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Feature Article, November 2005
Downtown Houston: Alive After Five
After-5 o'clock retail once floundered in downtown Houston. Today it is flourishing.
Blake Tartt III
The greater Houston area has 4.5 million shoppers and the downtown district attracts more than 92 million visits per year. These numbers and recent revitalization efforts in downtown Houston, make it easy to assume that the city's center is ripe for “after-5 o'clock” retail development. But Houston is a very non-traditional market, where traditional retail rules rarely apply.
Retail — more specifically after-5-p.m. and weekend shopping — have floundered in this market. Why? Daytime visitors and downtown workers, presumably 9-to-5 weekday commuters, account for 53 million, or more than half, of the visits to downtown Houston. The remainder of downtown Houston visitors make special trips primarily for sports, the theater, concerts, conventions and other events. This populace commutes to downtown for weekday work, or weekend events, and immediately returns home to the suburbs or other city regions. With a psychographic profile centered on car-travel, the typical Houstonian thinks nothing of driving an hour or more for a downtown baseball game and then immediately driving home after the game's end.
The vast majority of Houston's downtown population comes from communities far from the heart of downtown itself. Only 2,300 permanent residents live in downtown. About 2 million live in city proper, the other 2.5 million fill in a primary metropolitan statistical area (MSA) that stretches upwards of 50 miles from the city's center; the MSA comprises six counties. Hence, it's only natural that more than half of people who call themselves “Houstonians” rely on the infrastructure — and shopping districts — found in their local communities. First and foremost, Houstonians crave convenience.
Even for those who populate the city of Houston itself, the quality and lure of easily accessible regional malls and shopping centers is enough to keep downtown from evolving into an after-5-p.m. shopping district. For example, Uptown Houston, home to The Galleria, recorded nearly $2 billion in retail sales in the year 2000. This figure made it the highest volume retail-shopping district in Houston, even prior to a recent expansion of the Galleria. Compare this slightly dated figure — from a single Houston-area shopping district — to only $1.1 billion in retail sales found downtown in 2005, more than half of which came from restaurant and bar sales.
Yet, hope still remains for retail in downtown Houston. The key lies not in after-5 o'clock shopping, but in a form of retail that appeals first and foremost to the area's captured 9-to-5 crowd.
Successful retail in downtown Houston begins with thinking of the city's center like Grand Central Station. It may sound strange, but the similarities are clear. Those who visit downtown Houston are on-the-go working commuters or are making special, one-stop, in-and-out trips. They don't have time linger. Therefore, the astute retail developer would not shoehorn big-box retailers into a place where they simply won't succeed. A customized solution that caters to the demographics, psychographics and shopping patterns of a specific micro-market's population is the best approach.
A carefully formulated airport-style retail approach is currently being employed to re-merchandise The Shops At Houston Center, a retail venue owned by crescent HC Investors, LP (a joint venture of Crescent, JP Morgan Chase and GE Capital) and managed by Crescent Property Services, Inc. The project is attached to office buildings that house a captured market of 20,000 workers.
Visitors from adjacent downtown office buildings, the George R. Brown Convention Center and nearby hotels traffic The Shops At Houston Center for a quick lunch or a needed sundry item, epitomizing the airport-retail mentality.
Providing a more diverse variety of dining options and beginning a kiosk-retail program will help sales. But, encouraging visitors to lengthen typical visits to The Shops At Houston Center may be equally as important.
To achieve this goal, the team leading the renaissance of The Shops At Houston Center is transforming the space into an indoor urban park. Enhancements will include interior landscaping, enhanced lighting, foot-friendly floor coverings, as well as furnishings and finishes that evoke an alfresco flair. These elements, along with mood-evoking music, all-encompassing Wi-Fi connectivity and numerous other enhancements, will create a true sense of arrival at The Shops At Houston Center, and will encourage visitors to linger and explore refreshed shopping options.
“There's never been a more exciting time to be at The Shops At Houston Center,” says Bob Hustwit, manager of retail leasing and operations for Crescent.
But what about creating an after-5 crowd for The Shops At Houston Center? The Shops at Houston Center is fostering the beginnings of a steady after-5 crowd.
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Located in The Shops at Houston Center is Strip House, a nationally renowned, upper-echelon steakhouse with additional locations in Manhattan and New Jersey. Strip House is already attracting heavy traffic after 5 and on weekends, both from the local population and from communities outside of downtown.
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Located in The Shops at Houston Center is Strip House, a nationally renowned, upper-echelon steakhouse with additional locations in Manhattan and New Jersey. Thanks to its blend of decadent food and seductive atmosphere, Strip House is already attracting heavy traffic after 5 and on weekends, both from the local population and from communities outside of downtown. Larry North Fitness, a hip, high-end work-out and wellness center located in The Shops At Houston Center also lends credence to a strategy that is being employed to attract more after-5 visitors: namely, the addition of vanity services. Opticians, cosmetic dental offices, spa services and the like offer the potential to attract after-5 errand runners and those who may crave a bit of self-indulgence before their commute to the suburbs begins.
In short, by not trying to force a round peg into a square hole, The Shops At Houston Center could serve as a model for retailers trying to make the most of downtown Houston buyers.
Blake Tartt III is president and CEO of Houston-based New Regional Planning.
A Lively Downtown, But Where's The Retail?
Downtown Houston is home to numerous corporations and attractions that serve as magnets for both working commuters and special-event visitors. It would seem logical that overflow from such activities would infuse a shopping marketplace, but such is not the case.
Houston's theater district has a total of 12,948 seats and nine stages located in five major performance venues. The district is also home to the Landry's Downtown Aquarium and the 130,000-square-foot Bayou Place entertainment complex, which houses a concert venue, restaurants, bars and a 1,480-seat cinema.
Minute Maid Park welcomes approximately 3 million Houston Astros fans per season. In 2004, the stadium seated a record crowd for the Major League Baseball's All Star Game. The Toyota Center, home to The Houston Rockets (NBA), Houston Comets (WNBA), Houston Aeros (AHL) and a bevy of concerts and special events, hosted more than 7 million fans in 2004 alone.
The George R. Brown Convention Center is the ninth largest convention facility in the United States, and was recently expanded to 1.85 million square feet. In 2004, it is estimated that the center played host to 1.3 million convention-goers.
Because of the area's oft-oppressive climate, downtown Houston is not a nationally renowned outdoor-events hub. However, the annual Houston International Festival, Texaco Havoline Grand Prix, Houston Marathon, and other events drew 2.3 million people to downtown Houston in 2004.
A total of 15 hotels are located downtown, with nearly 5,000 guest rooms and 106,000 square feet of meeting space. The new Hilton Americas-Houston, the city's largest convention hotel, boasts 1,200 rooms.
Downtown Houston is also home to 43 million square feet of rentable office space. Major downtown employers include Shell Oil Company, Exxon Mobil Corporation, JP Morgan Chase, Continental Airlines and ChevronTexaco. A total of approximately 140,000 people work downtown.
As an aggregate, downtown Houston is projected to generate 92 million visits in 2005 — quite a mouth-watering number for retailers.
— Blake Tartt III |
©2005 France Publications, Inc. Duplication or reproduction of this article not permitted without authorization from France Publications, Inc. For information on reprints of this article contact Barbara Sherer at (630) 554-6054.
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