Spencer Riverfront Plan

FIGURE 1: Historic flows of Little Sioux River

MARKET REVIEW

SUMMARY • Spencer’s population is stable. A future growth of 0.5% annually means the population will continue to age. Services for older populations can be an opportunity to create accessible environments. Unique quality of life amenities should be targeted to attract people. • Business Establishments. Spencer serves as a local hub for daily convenience items and services for the surrounding market areas. About 57% of business within the total market area are located within the primary market area of Spencer. Retail trade and services account for the largest share of all business establishments in the market, roughly 33%. The secondary market area beyond Spencer shifts to more agricultural-based businesses. • Consumer Spending. Overall consumers spend less than the national average on nearly all products and services, which is typical in the Midwest. Households outside of Spencer spend less on entertainment and recreation, including concerts, theaters, parks, recreational clubs, and sporting events. However, all households spend more for items to recreate elsewhere – recreational vehicles and equipment. Households spend only slightly more on food at home than food away from home. This could mean a lack of options nearby or a preference to save money to spend on other discretionary items. • Retail Sales. The primary market imports dollars, or in other words attract people from outside of city to spend money. The primary market captures 85% of retail sales in the market area, whereas the secondary market captures 15%. The total market area imports dollars, but has a much smaller surplus than the primary market with more industries seeing a gap – there is less spending than anticipated based on population. This means more people in the secondary market

are choosing locations other than Spencer more often to purchase these products. Retail sales when including this area in the total market is $792 million, a surplus of nearly $135 million over projected spending, compared to $6 million when excluded. The level of retail and service spending in these areas creates competition for several types of businesses in Spencer. Industries that have a gap in the original market area, but a surplus when the Okoboji area is included indicates a larger draw to go north for these purchases rather than Spencer. The goal should be to attract a portion of this tourist surplus spending to Spencer. Also, retail establishments should be concentrated in downtown. »» Spencer serves the rural region as a business and employment hub. Retail trade and services account for the largest share of businesses in the market area. Spencer can capitalize on returning visitors to attract them to new amenities in downtown and along the riverfront. »» Consumers in the market area spend less on almost all retail and restaurant categories than the national average. This can indicate a lack of opportunities for these categories. In addition, consumers spend relatively more on recreation equipment (perhaps bicycles, fishing, water activities, etc.) and pets, indicating a desire to seek outdoor leisure opportunities. »» Spencer imports dollars over what the local population can be expected to spend at local retailers. Spencer’s market area sees a leakage of spending for food and drink establishments. Further analysis shows that people in the surrounding area may go elsewhere for specialty food and drink purchases. Providing a variety of restaurant and unique food store options in Spencer can be an opportunity to capture spending from the surrounding area.

The market analysis considers population, demographic, retail spending, and housing characteristics for the City of Spencer. It examines commercial and residential possibilities, and identifies development potentials for the city and riverfront. This summary of the 2016 Market Review memo begins by defining the city’s market areas. Spencer is a moderately sized rural community offering adequate commercial retail to support everyday needs and also larger purchases. Its market serves local residents and several surrounding rural communities. Spencer’s markets are limited by proximity to other communities that offer similar retail opportunities that are closer for certain populations. These are primarily Spirit Lake to the north and Storm Lake to the south, and larger metros to the west. Sioux Falls, South Dakota and Sioux City may reduce the span of Spencer’s secondary market to the west for larger purchases. Consumers will travel further for more retail options. Primary Market . The primary market area is the City of Spencer and the immediate surrounding area that extends approximately two to four miles from city limits. Residents in this area do daily shopping in Spencer like groceries. Secondary Market . Secondary market area extends about 15 miles 30 miles from downtown Spencer. Residents of this area use Spencer retailers and service providers for typical needs and occasional large purchases not needed on a daily basis.

4th Street

3rd Street

FLOODING - SMU SKYCAM

2nd Street

4th Avenue

3rd Avenue

2nd Avenue

1st Avenue

1st Avenue

CHANGING RIVER

1st Street

The land that constitutes Spencer was selected, in the mid-1800’s, because of the relatively flat terrain and its proximity to the Little Sioux River corridor, which provided water and building material. The flat terrain has served Spencer well over the years. The Little Sioux River corridor, at times, has proved to be a challenge. First, periodic flooding has resulted in the straightening of the corridor through the heart of Spencer. Second, access across the Little Sioux River is limited to two bridges. These two facts have made the Little Sioux River a point of division within the community and, thus, an under- utilized asset. The alignment of the Little Sioux River has been manipulated over time to run straighter through Spencer. Figure 1 shows the historic alignment from the 1930’s to today. The concept will show has some of the oxbow areas can be restored for calm water access.

Park Street

Grand Avenue

4th Street SW

1930 Alignment 1950 1970

1990 2015

NORTH

6

7