Real estate investors and house-hunters are smart to buy where a Starbucks store is planned

House-hunters and real estate investors say the presence or expansion of  chains like Home Depot and Starbucks are an indicator that a neighborhood's home values are set to spike. Blogger Sarah Gilbert says "the smartest real estate strategy ever" is to "buy, immediately, in a neighborhood where a Starbucks is planned." She wrote in 2006 that her own home value doubled shortly after a Starbucks opened nearby. (Read "The Starbucks Effect" in Newsweek)

Comments

[Varangy]

That article is typical Newsweek pseudo-intellectual drivel.

IF any relationship exists between the Starbucks and home prices, it is more likely that rising home prices are signaling affluence and more disposable incomes and therefore 'pulling' Starbucks in, not Starbucks 'pushing' prices up. (One could argue that there are endogenous effects at work, but who really cares.)

The article alludes to the pulling effect, but gives anecdotal quotes supporting the pushing effect. Sheesh.

Granted, this is all based on a big IF such a relationship actually exists. But that wouldn't sell crappy rags like Newsweek.

[Jon]

Did you just call Newsweek a crappy rag? You must be really sophisticated! Holy crap, did you just say ENDOGENOUS? OMG we have a genius on our hands!

The point of the article is that SBUX is a good leading indicator of real estate value because big retail chains have huge teams studying demographic and income trends to predict what areas will be good markets in the future. It's not that Starbucks causes house prices to go up.

[a]

how about those under performing stores that they will close?

plus plans for the stores are made years and years in advance. They will build a home depot even if home priced dropped significantly.

[Lynne]

http://www.youtube.com/watch?v=AlfszjapNb8
Starbucks video from UW

[real estate properties]

its good to have a beside on your place..

[Former $tarbuckie]

Wow! Really! I live in Southern California and my property value is falling quicker than you can dump pike puke down the toilet. And I LIVE within a quater mile of 4 $tarbucks. While I do believe there WAS a time when a $tarubucks store in your ZIP was a sign of a "nice neighborhood"; there are so many now, even in socioeconomic depressed areas, I don't think having a $tarbucks nearby means anything anymore.

[Cali ASM]

"While I do believe there WAS a time when a $tarubucks store in your ZIP was a sign of a "nice neighborhood"; there are so many now, even in socioeconomic depressed areas, I don't think having a $tarbucks nearby means anything anymore"

That's because Sbux and the "experience" have been watered down.

[Jim Lane]

If you wait until one is PLANNED, you will be behind the curve. The real trick to this would be to predict where one will be located and move in before any planning is done. Then, Starbucks seems to be a crap shoot these days anyway.

[lala]

Does anyone know which stores have the Sorbetto machines? I really want to give it a try and when i called around yesterday i couldnt find them!

[truth]

Comparing pre-2007 housing market factors to post-2007 data is simply foolish.

Everyone was piling into dot-coms in 1999, too.

In my area, any less than 2-year-old sbux store is surrounded by new unsold homes.

[Ken]

So, would that the building of a Super Walmart, with a Starbucks inside of it? One of those just went up not far from my place, and it didn't do squat for my home value!

[Exsoontobebarsitaagain]

Where I live there is a Starbucks going in a Super Walmart parking lot. The Walmart tends to draw in a whole lot of city folk that will probably not be SBUX clientele. Not sure what the thinking behind the SBUX is with that location but I would never have put a store nearby. Not to mention that 1.5 miles north (on the same street) there is already a store in yet another VERY questionable neighborhood.
It’s not about picking the best locations, it’s about filling the market up with soon to be even more under performing stores.

[Jon SBUX FORUM]

ExSoonToBeBaristaAgain,

While Wal-Mart customers might not fit the traditional mold of the Starbucks customer, I think a lot of these people are coming into Starbucks nowadays. A lot frappuccinos, caramel macchiatos, and generally the drinks that are really unhealthy are the most popular.

[Melody]

Jon, to add to what you're saying: I think that many customers have no concept that you could drink a solo espresso, or espresso con panna or something like that.

I was in Bellevue, at a wonderful Starbucks, and ordered a solo shot. The baristas there know me so they gave it to me in a very small for here cup, and passed it to me fast, and I stood there and downed it at the bar in 10 seconds.

A very bellevue woman turned to me and asked "what are you doing? what are you drinking?"

One time another customer turned to me and said "cute little small cup! Is that a sample size?"

How cute that would be a mini latte (sample size) in a demi tasse cup! LOL

I get strange looks when I do a single shot like that.

[hoit]

Berverly triangle has the Sorbetto machine, not sure if they are using it yet.

[Jon SBUX FORUM]

lol Melody, maybe a little more coffee education is in order for this country!

[Claire at Allentown]

i know starbucks has about 7000 co-operated stores and 4000 licensed stores in the US. What is the difference between them? How can I tell which is which? just curious....

[John]

Starbucks will probably be closing a bunch of US stores over the next year. That might be a good indicator of where to sell :-)

[Lou Sussler]

I had to look up endogenous. Now that I know what it means, I'm going to try to work it into everyday conversation.

[jason]

"Jon, to add to what you're saying: I think that many customers have no concept that you could drink a solo espresso, or espresso con panna or something like that."

Straight espresso at a *bucks... not a chance bitter watery crap pulled through a machine designed to produce quantity not quality.

[Melody]

@ Jason:
Good point Jason, and I don't do straight shots from a Verismo. Sorry I did NOT think of that! Straight shots from a Mastrena ARE quite doable, and I'm a regular at the original store which has a manual machine. You're right: My biggest complaint with a Verismo shot is that is watery.
Sorry for the confusion. When I posted that I just wasn't thinking about what is at Starbucks outside of downtown Seattle, and that was my mistake entirely!!! A Verismo really does not produce a quality shot.

[StLouieDrip]

Jon SBUX FORUM: lol Melody, maybe a little more coffee education is in order for this country!

Jon, I've often had that exact same thought in regards to sbux baristas.

As to Masterna's vs Verimos, I haven't checked every store but I'd be VERY surprised if there was a Masterna in any sbux store in my entire city. The best I can hope for is to go to the store that keeps its Verismo as exquisitely well-calibrated as humanly possible, and with staff who know immediately when it needs readjustment. So far I've only found 2 like that. There may be others, but I've only found 2.

[StLouieDrip]

Yowie, I screwed the italics up big time on that one, sorry.

[Cali ASM]

How do you do italics, bold, etc?

[jason]

Jon, I didn't realize that you could still get a manually pulled shot at any Starbucks. I miss that the espresso blend is good if pulled correctly and fresh. Starbucks started my coffee obsession. Now I've graduated to places like Intelligensia or lacal Micro roasters.

[StLouieDrip]

Gosh, now every post after my screw-up is showing up as italics?! Is that also showing up for others like that? If I could edit my error I'd fix it.

Cali ASM, I'm almost afraid to say how to do bold and italics, if it screws up the whole page like that, geez.

I'll try again to turn off italics in this post. Hope this works. Fingers crossed.

[StLouieDrip]

yay! :-D

[MyGiveADamnsBusted]

Hey stlouisdrip, at the store I work at...in the lovely state of Maine...everytime a different partner uses the verismo bars...he/she times the shots and calibrates them accordingly if they in fact need calibration. So when I open in the morning I run and test the shots on each machine...and as the day progresses each partner coming onto the bar does the same thing.

[StLouieDrip]

^ Bravo! Well, I might drive across town for good espresso, but darnit, you're too far away for me to drive right over there! ;-)

And hey, I also think your GIVEADAMN is not so BUSTED after all. :-D

[John]

So 600 Starbucks closing means you're property value is toast?