Aurora’s retail strategy aims to revive struggling shopping centers

AURORA | Like many American cities, retail sales taxes make up the largest portion of revenue for Aurora, which presents unique challenges as the retail landscape continues to evolve. 

For the past year, the city has been working on a retail strategy to help stabilize struggling shopping centers, strengthen successful ones, and adapt the city’s commercial landscape to post-pandemic consumer behavior and long-term market shifts.

“Retail isn’t just about shopping, it’s about where we gather, where we meet,” Janine Rustad, the Planning and Business Development director, said. “So we want to make sure Aurora is the best it can be.”

During a Monday City Council study session, Rustad presented the now-complete strategy, which will establish a framework for how the city will engage property owners, retailers and community stakeholders to improve retail vitality across all six wards, according to Rustad. She also told council members where the city’s limits lie.

“We cannot act as a broker,” Rustad said. “While we can be a matchmaker.”

The city can make introductions between investors and retail landlords or among businesses with ideal locations seeking vacancies, she said. 

“We do that matchmaking, but we also have that important role of offering incentives and making sure we’re taking care of the public realm,” Rustad said. 

At the core of the strategy, prompted primarily by Councilmember Francoise Bergan, is a standardized set of “retail center health indicators” used to evaluate shopping centers across Aurora, Rustad said. These include occupancy rates, price per square foot, center appearance or physical conditions, tenant mix and the presence of strong anchor tenants.

“When you see a lot of vacancy, that’s a center that probably isn’t doing so well,” Rustad said. “You’re not getting in the rents, you’re not taking care of the center. And it’s the spiral effect.”

The city identified four types of retail landscapes:

• Primary centers have strong anchors, low vacancy rates, are in good condition, look modern and clean, have strong regional consumer draw. They generate strong tax revenue. 
• Shadow centers are located near major anchors or big-box stores, but without a big-box primary tenant, instead they have smaller, nationally recognized tenants and/or privately owned businesses.
• Micro centers are similar to shadow areas and are often neighborhood-focused retail serving specific communities, such as along Havana Street.
• Secondary centers lack strong anchors and are characterized by high vacancy rates, outdated buildings, or heavy concentrations of service uses, some of which may be candidates for redevelopment.
  

“There are things that impact retail, some of which we control, some of which we don’t,” Rustad said.

The market and economic conditions are beyond the city’s control, aside from grants and incentives. 

The city can work on visibility, access and deferred maintenance that affect customer perception, as well as subdividing or encouraging reinvestment in large or outdated tenant spaces, Rustad said.

“With ‘big box’ going out, they are going out of business faster than any of them are being refilled,” Rustad said. “What we’re seeing is usually those spaces are ‘demised,’ meaning you might get two or three tenants where there was one.”

Missing anchors or limited complementary uses reduce the “one-stop” convenience residents expect, Rustad said. Lower foot traffic also discourages new tenants and slows reinvestment, so marketing and “matchmaking” can help fill vacancies.

To strengthen existing retail centers, the city is improving or encouraging private lot owners to update lighting, sidewalks, transit access, and safety conditions around commercial areas, which can influence willingness to visit, Rustad said. Perceptions of safety and cleanliness shape consumer comfort and confidence, according to city information.

The goal, Rustad said, is not to add more retail, but to “right-size” it.

“We don’t want to have so much retail that we’re cannibalizing ourselves,” Rustad said. “We want to be able to bring in new and have the right amount in the right places.”

The city currently offers a large-scale retail reinvestment incentive tied to anchor tenants and spaces larger than 10,000 square feet. While it has been successful in attracting tenants such as Nordstrom Rack and Lucky Strike, Rustad said the program is complex and may no longer align with today’s retail realities.

“We may need to tie incentives to individual spaces rather than entire centers,” Rustad said.

To encourage revival, the city is working to enable adaptive reuse and flexibility.

“We want to enable adaptive reuse and flexibility,” Rustad said. “So you’re going to hear about the Downtown Development Authority. We want to make sure that we’re making it easy to reuse buildings, or as easy and fast as possible.”

The city’s restaurant incentive program, which encouraged restaurants to move into spaces previously used as restaurants, was funded through federal ARPA dollars, and Rustad said staff hopes to revive or expand it using new funding mechanisms. City officials said the program was successful, turning a handful of vacancies into thriving businesses.

One retail redevelopment incentive will be bringing a new King Soopers to Ward II at Peoria Street and East 56th Avenue, as well as adding three more businesses to the site. 

These incentives not only get the big-box companies in, Rustad said, small retailers also follow by moving in. 

Rustad said that staff is looking to revise incentive programs to make them more predictable and user-friendly for property owners, expand eligibility to smaller retail spaces, and ensure promised benefits are realized in practice, not just on paper.

“We want to make sure we are giving the benefit that is bargained for,” Rustad said. 

The city is also examining how to extend incentives to smaller shopping centers, many of which have spaces under 10,000 square feet, as big-box retail continues to decline, Rustad said.

Retail safety, walkability, and customer confidence were also aspects Rustad said the city is working on, along with efforts to better promote Aurora’s retail districts and to reshape the city’s narrative for investors and residents. 

One example Rusted used was recent changes at a former neighborhood Walmart site, where removing physical barriers reduced criminal activity and restored a sense of safety.

Retail theft rates have exceeded industry benchmarks in some locations, discouraging tenants and contributing to vacancies, Rustad said.

Rustad said a balanced mix of retail, entertainment and services is key to driving foot traffic and creating vibrant centers. Other places might require more residential space where retail is overflooded. 

Rustad said staff is also exploring mixed-use redevelopment and potential urban renewal designations in areas with chronic vacancy and fragmented ownership, working alongside the city’s new urban renewal manager.

The next step for the city includes city council’s approval of the retail strategy, followed by stakeholder engagement with property owners, brokers, merchants, and business organizations to review the strategy’s direction and discuss market conditions and trends.

Then in the first quarter of next year, the city will develop an implementation plan that includes ongoing support beyond 2026.