscaping and modern renovations have begun to evolve the experience that distinguishes shopping at Canal Place from the rest of the city.

About Canal Place

Situated on the edge of the historic French Quarter, Canal Place is home to many notable, exclusive designer boutiques.  An on-site, four-star hotel, The Westin New Orleans, and a convenient covered parking facility add to Canal Place’s unique offerings.  Anchored by Saks Fifth Avenue, this world-class shopping center boasts a superb mix of stores including Louis Vuitton, Tory Burch, MCM, Anne Fontaine, Brooks Brothers, Tiffany & Co., lululemon, and vineyard vines, to name a few. For more information, visit www.canalplacestyle.com. Connect with Canal Place on Facebook, Twitter and Instagram (@canalplacestyle).

About O’Connor Capital Partners

Founded in 1983, O’Connor Capital Partners www.oconnorcp.com is an institutional real estate investment, management, and development firm based in New York City and run by CEO Bill O’Connor. The firm pursues acquisitions, developments and residential conversions on behalf of its institutional funds, separate accounts, and own account. O’Connor primarily targets retail and residential opportunities throughout the United States and Mexico. Since inception, O’Connor has acquired or developed over $30 billion of property, including over 55 million square feet of retail space and over 30,000 residential units globally.

About Stirling Properties

Stirling Properties is one of the most diversified full-service commercial real estate companies in the country. Regionally focused and nationally acclaimed, we specialize in Advisory Services, Commercial Brokerage, Development & Redevelopment, Asset & Property Management and Investments over a wide array of property types across the Gulf South. Connect with Stirling Properties on the web at www.stirlingproperties.com, “like” us on facebook.com/stirlingproperties, follow us @StirlingProp on twitter.com/StirlingProp or subscribe to our Stirling Insights blog.

About PJ’s Coffee of New Orleans

PJ’s Coffee of New Orleans was founded in 1978 by Phyllis Jordan, a pioneer in the coffee industry that demonstrated that better beans, superior roasting techniques, and pure passion for the art of coffeemaking mattered. In 2008, the company was purchased by New Orleans natives and brothers, Paul, Steven, and Scott Ballard. PJ’s Coffee serves a wide variety of hot, iced and frozen coffee beverages using only the top 1% of Arabica beans, as well as organic tea and fresh breakfast pastries. PJ’s Original Cold Brew™ Ice Coffee is brewed daily using a special cold-drip process that protects the flavor and strength of the beans, while producing a coffee that is 2/3 less acidic – a process and technique pioneered by our founder and used for more than 30 years at all PJ’s locations. Bags of whole bean coffee, single serve cups of PJ’s Coffee and PJ’s Iced Coffee Concentrate are available for sale in-store and online. With over 126 operating stores, including four international locations, PJ’s Coffee continues to expand across the U.S. and abroad and is slated to open 45 more stores throughout 2021.

Stirling Properties Executives Awarded CCIM Designation

Stirling Properties announces three of the company’s executives have been awarded the Certified Commercial Investment Member (CCIM) designation, commercial real estate’s global standard for professional achievement. The CCIM designation is conferred by the CCIM Institute, one of the largest commercial real estate networks in the world.

Congratulation to the following new CCIM designees:

Mac Bauer

Mac Bauer, Development Director

Bradley Cook

Bradley Cook, Advisor

Ryan Murphy

Ryan Murphy, Senior Advisor

 

Brad Stillwagon, Asset Manager with Stirling Properties, was also acknowledged by the local Louisiana CCIM Chapter for his contributions and work on candidate guidance.

A CCIM is a recognized expert in the disciplines of commercial and investment real estate. Designations are awarded to commercial real estate leaders who have a proven record of success in the field and have demonstrated a mastery of financial, market, and investment analysis for commercial real estate. CCIM designees come from a variety of professional backgrounds including asset management, brokerage, banking, development, property management, law and accounting.

Earning a CCIM designation places the recipient among the most distinguished professionals in the industry. Today, fewer than 10 percent of commercial real estate professional currently hold the designation of CCIM, making them the go-to experts in their respective markets.

CCIM Institute is a global community of 13,000 members in 30 countries that educates and connects the world’s leading experts. 

Pan-American Life Insurance Group Renews Long-Term Commitment to New Orleans Market

Pan American Life Center

Extends 10-Year Lease Terms at Pan-American Life Center in New Orleans, Louisiana.

Stirling Properties announces that Pan-American Life Insurance Group has signed a long-term lease extension thru 2031 of its office space at Pan-American Life Center in New Orleans, Louisiana. The company will also retain naming rights of the newly renovated building. 

Pan-American Life Insurance Group, one of New Orleans’ largest employers and a leading provider of life, accident and health insurance throughout the Americas, occupies a total of 84,014 square feet of office space on four floors of the Pan-American Life Center located at 601 Poydras Street in New Orleans’s CBD. This marks one of the largest lease renewals in the New Orleans office market since 2019.

Founded in New Orleans, Pan-American Life Insurance Group is currently celebrating its 110th Anniversary and a rich history of corporate philanthropy and community service in New Orleans, supporting dozens of organizations across the arts, education and public safety.

“Pan-American Life Insurance Group is pleased to extend our office lease in the Pan-American Life Center and continue our long-term commitment to the New Orleans community and surrounding South Louisiana region. We look forward to renewing our promise to serve as a lifeline to our customers, their families and their businesses,” said José S. Suquet, Chairman of the Board, President & CEO of Pan-American Life Insurance Group.

Gaines Seaman, Senior Advisor with Stirling Properties, serves as the exclusive leasing agent for the office tower and worked with Pan-American Life Insurance Group to secure the lease extension.

“Pan-American Life Insurance Group has been an integral part of the New Orleans office community for many years, and we are honored to help cement that relationship for many more years to come. Pan-American Life Insurance Group’s renewed commitment to and investment in our area further validates the resiliency of the New Orleans office market. The recent lobby renovations and added amenities to the Pan-American Life Center make it an attractive office location for corporations, large or small,” said Seaman.

The Conference Centre on 11

The Conference Centre on 11

The Pan-American Life Center is recognized as one of New Orleans’ most prestigious office towers, boasting high-quality tenants in addition to housing the national and regional headquarters of many premier corporations. The class-A building encompasses roughly 673,000 square feet of office and retail space and an eight-story parking structure. The local ownership group of the Pan-American Life Center recently made a renewed investment of $7 million in renovations of the building as a sign of its deep commitment to ensure that it remains a premier office location in New Orleans. The renovations included a redeveloped café, state-of-the-art conference center and upgraded ground floor lobby to better position the building in the evolving office landscape.

The new Café on 11 is a restaurant-style, full-service cafeteria featuring a modernized dining area and exciting new menu. The Conference Center on 11 offers multi-purpose meeting space in various sizes and configurations, including a ballroom, tiered-seating amphitheater featuring high-tech audio/visual equipment, ample break-out areas and collaborative spaces, full-service catering and on-site event management and technology assistance. Other unique amenities in the building include a grab-and-go mini-mart, coffee bar, Royal Shoeshine & Repair Station and dry-cleaning pick-up lockers.

The Cafe on 11

The Cafe on 11

Office tenants in the building include Pan-American Life Insurance Group, IBERIABANK, Morris Bart Law Offices, McGlinchey Stafford, Merrill Lynch, Lugenbuhl, Wheaton, Peck, Rankin & Hubbard and Stirling Properties. First-floor retail tenants include Smoothie King, Starbucks, Tsunami and IBERIABANK. Stirling Properties’ affiliates own the property and are the exclusive management and leasing agents for the Pan-American Life Center. 

For more information on the Pan-American Life Center, visit www.panam-neworleans.com. For leasing information, contact Gaines Seaman at gseaman@stirlingprop.com or (504) 523-4481.

Stirling Properties Breaks Ground on River Chase Self Storage in Covington, Louisiana

River Chase Self Storage in Covington, Louisiana

River Chase Self Storage Rendering

Stirling Properties commercial real estate company has broken ground on the development of River Chase Self Storage as part of the River Chase mixed-use development in Covington, Louisiana. This project marks the company’s latest ground-up self-storage facility development.

The 108,000-square-foot storage facility will be located on 2.7 acres off Brewster Road, next to Brewster Commons apartment community and just south of Sam’s Club. It will include a 3-story building with 594 climate-controlled units and three non-climate-controlled single-storage buildings with 44 drive-up units ideal for boat and RV storage. The facility will also feature 24-hour security and state-of-the-art amenities. 

Construction has commenced on the project, with site work and foundation work already underway. The property is slated to be completed before the end of the year. 

Stirling Properties is developing the facility and will handle Asset Management of it upon completion. The architect is locally owned Greenleaf Lawson and Kent Design Build is serving as the building general contractor for the project. The Civil Engineer is Duplantis Design Group and Richard Price Construction is handling the site work.

“We are excited to begin the development of River Chase Self Storage. This project marks Stirling Properties’ newest ground-up, climate-controlled storage facility development,” said Townsend Underhill, President of Development for Stirling Properties. “St. Tammany Parish is experiencing fantastic population growth, creating a high demand for this type of product and its strategic location along the I-12 corridor provides high visibility, easy access in a secure environment and convenience for customers.”

Stirling Properties has developed and operates approximately 1,750 self-storage units, including over 1,600 climate-controlled units throughout its portfolio.

Stirling Properties also developed, manages and leases the surrounding River Chase master-planned development located amidst 253 acres on the southeast corner of Interstate 12 and LA Highway 21 in Covington. Anchored by retailers Target, Sam’s Club, Belk and JCPenney, the mixed-use project includes approximately 945,000 square feet of retail and restaurant options, as well as a Holiday Inn Express hotel, Regal Cinema, over 600 luxury residential garden homes and apartment units, and a Class-A office building that serves as the headquarters of Beacon Offshore Energy. Additional residential and office developments are coming soon. River Chase is a Louisiana Economic Development (LED) Certified Site.

For more information, please visit www.stirlingprop.com. For retail leasing and sales, contact Rhonda Sharkawy at (504) 620-8145 or rsharkawy@stirlingprop.com. For office leasing and sales, contact Ryan Murphy at (985) 246-3771 or rmurphy@stirlingprop.com.

History Will Tell

disruption

I want to share an intriguing quote I heard recently: “History is nothing more than a record of disruptions.” When you think about it, the sentiment is entirely accurate. If it weren’t disruptive to the logic or actions, it wouldn’t be worth remembering, learning from or memorializing. Disruption is difficult, stressful and, well, disruptive. But boiled down, disruption is progress. We can’t advance as a society without changing our mindset, which leads to behavioral change, then systemic change.    

We are living in a simultaneously historic and dichotomous time. In the throes of a global pandemic, we had nowhere to go and nothing to do. But despite that, change occurred more rapidly than ever before. How we react to that change can and will determine our future.

Some people have opted to sit back, wait it out, expecting things will eventually return to normal. They view the situation as temporary. To others, this is an opportunity of a lifetime, a chance to hyper-focus on our actions, reactions and interactions with each other and our surroundings. It’s become a chance to re-think flaws in the system—whether physical or social—and push for progress. Those are the trendsetters and change-makers. 

Growing up a child of the 80s (who could be classified as both a Jock and Nerd), I had two people who significantly inspired my youthful ambitions: The Boz and The Woz. 

The Boz (Brian Bosworth) was the most formidable and rebellious college athlete of the decade. Middle linebacker for the notoriously rough Oklahoma Sooners, he was an All-American first-round draft choice who thumbed his nose at authority. He rocked a faux-hawk and earring and was known for simply crushing anyone who came near him. When he was suspended from college football for steroid use, the media noticed, and reports of drug use and other poor behavior by college athletes were brought to light. Ultimately, his descent from exalted hero to reviled cheater started a wave of mass investigations into college sports that altered public opinion and were the precursor to many rules in place today.

The Woz (Steve Wozniak) used his brain rather than brawn to create the first Apple Computer. Sometimes referred to as “the other Steve,” Wozniak was the co-founder of Apple along with Steve Jobs, and was the actual innovator who created the first products that led to the smartphones we are all tethered to today. Woz was seen as a true pioneer, the obscure reference that techies worship, the guy so cool that he is a question that is an answer on Jeopardy. 

A few years back, I had the opportunity to meet Steve Wozniak when he delivered the keynote address at a conference I attended. While waiting in line to greet him, I thought, “What do I say to him? He is The Innovator, The Original Disruptor.” My fawning fanboy questions ended up something like, “Where did the idea and inspiration come from to create something so ingenious? How did you have the foresight to change the way people thought about technology? With technology that was only accessible to the largest and richest of big businesses to solve the most technical problems, how did you know the real power was to give everyone access?” 

In reality, the question was more like, “So, how did all this happen?” But he’s The Woz; he knew what I meant. His response, some of which he repeated in his speech, floored me. He said, “I didn’t invent anything. I’m an engineer, not an inventor. All I did was take other people’s ideas and existing products and piece them together. I didn’t have the foresight to see a market for the product. I made the first one for myself, then we gave the plan to our computer club. I had no clue anyone other than our small group would ever want or have use for it. Steve Jobs was the one who realized it could be more than that.” The first Apple computer was clunky, lacked a monitor and was just a compilation of parts designed to serve other purposes. The Apple II was the model that most remember, designed explicitly for consumer sales and backed with the marketing savvy of Steve Jobs. These led to the products that changed the world. 

Where am I going with all this? In the commercial real estate industry, we, too, are at an inflection point. No new technology has come out of this pandemic relative to our industry. Still, the acceleration of its use in an industry that has long been behind the curve for adaptation is astounding. Much like Wozniak assembling a few parts that changed the world, companies are focused on taking individual software platforms and merging them to create functional integrated solutions. They are using tech to create more efficient systems to run our properties and reduce carbon footprint. Others are utilizing tech to create more energy-efficient features, building materials, work from anywhere models and supply chains. Retailers used tech seemingly overnight to pivot their entire delivery systems to meet consumer demand.   

Likewise, social changes can be likened to the Brian Bosworth story. Our society has sluggishly dragged forward in recent years with a complacent attitude toward issues like racism, gender inequality and environmental concerns. The Boz wasn’t the only athlete that broke the rules in the 80s. We, in general, turned a blind eye to the poor behavior of many athletes, celebrities and politicians because we wanted to exemplify the ideal and not rock the boat. In turn, the incidents that caught the world’s attention over the last year have thrown open the door for true meaningful change.

Was The Boz a bad guy? No. Was The Woz the ultimate genius? No. Their images over that decade do, however, represent the massive social and technological change that led to disruption, which in turn became history. 

It has been echoed since COVID hit that there will be winners and losers in its wake. Which category we fall into depends on how we adapt to the issues brought to light during this time. Those that resist change or wait it out on the sidelines, in some way fail. Those that adapt to technology, embrace social change and recognize environmental issues will prosper. Just as we smugly look back on history at those who accepted appalling acts and unthinkable practices by today’s standards, we too will be judged by our children, grandchildren and great-grandchildren. 

Look at your business (both personally and professionally) and how you can adapt to be part of a tech-savvy, socially conscious and environmentally responsible future. These issues will be the biggest challenges that our industry and society will face going forward. People, products, properties and processes that confront these issues head-on will be the disruptors and change-makers. They are our future and the winners. Those who just wait it out or go back to how it was are not. Simply put, embrace disruption, or risk becoming history.   

April 19, 2021|Blog, Commercial|
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