What are the demographics of a commercial real estate property? In this edition of the Champions DFW Commercial Realty radio show and podcast, Dave Reardon provides his data driven insight with Rudy Janecka of Champions DFW and Ron Taylor of 620 AM KEXB. After reading this excerpt of the conversation, learn more about demographics in commercial real estate when you listen to the podcast…
Ron Taylor: Our good friend, Rudy Janecka with Champions DFW Commercial Realty, is joining us today here as our guest host and David Reardon is our guest. We’re talking about specific areas when it comes to commercial realty folks really defining some terms, pun intended, defining trade areas. Rudy, this is something that’s very important, and again, is a great, great tool for Champions, I imagine.
Rudy Janecka: We lean on folks like Dave to help give us supporting data so that we can support all of our clients. It’s a great tool to have and anyone with an analytical background loves to get into the data. In most corporate settings, you have senior teams that are decision makers on financing for projects. Then you’d go on down to developer managers and real estate managers and so forth that have to be out in the field, putting the deals together to create these opportunities for approval.
Those decisions are all typically based on demographics and in scientific data that guys like Dave Reardon provide. They’re the unsung heroes a lot of time in the success of all brands as we go forward. They get in the trenches. They do a lot of the work that no one even knows that gets done early on, so we’re glad to have Dave on the show. I wanted to get into some more detailed or drilled down and talk about demographics. I wanted to bring up the familiar term that typically gets brought up on the show weekly, is the term “millennials.”
They seem to be the hot demographic sector that is everyone’s going after right now. They’re the ones that are coming out of college, making money and they’re sort of changing our culture. It’s just neat to see the generations out there with their thumbprint. So, Dave, you want to just start us out and kind of talk about demographics and psychographics and how, you know, all the little variables and so forth that come into that?
Dave Reardon: One of the key aspects of understanding your trade area is understanding what kind of demand is there. One of the most traditional ways to go about getting that is to look at the demographics of the people who live there or work there, depending on the type of business, or even who travels through your shops there. The demographics are the basic things like how many are there, how many people, what’s the population, how many households, characteristics to that population and what’s their age, race, ethnicity, income levels, educational attainment and so forth.
Those are very commonly used, I think most people are probably familiar with, you know, seeing any kind of article report that talks about that kind of data. But they’re kind of key in doing your own trade area analysis is understanding which demographics are relative to you and your business and kind of seeing what are the right targets. For example, our digital business, which most seemed to be, you know, target the millennial, which is you know, a generation of people of a certain age, and kind of understanding that all together.
Now, taking that a step further, you mentioned psychographics. That’s actually demographics plus, I would say, to kind of simplify it. Sometimes you might have some demographics that kind of don’t necessarily work together. If for example, you like people of a moderate income and you look at an area that has older people of moderate income or young people of high income or something of that nature, they kind of contradict to each other, so you may have more trouble determining, “Is this good or bad for me?” And psychographics is sometimes called lifestyle segmentation and they’re actually a tool that kind of help you pull that together.
Learn more about Rudy Janecka, here.
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