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Home My WebLink About100809PFountainHillsRetailMarketFountain Hills Retail Market AnalysisTownCouncilTown Council Strategic Planning WorkshopOctober8,2009October 8, 2009 ProjectObjectiveProject ObjectiveTo analyze the market and identify the type of retailthatcouldbesupportedwithinFountainretail that could be supported within Fountain Hills Town Center and Four Peaks Plaza. ScopeofWorkScope of WorkTwo trade areas were analyzed:y–Town Center –Four PeaksTasks: –Trade area identificationDemographicanalysis–Demographic analysis–Employee market segment–Consumer expenditures and trade leakage–Lifestyle analysis–Retail Demand analysis TwoTradeAreasTwo Trade Areas•Town Center MTA contains 64.7 square milesand30 918miles and 30,918 people•FourPeaksMTA•Four Peaks MTA contains 90.4 square miles and 38,672 ,people TradeAreaDemographicsTrade Area DemographicsFountain Hills Town Center Four PeaksMTA MTAPopulation 23,934 30,918 38,672Median Age 45.8 44.2 39.1HH Size 2.46 2.46 2.60Median HH Income $77,309 $78,152 $68,567OwnerOccupied64 5%64 7%65 7%Owner Occupied64.5%64.7%65.7%Renter Occupied 15.9% 14.1% 14.6%Vacant 19.6% 21.1% 19.6% PopulationGrowthPopulation Growth44,19945,00050,00030,91834,98130,20938,67230 00035,00040,000pulationFountain HillsTown Center MTA20,24523,93426,44624,75020,00025,00030,000PoTown Center MTAFour Peaks MTA15,0002000 2008 2013YearFountain Hills Town Center MTA Four PeaksMTA2000 to 2008 Growth 18.2% 24.9% 28.0%2008 to 2013 Growth 10.5% 13.1% 14.3% FountainHillsPopulationPyramidFountain Hills Population Pyramid200865-6970 - 7475 - 7980 - 8485+35-3940 - 4445 - 4950 - 5455 - 5960 - 6465 69Age5910 - 1415 - 1920 - 2425 - 2930 - 3435 -39% Female% Male543210123450 - 45 -9Percentage of Population EducationalAttainmentEducational Attainment60.0%50.0%46.1%43.9%42.8%48.6%50.6%30.0%40.0%33.0%34.8%34.9%26.0%24.6%10.0%20.0%5.2%5.2%6.0%15.3%15.4%15.7%16.1%16.3%10.1%9.4%0.0%Fountain Hills Town Center MTA Four Peaks MTA Maricopa County Arizona5.2%5.2%llllhldflNo DiplomaDiploma or Some CollegeAssociate or Bachelor DegreeGraduate or Professional Degree Findings –Fountain Hills Resident kMarket Segment•Median household income is $77,309•Industry concentration:–educational, health & social services, retail trade, professionalmanagement&administrativeprofessional, management & administrative services, and finance, insurance & real estate.•Predominate occupations:lffitdhlth–sales, office, management, and healthcare.•The civilian labor force consists of 10,452 people of which 43% earn $40,000 or more¹•17.6% of the labor force live andwork in Fountain Hills¹1USCBLEDOiiDiiDB20061 ‐US Census Bureau, LED Origin‐Destination Data Base 2006 LifestyleDataLifestyle Data•LifestyledataprovidesafinergrainofLifestyle data provides a finer grain of information regarding spending and lifestyle habits of consumers. •Analyzed for all three study areas.•The predominant people in all three pppstudy areas fall into the “Upscale America” MOSAIC group. UpscaleAmericaGroupUpscale America Group–Overwhelmingly baby boomers who have gyyhigh discretionary incomes –Older children are not likely living at home lany longer. –These households are consumers of high‐end merchandise from home furnishings gto fashion to electronics. –They also tend to enjoy eating out, diidattending entertainment venues, and participating in sporting activities for exercise. FountainHillsWorkerMarketSegmentFountain Hills Worker Market SegmentFountain Hills Town Center Four Peaks MTA MTA Workers 1 5,288 7,676 8,516DailyExpenditureperworker$6$6$6Daily Expenditure per worker$6 $6 $6 Total Daily Expenditures $31,728 $46,056 $51,096 Total Annual Expenditures $8,249,280 $11,974,560 $13,284,960 •There are 5,288 workers employed within Fountain Hills•65.2% of those workers commute into Fountain Hills•29.5% of the workers earn $40,000 or more.11 US Census Bureau, LED Origin‐Destination Data Base 2006 Consumer Spending and dkTrade Leakage2008 2013Total Expenditures $616,642,700 $683,388,446 Actual Sales $173,187,141 $191,364,048 TradeLeakage$443 455 559$492 024 397Trade Leakage$443,455,559 $492,024,397 Leakage per HH $45,515 $46,962 Source: Town of Fountain Hills 2009; AGS; Consumer Expenditure Survey, U.S. Dept of Labor, Bureau of Labor Statistics, 2005‐2006;US Census 2000; ESI Corp SquareFeetRetailDemandSquare Feet Retail DemandFountain Town Center Four Peaks Target Hills MTA MTA Total Square Feet in all Categories 974,894 1,317,709 1,536,588Potential Targets:gApparel 139,163 188,099 219,344Building, Lawn and Garden 103,904 140,441 163,769Sporting Goods 18,035 24,377 28,426Furniture and Floor Coverings 86,412 116,798 136,199Restaurants and Taverns 147,552 199,437 232,565 RetailTargetsRetail Targets•Retail targets within the six gcategories were identified utilizing the following screeningfactors:Retail Category Number of TargetsApparel33screening factors:–Plans to expand specifically in the State of Apparel 33Building, Lawn and Garden 5Entertainment 8Sporting Goods 3Arizona–Preferred locations DemographicsFurniture and Floor Coverings 18Restaurants and Taverns 25–Demographics–Population density–Other qualitative factorsq ConclusionsConclusions•FountainHillsisloosingsignificantsalestaxFountain Hills is loosing significant sales tax revenue due to leakage.•ThedemographicsofFountainHillsandthetradeThe demographics of Fountain Hills and the trade area indicate a very affluent community.•EmployeesthatcommuteintoFountainHillsare•Employees that commute into Fountain Hills are also potential customers with significant spendingpotential.spending potential.•The high income levels within the trade area will beakeyfactorwhenrecruitingretailoperationsbe a key factor when recruiting retail operations. An Introduction Starting with the results citizens want, not the programs that have always been funded and last year’s spending –but with outcomes that matter most to the public. Traditional budgeting begins with the question “How much will it cost to keep doing what we’ve been doing in the way we have always done it with the results we have always gotten?” There exists only so much taxpayer tolerance associated with providing government services. We call this the price of government. For the last 50 years Americans have committed the equivalent of 35 to 37 cents of every dollar of annual personal income to buy services from their local, state, and federal governments. 0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 1972197419761978198019821984198619881990199219941996199820002002Total: federal, state, local 0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 1972197419761978198019821984198619881990199219941996199820002002Total Federal State Local Get a grip (Is this budgetary condition temporary / cyclical or permanent?) Set the price of government (Accept and embrace the realities of what citizens are willing to pay.) Set the priorities of government Allocate available resources across priorities Develop a purchasing plan for each result (What are the factors that will deliver the desired outcomes?) Strategic Focus Council Prioritized Outcomes Departmental Budget Proposals Based on Desired Outcomes Budget Implementation and Service Delivery Evaluation, Reporting, and Realignment Economic Update October 8, 2009 Prepared by: Julie A. Ghetti, MPA, CPA October 8, 2009 Operating Funds: General Fund Restricted (special purpose) Funds:Highway User (HURF) Fund -StreetsSpecial Revenue FundsDowntown Excise Tax FundDebt Service FundsCapital Project FundsPublic Art Fund October 8, 2009 October 8, 2009 Total $14.7M Public Safety (police, fire)$5.9M Administrative $3.1M Public Works $1.4M Parks, Recreation $1.7M Planning, Building Safety $1.1M Community Center, Seniors $1.0M October 8, 2009 October 8, 2009 October 8, 2009 Sales tax from construction is projected to decline throughout the remainder of this fiscal year As projected, retail sales activity has declined but at a much slower rate than construction Construction economy continues to be weak, there were only 2 new residential building permits for the first three months of this fiscal year State Income Tax will be $900K less next fiscal year Building permits from the Ellman property unlikely before 2015 October 8, 2009 Town continues to “proceed with caution” before approving expenditures Research and analysis on privatization versus in-house and vice versa Big question marks are State sales tax and building permit activity Mid year adjustments may have to be made Anticipate annual threat of legislature grabbing a portion of State Shared Revenues October 8, 2009 October 8, 2009 Current Year *Conditioned on development of Ellman properties HURF (Highway User Revenue)$1.6M Excise Tax (Economic Development)$0.4M Grants $2.6M Debt Service $3.3M Development Fees $0.1M October 8, 2009 Funded by construction sales tax Balance on July 1, 2009 was $10.4M Anticipated revenue FY10 is $510,000 Stimulus or grants revenue FY is $5.5M Current year projects budgeted at $12.7M October 8, 2009 The economic slowdown gives us the opportunity to re-engineer ourselves for more efficiency and better service We need to continue reducing operating costs while minimizing the effect on the citizens Continue to monitor expenditures to ensure that there are sufficient current year revenues to pay for expenses October 8, 2009 Questions? October 8, 2009 October 8, 2009 100 19 8 18 7 11 10 11 14 2 #1 #2 #3 #4 #5 #6 #7 #8 #9 19 Town Character and Infrastructure: I want to maintain our town and quality character Examples: roads, parks, downtown 8 Examples: dust control, carbon footprint, energy usage 18 Public Safety: I want a safe community with a low crime rate Examples: Block watch, drug coalitions 7 Culture: I want public art and cultural events Examples: Ballet Under the Stars, monuments, 11 Recreational Opportunities: I want programs for youth and teens, seniors Examples: hiking and bike trails, recreational programming and classes, 10 Education and Learning: I want lifespan learning opportunities Examples: Mentoring programs, Town Academy, job training 11 Health and Welfare: I want a healthy and happy population 14 Economic Vitality: I want a healthy, growing economy 2 Other: Examples: Community College, job training 100 TOTAL Examples: zoning, business licenses and permitting, tourism promotion, taxing/fee structure, small business incubator Focus Area Environmental Sustainability: I want clean air and water, and to live in balance with the flora and fauna of our desert environment. Examples: health fair, community fitness/health initiatives, health screening, pedestrian-friendly infrastructure Customer Service Enhancement Proposal October 8, 2009 Prepared by: Julie A. Ghetti, MPA, CPA October 8, 2009 How do we make the main entry to Town Hall more customer service oriented? How can we enhance the experience for citizens coming to Town Hall? October 8, 2009 Encourage volunteers to reach out to Town Hall visitors Use of kiosks for citizens to make inquiries, get information Relocate customer service representatives from second floor to main floor reception October 8, 2009 October 8, 2009 Pros Cons Volunteers serve as first impression to visitors, serve as greeters and give directional information Volunteers are not always available four days a week Volunteers are a valued service to the Town Some volunteers like to be kept busy, others like to just be greeters; tasks are difficult to assign to rotating individuals Cost is $0 October 8, 2009 Pros Cons An interactive kiosk on the main floor would allow citizens to register for programs, apply for a license or job, etc. Licensing, program registrations and other financial transactions would remain on second floor Volunteers would still be needed to greet visitors and give directions Customer service minimally enhanced Cost for a terminal approximately $2,500 October 8, 2009 Pros Cons Customers would be able to transact business right when they entered Town Hall,such as Town information, purchasing dog tags, business licensing, program registration, any Town business Existing staff would be relocated to the main floor to back up Customer Service reception Volunteers would be utilized on both the main floor and second floor Minor renovations would be required to accommodate backup for Customer Service during busy times. Cost approximately $15,000 October 8, 2009 Questions? October 8, 2009