The Richmond retail market continues to be strong. Overall vacancy rates are slightly higher than usual, hovering around 7 percent with negative absorption, due to all types of new products coming online in the first half of 2017. The market is adding millennials at double the pace of any other generation and has been recently named in multiple media outlets as one of the top living destinations for millennials nationwide. With this influx, multifamily development in Richmond is robust, which in turn is attracting all types of urban retail and chef-driven restaurants. The most popular submarkets for new urban retail are the Central Business District, Shockoe Bottom and the white-hot Scott’s Addition, with many developers taking advantage of Richmond’s Historic Tax Credit program. Richmond’s famous grocery wars continue with major players jockeying for the best positions. Kroger has historically positioned themselves well in the market with 18 stores, many of which have gone through recent expansions to the Marketplace concept. It recently scrapped plans for the development of two new relocation positions in Mechanicsville and Colonial Heights. The most recent grocery news has been Martin’s Food Markets exiting and Publix entering the market. Martin’s peaked at 19 stores, most of …
The New Jersey retail market continues to gain strength as landlords redevelop existing properties, successfully backfill formerly vacant supermarket and Sports Authority boxes, and even break ground on several major shopping centers. Green Leaf at Union, a new redevelopment scheduled to open this fall, will include 111,000 square feet of gross leasable area. Located on Route 22 and West Chestnut Street, the center will be anchored by Bob’s Discount Furniture and LA Fitness. Chimney Rock East and West in Bridgewater is also under construction. The new upscale center will add more than 200,000 square feet of gross leasable area to the Route 22 corridor. Tenants will include Whole Foods, The Container Store, Saks Off Fifth and Nordstrom Rack, as well as ULTA and European Wax Center, which were both represented by R.J. Brunelli & Co. (RJBCO). The District at Metuchen, a new 78,505-square-foot upscale neighborhood center, opened in downtown Metuchen on Route 27 and Middlesex Ave. It is anchored by Whole Foods, with a satellite tenant lineup that includes RJBCO clients Massage Envy and European Wax Center. The Route 35 corridor in Hazlet/Holmdel/Middletown has seen its ups and downs this past year. In Middletown, the WRDC-owned property formerly anchored by …
The Minneapolis retail market ended the second quarter with a vacancy rate of 3.1 percent. The freestanding retail segment (buildings not contained within a shopping center) posted a vacancy rate of 1.8 percent. Over the past year, there has been a pattern of positive absorption in the market. The average quoted asking retail rental rate at the end of the second quarter was $13.94 per square foot. Comparably, a year ago this rate was $13.29 per square foot. Meanwhile, construction of retail properties has been on an upward climb. Within the past four quarters, 1.2 million square feet of retail space has been built, and there is an additional 892,910 square feet in progress, according to CoStar Group. Net absorption continues Retail net absorption was moderate in Minneapolis in the second quarter of 2017, totaling 484,120 square feet. That’s up from 135,536 square feet of positive absorption in the first quarter and 366,652 square feet in the fourth quarter of 2016. However, these figures are all down from the third quarter of 2016, when 638,183 square feet were positively absorbed in the market. Several tenants have moved out of large blocks of space in 2017. For example, Sears vacated 125,209 …
The northern suburbs of Indianapolis aren’t just following the latest trend of developing dense urban cores within suburban markets — they’re on the leading edge. In particular, Fishers and Carmel boast flourishing downtown environments that are walkable and bike-friendly. The idea is to develop a core urban area amid the suburban sprawl by creating activities and concepts that serve various community needs such as cool restaurants, shops, office and living space, evening events for adults, family activities and music and arts entertainment. It’s a lifestyle choice that more and more people prefer. While retail is struggling to regain balance in traditional environments, these mixed-use developments are resonating with their communities. Consumers are looking for experiential opportunities with multiple touch points, such as living, shopping, fitness, dining and entertainment options that integrate open green space. The suburbs of Indianapolis are responding to this trend. Grocery stores and medical facilities also are key to these types of developments, as residents desire the convenience of making one stop. Fishers blazes its own trail Fishers, located just northeast of Indianapolis in Hamilton County, officially became a city in 2015. The community elected a mayor with a strong vision. That vision included the urban core …
The terms “experiential retail” and “mixed-use development” are both thrown around heavily in the context of 21st century commercial real estate. As buzzwords for the changing landscape of retail real estate and encapsulations of the preferences of millennials, the terms are as popular in their usage as they are arbitrary in their application. Is an apartment building with a ground-floor restaurant or coffee shop really considered mixed-use? Is it actually legitimate to think of buying shoes or jewelry as an experience? The answer varies depending on who’s asked. But the fact remains that dividing lines between certain property classes are beginning to blur. Increasingly, office and multifamily projects are designed to include food, drink and entertainment options, which have become the only real common denominators among mixed-use projects. Given that those three facets of retail involve spending on one-time, consumable products and services, they have become the face of experiential shopping and spending. Integrating retail development into mixed-use projects, as opposed to standalone shopping centers or pad sites, comes with its own unique challenges: parking, noise restrictions and sourcing contractors that specialize in build-outs for multiple property types, to name a few. But developers realize that no matter how much …
The greater Kansas City area retail market remains solid as a rock, despite CoStar Group’s mid-year report showing a slight decline in the average asking rental rate and a slight increase in vacancy. The retail vacancy rate in the second quarter of 2017 stood at 5.7 percent, up slightly from the previous quarter’s 5.5 percent. The average asking rental rate for retail is $13.05 per square foot, down from $13.07 in the previous quarter. Local, regional and national restaurant chains continue to expand with strong success throughout all areas of the Kansas City market, and “new-to-market” users continue to open their doors. Currently, there is approximately 570,000 square feet of retail space under construction in the Kansas City area and various mixed-use projects under development. Additionally, several new shopping center projects have recently been announced and are quickly gaining traction with restaurant and retail users. One of the major catalysts for the widespread retail and mixed-use boom throughout greater Kansas City is the various incentives that have been made available to developers including tax increment financing, community improvement districts, transportation development districts, tax abatement and other incentives. On both sides of the state line, as sites become more expensive and …
Orlando’s retail market is experiencing renewed vigor. Construction cranes are rising in key areas due to increasingly high demand, and low vacancies are fueling rental rate growth, which has been somewhat stagnant over the last several years. There is also demand for larger vacated boxes as a result of the downsizing and bankruptcies of retailers. Spaces once occupied by Sears, Sports Authority and hhgregg, for example, are being filled by retailers entering or expanding their presence in the market, such as Luckys Market, Earth Fare, Orchard Supply, Ollie’s, 24 Hour Fitness and At Home. The activity is both resulting in and benefitting from exciting new developments and infrastructure improvements in the market. Development, Infrastructure Current development activity in Orlando is in direct response to considerable consumer demand, with many major retail projects recently completed or under construction. Lake Nona Landings, a 53-acre development in Tavistock’s master-planned Lake Nona community, opened in early 2017 with the area’s first Walmart Supercenter and Sam’s Club, and will serve as an anchor for the growing Narcoossee corridor south of State Road 417. Horizons West/Four Corners is a thriving residential area encompassing parts of western Orange and north Osceola counties where retail, restaurant and multifamily …
As America’s brick-and-mortar retail sector continues to come to grips with the impact of e-commerce on its long-term future, it is worthwhile to track the progress of the growing number of retailers who have chosen to step away from a web-only platform. These retailers are establishing an omni-channel presence by setting up operations in physical stores, and many are showing signs of success. Many such retailers are choosing to set up shop along the streets of New York City, with its massive and steadily growing population and its broad demographic mix. Despite the recent, well-publicized increase in the city’s available inventory of retail space, New York City remains the preferred market to launch a brand with aspirations of building a meaningful national profile. Considering the more-youthful and trendy profile of a large proportion of online shoppers, these “adding-bricks-to-our-clicks” companies are gravitating toward New York City submarkets that deliver this coveted, younger demographic. Moreover, e-commerce players possess a ton of data profiling their customers — including their buying behavior and their browsing interests and habits — and retailers tap this intelligence when making decisions about where to locate stores as well as how they should be merchandised to best cater to …
For the past several quarters, the headlines of most CRE publications in Texas and beyond have proclaimed the end of retail as we know it. By now, we’ve all heard the stories and seen the writing on the wall: e-commerce will kill the shopping mall; large anchors that landlords have counted on for decades are shuttering and Amazon will be the end of the retail storefront. It’s a familiar tale as of late. But amid the doom and gloom of store closings, Houston seems to be staying on top of the trends, as its retail market remains healthy and appears to be moving ahead. In fact, despite losing over 70,000 oil-related jobs since 2015, Houston’s retail market remains one of the strongest in the country, posting an average occupancy rate of 95 percent. In addition, employment growth in the retail sector grew 5.1 percent in 2016 amidst the oil bust. Despite these strong retail indicators in Houston, the aforementioned market changes do have an effect on the retail environment. And while retailers themselves need to make the biggest adjustments, developers and landlords are not without their own challenges. Like the rest of the country, Houston retailers must figure out ways …
Anxiety and hand-wringing about the future of retail were evident at this year’s ICSC RECon event, as developers, retailers and restaurant operators continue trying to make sense of the persistent march of online buying, while also looking to inject new enthusiasm into the bricks-and-mortar shopping experience. In the greater Baltimore metropolitan region, we are experiencing many of same issues as the balance of the country. But, like always, we believe this region has several built-in advantages that will continue to buoy the retail environment, including a diversified business climate, proximity to Washington, D.C., and presence of defense contractors. While “caution ahead” signs seem to be lurking around every corner, there are numerous developments in Baltimore that are screaming “full steam ahead.” Darwinism is in full effect locally, as shopping centers embedded within planned-unit developments or retail destinations offering e-commerce-resistant experiences are the venues with the brightest futures. The developers and retailers that are willing to accept and adapt to changing trends, such as millennials’ preference for experiences rather than ownership, are the entities that will be left standing after this latest seismic shift. Here is a quick look around the Baltimore area landscape, with a focus on the various starts …