After more than a year of pandemic-related restrictions, consumers have welcomed the gradual reopening of the economy. Restaurants and movie theaters have experienced an influx of patrons, and many retailers are enjoying increased foot traffic. Perhaps the last sector positioned to benefit from pent-up demand is live entertainment. Various sports stadiums have come back, some at full capacity, and the next iteration of the reopening will be outdoor concerts, followed by indoor live music venues. With artists eager to return onstage in front of an audience and people yearning for that unique performance experience, the prospects for strong concert seasons later this year and next year are good.
While the audience can’t wait for the opportunity to attend concerts, retail investors and owners may also have opportunities to capitalize on that demand.
Successful brick-and-mortar retail developments have shifted to focus on creating an experience and providing services that cannot be replicated online. With many centers facing significant vacancies, owners have sought to backfill these spaces with entertainment options that drive traffic to their properties. Concert and live music venues should not be overlooked, as they can be a powerful tool for creating meaningful and consistent traffic to an underperforming or redeveloped center. Additionally, live music events draw from a larger trade area than conventional retail, restaurant and entertainment uses, thereby introducing new customers to the property.
Fit Sizes for Purpose
Music venues enjoy a key advantage: A sizeable venue can fit within the flow of a mall or retail center. A vacant department store can range from 30,000 to 70,000 square feet. This box can be repurposed, or the pad can be redeveloped, to provide a live music venue that can sit 2,000-3,000 concertgoers. That size can even be increased if several boxes are put together. This number represents a large enough venue to draw national touring artists and promote concerts that would have broad appeal.
Expand Trade Zone
Offering unique events like concerts instantly expands a center’s trade area. In some cases, retail centers have tripled their trade area on days when concerts are taking place. These concertgoers will drive the extra miles to see an artist or performer they admire. What’s more, data shows that many of them don’t just drive in and out for the concert. They will dine at the retail center, stop by a bar after the show, and even stay at hotels on site or nearby. Live music can be a real boon to broaden a center’s appeal.
Of course, repurposing a retail asset into a venue is not always a “build it and they will come” scenario. Some factors need to be considered when exploring the option of a live-music venue.
Three main criteria must be met to have a successful venue:
- Transportation Access. A center must be able to accommodate transportation and parking for potentially thousands of concertgoers. However, beyond attendees, the center has to be able to accommodate the artist’s production requirements. Working with a big band or a national artist who provides a significant stage show could entail several large trucks with equipment, instruments, crew members and other necessary items for the artist. The trucks will require direct access to the venue, making the staging and set-up as easy as possible. This route needs to be thought out to provide the best access for the production, while limiting disturbance to other retailers and shoppers in the venue.
- Talent Friendly. First and foremost, artists want to be able to draw a good crowd and fill a room with a sold-out show. However, if they have several options for venues in a given radius, the performer will likely choose the location that provides the best experience for the talent. Many times, the artist’s booking agent must approve the venue before bringing a proposal to their client. Does the building have good acoustics and state of the art audio/visual/ production equipment? Is the backstage area welcoming? Do nearby hospitality options meet the artist’s needs, such as fine dining, after-hours locations and quality hotels? All of these factors matter. Even for smaller venues, some major artists like to do intimate shows. A center could miss out on an incredible opportunity if the venue does not cater properly to talent.
- Location. This is the classic real estate story. A concert venue doesn’t fit into every location. Adding a stop to a national tour has to make sense for the artist economically. They may not want to divert their equipment and support crew away from the established route for one or two shows, which could create transportation and logistics challenges. A center located near a major interstate or along a national transportation corridor will have an advantage, and many secondary and tertiary markets fit this requirement. For example, an artist may have a show in Atlanta and then New Orleans. A venue in a secondary market situated between these major market cities on an interstate offers an opportunity for the artist to stop with little hassle and fit in an extra show. To be a successful venue, a center’s logistics have to work.
The future is bright for live music, and the sector will present more opportunities to capitalize on this demand as retail centers look for new ways to draw consumers. With all of these factors in mind, partnering with the right concert operator is the safest and smartest way to go, and several national concert operators look for these opportunities. If the center location proves to be the right fit, live venues should be a top consideration for retail owners moving forward.