The landscape of the supermarket business in Philadelphia is changing at a dramatic rate. Larger store formats, such as Wegmans, Target and Walmart are having serious impact on smaller supermarket chains. Two other very tough competitors, Giant of Carlisle, Pennsylvania, and ShopRite, are also reshaping the market share of food dollars spent in the Philadelphia area. Recently Safeway purchased the Genuardi’s chain and sold off almost all the stores. Super Fresh and Pathmark closed many formerly high-producing stores with this new wave of competition. ACME Market, the former market share leader, has seen comp sales decrease dramatically. The newest entry to the market, Bottom Dollar, a discount grocer, hit Philadelphia with an onslaught of 20 new stores and is still growing. Divaris Development’s Village at Valley Forge, in Valley Forge, Pennsylvania, is one of the newer developments that has been on the boards for a while. The Wegmans there is getting ready to open, although additional retail has not been built at this time. Not far away, in Malvern, Uptown Worthington Center by O’Neill Properties is on track leasing a new lifestyle center, going after quality tenants to take advantage of the strong demographics of the Main Line and Chester …
Retail
“When the going gets tough, the tough get going.” The old adage is certainly taken to heart in Jonesboro. Amid the uncertainty of the recent recession, Jonesboro has become a beacon of resiliency and steadfast performance, resulting in much-deserved attention in nearly every aspect of commercial development. In fact, the Jonesboro MSA is one of only 54 U.S. metros that had gains in total employment between pre-recession November 2007 and post-recession November 2011. According to Garner Economics, a look at November 2011 employment shows that only 54 metros, or 15 percent, are at levels exceeding their November 2007 totals, which was one month before the recession officially started. Jonesboro has continued to increase its population, growing at a very respectable 2 to 2.5 percent per year for the past three decades and counting. This steady, consistent growth in population and tax base has made Jonesboro a huge attraction for expansion, particularly in the retail and healthcare segments of the market. 2011 saw just under 300 commercial building permits issued at a value of more than $250 million dollars, and nearly $40 million dollars worth of permits were issued in the first quarter of 2012. Investment in new infrastructure and facilities …
Retail activity in Greater Pittsburgh will likely gain positive momentum through the remainder of 2012, with moderate growth expected in 2013. Grocery stores, local restaurants, fast casual national chain restaurants, medical retail, and upgraded locations for existing national tenants have led the way for recent retail activity in Pittsburgh. The general atmosphere at the annual ICSC RECon convention in Las Vegas was upbeat and optimistic regarding the retail sector recovery nationally. I believe that the ICSC convention is a strong indicator that retail growth is headed in an upward direction. The Pittsburgh retail markets are broken into four quadrants: North (Cranberry/Wexford), South (South Hills Village/Mt. Lebanon), East (Monroeville/Murrysville) and West (Robinson). The Cranberry/Wexford market continues to be the most active, with sales being driven by the new 500,000-square-foot McCandless Crossing Development. Tenants there include Lowe’s, LA Fitness, Hilton, Fidelity Bank and Cinemark. The Northern quadrant along the Route 228 corridor continues to develop with new projects, such as the relocation of Dick’s Sporting Goods to a new larger facility and the completion of the Cambria Suites project. Additional activity on the Route 228 corridor includes a new free-standing La-Z-Boy furniture store, GetGo gas and convenience store, and two additional outparcels …
In the last nine months, we’ve seen a re-energized national retailer base in the Connecticut market that’s seeking new opportunities and absorbing prime retail space. The national retailers never completely disappeared; however, from late 2008 through the spring of 2011 there was little momentum from this sector. This newfound activity has served to restore the confidence of both the landlord and the local retailer base, effectively stabilizing rents and reducing vacancy rates in prime retail corridors. There was a great deal of talk about the “flight to quality” during the economic downturn and that trend continues. We are seeing especially enlivened activity in the upscale retail main streets in Connecticut including Greenwich Avenue in Greenwich, Main Street in Westport and Elm Street in New Canaan. This is not only a local trend, but a global one, as rental rates on high street retail corridors around the globe experienced a 4.8 percent increase year-over-year and luxury goods have made a strong comeback with year-over-year growth of 8.5 percent for the 12 months ending in August 2011. This trailed only the wholesale clubs segment in terms of overall performance. U.S. luxury retailers are also the beneficiaries of a weak U.S. dollar that …
The Southern Maine retail market is rebounding. According to Malone Commercial Broker’s retail survey, Greater Portland’s vacancy rate was at a 10-year high of 10.8 percent in 2009 but dropped down to 6.24 percent in 2011. We are seeing absorption of some empty big boxes, and new retailers are entering Maine’s marketplace. Last year, Buffalo Wild Wings opened its first Maine restaurant in South Portland and then opened a second location in Auburn. Five Guys opened its first Maine location in Portland in 2011, and Elevation Burger opened in South Portland at the beginning of 2012. Despite national headlines that Urban Outfitters is struggling, in 2011 the trendy chain leased approximately 10,000 square feet on Middle Street in Portland. Other retailers new to Maine’s marketplace over the last year include Aveda, BAM! Books-A-Million, J. Jill and White House Black Market. In addition to new retailers entering Maine, some existing national and regional retailers are expanding. To name a few: ACE Hardware has opened a new location in Falmouth; Subway has opened additional locations in Scarborough, Westbrook, and Lewiston; and Verizon opened a flagship store off of Franklin Arterial in Portland. Maine banks and credit unions are expanding as well. Norway …
Retail leasing in the Inland Empire is slowly meandering its way back to a healthy stride. The gamut of activity is still centered around the best opportunities and the strongest centers, but occupancy levels are stabilizing and overall there is a sense of cautious optimism. The retail vacancy rate has remained flat for the past two quarters of 2011 at 8.8 percent. This is a positive trend, however, compared to rates of 11 percent and higher over the past few years. We have also seen new tenants expanding within this market, taking advantage of a lenient leasing climate and landlords anxious to fill their centers. Tenants like Family Dollar, Dollar General, Fallas Paredes, Chase, America’s Tire, O’Reilly, Autozone, Pep Boys, $99 Cents Only, Planet Fitness and Crunch Fitness are actively pursuing junior anchor and pad buildings in shopping centers. Meanwhile, Forever 21, T.J. Maxx, Steinmart, Hobby Lobby and even Kaiser Permanente have absorbed some of the largest vacancies in this market over the past year. Wal-Mart has broken ground on sites in the Victorville trade area and more are on the way, including a few Neighborhood Market locations that Wal-Mart has secured over the past year. While this is positive …
Minimal construction and large lease signings are expected to bring the retail vacancy rate in Columbus to a 5-year low this year. At the same time, investment activity should increase through year’s end, particularly in the multi-tenant retail segment, as investors take advantage of historically low interest rates. Many of the leases in the Columbus metro area will be executed in areas with healthy population growth and established foot traffic, including Polaris, Easton, and Westerville. The lease inked by Menard Inc. for 240,000 square feet at the old Northland Mall last year will help revitalize the Morse Road corridor. Slightly north, elevated household incomes will bode well for Westerville, where Walmart will open by mid-year. Both moves will increase traffic within the area, while attracting smaller tenants to vacated inline space nearby. Elsewhere, Earth Fare Inc. will move into 30,000 square feet at the Gemini Place Towne Center in Polaris, further solidifying the neighborhood as a top retail corridor in Columbus. As leasing activity picks up and development activity remains slack, most submarkets will post an improvement in vacancy in 2012. Economic Vital Signs The Columbus retail market is one of the strongest outside of the Upper Midwest, according to …
Recovery was the name of the game in 2011 for many major retail corridors in Manhattan. SoHo and the Flatiron District were among the most significant rebounding areas. SoHo has benefited from international retailers’ expansion into New York and the city’s record-breaking tourism. New York City welcomed more than 50 million tourists in 2011, including 10.1 million international visitors — more than any other year in its history. The city generated $32 billion in visitor spending and $48 billion in economic impact, according to Mayor Michael Bloomberg and NYC & Company. And SoHo is a major stop on any tourist’s path. Broadway, Spring and Prince streets have long been the market’s primary retail corridors, and rents on these streets are nearly back to 2008 peaks, with very limited vacancy. In 2011, more tenants, especially European retailers, saw value and opportunity on the interior streets — Mercer, Greene and Wooster — which are one-third to half the rent of Broadway, Prince and Spring streets. The interior streets had suffered from higher-than-normal vacancy levels during the recession; now, they are flush with some of the biggest names in retail and are commanding higher rents than ever before. The Mercer Hotel and early …
The Upstate area of South Carolina finished 2011 with quite a bit of retail activity and good news on the retail front has continued into 2012. Greenville, Spartanburg and Anderson saw positive retail absorption of 233,144 square feet in the fourth quarter of 2011, according to CoStar, and vacancy rates declined to 6.4 percent in the fourth quarter of 2011 from 6.6 percent the previous quarter. The housing market seems to have stabilized and is showing positive trends, which is good news for retailers. And the Upstate has had a number of new economic development announcements including BMW’s facility expansion and Amazon’s new 1 million-square-foot distribution center, which is under construction in Spartanburg. The Upstate Alliance reported that 2011 brought the creation of more than 5,000 new jobs and capital investment of more than $805 million in investment and expansions. The Upstate South Carolina region has already announced more than $1 billion in capital investment thus far in 2012. The newest announcement is in Union for Belk Inc.’s new distribution center, which brings $4.5 million in capital investment and more than 120 jobs to the area. The Upstate has had success backfilling some big box vacancies. buybuyBABY took over the …
Salt Lake City’s retail market will post modest occupancy growth through year’s end, though performance will vary considerably by location, as weak housing conditions weigh heavily on parts of the metro. For example, many shopping centers in the Midvale/Sandy/Southeast, Southwest and Weber and Davis counties submarkets, which were home to significant residential and retail construction during the housing boom, will post vacancy in the mid-teens this year. While weakness will persist until the housing market enters a formidable recovery, outer suburbs may offer strong long-term growth opportunities, particularly in the south, as the final leg of Trax extends from Sandy to Draper. In the near term, however, close-in submarkets will outperform. In the South Central area, which experienced limited construction ahead of the recession, vacancy will hover around 5.5 percent. Within the submarket, discount stores, such as Savers, Goodwill and Dollar Tree, along with fitness centers, have started to backfill vacant spaces, taking advantage of discounted rents. Investors will seek healthy returns in Salt Lake City, though limited for-sale inventory will hamper velocity. Private buyers, mostly from Utah or the Western region, will favor performing strip centers and smaller single-tenant deals, such as fast food and drugstore assets, along with …