Most retail brokers in Des Moines are cautiously optimistic in their expectations for 2013. For the first time in years, I’m seeing a lot of site plans for new retail developments come across my desk. Several projects that had been on the back burner for the last few years have finally begun to take shape. Des Moines, like most markets, got hurt when the Great Recession hit. However, with its major industry based in insurance, it weathered the storm better than many other markets. At its high point, the unemployment rate was 6.8 percent, and the rate as of May was 4.3 percent. The Des Moines retail market didn’t get nearly as overbuilt as many of the other nearby larger markets. There wasn’t a ton of first-generation space that sat vacant on the retail market in Des Moines once the recession hit. Most of the retail developers here are conservative. Much of the first-generation space that sat vacant was the result of lenders taking back the properties and not wanting to invest any money in those assets. Lessons Learned The developers in today’s market have a more disciplined approach than many of their predecessors. There was a time when real …
Market Reports
The conservative nature of the Des Moines marketplace has been tested in the past 24 months yet cautious optimism prevails. Historically the high concentration of financial service and insurance companies translated into quick absorption of large blocks of space. However, the downturn in the economy and the move of companies such as Allied-Nationwide, Wellmark Blue Cross/Blue Shield and Aviva to new, owner-occupied buildings left behind significant blocks of space that have increased the office vacancy rate to almost 19 percent and will send it even higher. New construction and development has been divided between the central business district (CBD) and the west suburban markets. The 152,000-square-foot Davis-Brown Tower and the Wellmark’s 550,000-square-foot headquarters are significant additions to the CBD Gateway West corridor, while Aviva’s 360,000-square-foot, United States headquarters is situated in the ever-emerging Jordan Creek corridor. Although development of smaller office buildings has been slowed, there are some signs of positive growth. Delta Dental Iowa is nearing completion of its new 25,000-square-foot headquarters at Northpark Office Park in Urbandale. In addition, two significant lease transactions were signed in the west suburban market, including 25,000 square feet for Strategic America at 6600 Westown Parkway and 93,000 square feet for Sammons Financial …
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