January 21, 2014 10:20:48 AM
Nathan Gregory - [email protected]
Columbus councilmen will likely vote today for the city to enter into a three-year contract with a consulting firm that will recruit retail to city.
Two representatives from Birmingham, Ala.-based Retail Strategies met with the council last week during a specially called meeting to present their recruiting strategy and discuss how they could bring new businesses and sales tax revenue to Columbus. Its proposal is a three-year, $88,000 engagement with the city. The first year would cost $40,000 with the next two years costing $24,000 each.
The company formed in 2011 as a joint venture between two other Birmingham firms: Decision Data Resources, a web-based geographic information system firm, and Retail Specialists, a commercial real estate company. Business developer and client manager Charles Branch, one of the two presenters at last week's meeting, said the company has worked with 75 municipalities across the Southeast and Midwest since its inception.
City planner Christina Berry said she already has $20,000 set aside in the current budget to pay Retail Strategies to get started if councilmen go forward with the contract at today's council meeting. The other $20,000 the city would owe for the first year would be taken out of the budget for the 2014-15 fiscal year, which begins Oct. 1.
Councilmen Charles Box, Kabir Karriem, Marty Turner and Bill Gavin told The Dispatch Monday they would vote in favor of a motion to proceed with the contract.
One of the municipalities who works with Retail Strategies is Tuscaloosa, Ala. The company touts itself as being the listing agent for Midtown Village, a shopping center, during its construction phase, and has since worked with the owners to find occupants for 80 percent of the spaces. Tuscaloosa initially contracted with Retail Strategies to assist with strategic planning, retail recruitment and advice on incentive packages to retailers looking to locate new franchises.
Three Tuscaloosa councilors, Harrison Taylor, Kip Tyner and Matthew Calderone, were complimentary of the work Retail Strategies did to revamp some business areas there in the aftermath of the 2011 tornado that caused widespread damage. Tyner's and Taylor's only advice was for councilmen to make sure there was recruitment of new business and not mass relocation of businesses already in Columbus to new locations.
"We have a good relationship with (Retail Strategies) and I think they've fulfilled most of the things they said they were going to do," Taylor said. "A lot of stores changed places... and if I were doing it again I would make sure we have more brand stores that are not here than stores that are already here transferring."
Tyner said the revitalization of the Midtown area Retail Strategies helped provide also "really hurt" some existing shopping centers that were already there. Protecting existing business is a priority Columbus should make in working with the recruiting firm, he said.
"You make sure they're bringing something to Columbus that doesn't exist now. With us, is it something that people were driving to Birmingham before to shop because they couldn't get it here." Tyner said. "I think if they do that, you can justify it. It certainly has benefited (Tuscaloosa) now as far as new dollars. It was questionable at first. What we were seeing mostly was the stores closing other places to move. (Midtown Village) was like a brand new shiny penny. Everybody wanted to be where everything was brand new."
Another interest the city must protect is itself, Tyner added. Incentive packages that provide a large advantage to potential businesses is unfair to the ones already in place that weren't afforded those start-up incentives.
"We had two good malls -- McFarland Mall and University Mall," Tyner said. "They built without any incentives from the city. They were saying, 'That's unfair. What about existing businesses? We've been making money for you guys for a lot of years and now this new guy comes in wanting the moon and you're willing to give it to him.'"
Working with the Link?
Box said he's tried to put together a committee in the past to address retail recruitment but that was met with opposition from colleagues who wanted to keep that under the purview of the Columbus-Lowndes Development Link, which currently represents community economic development interests. The Link was recently behind an incentive package that will bring DICK's Sporting Goods and Michaels, an arts and crafts retailer, to Columbus in a new facility that will replace the long-abandoned University Mall building. The Link also helped with the location of Hobby Lobby, another arts and crafts franchise, to Leigh Mall on Hwy. 45. Those three retailers are slated to open late this year.
But Box, Karriem and Gavin each say bringing in Retail Strategies will simply mean strength in numbers and has no bearing on the city's relationship with the Link.
"We've got to do something," Box said. "Columbus is one of the most underserved communities in the Southeast as far as retail is concerned, especially in the area of clothing stores and department stores."
Karriem said another advantage to bringing in the firm is the city can make a stipulation in the contract that it would not work with neighboring communities including West Point and Starkville as the Link does now. It could be assured Retail Strategies has Columbus' best interest in mind bringing in a second party, he said.
"We need somebody that's going to be that cheerleader for Columbus," Karriem said. "We cannot continue to do the same things expecting different results. My rationale is we can't have too many lines in the water."
Gavin said the city should do everything it can to enhance retail development.
"The Link does a good job. Here lately, they've brought us several new stores, so they've been on the job and we've got some momentum going," Gavin said. "With the Link spreading out to West Point and Starkville also, I think it's incumbent on us to reach out and take one step even further than what we're already doing to help recruit retail. One of the problems I see is that we're kind of landlocked. We don't have a lot of buildings and space for someone to go out to, so this may present a challenge for us in the future, but I do think this will be a great opportunity for us. A good baseball team doesn't have just one starting pitcher. It has several."
A call to Link CEO Joe Max Higgins was not returned as of press time.
Nathan Gregory covers city and county government for The Dispatch.