Meanwhile, slowdown or not, at least five million sf of new product is either on the drawing boards or preparing to surface among 12 submarkets in 2002, according to published announcements by retail developers in the past nine months.
How the new space will affect the existing 45.3 million sf in the market is a question mark, especially Downtown and in the nearby Colonialtown district where 2.7 million sf of retail has only a 5.3% vacancy mark.
The project everybody is watching is the 2.29-acre, block-long Jaymont tract recently purchased by an investment consortium headed by retired British-born billionaire Joseph C. Lewis. The price was $7.6 million or $3.32 million per acre ($76.18 per sf), lower than most brokers had anticipated. What and when the Lewis gang will do with the prime Downtown dirt will affect the area for decades, brokers predict.
"It would add the missing retail element to the myriad of housing, hotels, office buildings and cultural facilities that are currently under way," Jeffrey S. Sweeney, Grubb's executive vice president/managing director, tells Globest.com. "Downtowns across the country are trying to lure retailers back, but are lacking the critical mass of people to attract them to the area."
South of Downtown, meanwhile, at least two mega retail showplaces are in the works, preparing to debut in 2002. They are the 1.3 million-sf, $300 million Mall at Millenia and the 1.1 million-sf, $250 million Festival Bay on north International Drive, the city's main tourist hub.
In South Florida, however, most retailers and restaurant chains are sketching their New Year expansion plans in light pencil as the bulk of the sales are modest and some are declining, A.T. Toroyan, a principal of Fort Lauderdale, FL-based Rotella Toroyan Clinton Group, tells GlobeSt.com. "Certain big-box segments, such as furniture, home furnishings and consumer electronics are seeing steady sales increases, while a consolidation in other areas such as pet supply stores and party goods, are slipping," Toroyan says.
Big-box space should see a slight increase in second-generation supply, but prime local space continues to have demand outpace supply, the broker says.
The Charlotte market is particularly concerned with growing big-box vacancies at several malls. City planners and brokers worry the shuttered stand-alone buildings will affect property values in nearby communities when owners are unable to re-lease the space to smaller users. Karnes Research Co. of Charlotte notes 12% of anchor stores at area shopping centers are vacant compared with a 7% vacancy level for smaller retailers at the same centers.
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