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Barnett: Nothing left to chance in recruiting
Jim Barnett of Barnett Commercial Real Estate Inc. is shown with pictures on a wall in his Martinsville office showing commercial and retail spaces he has sold. (Bulletin photo by Mike Wray)
Sunday, February 10, 2013
By DEBBIE HALL - Bulletin Staff Writer
Jim Barnett can’t help chuckling when the conversation turns to creating a new effort to recruit retail businesses to the area — mainly because he has been doing that for years.
“We are constantly searching for prospects to come to Martinsville and Henry County,” said Barnett, of Barnett Commercial Realty Inc. in Martinsville, which manages a number of sites in several areas, including the Cloverleaf Shopping Center and Spruce Street Station.
“This is not something that is left up to chance. It is a science,” he said. “They (companies) have it down to a science.”
He explained that commercial real estate “encompasses everything that’s not houses.” It includes industries, retail businesses and office spaces.
Barnett has been in the real estate business since 1988, he said. He earned his license in Virginia in 1993 and opened his firm in 1997. His clients have included CVS, Walgreens, Taco Bell in Collinsville, Sheetz and others, he said.
Even with all of his successes and experience, Barnett said he strives daily to answer the same question.
“How do you develop retail? I don’t know,” Barnett said. “That’s what I wrestle with every day.”
“I’m the last one to be a naysayer, but the thing is, you have to have” the demographics — population, the income levels and other factors — needed to attract retail businesses, Barnett said. “We have the highest unemployment in the area. That’s not an attraction” to commercial businesses that are thinking about locating here.
Henry County Supervisor Debra Buchanan recently proposed creating an office to identify and focus on market niches and develop new avenues to attract retailers. Sue suggested that the office would be located with the Martinsville-Henry County Economic Development Corp.
Discussing a new recruitment effort “sounds nice,” but it is not a simple feat, Barnett said.
He suggested looking around the community to get “an overview of what’s happening in retail right now.”
One of the largest anchor stores in Liberty Fair Mall — Sears Inc. — has closed, and there are other vacancies in the mall. Patrick Henry Mall and other local shopping centers also have vacancies, Barnett said.
Any number of factors may have contributed to businesses closing, such as the shrinking population and income levels, he said.
Those factors and others also may hinder other retailers from locating here, Barnett said while thumbing through a copy of “Retail Tenant Directory.”
The large book contains a wealth of information that Barnett and other developers use for research when soliciting or trying to recruit companies, he said.
The book lists companies’ names and their the requirements for locating in an area.
For instance, the Kohl’s Corp. requires a leased space of 75,000 to 133,000 square feet, among other things. “That’s a big store,” Barnett said.
Other businesses also may specify parking, the population density, income level of potential customers, adjacent businesses and the amount of traffic that passes by a location, among other factors, he said.
Some stores have specialized requirements for new locations, he said, such as a drive-up pharmacy and an area large enough to support a fuel pad.
Companies “can even tell you what the people are going to spend” when they shop, Barnett said.
The location process starts with pinpointing a particular site and then drawing circles around it at various distances. For example, a recent report generated for a site on Commonwealth Boulevard has rings drawn at one, three and five-mile radii.
Reports include demographics and other information, such as the number of people age 16 and older who are employed, a breakdown of the percent of employees in different industry segments, household incomes, type of homes, value of homes, whether property is rented or owned and the cost of rent or mortgages, the year the structure was built, whether there is a home equity loan, the type of heating fuel used, the number of vehicles available per home and other data.
Ruby Tuesday, a restaurant “that we’ve been trying to get for a long time,” wants a 4,500- to 5,000-square-foot space, 100 parking places, a population density of 25,000 to 50,000 of high- to middle-income people and a traffic count of 25,000 vehicles passing the location per day, Barnett said.
“The only area that approaches that” traffic count is in front of Wal-Mart, he added.
Marshalls — another retailer that has been mentioned in some discussions — requires a leased space of 25,000 to 30,000 square feet and a population density of 100,000 within a 20-mile radius, Barnett said.
“We have tried to identify areas where we could meet that” requirement and found that the only area locally is the U.S. 58 bypass at the intersection with U.S. 220 south of Martinsville, Barnett said. That location meets the population requirement by including parts of Eden and North Carolina and all of Henry County.
About five years ago, a study by Buxton, a Texas company, also pinpointed the U.S. 58/220 south area for future development, Barnett said. He added that in his opinion, the area was selected because of the traffic flow.
That study was done when Martinsville asked the Martinsville-Henry County Economic Development Corp. (EDC) to analyze four sites for retail businesses, commuting patterns and disposable incomes, said Mark Heath, president/CEO of the EDC.
The study was undertaken in 2006 and completed in 2007. Its results were “to help us sell retail and also to help identify” companies with criteria that may fit the development of the Baldwin Block, Virginia 174 (Kings Mountain Road), U.S. 58 and Virginia 650 (Irisburg Road), and the U.S. 58/220 bypass, he said. The study also generated a list of possible retailers that may be interested in locating in the area.
The $65,000 cost of the study “we think was money well spent,” Heath said. “We made it available to all of our commercial brokers and anybody could” use it to work on getting retailers to the area.