Retail

Hungry to Expand, Fresh-Format Grocers Boldly Enter St. Louis Market

by Jeff Shaw August 27, 2015

Family-owned grocers Schnucks and Dierbergs solidified their position as the primary grocers across the St. Louis metro area when Schnucks acquired 57 stores from National Supermarkets in 1995. But after several years of these two chains dominating the grocery sector, an influx of fresh-format grocery stores is shaking up the market by offering shoppers fresh, local, organic — and in some cases more affordable — whole food choices. These new chains — typically half the size of traditional grocers — appeal to a younger customer, as well as those looking to supplement their grocery shopping or find items for special occasions. Consumers interested in the offerings of fresh-format grocers are willing to drive farther to shop at their stores. New Entrants Abound Fields Foods, a “homegrown” fresh-format grocer, opened its first location in the Lafayette Square neighborhood in January 2014. The newly constructed 37,000-square-foot, stand-alone building is just south of downtown’s central business district. The grocer markets produce provided by farmers within 100 miles of the store, and also features a wine bar and personal shoppers. This unique, full-service grocer is locally owned and was the first fresh-format store to enter the metro area. Fields Foods has plans to expand …

August 27, 2015

Market Reports Nevada Retail Western Western Market Reports

Las Vegas’ Retail Market Stabilizes

by Nellie Day August 18, 2015

The Las Vegas retail market is transitioning from recovery to stability. Based on CoStar’s second-quarter report, the overall vacancy rate was 9.9 percent, a slight decrease from the 10 percent experienced at the end of the second quarter of 2014. The decrease is impressive considering the 2 million square feet in net absorption that occurred during this same period. Rental rates have continued to average around $1.30 per square foot, per month for the past 2.5 years, although we are hearing about newer centers achieving impressive rate increases. There was 822,512 square feet of retail space under construction at the end of the second quarter of 2015. Ikea is the largest retail project currently under construction in Southern Nevada, which is expected to open next summer. The second largest project is Tivoli Village’s 117,516-square-foot expansion. Restoration Hardware also signed a lease this quarter for 77,000 square feet at Tivoli. It is expected to take up occupy during the first quarter of 2016. Though private investors dominate the market, we are seeing more institutional investors who are interested in acquiring newly stabilized product. Cap rates have continued to decline, averaging 6.53 percent for 2015, compared to a 2014 average of 6.99 …

August 18, 2015

Darden Restaurants to Spin Off 420 Restaurants into REIT, Names CEO

by Nellie Day August 17, 2015

ORLANDO, FLA. – Darden Restaurants (NYSE: DRI) has announced its plans to create a spin-off REIT called Four Corners Property Trust. Darden will transfer about 420 of its owned restaurant properties to Four Corners, which will lease those properties back to Darden. Darden currently owns and operates more than 1,500 restaurants. Its most notable brands include Olive Garden, LongHorn Steakhouse, Bahama Breeze, Seasons 52, The Capital Grille, Eddie V’s and Yard House. Bill Lenehan has been named CEO of Four Corners. Lenehan sits on Darden’s board of directors and is running for re-election at the company’s 2015 annual meeting of shareholders. He will resign from the board if the Four Corners spin-off becomes official. Lenehan has also removed himself from the independent committees of Darden’s board. “The board and I have been incredibly impressed with Bill’s leadership, knowledge, and skill related to the Four Corners transaction,” says Gene Lee, Darden’s CEO. “We have also been impressed with his vision and capability, which gives us confidence he will be able to lead and transform Four Corners into a leading growth company.“ Four Corners filed an initial Form 10 Registration Statement with the U.S. Securities and Exchange Commission on Aug. 11, though …

August 17, 2015

California Retail Western

Marcus & Millichap Promotes Ten

by Nellie Day August 11, 2015

CALABASAS, CALIF. — Calabasas-based Marcus & Millichap has named nine senior vice presidents of investments and one executive vice president of investments. Alvin Mansour was named executive vice president. Senior vice president promotions include Eduardo Cerna, a multifamily specialist in Palo Alto, California; Jerry Goldstein, a retail specialist in Houston, Texas; Douglas Mandel, an office and industrial specialist in Fort Lauderdale, Florida; Richard Ringer, a multifamily specialist in Los Angeles; Steven Siegel, an institutional retail and net-lease specialist in New York City; Mark Taylor, an institutional retail and net-lease specialist in Philadelphia; Dean Zang, an institutional and retail net-lease specialist in Washington, D.C.; Christopher Zorbas, an institutional and multifamily specialist in San Diego; and Alex Zylberglait, an office and industrial specialist in Miami.

August 11, 2015

Industrial Market Reports Office Retail Texas Texas Market Reports

Dynamic, Fast Growth Comes to the Four-County Area of ‘Rio South Texas’

by Haisten Willis August 7, 2015

It’s safe to say that the Rio Grande Valley, now also referred to as Rio South Texas, is one of the most dynamic and fastest growing regions in the state. The four-county region at the southernmost tip of Texas bordering Mexico and hugging the Gulf of Mexico consists of Hidalgo, Cameron, Starr and Willacy counties. With nine ports of entry, five international airports, a first-class deep water port, a population of over 1.2 million and three interstates, it is easy to see why the Rio Grande Valley is one of the largest trade corridors in the world. Growth in all aspects, including retail, office, medical, education, industrial and housing, brought nearly $700 million in construction permits for all of 2014. Retail Sales tax revenue being sent back to the cities continues to increase at a healthy pace. Walmart’s opening of 12 new stores in the region affirms the positive growth and the confidence in the valley. The impact a Super Walmart has is evident with a city’s sales tax revenue. Two new stores in Donna and Elsa increased local sales tax revenue 14 percent and 57 percent, respectively. Retail sales in the region continue to rise, showing the strength of …

August 7, 2015

Maine Market Reports Northeast Northeast Market Reports Retail

Southern Maine’s Retail Market is Steady and Strong

by Jaime Lackey August 5, 2015

The retail market in Southern Maine remains strong through mid-year 2015. Retail vacancy rates are low, investment sales are up, new retail projects are actively under construction, and plans for new retail developments are on the horizon. Positive trends in Maine’s retail sector have been evident for several years now, indicating that the market has stabilized and there is strong potential for further commercial growth over the next several years. According to Malone Commercial Brokers’ 2014 State of the Market Retail Survey, the Greater Portland retail vacancy rate for 2014 was 3.68 percent, compared to 10.8 percent in 2009. The vacancy rate has consistently dropped every year since 2009, with 2014 marking the lowest vacancy rate in Greater Portland in six years. Initially, annual retail vacancy rate declines in Southern Maine were related to the absorption of empty big boxes and retail centers located in the Maine Mall District in South Portland, as well as the newly created retail hubs built along the Maine Turnpike corridor during the construction boom in the early 2000s. By 2012, one of these new retail hubs located in the City of Biddeford saw Lowe’s, Linen ’N Things, Old Navy, and Best Buy close their …

August 5, 2015

CIT Group Completes $3.4B Acquisition of OneWest Bank

by Nellie Day August 3, 2015

NEW YORK — CIT Group Inc. (NYSE: CIT) has completed its acquisition of IMB Holdco for $3.4 billion in cash and stock. IMB Holdco is the parent company of OneWest Bank. The combined company has more than $65 billion in assets and more than $30 billion of deposits. The merged company will now operate as CIT Bank. The company operates an Internet banking franchise, as well as a network of 70 retail branches throughout Southern California as OneWest Bank, a division of CIT Bank. New York-based CIT Group will continue to be led by John Thain, chairman and CEO. Steven Mnuchin, former chairman of IMB Holdco, joined CIT Group as vice chairman and a member of its board of directors. Al Frank, a former independent director of OneWest Bank, is joining the CIT Board, which will grow from 13 to 15 members. “The completion of this transaction advances our strategic efforts to build a leading commercial banking franchise,” says Thain. “Through the combination of our national lending and leasing platform with OneWest’s wholesale lending and branch banking franchise, we’ve created a differentiated provider of banking services for small and middle-market businesses.” The transaction has received all required regulatory approvals. Per …

August 3, 2015

Florida Market Reports Retail Southeast Southeast Market Reports

New Developments Coming to Miami’s Top Submarkets Will Satisfy Retail Demand

by John Nelson August 3, 2015

Miami is known for its spicy nightlife and beautiful beaches; but those are not the only things the international city has to offer. As the economy continues to surge, many now consider Miami the third major market within the United States following New York City and Los Angeles. Within the city, the retail market has always been attractive to owners and tenants alike, but over the past three years retail has rocketed to the forefront. One of the major factors of this evolution is Miami’s growth, both in population and in tourism. Between being an international vacation destination, a major cruise port, and the gateway to the Caribbean and Latin America, Miami is constantly growing. The weather and city also attracts growth. The population in Miami now is at 2.66 million and Miami Beach’s hotels reported having occupancy levels at or above 94 percent during President’s Day weekend. With this type of growth, Miami is experiencing strong consumer spending and an increase in demand for retail space. Retail vacancies are at an all-time low while rental rates are breaking records. Currently, Miami is considered to be under-supplied per capita in retail. Over the past few years, Miami has been increasing …

August 3, 2015

Market Reports Western Market Reports

Retail Construction, Absorption Remains Strong in OC

by Nellie Day July 28, 2015

After disappointing national GDP results early this year, we’ve received great reports on jobs, housing, auto sales, personal income and construction, suggesting the economy is improving. National job growth has seen a 12-month positive, record-breaking streak, while consumer confidence remains strong. Consumer spending is also likely to remain strong in the coming months, supported by high savings, rising house prices and a tightening labor market. This has led the retail market to continue its improvement with demand driven, in part, by high employment rates and consumer spending. Retailers are continuing to grow and progress with multiple small construction and proposed projects throughout Orange County. The local market finished last quarter with decreasing vacancy rates that ended at 4.4 percent. The Orange County retail market has seen a vacancy rate decline over the past 12 months that began at 4.9 percent and finished last quarter at 4.4 percent. Average rental rates have performed just the opposite to vacancy declines. We’ve seen a rise in the past four quarters to an average of $23.15, a total increase of more than 3.4 percent. The steady decline in vacancy and increase in average rental rates can be directly credited to the high demand for …

July 28, 2015

Great Atlantic & Pacific Tea Company Files for Bankruptcy, Agrees to Sell 120 Stores

by Nellie Day July 20, 2015

MONTVALE, N.J. — The Great Atlantic & Pacific Tea Company (A&P) has filed for Chapter 11 bankruptcy and agreed to sell about 120 of its stores for $600 million. The company operates 296 supermarket and liquor stores under the brand names of A&P, Best Cellars, Food Basics, the Food Emporium, Pathmark, Superfresh and Waldbaum’s. The stores are situated throughout the East Coast, including New York, New Jersey, Pennsylvania, Delaware, Massachusetts, Maryland and Connecticut. A&P will operate as business as usual throughout the court-supervised sale process. The company will soon close 25 stores, however, due to ongoing operating losses. “After careful consideration of all alternatives, we have concluded that a sale process implemented through Chapter 11 is the best way for A&P to preserve as many jobs as possible, and maximize value for all stakeholders,” says Paul Hertz, A&P’s president and CEO. “While the decision to close some stores is always difficult, these actions will enable the company to refocus its efforts to ensure the vast majority of A&P stores continue operating under new owners as a result of the court-supervised process.” The Great Atlantic & Pacific Tea Company was founded in Montvale in 1859. It was initially a small chain …

July 20, 2015

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