The Houston retail market has changed dramatically in recent years, but 2014 has seen historically strong real estate fundamentals to date. It is a sign of considerable economic strength that per capita personal income reached a new peak in 2013, even while Houston experienced the largest change in population across U.S. metro areas, according to the latest estimates from the U.S. Census Bureau. Houston’s population increase of nearly 137,700 over the year ending in July 2013 outpaced all other metro areas, with New York in second place (111,749) and Dallas/Fort Worth in third (108,112). Additionally, with Houston employment growth among the strongest in country, it should come as no surprise that household incomes are rising and retail sales are strong. A Retail Landlord’s Market Retail occupancy in Houston reached nearly 93 percent during the first quarter of 2014. While retail availability is extremely limited across the city, it is particularly tight inside the Loop as well as in the northwest areas inside of Beltway 8. Class A product is in high demand across all submarkets, so much so that the highest profile centers currently have no availability. However, despite this high demand, retail construction activity is less than a quarter …
Retail
Home to many of the fastest growing communities in Maine, the Sebago Lakes region is continuing its rebound from the Great Recession. Recent Census data puts Windham as the second-fastest growing Maine community, just behind our neighboring town of Gorham. All six of Windham’s bordering towns are in the top 30 fastest growing communities, including four in the top 10. Windham acts as the marketplace and service center for the region and serves a primary trade area population of 61,000 residents, and a secondary trade area of 80,000 people. The four-season nature of the region draws 500,000 visitors annually. Retail sales have rebounded from recession lows — and with 50 percent of the region’s sales, Windham leads the way. Construction of Single-Tenant Retail Remains Steady Tractor Supply (19,000 square feet), Goodwill (17,800 square feet) and Dollar Tree (10,000 square feet) have added to the 1.5 million square feet of retail space since 2012. AutoZone recently submitted plans for a 7,500-square-foot building to be constructed in the center of our retail district, and other retailers are showing interest in locations south of the retail center along U.S. Route 302. Vacancy Rates Remain Low Windham’s retail vacancy rate continues to remain low, …
The center cores of Baltimore and Washington, D.C., are located approximately 40 miles apart, and talk has renewed about the possibility of connecting the two metropolises by a Maglev rail system. The Baltimore/Washington region is generally considered the fourth largest in the country, boasting nearly 9 million people in the common area. But, when it comes time to rate the demographics, quality of life and overall attributes between the two, Baltimore assumes its secondary status in most comparisons, especially among some professionals in the retail real estate industry. Yet, given the recent successes of retail ventures that have opened in Baltimore City within the past year, prospects for future developments that promise to reinvigorate oft-neglected sections of the city and planned expansions of other mixed-use projects, Baltimore is currently enjoying a “charmed” life. The iconic advertising campaign for National Bohemian beer, which referred to Maryland as “The Land of Pleasant Living,” seems like an appropriate descriptor these days. The project that still has Baltimoreans buzzing is The Shops at Canton Crossing, the 330,000-square-foot retail shopping center situated within the city’s east side that opened last fall, and could easily serve as a national model for successful brownsfield development. Abandoned warehouse …
While Southern New England gambles on casino development, shopping centers are the game of choice in Seacoast New Hampshire. DDR Corp., Waterstone Retail and New England Development have all chosen to invest in major new ventures in the sales tax-free state, and they are expanding their horizons for locations, retail tenants and customers. Supporting retail development, housing activity continues to be robust in Rockingham and Strafford counties. The latest Seacoast shopping center launch is Waterstone Retail’s Granite Ridge Marketplace, at exit 15 of the Spaulding Turnpike in Rochester, N.H. The development plans to capitalize on the Route 11 tourist corridor as well as the populations in the southern Lakes and northern Seacoast regions. (See sidebar below.) With Holiday Inn Express and multiple restaurants already in place, the Granite Ridge District shows great promise as a regional destination and attraction. Combining customers of the Lakes and Seacoast regions, Rochester is a hub of development activity. The Spaulding Turnpike expansion involved an investment of $135 million and has transformed the six Rochester exits. Rochester Crossing by The Wilder Companies (exit 13) is anchored by Lowe’s Home Improvement, Kohl’s and PetSmart, and features Buffalo Wild Wings, GameStop, and Sally Beauty Supply. IHOP Restaurant …
Southern California has one of today’s strongest retail markets in the nation. Orange County has fared particularly well recently, showing resilience to the tough economic period of the past six to seven years. According to CBRE research, the average per capita income in Orange County is 20 percent above the national average, while its unemployment rate stands at 5.8 percent. This is well below the State of California’s rate at 8 percent, and below the nation’s rate of 6.7 percent. The overall retail vacancy rate of 4.9 percent has reduced 50 basis points since the first quarter of 2013 and has shown three consecutive quarters of positive net absorption. While the overall retail numbers in Orange County are improving, certain fundamental changes in the personality of the market are evolving after the recession: E-commerce: Bricks-and-mortar stores in Orange County are responding to unprecedented levels of online sales. According to CBRE research, national online sales are up 185 percent over the past 10 years. They’re projected to grow between 10 percent and 14 percent annually through 2017. Many of the region’s retailers are actively enhancing their customer’s in-store shopping experience to create an environment that e-commerce is unable to offer. Customer …
For Cincinnati residents and businesses, the ongoing revitalization of the city’s urban core is an exciting example of how the traditional live, work and play dynamic can set in motion a cycle of positive reinforcement whereby new housing spurs new commercial development, which in turn encourages additional residential growth. While the Queen City’s renewed civic connections and commercial synergies are making headlines and garnering justified attention, it is precisely this residential spark that has fanned the retail flame. Like so much development — and redevelopment — it is all about “chasing rooftops,” responding to demographic shifts and finding new ways to meet the needs of a changing urban populous. In today’s rapidly evolving Cincinnati market, those changes are evident, and the resulting development is literally and figuratively altering the Cincinnati cityscape. City Living Cincinnati’s recent urban residential development can be broken down into two categories: downtown development in and around the central business district (CBD), and the development in the first-ring communities just outside of that urban core. Both areas are seeing a great deal of high-end multifamily coming online. Typically, this new housing stock is amenity-driven and priced at a premium. The tight rental market for this product has …
Hawaii has been immersed in an economic recovery over the past two years. This recovery has exceeded the overall U.S. performance in regards to total employment growth and total personal income growth. These figures have grown in Hawaii by 2.2 percent and 3.4 percent, respectively. Such economic growth has spurred strong performance from retail centers, while healthy spending from domestic and international shoppers has advanced the retail recovery in Hawaii. According to the Hawaii Tourism Authority, total visitor expenditures for 2013 were a record high of $14.5 billion, a 2 percent increase over 2012. The total visitor arrivals increased 2.6 percent, to 8.2 million, exceeding the previous record of eight million in 2012. International tourism is a strong factor in Hawaii’s economy as well. According to the Office of Travel and Tourism, Honolulu ranks as the fourth-largest port for total overseas arrivals. Honolulu received almost two million non-domestic arrivals in 2012, not including those from Canada and Mexico. Not only is the level of overseas visitor arrivals placing Hawaii close to the top of the pack, but its growth has exceeded the U.S. (on a year-over-year growth basis) every quarter since 2011. International tourism arrivals to Hawaii have grown an …
The Charlotte market is emerging from the sluggish economy of the last several years and is booming with economic and commercial activity. In fact, Forbes recently recognized Charlotte as the fourth fastest growing city since the recession. The retail market is no exception and is continuing to improve with tenant activity increasing and vacancy rates dropping. From desirable South Charlotte to Independence Boulevard, new projects are coming out of the ground in an effort to meet the needs of the tenants in the market that are struggling to find locations. The suburban markets are seeing increased growth as people continue to move to Charlotte. South Charlotte continues to be the most desirable market for tenants, but limited availability has been a problem. The new Waverly project, a joint venture between Crosland Southeast and Childress Klein, will help to provide some options for tenants looking to expand into South Charlotte. Waverly will be located at the intersection of Providence Road and I-485 and is a 90-acre, master-planned development anchored by Whole Foods. The project will deliver in 2016 and consists of more than 230,000 square feet of retail space in addition to 330,000 square feet of office and medical space, a …
Rhode Island’s economy continues to struggle with unemployment that is above the national average. As a result, it has been difficult to get new ground-up development projects started with only a few exceptions. In Johnston, Saletin Real Estate Group has completed construction on the first phase of Johnston Towne Center on Hartford Avenue. The 95,000-square-foot shopping center is anchored by a 40,000-square-foot Price-Rite grocery store. BankRI has also opened a new free-standing facility on the site. In order to make the development a reality, the mayor and town council worked with the developer and issued tax increment bond financing. The project is considered a major redevelopment victory for the town of Johnston, as the construction of Johnston Towne Center required the demolition of the former Stuart’s Plaza shopping center — which had been 100 percent vacant for many years, and had become an eyesore along Hartford Avenue, one of Johnston’s busiest streets. Johnston Towne Center serves as the second victory for the rejuvenation of Hartford Avenue. The former Shaw’s grocery store, which had been vacant for several years and shares the same traffic signal as Johnston Towne Center, is now fully leased to Ocean State Job Lot and Planet Fitness. …
The Texas economy has recovered quickly from the recession, and Fort Worth is a prime example of a flourishing commercial real estate market. Leasing activity in the city’s retail market is high, despite low inventory and increased rental rates. Cap rates are low, investment sales have increased, and the scarce inventory has prompted multiple new developments. Incredible leasing activity involving both national and local credit retailers has been seen across the market, and the activity is projected to continue throughout the year. In particular, there are many high-end grocers entering the Tarrant County market, such as H-E-B, Sprouts and Whole Foods, to name a few. With leasing activity increasing in the market, there is a high demand for retail space, but there is a low supply, evident in the current 8 percent vacancy rate. The limited availability of leasable retail space coupled with high demand in the market has continued to drive up rents — rates have increased by 5.5 percent since the first quarter of 2013 — and has also begun to affect sales prices. The average asking price for Tarrant County retail investment properties currently stands at $146 per square foot, compared to $142 per square foot in …