Greystone Management Solutions CEO Charles Di Maggio was quoted by the International Council of Shopping Centers in their article entitled “There’s a lot more retail in today’s transit stations.”
An excerpt is below:
Even transit agencies that have long barred retail activity are now reconsidering, to help balance strained budgets, according to Charles Di Maggio, head of U.S. leasing for New York City–based Greystone Management Solutions and a specialist in transit-station concessions. With some exceptions, transit systems do not lease space by direct brokerage, instead using public RFPs (request-for-proposals), he notes. This “involves a paper-heavy proposal process and thorough vetting,” said Di Maggio, who has worked with transit authorities in Atlanta, Boston, New York and other cities and in New Jersey.
Public-private partnerships between transit districts and developers or advisers seem to create the best tenant mixes, Di Maggio says. Third-party managers such as JLL, which redeveloped the huge retail component at Washington, D.C.’s Union Station and manages retail in the Bay Area Rapid Transit system, in the San Francisco region, often assist transit authorities in their vending programs, he says. One challenge for transit retailers is to match retail and restaurant programs with transit-user consumer profiles. “Retailers need to know whether to target customers that have time to browse and impulse-buy, or to target the harried commuter with necessity buys directly related to the commute,” said Di Maggio. Where rider dwell time is limited, the most successful concepts provide convenience items and grab-and-go foods, he points out.
A common mistake retailers make is to compare their portfolios’ airport location sales — where passenger dwell time averages 137 minutes, according to U.K.-based Nigel Dolby Consulting — with projected sales at transit hubs, says Di Maggio. “Dwell time at train and bus facilities is frequently measured in seconds,” he said. On average, airport passengers spend roughly $9 per trip on purchases, as compared with less than $3 for commuter-rail passengers, he observes.
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