VOL. 127 | NO. 187 | Tuesday, September 25, 2012
New Panera Underscores Midtown’s ‘Tipping Point’
By Sarah Baker
Panera Bread Co. is coming to one of Midtown’s busiest streets following years of site selection in the area.
Panera Bread has plans for its first Midtown store to be built along Union Avenue. It will be the eighth store in the Mid-South.
(Photo Courtesy of Panera Bread Co.)
The St. Louis-based fast-casual sandwich franchise plans to open in the 4,588-square-foot, freestanding space that is currently a Pizza Hut at 1961 Union Ave. by early May.
Rick Postle, who owns Panera franchise rights to the Memphis area along with his wife, Rosemary, under the entity Delta Dough Inc., said Panera’s new Midtown store will not only fill unmet demand in the area but will be the first location in West Tennessee with a drive-thru.
“We’ve been looking in Midtown for several years – we’ve looked at everything up and down Union that’s ever become available,” Postle said. “For the Midtown section of Memphis, it actually has pretty good parking, and then of course having the opportunity to add the drive-thru window made this what we thought was a really excellent site.”
Saratoga Springs, N.Y.-based Conboy & Mannion Contracting Inc. recently filed a $600,000 building permit for renovations of the space, according to The Daily News Online, www.memphisdailynews.com. Pizza Hut will soon relocate to a 1,200-square-foot, take-out-only space a few blocks west in Loeb Properties Inc.’s Belvedere Collection.
Postle said the entire build-out, including rework on the building, interior layouts and equipment, and signage will top $1 million. The store will create more than 50 jobs.
The location will mark Delta Dough’s eighth Panera store in the Mid-South, a market it entered four years ago. Danny Buring and John Reed with The Shopping Center Group LLC represent Panera in the area.
Postle, who started Panera’s franchising business in 2004 and also owns 11 stores in Virginia, said the Memphis area can handle another four or five locations. But whenever a certain market seems like its saturation level has tapped out, Panera finds new ways to penetrate it even more deeply, Postle said.
“For example, when I first started at Panera in St. Louis, our home market, we had one Panera for every probably 120,000 people,” Postle said. “Now, Panera has discovered that they actually can build an average of one Panera for every 60,000 people. So there just continues to be more and more opportunities.”
Panera looks for three main criteria during its site selection: traffic counts, residential population and its demographics, and daytime population.
“Panera operates breakfast, lunch and dinner seven days a week, so you need residential population to drive your weekends and your evening business, and you want your daytime population to drive your breakfast and your lunch business,” Postle said. “And then the traffic count all day long helps us fill in, we call it the ‘chill periods.’ In a way, we have five different day parts.”
Alex Turley with CB Richard Ellis Memphis represented property owner Henry M. Turley in lease negotiations. He said that Midtown has reached a “tipping point,” especially along Union.
“Really in the last 90 to 120 days, you’re just really starting to see a massive amount of activity,” Alex Turley said. “There’s definitely demand.”
Alex Turley also placed Five Guys Burgers and Fries in its space that’s currently under construction at 2100 Union, as well as Chiwawa Restaurant in the old Chicago Pizza Factory at 2059 Madison Ave. – two outlying restaurants of the soon-to-be redeveloped Overton Square.
The head of CBRE’s retail division was also just awarded the listing of 1520 Union, where the U.S. Post Office relocated from earlier this year.
Then there’s Kroger in between South Idlewild and Lemaster streets, which has recently acquired property for expansion. Not to mention Memphis Police Department’s soon-to-be vacated space at 1925 Union, which is promising for future retail development.
“A lot of retailers want to be in Midtown, it’s just a matter of finding space or property that can accommodate their business,” Turley said.