Grocery stores are always getting a better understanding of the priorities of their core customers. Convenience, value and service are the top reasons people shop where they shop. However, those priorities are expanding. The focus has shifted away from simply providing a “one size fits all” solution toward a customized strategy to attract a cross-section of customers — from the everyday shopper to experienced foodie. By doing so, retail spaces are successfully opening across the state at an elevated rate, addressing growing customer demand while navigating the ever-changing market. Here are five items impacting grocery stores in our state. Educated Customers Customers are becoming more educated about the products they buy. Their expectations are changing. Retailers are finding creative ways to successfully addressing them. To increase revenue and margins, drug stores are getting into the mix, with mixed results. Established chains like Walgreens and CVS/Pharmacy are renovating over 400 locations, with increased emphasis on rebranding their drug stores as health/wellness retailers and expanding the grocery items kept in stock. Big box stores, like Walmart, are also making changes as they try to refine their market strategies. The company announced that approximately 102 of its smaller Walmart Express stores will be …
The dissolution of The Great Atlantic & Pacific Tea Company, better known as A&P, after 156 years in business was not a complete shock — they had, after all, applied for bankruptcy protection once before already this decade. However, the company and its many legacy brands occupied 296 stores in the United States and Canada at the time of liquidation, which meant a seismic shift was bound to occur in those real estate markets. In Northern and Central New Jersey, the resulting repositioning of A&P’s highly-coveted retail properties is proving to be an unexpected positive for a variety of reasons. For one, A&P occupied space in many of their shopping centers for decades, meaning they were paying less than market rent. Landlords are now able to negotiate new deals at higher rents, resulting in an important market correction. This is also an opportunity to reassess the makeup of centers and figure out not only what categories are missing but also what use groups will best drive traffic and stabilize the centers. Owners are able to repurpose the anchor spaces to accommodate smaller users. For example, on Route 35 in Middletown, the former Pathmark has been subdivided into a TJ Maxx …
In 2016, uncertainty in the oil and gas industry has made a major impact on the Fort Worth commercial real estate market. While each submarket is affected differently, the need for relocations and renovations will lead to a rising demand for quality office and retail spaces across the area. Development of Fort Worth real estate is expected to remain strong in 2016, with growing opportunities that create a strong and healthy market. Office Opportunity Downtown Fort Worth has become a hub for major players in the oil and gas industry, such as Holland Services, Forestar Oil & Gas and FTS International. Within the last 180 days, these tenants have put over 125,000 square feet of office space up on the market for sublease. However, the rest of the office sector has been consistently absorbing large blocks of space, proving healthy despite oil and gas concerns. We have seen at least six transactions totaling over 385,000 square feet within the last six months. Transactions included Charles Schwab’s 130,000-square-foot lease at Circle T in Westlake, and Teague Nall & Perkins’ 42,000-square-foot lease of the former Everest College building at the Mercantile Center in Fort Worth. The consistently strong demand for quality office …
NEW YORK CITY — After losing money for 13 consecutive quarters, teen apparel retailer Aéropostale Inc. (OTCQX: AROP) has filed for Chapter 11 bankruptcy protection. Aéropostale will close 113 U.S. locations, as well as all 41 stores in Canada, and could announce more store closures at a later date. Of the 154 stores closing, 117 lost money last year, and the rest generated little profit. Click here to see a complete list of planned store closures. Store closing sales are scheduled to begin in the United States during the weekend of May 7-8, and in Canada during the week of May 9. The company plans to “emerge from the Chapter 11 process within the next six months as a standalone enterprise with a smaller store base, increased operating efficiencies and reduced SG&A [selling, general and administrative] expenses,” according to a press release from the company. Any sale of the company would be announced within the next six months. “While initiatives such as the implementation of our two-chain Factory and Mall strategy and our merchandise repositioning have started to gain traction, the ripple effects of an ongoing dispute with our second-largest supplier put substantial strain on our liquidity while also preventing …
LOS ANGELES — The developers of The Bloc, a 1.1 million-square-foot office, retail and hospitality redevelopment in downtown Los Angeles, have received a $225 million permanent loan to finance the project. The Bloc is located at 700 S. Flower Street. The site was originally built in 1973 as a traditional mall. The redevelopment will transform the space into an open-air urban complex. It will be the largest mixed-use property in Los Angeles, according to developers The Ratkovich Company, National Real Estate Advisors and Blue Vista Capital. The Bloc is scheduled to open this summer. A renovated flagship Macy’s will anchor the center. The Bloc will also offer a variety of artisanal retailers and restaurants, as well as creative-leaning office space and a newly renovated, 496-room Sheraton Los Angeles Downtown. The new loan replaces an existing CMBS loan inherited when the property was purchased in 2013, with a final payoff amount of about $121.6 million. It also provides additional proceeds to finalize the redevelopment and fund leasing costs at the property. “This financial commitment lends further credence to the vibrant revitalization underway in downtown and lays the foundation for continued growth in the decades ahead,” says Jeff Kanne, president of National …
Retail and restaurant activity is strong in Houston. The Woodlands, an award-winning master planned community located 27 miles north of downtown Houston, has defied the negative impact of the oil and gas market by staying extremely solid with high occupancy and strong rents. Both retail and restaurants have seen robust growth. “Despite reports of Houston’s economic slowdown, the retail market isn’t fazed by the dropping oil prices,” says CBRE’s Houston retail research report for third quarter 2015. “In fact, construction has increased, national retailers are bullish on the Bayou City and five years of the strongest population gains in the nation are driving healthy retail growth.” Retail occupancy in the Far North sector, including The Woodlands, remains at approximately 94 percent for the third quarter of 2015, according to CBRE. Suburban Expansion While traffic in the Houston area continues to become congested, suburban cities such as The Woodlands offer shoppers and diners almost all of their retail needs within the walls of the community. Residents are finding no reason to leave. Retail in Houston and The Woodlands is limited by supply. As quickly as construction begins on new retail sites, preleasing occurs. “Fortunately, there is currently 2.6 million square feet …
Millennials are the largest and fastest-growing retail consumer segment in the nation. In Hampton Roads, this demographic represents 30 percent of a total population in excess of 1.7 million people. This tech-savvy and largely transient group spends approximately $3.4 billion on retail and dining every year in the local economy. It is widely acknowledged that Millennials are changing the retail industry. Developers and retailers alike, faced with rapidly changing spending patterns, more than ever must focus on the shopping, living and working trends of these consumers in order to ensure that future developments meet the needs and expectations of this demographic. The well-established, nationwide trend of shoppers migrating to walkable, mixed-use environments has led to the proliferation of multi-faceted, pedestrian-friendly developments that feature specialty retail as an integral part of a live/work/play theme in a more or less urban setting. Hampton Roads is no exception to this movement. This explains the growth of lifestyle centers in Hampton Roads, as well as the successful repositioning of some traditional malls in the region. The combination of these upscale projects and the purchasing power of the large population base has finally caught the attention of many upscale national retailers that heretofore had considered …
LITTLETON, COLO. — Vestar has acquired Bowles Crossing, a 409,457-square-foot regional shopping center in the Denver suburb of Littleton, for $76.1 million. The 53.8-acre Bowles Crossing is one of the area’s top regional shopping destinations in the southwest Denver metro area. Tenants at the center include Trader Joe’s, DSW Warehouse, Ross Dress for Less, Gordmans and a newly renovated AMC Theatre. The center is located at 8055 W. Bowles Ave., at the northeast corner of Wadsworth Boulevard and Bowles Avenue. Vestar plans expand the shopping center, adding new retail, restaurants and a multifamily component. “Over the past 12 months, Vestar has acquired five retail centers valued at $670 million throughout the Western states,” says Clint Marchuk, the firm’s vice president of acquisitions. “Our goal is to continue acquiring strategic centers in key markets with strong demographics.” Vestar also recently acquired the 623,205-square-foot, open-air retail and entertainment portion of The Gateway, a retail, residential and office complex in downtown Salt Lake City. Phoenix-based Vestar is a privately held real estate company that specializes in the acquisition, management and development of commercial real estate, particularly retail. The company owns and manages more than 25 million square feet of retail assets in the …
The Charlotte MSA continues to experience a high level of retail activity as we go into the last quarter of 2015. With a regional inventory of 62 million square feet of retail space, the MSA has seen more than 8 million square feet of new development proposed. Vacancy rates are holding steady in the 8 to 9 percent range, and average rents have remained stable. Grocers Setting the Pace Retail development activity in the Charlotte area remains driven by grocery store expansion. Publix has opened units in Ballantyne, Matthews, Southeast Charlotte and, most recently, South End, with several new stores approved and in various stages of development. Some of the Publix activity has resulted from conversions of units it acquired from Bi-Lo, while the Ballantyne, Fort Mill and South End stores were new construction projects. Publix will open five more stores in the market in the coming year, bringing its MSA store count to 16. This will include Publix’s first stores in the Cabarrus County and Gaston County markets. Perennial market leader Harris Teeter remains the dominant traditional grocer in Charlotte with a 20 percent market share, which places it, Walmart and Food Lion in close proximity. Harris Teeter, which …
Recovery is continuing to occur in the Delaware retail market and forecasts show it will continue in the year to come. The retail sector has been strong in Class A locations, while secondary centers have experienced less demand. Land values on major corridors remain high and the limited supply is expected to further this trend. The area around Christiana Mall continues to be a strong draw for national retailers. Recent new retail activity includes the Christiana Fashion Center, which has been approved for buildings totaling in excess of 500,000 square feet. Current tenants include The Container Store, REI, Nordstrom Rack, DSW, Saks OFF Fifth, Ulta Cosmetics and Jared Jewelers. Allied Properties is developing the center. Also in the Christiana area, Kimco is planning to develop the Christiana Promenade which will encompass more than 400,000 square feet. Demolition of an existing structure is underway. The city of Wilmington will see a new $40 million redevelopment of a popular retail and office location on the 2000 block of Pennsylvania Avenue. Mayor Dennis Williams recently announced the project, which will redevelop the existing property into an attractive, high-quality mixed-use and pedestrian-oriented space that incorporates luxury residences above a first floor of quality retail …