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DATE: June 16, 1986 <br />TO: Mr. Craig Waldron <br />Director of Economic Development <br />FROM: Project Team <br />Target Area Study <br />SUBJECT: Analysis of Costco Proposal <br />This memo summarizes the findings of the project team's analysis of the Costco <br />proposal to build a store on County. Road C in Roseville. Public Financial <br />Systems, R.B. Sollie and Associates, and Van Doren -Hazard -Stallings, Inc. have <br />been retained to review six target areas of the City as part of a compre- <br />hensive financial, land use and market analysis. At the present time, the <br />project is in the early stages. Comments on the Costco proposal, therefore, <br />are offered without having conducted a detailed review of the area surrounding <br />the proposed site of for the other five study areas. <br />Market Analysis <br />Costco currently operates 21 units in five western states, Florida, Alaska and <br />western Canada. The stores are described as wholesale cash and carry member- <br />ship warehouses which sell high quality, nationally branded merchandise at low <br />prices. Costco's markets are businesses purchasing primarily for commercial <br />use or resale and individuals who qualify to join a buying group. The company <br />opened its first unit in September, 1983. The number of wholesale members was <br />about 173,000 and group members 851,000 in February, 1986. <br />Location Considerations: Costco feels it is necessary that they locate in <br />"first ring" suburbs. Suburbs such as Roseville provide an optimum mix of <br />locational criteria, such as population resources, business clients, highway <br />access, and centricity, which are important to their success. <br />Costco has indicated that the site on County Road C meets their criteria. Jt <br />is easy for customers to find and has good access to I-35W and to local access <br />via County Road C and Snelling Avenue. They project that approximately 80 to <br />85 percent of their customers will come from within a ten mile radius. <br />It does appear that this site would be a good location for Costco. Although <br />its was apparently not their first choice, (they had originally proposed to <br />build on a site on Lexington Avenue) this location appears to satisfy their <br />requirements. <br />PIRL IC._ FINANCIAL S T MS <br />512 NICOLLET \CALL. SUITE 550 • �11NNEAPOLIS. MINNESOTA 55402 <br />TELEPHONE: (612) 333-9177 <br />