Retail is looking up in Richmond. Following a recession characterized by a dearth of new retail development, the Richmond retail market is once again poised for growth. Decreases in the overall vacancy rate, positive employment growth, increases in retail rents and an upswing in overall retail construction suggest that the market is amidst a retail recovery. Historically, these economic factors have driven robust expansions. While “robust” might be a bit dramatic for 2013, several retail projects are in the pre-development and development phases, coupled with a number of significant retail transactions. Those are encouraging signs that point to recovery. Several noteworthy retail developments fill the pipeline. Walmart recently acquired a 10-acre site at Reynolds Crossing, a 90-acre, mixed-use development in Richmond’s established “near west end” suburb, with plans to build a 90,000-square-foot store with a garden center. Expected to open in spring 2014, Walmart is set to anchor the development that includes small shop and restaurant space in addition to outparcels. Likewise, Kroger is under construction with its third Kroger Marketplace in the Richmond MSA. This 124,000-square-foot grocery concept anchors Staples Mill Marketplace, which will also include outparcels and small shop and restaurant space. After 10 years of planning, Gumenick …
Market Reports
At the mid-year mark, CoStar reported industrial occupancy in Richmond was approaching 90 percent for industrial product of all sizes, excluding flex space. Buyers looking to purchase single-user Class A facilities of 40,000 square foot or greater are experiencing an acute shortage of said product. These larger free-standing, single-occupant facilities are now in shorter supply in the suburban areas of all four quadrants, though multiple opportunities remain in the city of Richmond, both north and south of the river, generally class B/C type product, but functional and reasonably priced. There are also several free-standing purchase opportunities under 40,000 square feet available in the suburban sector of the northwest quadrant. The second quarter ended with four large facilities (two in the city of Richmond and two in Henrico County) going under contract to users, which further impacted the availability of freestanding facilities for owner/users looking to relocate into facilities with a minimum of 40,000 square feet. Local expansion has comprised approximately 78 percent of large industrial sales since the third quarter of 2012, with 14 of the last 18 major transfers (totaling approximately 1 million square feet). The majority of these acquisitions involved end users purchasing Class B facilities for manufacturing/warehousing …
The Hampton Roads metropolitan area of southeastern Virginia, named for both the Norfolk-Virginia Beach metro area it encompasses and the body of water that surrounds it, is unlike most other U.S. markets. Its huge military presence, which includes the Air Force, Army, Coast Guard, Marines and the largest Naval base in the world, helps keep this market on an even keel, as do the estimated 6 million people who visit its tourism haven, Virginia Beach, each year. Consequently, this growing market has not been hit nearly as hard by the retail downturn as others. The seven cities that chiefly comprise the Hampton Roads trade area—Virginia Beach, Norfolk, Hampton, Chesapeake, Newport News, Portsmouth and Suffolk—are expected to show a combined population well in excess of 2 million when the 2010 census is tallied, up from 1.6 million at last count. There has been some softening in retail demand. Like elsewhere, landlords have had to re-adjust expectations. Those willing to be aggressive and creative are getting deals done, though certainly not at the same numbers as just 3 years ago. While small businesses seem more willing to look at new opportunities, one overriding issue continues to be tenants’ inability to obtain financing. …
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