Above: Anjee Solanki, Head of Retail U.S. for Colliers, left, leads a discussion on diversity, equity and inclusion in the retail industry during ICSC Monterey on Feb. 28, 2023. Participating, left to right, are Carmelita Botelho, Vice President of Real Estate for Grocery Outlet; James Chung, Founder and Principal at The Econic Company; and Grace Yang, Vice President of Retail at CenterCal Properties. 

 By Nathan Donato-Weinstein

When the International Council of Shopping Centers began meeting annually in Monterey, Calif., back in more than 30 years ago, Walmart had just overtaken Sears as the largest retailer in the world. Jeff Bezos had just graduated from college. Starbucks had fewer than 100 stores.

Fast forward, and a lot has changed. But the need for industry players to connect, exchange ideas and information, and maybe even sign a lease or two remains the same.

ICSC, the trade association also known as “Innovating Commerce Serving Communities,” brought together hundreds of professionals for two days of conferencing and deal-making on Feb. 28 and March 1. Once again, staff from the Office of Economic Development and Cultural Affairs was there to glean industry insights, promote San José as a good place to do business, and share information about San Jose retail opportunities.

Retail is critical for cities because it provides needed services for residents, enlivens neighborhoods, provides jobs, and generates city revenue through taxes. In San José, nine of the City’s top 25 sales-tax payers are retailers (not including gas station chains), and approximately 55,000 people work within the sector.

But retail is always changing – with some brands and concepts going the way of Sears in recent years. In December, San José was impacted alongside many other cities by the closure of a Bed Bath & Beyond at 5353 Almaden Expressway as the one-time housewares giant teetered on the brink of bankruptcy. But overall, the City’s retail vacancy is relatively small, at about 6%, according to the CoStar real estate information service, though some neighborhoods are higher.

At the ICSC Monterey event, the vibe was generally upbeat, with attendance approaching pre-pandemic levels. Yes, new retail construction is expected to remain subdued nationally thanks to higher interest rates. But leasing demand is relatively strong – especially in grocery-anchored centers, said John McNellis, an author, lecturer and partner with the development firm McNellis Partners, during a panel discussion. During the ever-popular Retailer Runway event, more than a dozen companies presented growth plans – including San Jose’s own South Winchester BBQ, part of the growing family-owned Real Smoked BBQ chain. Child-care-related, food and health/personal care tenants were featured.

San José is generally on growing retailers’ location shopping list because of our huge population, diverse demographics, strong income profile and desirable location in the Bay Area. The City has also birthed several storied chains, including Orchard Supply Hardware and Shoe Palace.

In 2019, the San José City Council approved a Citywide Retail Strategy and a Downtown Retail Strategy to provide a roadmap for ensuring our retail sector remains strong and relevant heading into the 2020s. This came after a North San José retail strategy that was completed 2017. While times have changed, much of the information is still relevant. You can read more about the City’s retail climate in the Council memo.

If you have any questions, please reach out to nathan.donato-weinstein@sanjoseca.gov.