Posts tagged broughton space for lease
The International Council of Shopping Centers, a 60,000 member global trade association for the shopping center industry, held its southeastern conference in Atlanta last week. 2500 developers, retailers, brokers & service providers networked to make deals with attendance up about 10 percent over last year.
Promoting several of NAI Savannah’s retail listings, our team found there was more activity on the tradeshow floor than last year. Opinions of those we spoke with mirrored the slightly improved consumer confidence index (CCI) in October. Though the CCI is still at very low levels, there was a very modest improvement in consumer’s belief that business conditions will get better over the next 6 months.
Economy brand retailers (Dollar General, Dollar Tree, Big Lots, etc.) are actively looking at expansions as their market segment has been one of the few that has fared well during the recession. Savannah based Citi Trends, a value family apparel retailer, has opened many stores around the US over the last few months. Retailers such as Wal-Greens & CVS had a lot of activity at their booth, but like most, will not expand unless new sites are “main-and-main” locations with strong demographics and little risk of failure.
Retailers that I get constantly asked about, Whole Foods & Trader Joe’s, are expanding only in primary markets for the same reasons. Expanding a non-franchisee retailer to a smaller market like Savannah involves more risk and requires additional management resources, even though it may do very well. Growing a brand in metro Atlanta for example, which allows for multiple locations within a close proximity, reduces distribution costs and manpower. This is especially important when margins are narrow. Unless there is a unique story, Savannah will be pursued by retailers when the larger markets are more saturated.
In a panel discussion, several investment REITS said they are finally starting some retail acquisitions but are being very selective. They did not see the large amounts of distressed properties as anticipated and need to start placing their funds. Cap rates have already reduced in some sectors.
Landlords say they are actively signing leases versus last year when they were just waiting for 2011. The economy is hopefully bottomed out with very few tenants asking for rent reductions compared to last year. A good local sign, the new Pooler Publix shopping center recently opened 93% pre-leased. They still have work to do to pre-lease Phase II of the project. In our overall market, new development has been almost absent. The Oglethorpe mall, nearly fully occupied, shows individual store sales up this year compared to a 3 percent drop last year.
Locally, Christmas retail sales are projected to increase 2 to 3 percent. Kiplinger projects 2010 national Christmas sales to increase by 3 percent. 2011 national retail sales are projected to be slightly under 3 percent versus the 3.5 percent projected for 2010. Making the fourth straight monthly gain, national retail sales were up 1.2 percent in October mostly due to auto sales.
Rex Benton is Savannah Commercial Real Estate agent with NAI Savannah, the commercial division of Mopper-Stapen, Realtors and is a contributing columnist for “BiS-Business In Savannah” weekly business publication and is an active blogger: http://www.savannahcommercialrealestate.blogspot.com/ www.naisavannah.com 912-358-5600 Office Space, Retail Space, Industrial Space, Investment Real Estate