C-A-L Ranch’s decision to expand into the Carson City market despite the city’s unemployment rate of 11.8 percent in June points to the underlying health of the retail market in the state’s capital.
C-A-L Ranch invested more than $1 million to renovate and stock the former Safeway location at 2035 N. Carson Street in preparation for its early May opening, says Dill Bunker, vice president of operations for the Idaho Falls-based retailer.
The store employs 28 with four managers.
Several factors point to the underlying strength of the retail market in Carson City, including the opening of C-A-L Ranch, and the entrance of national chains such as Olive Garden, Big Lots! Burlington Coat Factory and Johnny Rocket’s.
Retailers such as Auto Zone are making fresh investments into market, and Michael Hohl Motor Company also made significant investment in two new facilities.
Dick Campagni built a new Toyota facility, and the extensive renovation of Carson Lanes bowling center also brought four new retail spaces to the market.
Other national retailers are looking at Carson City as well, notes Brad Bonkowski, principal at Coldwell Banker Commercial Premier Brokers.
Bonkowski says retail in Carson City is on a slow and steady track an improvement from the depths of the recession, when retailers big and small were folding on a regular basis.
“It is not on fire, but it is not completely stagnant,” Bonkowski says. “I’m cautiously optimistic that we will keep filling up the stores and we won’t have too many more leave or close down.”
Despite new entries into the retail landscape, the overall retail vacancy rate remains high at roughly 16 to 17 percent, says John Uhart of Uhart Commercial Real Estate Services.
New retailers have been offset by the departure of small mom-n-pop shops leaving the market or closing their doors. Some big holes were left by the closure of regional department store chains Mervyns and Gottschalks in the early days of the recession.
There is roughly 4 million square feet of retail space in Carson City. The average full-service rent ranges from about 98 cents to $2.50 per square foot.
Uhart says inquiries for retail space have picked up over the last 90 days.
“It is a good indication we are getting more calls for retail-type uses, so that is very encouraging,” he says.
Ronni Hannaman, executive director of the Carson City Chamber of Commerce, says that well-researched decisions by national retailers show that the Carson City retail market remains a healthy and attractive place to do business.
“The fact that we have a national restaurant chain (Olive Garden) coming into Carson City bodes very well,” Hannaman says.
Hannaman notes the benefits of C-A-L Ranch are particularly noteworthy because nearly everything it sells generates sales tax revenue, unlike Safeway, which didn’t generate sales tax on its food items.
Two things spurred C-A-L Ranch’s decision to expand into Carson City: Its Elko store, the first Nevada location for C-A-L Ranch, has recorded terrific sales numbers in the three years it’s been open. Second, there is a fairly significant agricultural industry south of Carson City that the company hopes to attract to its newest store.
“After looking at the population of Carson City and the amount of agriculture that takes place albeit a little south, we felt it would be a good place for us to put in a store and do some business,” Bunker says. “That (Gardnerville/Minden) market we felt we would be able to attract to Carson City because the distance isn’t so great, and most of them already come to Carson City to shop.
“By positioning ourselves where we did, we hope to attract the South Reno market as well,” Bunker adds.
The newest C-A-L Ranch store hasn’t hit the high sales projections the company envisioned, Bunker says, but it has performed well within established revenue targets. C-A-L Ranch formerly specialized in sales of agricultural products, but its business has shifted to sporting goods, firearms, camping, fishing, work wear and footwear.
“We are a real presence in every market we go to,” Bunker says. “We are still a little bit concerned about the county’s unemployment rate, but what we have found is that our stores, when the overall economy is doing well our stores do well right along with it because we have what people want. When times get tough we still do well because we have what people need. We take care of folks on both ends and it works out pretty well for us.”
Sales have been strongest at middle-range and low-cost retailers such as Walmart and Ross, Bonkowski says. High-end retailers are not faring as well.
Similarly, while much of the restaurant industry is struggling, low-cost offerings such as pizza parlors are doing great business, he says.
Per the agreement, Caesars will continue to operate Harrah’s for the first half of 2020 before it’s redeveloped into a non-gaming hotel and mixed-use development.