20 minute read
Industry News
AroundtheIndustry
RETAIL
Forever 21
Forever 21 is back in brick-and-mortar growth mode with plans for 14 new US stores, most of which will be in outdoor lifestyle centers and outlet malls. The new locations will be smaller and feature more curated selections aimed at appealing to Generation Z fashion fans.
Tractor Supply
Tractor Supply has won federal regulatory approval for its planned $320 million acquisition of Orscheln Farm & Home, a smaller rural lifestyle retail chain. The Federal Trade Commission approval is contingent on Tractor Supply selling 85 of Orscheln’s 166 stores, 73 of which will go to Iowa-based Bomgaars, and the other 81 stores will be rebranded with the Tractor Supply banner.
Walmart
Walmart has retrofitted its 1.2 million-square-foot distribution center in Palestine, Texas, to include high-tech automation that can sort, store, retrieve and pack merchandise. The upgrade is part of efforts to increase efficiency, speed and safety across all 42 of Walmart’s regional distribution centers.
Target /Apple
Target will grow the number of in-store Apple shops to 150 locations, with a lineup of gadgets including Apple TV devices, iPhones and Apple Watches available in time for the holiday shopping season. Target’s first mini-Apple shops opened last year as part of the retailer’s growing focus on partnerships with popular brands, a lineup that also includes Walt Disney Co. and Ulta Beauty.
Boot Barn
Western apparel retailer Boot Barn has grown to 321 stores with the opening of 10 new locations during its fiscal second quarter, including its first shops in New Jersey and Delaware. The retailer plans to grow to between 500 and 900 stores as it breaks into new markets in Maryland, New York and Connecticut.
DSW/Cobblers Direct
DSW has partnered with Cobblers Direct to roll out shoe repair services to all of its more than 500 US stores, as part of parent Designer Brands’ plan to expand service offerings. DSW customers can access repair services by scanning a QR code and placing a digital order and consulting with a Cobblers Direct staffer on a range of services including sole replacements, strap repair and deep cleaning.
Culture Kings
Streetwear retailer Culture Kings opened an experiential, 14,000-squarefoot store in Caesars on the Las Vegas Strip. The 14-year-old, Australiabased company is prioritizing a “retail-tainment” approach to physical retail.
Warby Parker
Warby Parker is planning to open hundreds of stores over the next several years to add to its almost 200 physical locations currently. The retailer, which used to be online only, has also opened its own optical labs in New York and Las Vegas and is offering in-store eye exams and other services.
Tapestry
Tapestry, parent of luxury brands including Coach and Kate Spade, opened 60 stores in China over the past two years and will open an additional 30 in the next 12 months. Tapestry’s brands are seen as “accessible luxury” and the company’s strategy has been to move into smaller, less-affluent cities where other luxury brands haven’t opened stores.
RESTAURANT
Crisp & Green
Health-focused fast-casual chain Crisp & Green aims to grow from its current 26 locations to more than 1,000 over the next few years. The Minnesota-based company is on a mission to give consumers across the Midwest access to convenient, healthy meals.
Panera Bread
Panera Bread debuted a new urban format in New York City that melds features of the chain’s traditional units with aspects of its newer Panera To Go concept. While the concept is focused largely on takeout and delivery orders, it features counter seating, unlike a Panera To Go unit set to open in the Union Square neighborhood next month, which will not include a dine-in option.
Applebee’s Neighborhood Grill + Bar
Applebee’s Neighborhood Grill + Bar is closely monitoring its new pickup windows, the first of which opened this year, to determine whether they’re meeting goals of customer and employee satisfaction and providing a return on the investment. The chain expects to have as many as 20 of the windows up and running by mid-2023.
Chili’s Grill & Bar
Chili’s Grill & Bar will open a small-format unit near Southern Methodist University in Texas today focused on serving offpremises orders. Takeout and delivery account for about one-third of Chili’s orders and the new format could allow for expansion into nontraditional venues.
Mendocino Farms
Mendocino Farms plans to open its ninth new location this year, bringing the fast-casual concept to 51 units in California and Texas. The company has opened nine new restaurants this year.
Starbucks
Starbucks opened a 23,000-square-foot, three-story Reserve store in New York City’s Empire State Building. The new space features signature cocktails, classes and workshops, and will be the first Starbucks location to use the chain’s new Cold Pressed Espresso brewing system.
Hooters
Hooters has partnered with ghost kitchen company Franklin Junction to fulfill off-premise orders through a host kitchen in Rogers, Arkansas. The partnership will work both ways, with some Hooters locations acting as host kitchens for other brands, and Hooters may also use the ghost kitchen network to offer off-premises ordering for the fast-casual brand Hoots Wings and some of the company’s virtual brands.
AroundtheIndustry
Chinah
Chinese fast-casual concept Chinah plans to grow to four locations with the opening of restaurants in Brooklyn, New York and the area near New York City’s Grand Central Terminal early next year. The chain, which specializes in bowls inspired by homemade Chinese cooking, also has plans to open two ghost kitchens to serve delivery orders.
MrBeast Burger
Virtual restaurant brand MrBeast Burger opened its first branded brick-and-mortar location on Sunday at New Jersey’s American Dream mall. MrBeast Burger has grown to more than 1,700 virtual locations since launching in 2020 with a business model that signs existing restaurants as partners under licensing agreements.
HOSPITALITY
Waldorf Astoria
The Waldorf Astoria has opened its first resort in the Mexican Caribbean adjacent to the Hilton Cancun. The Waldorf Astoria Cancun has 173 rooms, five restaurants and bars and a 40,000-square-foot spa.
Choice Hotels
Choice Hotels is going upscale with the purchase of Radisson’s Americas. The company has 969, with 470 extended-stay in development, but sees upscale and midscale markets growing.
Darwin Hotel
The new owner of a four-story hotel near Ponce City Market and the Atlanta Beltline is trying to keep up with the area’s rapid change. The Darwin Hotel, a boutique hospitality concept, showcases the surrounding Old Fourth Ward neighborhood and how it’s changed in recent years.
BWH Hotel Group
The extended-stay segment continues to be the rock star of the lodging industry, so it’s fitting that the BWH Hotel Group introduced a new extended-stay brand during its North American Convention— which was themed BW Rocks and held in the home of rock ‘n’ roll.
Marriott International
Marriott International will open 30 new hotels in various locations in Africa by the end of 2024, while Radisson Hotel Group plans 150 hotels in the next five years. Meanwhile, IHG Hotels & Resorts has signed franchise agreements to rebrand three properties in Tanzania and Kenya.
Hilton Hotels
A secret tunnel under The Hilton Baton Rouge Capitol Center, where former Louisiana governor Huey P. Long reportedly lurked to watch the capital city’s train and river traffic, has been converted to an event space called The Tunnel. The space with a speakeasy atmosphere hosts weekly live music with a curated drink menu and has plans for murder mystery-themed dinners.
Marriott International
Twenty new Marriott International properties will be opening in the Middle East over the next 15 months. Half of the properties are planned for Qatar ahead of the FIFA World Cup, while the others are planned for Saudi Arabia and UAE.
Cambridge Suites
Toronto’s Cambridge Suites Hotel is removing its peaked roof as it proceeds to add 50 floors to the existing 21. The unusual project will require building a bridge structure atop the hotel to support the weight being added to the tower, which will rise 757 feet when finished.
GROCERY
ALDI
Aldi will open its first store in Staten Island, the southernmost of New York City’s five boroughs, in 2023. With 2,200 stores across 38 states, Aldi is on track to become the third-largest grocery retailer by store count by the end of 2022. Aldi currently has 123 locations in the state of New York.
Grocery Outlet
Grocery Outlet and Uber have expanded their partnership, bringing ondemand and scheduled grocery delivery to Grocery Outlet stores across the United States. Grocery Outlet locations throughout New Jersey, Maryland and Pennsylvania have come online, joining stores in California, Oregon and Washington for a total of 386 in seven states. The service is now available at locations in Los Angeles; San Francisco; San Diego; Philadelphia; Seattle; Sacramento; Portland, Oregon; and other cities.
The Kroger Co.
The formal opening of an Ocado-automated “spoke” facility in Oklahoma City has extended The Kroger Co.’s reach to 36 states, now including Oklahoma.
SuperFresh
SuperFresh plans to open two 16,000-square-foot SuperFresh stores in Clifton and Passaic, New Jersey—areas it has considered food deserts. The supermarkets will focus on perishable items like produce, meats and dairy but also will offer boutique-like finishes such as fresh sushi and a live fish tank featuring Chilean sea bass and lobster.
Harps Food Stores
Harps Food Stores has agreed to acquire all seven locations of independent grocer The Markets in central Louisiana and southwest Mississippi. The deal marks Harps’ entry into the two states and brings its store count to more than 140.
Clover Food Lab
Clover Food Lab, a Massachusetts’ cult-favorite vegetarian, fastcasual food chain, will open its 15th location restaurant, but its first location to include a grocery store.
Hy-Vee
Hy-Vee has cut the ribbon on another of its “totally reimagined” stores in La Crosse, Wisconsin, featuring digital shelf labels, a Hy-Vee Scan & Go mobile payment option and digital kiosks for ordering cakes and prepared foods. The store also has more than 100 televisions highlighting services and promotions alongside a food hall with several meal offerings, a pub and an outdoor patio.
Meet me at Trader Joe’s
Trader Joe's holds the top spot among supermarkets and drug stores in Fordham University's American Innovation Index. Other top-ranking grocers and drug stores in the consumer survey-based index include Whole Foods Market, Publix Super Markets, ALDI, CVS, Kroger, Albertsons, Walgreen, Safeway and Rite Aid. The survey, the only one in the United States that measures company innovativeness, is based on customers’ experiences. Conducted this past July and August, it covers 190 firms from 19 industries, including airlines, hotels, banks, TV and internet service providers, wireless phone providers, manufacturers, and retailers. The study surveyed 6,416 consumers and covered more than 30,000 customer-company relationships.
They said it...
— ICSC President and CEO Tom McGee on why traffic will increase during the holiday shopping season, as 81% of consumers report they plan to visit a shopping center in a recent survey
— Capital Tacos co-owner Josh Luger on why the fast casual chain is branching out into different formats, including food trucks and virtual restaurants, alongside traditional brick-and-mortar locations
— Kimski Chef Won Kim on how the Korean-Polish restaurant continues to shake things up with a new pop-up each month from November through March to show off new concepts
Walk on up
The Rego Restaurant Group, which owns Quiznos and Taco Del Mar, is teaming with BCubed Manufacturing to create prefabricated drive-thru and walk-up units for both brands. The 650-square-foot units—called "The Qube" at Quiznos and "Baja Shack" at Taco Del Mar—will be built offsite, and shipped with the plumbing and wiring already installed. Rego is hoping the perk will attract new franchisees.
Stranger than ‘Stranger Things’
Did you know you could turn your TV watching experience into a lifestyle one? Thanks to leaders in both the public and private sectors in Gwinnett County (Georgia), a Duluth shopping center is being converted into a mixed-use development. The shopping center has grown in popularity after it was used as a set for the filming of the widely popular Netflix series, "Stranger Things." Under the plan, Global Villages would comprise seven residential villages centered on a 4.5-acre park, and include 2,700 housing units, 25,000 square feet of office space and up to 100,000 square feet of retail. It also would include a 40,000 square foot cultural center, international library and eight additional acres of greenspace mixed among the villages.
The numbers game 32 14
The number of states that have added construction jobs between August and September, according to recent analysis of federal employment data by the Associated General Contractors of America. The numbers show that Florida picked up the most jobs, while North Dakota posted the largest percentage increases. Texas and New Jersey lost the most jobs during that period.
The percentage increase in hotel leisure travel that is expected over 2019 by year’s end, according to data from the American Hotel & Lodging Association. The projections show the recovery varies by city and could be affected by inflation.
2,074
The number of hotel projects that are in the pipeline over the next 12 months (along with 987 under construction), according to the most recent Construction Pipeline Trend Report. By the end of the year, 525 new hotels are projected to have opened, a 1.1% increase in new hotel supply for 2022.
Riding out the storm
How today’s construction professionals work and navigate tough times
How do you better prepare for new variables in the construction process? When do you change construction methods? What construction costs are increasing and which materials are increasing the most? Why should you and how to map out a project's entire supply chain?
There are so many questions facing today’s commercial construction executives. Over the past two-plus years, the industry has not only faced its share of unprecedented challenges, but the future is filled with a sense of uncertainty. So, how do project leaders actually work and navigate through these mazes? We asked Kenneth M. Colao, President and CEO of CNY Group, to share his insights on the road—and ride—ahead.
Where does today’s construction industry stand?
The industry is cyclic and has a history of going through periods of uncertainty and change. The pandemic upended our industry for a short period of time, but we have adjusted, and I think for the better. Today
there is one certainty: The rate of change is continuously increasing, creating a greater need to increase our time in planning and analyzing more scenarios and options. While much of the conversation is about how to capture and increase costs due to inflation and escalation, these issues only scratch the surface of the challenges of today’s construction industry.
What new variables are you seeing with respect to your construction management? What has stayed the same or returned to pre-pandemic levels?
The largest variable is rising costs, delays of materials and availability of adequate labor. This has altered how we work with our clients, requiring us to meet earlier and more frequently to ensure lighter cost management and scheduling. But I believe the industry is stabilizing and returning to pre-pandemic form. The change and uncertainty of the past twoplus years have left a long-lasting impact; safety protocols are being reviewed and updated more frequently and some workers continue to wear masks voluntarily and practice safe distancing. The goal is to provide a safe environment where people can work productively again, which I believe the industry is returning to.
What construction costs do you see changing? How can people reduce these costs in their projects?
Construction costs ultimately depend on the market, geography, complexity and the size of the project. In the last two years, we have seen the cost of some materials rise upward of 140%. These include materials such as miscellaneous iron, stairs, staircases, ladders, railing, metal moldings, trims and storefronts. We have even seen the costs of softwoods, plywood, and structural steel increase by over 60% in the last 18 months. We recommend selecting larger suppliers and trade contractors to defray some of these growing costs because of their ability to bulk purchase materials to smaller contractors who are buying items off the shelf from smaller contractors who will pay significantly higher costs. We also encourage developers and owners to focus on investing in durability on the front end because building operations and maintenance may become more expensive over time, otherwise making it worth the initial capital investment.
How do you recommend working around logistical issues of importing international materials without breaking budgets with costly domestic materials?
My team recently adjusted our approach to erecting the facade of a building, despite the original design being programmed as a least-cost method. Due to the delivery times on the precast, we had initially planned on, we instead opted for handset masonry and terracotta facade to avoid extending construction delays even further.
Today, we map out the entire supply chain to be as prepared as possible for delays and price adjustments. When should someone change from a least-cost construction planning method to a least-time method? Do you see one being prioritized over the other?
Most clients will start with a least-cost method. But similar to the project I mentioned, the cost of extended schedules will add costs and eventually surpass the premium between the two methods. The ability to pivot is crucial and is the reason we spend more time with clients throughout our pre-development process to ensure we manage budgets and to explore problems and provide the best possible solutions. The best action one can take is to sit down earlier and more frequently with clients to plan and strategize the project’s developmental process.
What advice do you have on mapping out a project’s supply chain?
We want to know where the raw goods are sourced from, location of manufacturing processing, and where they are being fabricated. We research how many touch points there are for each item and material, and communicate with both of those companies to understand the factory schedule. We are visiting factories more so than we ever had before. By mapping out our supply chains, we save our clients time and money by knowing exactly where our materials are. I believe preventing those stressful situations makes it a worthwhile investment for both the client and your team. What long-term costs should be prioritized in the construction process? How can someone convince their clients that long-term operational savings will offset required upfront costs?
Developers thinking longer term are spending more money upfront and upgrading, particularly in the MEP area to reduce energy usage of the buildings. The best way to analyze this is to understand the payback period and whether it is feasible to finance the added upfront costs. It is a no-brainer to invest more upfront when you can look at the cost of a building’s operation and maintenance over 30 to 40 years, see the operation costs, and find where you can invest wisely to reduce future costs. I believe owners and developers are moving in this direction. CCR
Eye on Green
Advocating for sustainability throughout the build and renovation process By Sandeep Modhvadia
The commercial construction industry has a monumental opportunity to help companies launch their energy journeys and deliver on corporate sustainability goals. The Green Building Council estimates that 39% of the world’s carbon emissions are generated by the construction industry, meaning any reduction here has the potential for major impacts on reducing our carbon footprint.
Building professionals with an eye on sustainability can turn to a data-based energy efficiency blueprint throughout any project to create safer, greener spaces. A recent cross-industry survey reflects these heightened efforts to accelerate adoption of Environmental, Social and Governance (ESG) goals. The "2022 Atrius State of Energy Management" report, based on a survey of more than 600 energy and facility professionals, offers a detailed outlook on how the organizations are meeting the corporate sustainability goals.
The annual report captures the experiences of energy professionals in multiple industries over the previous year, gathering data on what resources and investments these professionals require to meet their organizations’ ESG goals. Stakeholders can use these findings to not only inform their strategies moving forward, but gauge where their peers are on their own respective journeys towards creating greener spaces.
Optimized Systems and Fine-Tuned Control Needed to Meet ESG Goals
With energy use within buildings representing a third of global resource consumption, and accounting for nearly 20% of the greenhouse gas emissions worldwide, energy and sustainability teams are championing solutions to make their buildings more efficient to hit carbon-reduction goals. Nearly 80% of the “State of Energy Management” survey respondents reported a commitment to creating greener spaces. The report also underscored how energy teams require more executive support and increased budgets to better develop, communicate and accelerate progress toward sustainability goals. Optimized ventilation and air-conditioning, lighting, and heating systems are also integral for meeting broader environmental goals. Improvements here will help the general building sector attain its potential of energy savings of 50% or more by 2050. Among this year’s survey respondents, 69% anticipated investing towards more efficient HVAC equipment, while 52% ranked reducing carbon emissions important. The survey results also showed that to accomplish their corporate sustainability goals, energy managers require finer control of buildings at scale, a clearer picture of corporate goals and more precise data that most of today’s solution sets struggle to provide. Technologies such as digital twinning and IoT networks can give deeper insights on how people are interacting within a space to better understand how to lower operational costs. Whether we are constructing a new building or upgrading existing systems, investments in modern building management technologies and solutions will lead to smarter, safer, greener and overall more efficient spaces.
Corporations Are Beginning to Provide Much-Needed Resources
For the third year in a row, time and money continue to thwart teams trying to develop and lead reduction strategies. Nearly 40% of respondents said their organizational ESG goals are tied to financial reporting but resources are not invested to align with these mandates. A further 31% stated their ESG goals are not incorporated in their business reviews. There is hope that these numbers will decrease in following reports as major companies such as Chipotle, McDonalds, Caterpillar and others are increasingly tying executive pay to ESG goals. As organizations continue elevating their sustainability initiatives to regulators, the public, and financial markets, those teams responsible for achieving these goals have a better chance at influencing stakeholders for resources to accelerate their success.
Commercial Construction Integral to Energy-Efficient Builds and Renovation
No longer a static aspect of any business, buildings have the real potential for being an intelligent entity no matter how the space is used. The Fourth Industrial Revolution (4IR) is propelling disruption across all sectors, including commercial building construction and renovation. A site that monitors resources and energy use automatically gives more time back to teams to focus on planning, collaborating and generating ideas. Creative solutions at the design stage of any commercial construction project, whether it is a state-of-the-art new building or a digital overhaul of an older building, will create a smarter, safer, and greener built environment. Commercial construction professionals are in the pivotal position of both demonstrating leadership through their own green practices and positioning our buildings toward a more sustainable future. CCR
Sandeep Modhvadia is Vice President, Product at Acuity Brands, an Atlanta-based lighting and building management firm with operations throughout North America and in Europe and Asia.
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