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PALM BEACH COUNTY, FL-Shopping centers in the county have bounced back and are experiencing strong occupancy rates and rents, according to recent research by Terranova Corp., a third-party commercial real estate advisory firm based in Miami.
The research results are based on a survey of 196 centers with 50,000 sf or more and do not include enclosed regional malls. Research shows that after the county's shopping centers had suffered from double-digit vacancy rates at the end of 2001, with much-improved occupancies, the market is seeing double-digit percent increases in average rent.
Countywide, the shopping center vacancy rate has been cut nearly in half, dropping to about 5.2%, compared with about 10.3% in winter 2001. This improvement occurred despite an increase of approximately 1.3 million sf of new shopping center space during the period.
Both the new retail projects introduced to the market and the absorption of previously vacant anchor spaces have contributed to higher rents. The average asking rent for shopping centers in Palm Beach County currently is $20.04 per sf--a 27.5% hike from $15.72 in 2001, adds the report.
According to the research, the biggest rent increase occurred in the Wellington/Royal Palm Beach submarket, which saw its average asking rent increase 48.21%, from $14.81 in 2001 to $21.95 currently. Since the 1.3-million-sf Mall at Wellington Green opened in fall 2001, this submarket has seen a growth spurt in retail and residential construction in general.
The Terranova study also shows that while some major retailers, such as Kmart, Sears Homestore and Winn-Dixie, have cut back or closed in the area, other national and local stores have expanded to fill the space. Two such stores are Staples, which has replaced a Homestore in Delray Beach, and President Supermarket, which opened in a former Winn-Dixie location in Lake Worth.
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