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As the economic downturn rippled across the country in 2008, there were a few key cities that saw -- and felt -- the signs before the tidal wave: Miami, Phoenix and Las Vegas come to mind. These cities reveled at the height of the real estate boom, both residential and commercial, and Las Vegas -- maybe more than most -- enjoyed the riches of a robust economy as tourists flocked to the Nevada desert hotspot.
But what goes up must come down, as Las Vegas residents found out the hard way. Now, almost five years removed from the recession, the tides are turning on all fronts, even retail.
"We are optimistic about the market," said Rick Crawford, president of Midjit Market Inc., operator of Green Valley Grocery. "We just came off a very nice year. We were within one or two percentage points of our budget both up and down in various categories. We are now two months into the next year and we are right where our budget projects us to be."
Green Valley Grocery sports a portfolio of 46 convenience stores. The majority includes a Shellbranded gas station; one location is branded Chevron. Of the 46 stores, 43 are in the Las Vegas Valley, which spreads roughly 25 miles north to south and 25 miles east to west, Crawford explained.
It's a good place to set up shop as 70 percent of Nevada's population resides in the Valley, he said.
There is no doubt that some in the Las Vegas retail community have suffered along with the rest of the country over the past five years, but Green Valley Grocery is coming out ahead. "We lost a lot of the independent operators because of the economy. We acquired some and some went away. There has been a lot of turmoil there," Crawford noted.
Turmoil aside, Green Valley Grocery continues to find a way to grow. This summer, the retail chain acquired two stores (Nos. 45 and 46) and went into escrow to acquire another location. That deal is expected to close by the time the 2012 NACS Show rolls into town. Green Valley Grocery is making a splash on the ground-up front as well. It is in the process of building one new store and recently signed a lease for another new build, which will begin construction next year.
"We are positive about southern Nevada," he added.
And Green Valley Grocery is not the only one. Sinclair Oil has been active in the market as of late, bringing its familiar green dinosaur to gas station canopies across the city. In addition, Union 76 popped back up on the scene as 76 gas stations. On the convenience store front, 7-Eleven still stands as the market leader, followed by Terrible Herbst Oil Co. (Terrible Herbst) and Rebel Oil Co. Inc. (Rebel). Green Valley Grocery comes in at No. 4. Alimentation Couche-Tard Inc.'s Circle K Stores and Speedee Mart Inc. also have a notable presence, with smaller chains dotting the landscape, Crawford said.
Make no mistake, though, times are still tough. The Las Vegas metropolitan area still battles high unemployment. According to the Nevada Department of Employment, Training and Rehabilitation, the state's overall unemployment rate rose four-tenths of a percentage point to a seasonally adjusted 12 percent in July. That figure is down year over year and two percentage points below the recessionary peak of 14 percent. The department's July numbers showed the Las Vegas metro area had the highest unemployment rate among the state's three population areas at 12.9 percent, not seasonally adjusted.
On a positive note, in its Nevada Labor Market Overview for July 2012, the department said Las Vegas job levels were up 1,900, seasonally adjusted, from June 2012 and up 8,700 from July 2011.
The city is seeing its convention and tourism business booming as well. Las Vegas was named the top trade show destination in the country for 2011 -- for the 18th consecutive year -- by Trade Show News Network. By the numbers, the city plays host to more than 19,000 meetings annually, and those meetings translate into a $6.3-billion impact on the local economy and support 58,000 jobs. In addition, the Las Vegas Convention and Visitors Authority 2011 Visitor Profile Study found visitor spending is on the rise in lodging, food and beverage, shopping, local transportation and hotel packages.
"There is still large unemployment, but this year has been a busy year for tourism in the city. The tourists are spending less money, but the number of bodies coming in is dramatic. Las Vegas hasn't completely come back, but it is getting there," Crawford said, noting that construction is picking up and existing home sales are also ticking up at a nice rate.
Unlike other convenience store chains with sites located in highly trafficked tourist areas -- the Las Vegas Strip, for example -- Green Valley Grocery does not see its dollars come straight from tourists' wallets. However, its locations do benefit from a trickle-down system.
"We don't get the direct tourism business, but our customers work in the gaming industry or supplying the hotels. Indirectly, our customers earn their wages from the tourism business," he said, adding that the chain has a few stores on major freeways although most are in the Las Vegas community.
Going for the Green
In addition to expanding its foot- print, Green Valley Grocery has been busy making changes to its existing stable of stores. For example, the company is installing LED lighting and skylights where it makes sense. Outside, it is making the gas canopy more energy efficient with LED lighting as well. Green Valley Grocery also launched water reclamation systems at its car washes, Crawford explained.
"We are not LEED certified and we are not striving to be. But there are so many positive [takeaways] from LEED components and when you do a quick ROI [return on investment], it makes sense to incorporate them into the stores," he said. "Certainly skylights; we have sunlight 365 days a year so we might as well take advantage of it."
There is no set timeline to bring these components to its existing stores, but Green Valley Grocery is retrofitting them as the company looks to refresh sites.
One Sahara Boulevard store the retailer acquired in June is currently undergoing changes through a program with Nevada Energy. Green Valley Grocery plans to invest about $40,000 in the store's "green features" and will receive an approximate 50-percent rebate from the power company.
"We figure we will see an ROI in less than two years," Crawford noted.
Aside from these green efforts, Green Valley Grocery has added freshly made sandwiches to more than half of its locations to enhance its foodservice staples such as fountain drinks, coffee and fresh doughnuts. The company also installed f'real machines in most stores and added pizza to the menus at 10 locations.
"It's been a good year during tough times," Crawford said. "We always ask, 'What can we do, do differently or stop doing to improve our offering and operations?' That has been our mantra for a few years."
The mantra seems to be paying off in spades for Green Valley Grocery.