GlobeSt.com: What is your view of the Southern California retail market?

Olsen: Southern California, in my opinion, is a very healthy market, especially for retail. But you still have to be very aware of the obsolescence of retail, where you're buying and what's around it. Retail has shifted into more of an entertainment shopping experience. People don't just want to go into one store, get in their car and go into another store. They want to go into one center that can cater to all their needs. We're looking for two things for retail investors: a shopping center that can cover multiple needs or desires for the shopper, and properties where we can go in and add value—we're buying stabilized properties, but maybe creating value through exterior renovations as well as tenant profiles and upgrades.

Wang: Southern California is a market we haven't really focused on for a while because it's very expensive. We have bought some properties that were a little more on the value-add side, in markets like the Inland Empire versus the coastal cities. Overall, the market is still trying to find its new identity, based on what we see with the Internet and Amazon and new types of retailers. It's still scary in a way; we're hearing about major brands going dark—Toys R Us just announced another round of store closings. It's hard with consolidations with major brands making it even more confusing. I think he way to go is to find something a little more creditworthy like Walgreens or CVS, where the client has expectations in order to hold for long time. Cap rates are still very low, and risk-adjusted returns on that type are not what we would hope. Some with a longer hold period or higher risk tolerance are value-add situations.

GlobeSt.com: Where is your retail focus if not Southern California?

Olsen: We just purchased value-add property north of Las Vegas in a prime location, but the center was only about 20% occupied. We like the opportunity, the idea of going in there, leasing it up, doing a complete renovation to the exterior, enhancing the tenant profile and maybe flipping that property with a short-term hold.

Wang: We're not committed to any one area in particular. We're looking more for that type of opportunity; if it presents itself, and the market turns out to be a healthy market that's growing, we won't be averse to going into that market. We won't say no because we haven't gone into that particular area before.

GlobeSt.com: What else should our readers know about retail real estate?

Olsen: It is rapidly changing, and as Andy said, with Amazon being such a big player and shaking things up, you really need to know the market and the particular corner of the street you're on and what is driving your potential customer to that center. It's paramount today with retail because it is changing so rapidly.

Wang: You see trends at this point where different industries are merging. The entire landscape is going to be something very different in five years. Even Walgreens and CVS may turn into a drugstore/pharmacy/clinic with some of the changes. The ability to change in these types of environments and adjust with new hybrid-type locations that have never been in existence before will be key.