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| Michael Bull in Recording Studio |
ATLANTA, GA (Jan. 29, 2013) – After enduring a brutal
stretch during the Great Recession and its aftermath, the U.S. retail real estate
sector stabilized in 2012.
That was the
consensus of a panel of experts on the most recent episode of the weekly
“Commercial Real Estate Show” radio program, hosted by Michael Bull of
Bull Realty. The episode took an enlightening look at the sector, examining
investment sales, development trends and retailers that are expanding.
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| Dan Fasulo |
“We definitely moved
into a period of stabilization [last year],” said Dan Fasulo, managing
director of Real Capital Analytics. “We’re not seeing huge declines in occupancy
anymore, not really seeing rents plummeting. There might be certain submarkets
that are still pressured, but all in all, fundamentals have stabilized.”
The sector should
continue to improve gradually in the year ahead, Fasulo added. “I think we’ll see
incremental growth,” he said. “The U.S. economy is like a big ship – once it’s
going in the right direction, it’s hard to turn back around.”
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| Bob Simons |
All of the
components of the retail real estate sector are feeling better about the
industry, said Bob Simons, a partner with the Hartman Simons commercial
real estate law firm.
“There’s an increased confidence,” he said. “There’s
confidence from the consumers – [they] are starting to spend more money out
there. There’s increased confidence from the equity markets. Going back to ’09,
2010, the equity markets were running as fast as they could from the retail
sector.
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| John Crossman |
“They’re starting to come back, and valuations are starting
to stabilize, improve, which brings lenders back to the fold.”
Despite the overall
uptick, the sector still faces issues, and filling vacancies can remain a
challenge. John Crossman, CEO of Crossman & Co., said his firm often
has to get creative to fill the retail properties it leases.
“We’re being very
pro-active on non-traditional uses … ,” he said. “Maybe there’s an office
tenant that comes into a retail space. We’re [finding] medical [tenants], which
can be very helpful, and we’ve had churches come into shopping centers.”
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| Jeff Fuqua |
The guests said the
sector is nearing the point where new development is feasible, but Jeff
Fuqua of Fuqua Development said new retail properties will be a good deal
smaller than the suburban power centers of the past, will incorporate other
uses such as residential, and will be located in intown or dense suburban environments.
Contemporary retail developments are“smaller, more complicated, more expensive
– [they’re] different,” he added.
According to the
guests, sporting-good chains and specialty grocers are adding sites
aggressively, while home-improvement retailers have been stagnant when it comes
to expansion.
The entire episode
on the U.S retail real estate market is available for download at www.CREshow.com.
The next “Commercial
Real Estate Show” will be available Jan. 31 and will examine the U.S. industrial
market.
Contact:
Stephen Ursery
The Wilbert Group
E-mail: sursery@thewilbertgroup.com
Office: (404) 965-5026
Cell: (404) 405-2354
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