Trader Joe’s? Topgolf? Officials aim to lure new shopping options to the Roanoke Valley

Roanoke-area residents looking for more grocery stores, restaurants and other retail options could get a boost from a new regional collaboration.

Roanoke County, on behalf of the economic development authorities of Roanoke, Roanoke County and Salem, is advertising to hire a consultant to “provide a retail analysis and to develop and implement a retail recruitment plan” for the three localities.

Regional economic development officials say they hope a data-driven study of the Roanoke region’s retail customer base, combined with local knowledge about the community, will bring in new shopping options.

“A big part of it is understanding what our retail options look like, whether there are some existing underutilized buildings or some corridors that have vacant land that could be basically a good fit for what identified retailers could locate in those spaces,” said Tommy Miller, Salem’s economic development director.

The analysis will particularly focus on the Roanoke metro area’s commercial corridors of Electric Road/Virginia 419, Williamson Road and U.S. 11/U.S. 460, according to the project’s request for proposals, which closes at the end of this month.

“It is anticipated that attracting retail to these corridors will elevate the community as a regional shopping and dining destination, which benefits all of the localities engaged in the study,” the RFP states.

The economic development directors in Roanoke, Roanoke County and Salem are relatively new to their positions. Megan Baker arrived in Roanoke County about a year ago and Miller about a year and a half ago, and Marc Nelson has been Roanoke’s economic development director for about two years, although he’s been with the city for about a dozen.

While it’s a new idea for these three localities to work together on the retail analysis, Baker said she’s seen it done before in Georgia, where she previously worked, and that inspired her to pitch it to Salem and Roanoke.

“Roanoke city, the county and the city of Salem have all come together, and so we’re working on our major commercial corridors together. Granted, I love when things come to Roanoke County, but we’re not focused as much on where the line between Electric Road and Franklin Road is,” Baker said, referring to the border between Roanoke and Roanoke County. “We’re more looking at it from a holistic point of view.”

Retail recruitment can be a ‘long game’

The study’s cost is estimated at approximately $60,000 per year for three years, with Roanoke County and the city of Roanoke each paying 44% and Salem paying 12% because of their respective population sizes, Baker said.

“It really takes a good three years because nothing moves quickly,” she said. “We’ve had conversations with retailers who say, ‘Well, we’re looking at your market. You haven’t made the short list yet, so it might be a couple years.’ Getting to those right people, finding the right site for the retailer, it does take time. I would say that economic development, retail recruitment, it is a long game.”

Once hired, the analyst likely will spend about four or five months gathering data on demographics and shopping patterns, Baker said.

“They look at demographics, they look at where shoppers are pulling from, where are the retail leakages, where people are going to shop and just understanding what is our customer base, what is the potential customer base to stop the leakage to Charlottesville and Greensboro,” she said.

The analyst will then develop marketing materials, attend shopping conferences and reach out to prospective retailers.

“It’s really going to help us tell our story,” Baker said.

Officials say the work will benefit the entire Roanoke region. Roanoke, Roanoke County and Salem have more than 220,000 residents combined. When nearby Botetourt, Craig and Franklin counties are also included to round out the federally defined Roanoke metropolitan statistical area, the population rises to more than 310,000.

“Obviously if you put a grocery store in Salem or a unique retail offering in the Glenvar region or Cave Spring, it’s not just going to benefit the Cave Spring residents, it’s not just going to benefit the Salem residents, it’s something that is going to be for the whole region,” Miller said.

While the study will look at attracting large, well-known businesses, having the retail analysis in hand could also help make the case for the Roanoke region to smaller retailers that might not have their own research teams, he said.

“The public wants new retail options that they’ve experienced elsewhere,” Miller said. “But maybe there’s some really interesting, smaller unknown retailers that haven’t looked at this market that we’re not even really aware of. So hopefully it’ll bring to light some other options that aren’t on the table that could really be a big benefit.”

What do retailers want?

In addition to third-party consultants such as the one the local government collaboration hopes to hire, private developers play an important role in bringing in new retail.

“A lot of times when you see retailers come in, the developer or shopping center or a particular place, they’re the ones who form the relationship with a retailer and bring them in,” Nelson said.

Retailers conduct their own research, too, looking at a variety of metrics when deciding whether to open a new location in a particular area.

“Retailers typically operate by way of evaluation of demographic models,” said John Hull, executive director of the Roanoke Regional Partnership, a regional economic development organization.

Hull said each retailer’s model is different and looks at “who their customer is, how their customer behaves, what types of communities they live in, income levels, education levels, population centers and growth rates and commuting patterns.”

Some retailers have specific needs — for example, an indoor trampoline park likely would want to know how many children in its target age range live near a proposed location.

“They’re fairly sophisticated models,” Hull said.

Retailers evaluate potential markets not just from a demographic standpoint but also a competitive standpoint, Hull said: “Are there other operators that are already in that segment or that retail type who are in essence serving that portion of the market?”

The Roanoke area has an advantage in that department, said Matt Miller, the partnership’s director of market intelligence.

“I don’t want to use the term ‘isolated,’ but we are three hours from Richmond and two hours from Greensboro. So sometimes the competition for a single retailer is pretty far away,” he said.

Selection criteria are often trade secrets

When it comes to exactly what factors they use to choose a new location, retailers often keep those cards close to their vests.

“The problem is we often never know what criteria they are using. We don’t know if it’s a 30-minute drive, or 60-minute drive, or people that earn over $100,000,” Matt Miller said. “A lot of that stuff is proprietary and we never see that.”

Nelson, of Roanoke, named three stores as examples of businesses that often come up in conversations about which retail businesses area residents would like to see: Trader Joe’s, Whole Foods Market and Topgolf.

“Retail is one of those things that everybody here always asks about,” Nelson said.

Cardinal News contacted those three companies, asking if they had locations planned for the Roanoke area and how, in general, they choose where to locate new stores.

Whole Foods Market — an Austin, Texas-based grocery chain owned by Amazon that has more than 500 stores, including in Charlottesville, the Richmond area, Newport News and Northern Virginia — did not respond.

Trader Joe’s is a Monrovia, California-based chain of “neighborhood” grocery stores with more than 500 locations. It has stores in Richmond, Northern Virginia, Charlottesville, Newport News, Virginia Beach and Williamsburg — but not in Roanoke or anywhere in Southwest or Southside Virginia.

Trader Joe’s spokesperson Nakia Rohde said the grocery retailer is “actively looking at hundreds of neighborhoods across the country as we hope to open more new neighborhood stores each year.”

“At this time, we do not have a location confirmed in Roanoke,” Rohde said.

For details about how and why Trader Joe’s chooses a particular location, Rohde pointed to the company’s podcast, specifically Episode 52: “How to Make a Trader Joe’s (Part One).”

In that podcast episode, company employees offer few concrete details about the selection process but note that only about one in 10 sites considered ends up becoming an actual store.

“We can’t open every store that we’d like to open. Not all at once, certainly,” Matt Sloan, Trader Joe’s vice president of marketing, says on the podcast. “And yet we’re definitely a growth-oriented company.”

Topgolf is a Dallas-based “golf entertainment complex” that features hitting bays rented by the hour, virtual golf games, food, drinks and music. It has more than 90 locations worldwide, including in Richmond, Virginia Beach and the Washington area.

“We don’t have any information about a Topgolf venue opening in Roanoke, Virginia but we’re always exploring new opportunities,” the company said in an email.

Topgolf declined to provide details on the company’s site selection process: “Unfortunately, we are going to have to pass on this.”

Local knowledge can supplement data

While each retailer has its own model of evaluating demographics and other factors it considers, local economic developers communicate information to prospective businesses that might not be immediately apparent from those models, Hull said.

For example, he said, the Roanoke region could be considered unusual among markets of similar size because of its proximity to other metro areas and the fact that it draws students from numerous colleges and universities.

Local officials also can fill in retailers about projects that are planned but have yet to come to fruition, such as an expansion by Wells Fargo that’s slated to bring 1,100 more jobs to its Roanoke County support center.

“It would probably be very difficult for a retail company or developer who is out of market to really understand the impact of the Wells Fargo project on any given submarket,” Hull said, referring to smaller geographic markets within the larger Roanoke metro area.

Hull said he thinks the three local governments are wise to collaborate on the retail analysis.

“Retail diversity is a quality-of-life concern,” he said. “It matters when it comes to talent attraction and recruitment and talent retention. We need to be very intentional as a region in terms of building the product — and by product, I mean our livability product — to be as attractive as we can possibly be.”