Despite the economy, there are new developments in our region. There are even success stories - but the people who are telling them are employing different strategies than what's worked on auto pilot for the past several decades.
Retail and commercial real estate are evolving in our changing region, and the next few pages take a look at where it's going. Development companies, like other businesses, have had to diversify to stay strong. Turn the page for more.
Shopping for New Strategies
Retail developments can remain successful in a sluggish economy with the right tactics
Few in this country have suffered through the slings and arrows of the current economic crisis the way developers in Southeastern Michigan have suffered.
However, they have found a multitude of ways to ride out the current storm and are looking to the second half of next year as the turning point in the nation's economic recovery.
"I expect we'll be back in the second half of 2010, perhaps as late as the first quarter of 2011," said Nathan Forbes, managing partner of Forbes Co. In the meantime, Forbes and other developers are using different methods to slog ahead.
Many are simply delaying or getting out of projects that just don't make sense in the current climate. Forbes has put projects on the backburner in Michigan and Florida because bank financing for the projects was not available, and it wasn't prudent to expend his company's financial resources to push forward.
Others realize the cyclical nature of the beast and have been bolstering their balance sheets for some time knowing these economic dog days would arrive at some point. That point is now.
"Any company that survives a downturn like this must have a good balance sheet," said Robert Taubman, chairman, president and CEO of Taubman Centers Inc. "We entered it in very good shape."
Part of that focus on the balance sheet is effectively managing costs, working with tenants and, unfortunately, cutting back employee rolls to manageable levels. All of the developers interviewed for this piece said they have reduced their workforce.
Perhaps the best way to ensure survival in tough times is to rally the troops, so to speak. Having strong retailers in commercial developments is the best way to keep the developments viable. While this sounds like a big helping of common sense, it's not as simple as it sounds, according to several developers.
Many are working with their tenants who aren't generating enough revenue to meet...