Confident with Confidentiality: How CBRE covertly rolled out a new concept in a new market
In 2004, Texas’ lack of specialty grocers caught the attention of Sprouts leadership. Sprouts had a desire to move into the Texas market but did not want other specialty grocers to know about their plan to expand. Sprouts needed a firm that could find great locations without specifically disclosing who would be moving in.
After signing a confidentiality agreement, CBRE strategized on the best way to introduce Sprouts to the DFW market. CBRE realized it would not be long before other specialty grocers like Trader Joe’s and Fresh Market noticed DFW’s absence of this grocery store genre and developed the following plan in order to capitalize on its first mover advantage:
Understand Sprouts Criteria
CBRE traveled to and studied Sprouts in other markets and learned all about the grocer and its successes to prepare for discussions with property owners and landlords. In the absence of being able to disclose the brand, our brokers would need a deep understanding of the retailer so they could paint a picture using data alone.
Secure Prime Locations, Quickly
CBRE brokers knew that in order for Sprouts to have lasting success, it would need to find quality and defensible positions in the Dallas market and its submarkets so to not be out positioned when competitors moved to the area. CBRE also needed to work quickly to secure these locations to ensure Sprouts would be able to continue to grow and increase sales even after its competition came into the area.
Leverage Existing Relationships
CBRE faced a unique challenge in selling a client to landlords who would not know the name of that client until after the confidentiality agreement was signed. CBRE leveraged its strong relationships with local property owners and landlords who trusted that CBRE had their best interests in mind when considering their properties for this new-to-the-market client.
Sprouts opened their first store in Texas in 2005. Since opening their first location, Sprouts has opened two locations each year on average and currently has 14 stores in the DFW area. CBRE referred Sprouts to its partners in Houston and Austin for further expansion, and there are now 29 Sprouts open throughout the state.
“CBRE is simply the best.”— Seth Brown, former head of Real Estate for Sprouts
Because of CBRE, Sprouts:
- Quickly and confidentially gained substantial market intelligence to analyze and quantify the potential success for Sprouts stores in the market.
- Had an advantage by beating competitors in the race for optimal store locations.
“Our Texas stores are currently outperforming the remainder of the company. Your research, mapping, aerials and your knowledge of the players have been an invaluable asset.”— Seth Brown, former head of Real Estate for Sprouts
Follow the trends and stay ahead of them
As of 2013, Specialty grocers make up 23.8% of all grocers in the Dallas market. This percentage is expected to rise as young millennials become young professionals. Understanding the trends helped CBRE sell this concept without revealing our client’s name.
Placement is Critical to Success
Sprouts was able to establish a significant presence in Texas because it was placed in quality and defensible locations. Having the collaboration and strength of a statewide team also helped in the multi-market rollout.
Expansion can happen even with lips sealed
Even without being able to disclose the name of the client, CBRE was able to successfully roll out Sprouts into the new market through the trust built in its relationship with property owners and landlords.
Get in Touch
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