HOTWORX Hits 100
Stirling Properties brokers 100th retail location milestone for fitness franchise as part of rapid expansion plan.
Stirling Properties announces that new fitness concept HOTWORX has secured its 100th retail location in Southlake, Texas. The fitness franchise, which opened its first store in 2017, now operates in 20 states across the country and anticipates another 75-100 national locations in the pipeline over the next year, as well as international growth.
Two years ago, Stirling Properties was selected to exclusively represent HOTWORX, a new-to-market fitness concept, in its aggressive expansion efforts across the U.S. Stirling Properties’ commercial advisors worked with the company to identify and secure retail locations in Alabama, Arkansas, California, Florida, Georgia, Indiana, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, Tennessee and Texas. Now, HOTWORX has its sight set on international expansion efforts. Last month, the company officially closed the deal with a Master Franchisee for Australia.
HOTWORX—founded in New Orleans, LA—is revolutionizing the fitness industry by providing the ultimate hot exercise experience and is the first to launch a 24/7 business franchise model using its proprietary patented technology. It is a virtually instructed exercise program created for users to experience the many benefits of infrared heat absorption while completing a 30-minute isometric workout or 15-minute high-intensity interval training (HIIT) session. As the infrared heat penetrates the body, the isometric postures further accelerate detoxification by physically removing toxins from organs through muscle contraction.
Joe Gardner, CCIM, and Thomas Bryan, Stirling Properties’ Advisors, serve as the exclusive national tenant rep brokers for HOTWORX. Utilizing the Retail Brokers Network (RBN) and the local knowledge of individual brokers across the country, the dynamic duo is working diligently to secure the ideal store locations for the fitness concept.
HOTWORX in Orlando, Florida
“HOTWORX provides a first-in-class fitness program in the niche infrared exercise market. The franchisor utilized a tremendous amount of knowledge and input to create a business model that minimizes risk and maximizes customer experience—you simply can’t order this type of service online. We are proud of the extraordinary success of our client and look forward to helping them bring more retail locations to market soon,” said Bryan.
“We are overwhelmed by the countless, positive testimonials we receive from our HOTWORX customers, and we are confident that increasing consumer access to the HOTWORX brand—by securing more locations across the country—will only create more stories to be celebrated. We’re excited to continue our successful partnership with Stirling Properties to grow our business,” said Stephen Smith, HOTWORX CEO.
“HOTWORX is growing faster than any other fitness concept in the country. One of the biggest attributes of this success is its desirability among landlords and property owners,” said Gardner. “Fitness is currently one of the most attractive space users in commercial real estate because of its ability to drive traffic to neighboring retailers and encourage repeat visits from customers.”
Fitness is driving growth in retail real estate. According to a report from ICSC (International Council of Shopping Centers), Mixed-Use Properties: A Convenient Option for Shoppers, from 2008 and 2018, the number of fitness centers in shopping centers (including traditional/boutique gyms, yoga, cross-fit and cycle studios) increased from 6,218 to 14,044.
Furthermore, incorporating a mix of tenant types, such as health and fitness centers alongside traditional retailers, draws additional, more frequent traffic—29% of consumers say the presence of non-retail tenants encourages more frequent shopping center trips—and creates excitement through one-of-a-kind experiences.
The health and fitness trend has taken the real estate business by storm, morphing into a more than $30 billion industry—with no signs of slowing down. New-to-market, niche concepts such as HOTWORX that are reinventing the way consumers exercise and even shop, have a bright future in the evolving retail landscape.
Retail Site Selection & Convenience Stores
Proximity & Accessibility of Retailers
Since the beginning of time, retailers have strategically positioned themselves in a manner where they could capitalize on the disposable dollars that their target market spends.
While technology advancements have enhanced the ability for consumers to buy certain products online and have them delivered right to their doorsteps, there are still several retail sectors that cannot be replaced by e-commerce.
This blog series will outline three of those retail sectors: 1) Convenience Stores (C-Stores), 2) Fast Food Restaurants (Quick Serve Restaurants or QSRs), and 3) Drug Stores, as well as the site selection criteria they require.
I started in the commercial real estate industry in 1996. At that time, “portable” phones were in a bag that had to be plugged into a cigarette lighter, the internet was in its infancy stage, and relationships required verbal communication only.
While so much has changed over the past 23 years, three primary demographic criteria have remained a constant for market-based retailers: traffic patterns/counts, population (existing and growth) and access.
All retailers benefit from customers passing their physical stores regularly and having a location that is easily accessed. However, extensive consumer studies have caused certain retailers to apply more weight to traffic patterns and population when evaluating a market. Let me explain.
Part #1: Convenience Stores (C-Stores)
C-Stores are the one retailer that relies most heavily on traffic counts, as opposed to population. Also, C-Stores typically position themselves to take advantage of P.M. traffic patterns.
I started doing commercial real estate site selection work for a regional C-Store in 2002. The Director of Real Estate had over 30+ years of experience at the time. In one of our first meetings, when asked what the most crucial criteria were when looking for a site (outside of immediate competition), he said without hesitation, “We need to be on P.M. traffic side of the road.”
When questioned why that criteria were so crucial, he responded, “If you think about it, most people are pressed for time in the mornings. So, they will typically stop and only put enough gas in their tank to get them to work. If they have a couple of minutes to come inside and buy something, it is usually a small ticket item like coffee or a pack of cigarettes.
On the other hand, P.M. customers are typically not pressed for time. In turn, they are more likely to stop and fill up their tank. Plus, a higher percentage will come inside and buy much larger ticket items, like a 12-pack of beer, a carton of cigarettes or food for dinner.
We have done extensive studies, and our P.M. customers generate 4-5 times larger ticket sales than our A.M. customers. You do the math. That is why we will always prefer our stores to be accessible to the P.M customer.”
Over the span of several years, I sold more than 15 locations to the same C-Store. At one point, the client gave me a trade area in which to find a site. To my surprise, the trade area he provided had very minimal rooftops, at best. Besides, it wasn’t in a high-growth area.
Despite being provided the sales numbers of an existing competitor in the market, the trade area was a mystery to me. Furthermore, the trade area to choose from was on the A.M. side of the road, yet the competitor’s C-Store had the 2nd highest sales out of 65 corporate locations.
I spent the better part of the next week sitting across the street from the competitor’s store and driving the trade area, trying to determine who their customer base was. I sat and watched the A.M., mid-day and P.M. traffic patterns. The store was packed the entire day.
In addition to a railroad track eliminating the P.M. side of the road from being developed, the road was a major thoroughfare to one of two bridges that crossed the Mississippi River. As a result, customers that lived up to 10+ miles away were forced to pass the location on a regular basis.
While the immediate area had limited rooftops, the competitor’s store had record sales based on traffic count alone.
Throughout the site selection process, sometimes the criteria evolve based on a specific market area. That’s why it’s important to consult a site selection specialist who can help you analyze the area and find the ideal location for your business.
Stay Tuned for Part #2 – Fast Food Restaurants or QSRs.
For questions regarding your commercial real estate property, contact J. Collier Thornton at (225) 926-4481 or cthornton@stirlingprop.com.
Stirling Properties Names Samantha Marshall As Relationship Manager – Finance and Development
Stirling Properties is pleased to announce that Samantha Marshall has been promoted to Relationship Manager – Finance and Development.
In this new role within the organization, Samantha will work to enhance the company’s investor relations, as well as play a more prominent role in securing debt and equity capital for its projects.
Samantha has been with Stirling Properties for over six years, and previously held the role of Paralegal / Document Manager. While she will be responsible for many of the same functions, she will also be handling new and expanded duties.
As Relationship Manager – Finance and Development, Samantha will continue to coordinate loan closings and remain point person with lenders, guarantors and investors. In addition, she will have more involvement with Stirling Properties’ lenders on the front end of securing loans for acquisition, development and refinancing. She will also be assigned various special projects within the Development Department, working directly with some of the company’s larger, long-term clients, as well as assisting with investor relations and equity raising as Stirling Properties continues to grow.
Samantha Marshall will work from Stirling Properties’ Covington, Louisiana, office. She can be reached at smarshall@stirlingprop.com or (985) 246-3726.
Stirling Properties’ 3rd Quarter Portfolio Report Shows Positive Outlook
As the commercial real estate industry endures unrelenting disruption—specifically in the retail and office market segments—we have seen glimpses of a silver lining.
Despite all the headwinds and negativity swirling, Stirling Properties’ outlook is optimistic moving into the 3rd quarter of 2019 compared to this time a year ago. A recent comparison of our overall commercial portfolio revealed positive key performance indicators in total rental income, rental and occupancy rates.
Mind you, these numbers may not reflect significant increases, but they do illustrate an upward trend. In fact, almost every key metric indicated a positive gain. A further breakdown shows both our office and retail properties are performing well with occupancy rates holding steady and rental rates up slightly, contrary to the ‘apocalyptic environment’ predicted in years past.
For Stirling Properties, our portfolio achievements are not the result of a magic wand or some sort of geographical shield. We attribute our continued success to proper management of our commercial properties.
Asset and Property Management is vital for the health of an asset and can significantly affect its worth. Yes, location is important, but a property can also increase in value just from being well maintained and, of course, the opposite is true as well. Management affects tenant and customer relationships, vendor relations, public perceptions, all the things that determine a properties’ success or failure.
With our properties, we focus on keeping rents at market level and our rental stream within reasonable expectations. We don’t overleverage. We concentrate on tenancy—the right tenancy—and we use our market knowledge to tailor each asset plan. Effective managers see headwinds coming and react accordingly to proactively overcome obstacles.
Knowledge and diversity of various property types and needs, as well as industry trends, are also critical. In today’s retail landscape, we’re seeing smaller footprints, the emergence of different tenant types and shifts in consumer demands. There is steady growth in the healthcare and industrial industries, and in some cases, they are merging with retail. In the office sector, users are looking for less square footage, more collaboration with open floor plans, and innovative trophy projects.
These trends in the commercial industry increase the need for more curated properties. Stirling Properties’ in-house operating, leasing and development resources allow us to be more strategic and forward-thinking with our managed properties. If a property is in a great location but is struggling with tenancy, perhaps a redevelopment would be effective. Does the building lack visual appeal, have a maintenance problem or even a marketing problem? Whatever the case, Stirling Properties’ comprehensive spectrum of services can tackle it.
Look at our current redevelopment of Cornerview Plaza in Gonzales, Louisiana. This retail center is in a great location but was struggling to backfill a nearly 90,000-square-foot vacancy left by its former anchor, Kmart. Stirling Properties’ team consisting of Asset Management, Development, Leasing and Financing worked with the Property Owner to redevelop the space into a multi-tenant, upscale Retail Center. We secured favorable financing for the ownership. This gave us the ability to move forward with an aggressive redevelopment plan, bringing on Marshalls, ULTA Beauty, Ross Dress for Less, Five Below and Aspen Dental to fill one-time anchor space, joining the existing grocery-anchor, Rouses Market, and AT&T.
Another notable example is DANA Incorporated. Our Leasing Team was enlisted to help the corporation locate an industrial space in the market for the relocation and expansion of their service and assembly center. After realizing their specific space needs, our Development Team was brought in to present build-to-suit options. We were able to help them locate land and manage the development of their new facility designed with ample flex space to meet their needs and accommodate future expansion.
Our all-inclusive approach showcases our diverse range of services we offer to our clients, allowing us to maximize the full potential of every property. And that commitment and dedication to our portfolio are reflected through consistent positive gains in leases, occupancy rates, rental rates and income.
Stirling Properties’ experienced management team serves more than 20 million square feet of property across the Gulf South, including some of the largest commercial properties in the Region. We fully understand geographic markets, diverse property types, a property’s unique requirements and marketability, specific financial situations, ownership goals and tenants’ needs. We consistently focus on cost-efficient operations and explore innovative concepts to improve the value of each asset. We pride ourselves on delivering results through diligence, professionalism, accountability, and good old-fashioned work ethic!
Now, all of this is not to say that more disruption and headwinds aren’t looming around the corner, but I am confident that we are prepared to handle it.
If you have any questions about your property or would like to discuss Asset Management options, please feel free to reach out.
Stirling Properties Announces New Tenants at Hammond Square
Redevelopment of former Sears and Rite Aid stores into multi-tenant retail space.
Stirling Properties commercial real estate company is thrilled to announce that Michaels, HomeGoods, Five Below and PetSmart will join the tenant lineup at Hammond Square shopping center in Hammond, Louisiana.
Rhonda Sharkawy, Senior Retail Leasing & Development Advisor with Stirling Properties, handled the lease transactions on behalf of the landlord.
Michaels, HomeGoods and Five Below will occupy a newly constructed multi-tenant building on the parcel formerly occupied by Sears and Rite Aid. Michaels will lease 21,000 square feet, HomeGoods will lease 22,000 square feet and Five Below will lease 8,300 square feet. PetSmart will occupy approximately 15,000-square-foot store adjacent to Hibbett Sports. There will be a newly created outparcel at the corner of Hammond Square Drive and Palace Drive, near the entrance of the retail center. This outparcel is available for a future retail or restaurant up to 6,000 square feet.
Demolition of the former Sears and Rite Aid buildings was completed earlier this year to make way for the $15 million redevelopment project. Construction of the new space has commenced, and developers are recycling the crushed concrete from the building demolition to use for paving base material. Buildout is expected to be completed in the first quarter of 2020 with the new retail tenants anticipated to open in the second quarter of 2020.
Also new to Hammond Square, Old Navy celebrated its grand opening this past spring. The new-to-market fashion retailer is located on Palace Drive between Zales and Shoe Dept. Encore. Poké City recently announced that it would open its 2nd Louisiana location at Hammond Square. The restaurant, serving Hawaiian-inspired food bowls, will occupy the former Which Wich location on Palace Drive between Menchie’s and GNC. It is expected to open this August.
“Stirling Properties is excited to welcome these first-class retailers to Hammond Square. They are all new to the Hammond market, and we are confident they will be extremely well-received by the surrounding Tangipahoa community. They complement our existing tenant mix perfectly—even further positioning Hammond Square as a leading shopping destination in the region. In addition, our leasing team is still working to secure additional retailers and restaurant options that we hope to be able to announce very soon,” said Grady Brame, Executive Vice President with Stirling Properties.
Hammond Square is Tangipahoa Parish’s premier shopping destination, located on approximately 100 acres at the northwest corner of Interstate 12 and US Highway 51 Business (SW Railroad Avenue) in Hammond, Louisiana. It is the 2nd largest open-air center in Louisiana encompassing over 902,000-square-feet of more than 40 national and local retailers, shops and restaurants, including Dillard’s, Target, The Home Depot, JCPenney, Academy Sports+Outdoors and AMC Theatres. Stirling Properties redeveloped Hammond Square and currently manages and leases the center.
For more information on Hammond Square, visit www.hammondsquare.com or facebook.com/hammondsquare. For leasing and sales information, contact Rhonda Sharkawy at (504) 620-8145 or rsharkawy@stirlingprop.com.
President’s Message: Don’t just paint it on the wall
Company culture has become a catchphrase, often overused and undervalued. Its meaning and relevance in today’s workplace are fading.
However, to me, company culture is not a buzzword. It’s not a byline or a slogan painted on the wall, or merely words printed on a t-shirt. It’s an attitude that is lived and nurtured every day.
A company’s culture is a shared set of values, beliefs, practices and purposes of the organization. It’s who you are, what you stand for, what you won’t stand for, and why people want to be associated with you. You can’t see or touch a culture, but you can certainly feel it. It affects every aspect of a business, from its employees to customers to public image, and it is evident in every action.
Stirling Properties’ ethos has been ingrained here throughout the decades. Our culture is the personality of our company and determines how we interact and work together as a team to accomplish our shared goals. These ideals motivate and shape the way we conduct ourselves and our business every day.
We place great emphasis on our team and our bench strength of up-and-coming new talent across all departments and geographical markets, as well as cross-training and expanding individual skillsets. Stirling Properties has hired over 50 new people in the past two years alone, and more than half of our team has joined in the last five years!
Every business evolves. People change, demographics change, beliefs and practices change. That’s precisely why it’s essential to have an entrenched company culture that everyone shares and buys into. Now, that’s not to say that company culture can’t adapt—it can, and it should, but it should never be abandoned.
The Millennial generation is driving significant change in workplace culture. They pursue jobs that offer purpose, meaning and flexibility that aligns with their personal beliefs and lifestyles. Companies that show commitment to social responsibility and professional development are more appealing to this demographic. As the largest cohort in the workforce today, this is especially important to consider.
At Stirling Properties, we’ve been successful in attracting this new generation of talent because I believe we live and breathe our company culture. Our culture was said to be our #1 asset by an outside consultant recently.
One of the hallmarks of our company culture is giving back. With the help of our Stewardship Committee, Stirling Properties provides charitable funding and volunteer support for numerous nonprofit organizations and community groups across our entire footprint that reflect our motto of #BeTheChange: Helping others is a work of heart.
Community spirit and generosity are evident not only on a corporate level but through individual involvement as well. Stirling Properties encourages its people to get involved and volunteer for philanthropic, civic, and cultural endeavors that impact our communities. Many members of our team generously give their time and resources to nonprofit organizations that hold a special place in their hearts.
What amazes me most is not the numbers or dollars of what is given, but rather the pride, enthusiasm, energy and heart that they commit to these causes. Also, I am humbled by their appreciation for the support that our company provides them to do so.
New Orleans Saints great Drew Brees recently said during an award acceptance speech, “Gratitude, humility and respect are the three greatest qualities you can have as a human being.” He went on to say that he works every day to instill those qualities in his children—his team off the field.
I think those same qualities can also be applied to a company and its team as a benchmark for culture. At Stirling Properties, I’m grateful for what we have and what we are able to give back, humbled by the outpouring of generosity and kindness by our team, and respectful of the cultural environment that is deep-rooted here, even amid more than forty-three years of demographic changes.
Company culture has always been an integral part of our business, but it’s more important now than ever. We need to be cognizant of and adapt to the needs of the next generation of people who are shaping our future workforce, while still staying true to the underlying principles and values that define our company.
Company culture is not a buzzword but a compass that will navigate a business towards success or failure. So, paint it on the wall, or print it on a t-shirt, but whatever you do, make it front and center in your company’s day-to-day activities.
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