How cool are the streets running through your neighborhood? If you live or do business from Minneapolis’ North Loop neighborhood, those streets might be very cool — or hip, if you prefer — indeed.
Cushman & Wakefield recently released its Cool Streets of North America report. The report looks behind the rise of the dozens of new edgy retail districts across the United States and Canada. Many of the neighborhoods featured in the report have long been known as cool.
But others, including the North Loop neighborhood in the Twin Cities, are relatively new to the world of cool.
The North Loop is listed as one of the top Cool Streets neighborhoods. Other neighborhoods on the list are Sunset Park in Brooklyn; Logan Square in Chicago; Over-the-Rhine in Cincinnati; RiNo in Denver; Silver Lake in Los Angeles; Wynwood in Miami; Roosevelt Row in Phoenix; Carytown in Richmond, Virginia; East Village in San Diego; Jackson Square in San Francisco; West Queen West in Toronto; Mount Pleasant/Main in Vancouver; and Shaw in Washington, D.C.
What makes the North Loop so cool, according to Cushman & Wakefield? First, Millennials make up 34 percent of the population in the neighborhood. It helps, too, that the residents living here have some disposable income to spend, with Cushman & Wakefield reporting that the average household income in the North Loop area is a solid $61,767. Finally, rental rates for retail locations here are in the basic range of $18 to $42 a square foot, meaning that alternative, unconventional retail concepts can locate here without going broke.
Garrick Brown, vice president of retail research at Cushman & Wakefield, said that Cool Streets serve as incubators for what might become some of the hottest new retail concepts.
“If retailers live and die by cool, the same also holds true of retail properties, shopping centers and neighborhoods,” Brown said in a statement. “And in an age of frugality, e-commerce encroachment and vast gaps in shopping center performance, cool matters now more than ever.”
In roughly half of the Cool Streets markets that Cushman & Wakefield studied, restaurant concepts outnumbered actual retail businesses by a ratio of two-to-one. In Cincinnati’s Over-the-Rhine neighborhood, for example, craft brewing is the driver behind the area’s resurgence.
“Independent retailers remain the heart and soul of the Cool Street phenomenon,” Brown said. “Small chains, start-ups and little guys are those most thriving in those locations, and this is largely driven by rents.”
The retail rents in Cool Streets neighborhoods generally stand at about 55 percent of the average asking rate of the nearest Class-A mall or high-street shopping district, Brown said.
What will happen to these Cool Streets neighborhoods in the future? Cushman & Wakefield says that mainstream retailers, especially struggling mall apparel concepts, will begin moving into these neighborhoods as a way to appeal to new customers and take advantage of lower rents.
Of course, that might change the character of these neighborhoods, lowering their cool status.