CREJ - page 2

Page 2
— Retail Properties Quarterly — February 2016
CONTENTS
Letter from the Editor
4
6
8
10
14
16
17
18
19
20
T
he impact the millennial gen-
eration is having on the com-
mercial real estate world was a
common theme addressed by
all the panels at the 2016 Devel-
opment & Construction Summit held
by the Colorado Real Estate Journal in
January.
For retail, this
largely relates to
creating shopping
or dining experi-
ences.The theme is
addressed through-
out this issue of
Retail Properties
Quarterly as well.
Creating unique spaces – whether it’s
designed to make you reimagine how
to think of shopping malls, designed
to change your perspective of a certain
industry or designed to encourage a
flow of people around a unique space
– can positively impact the retail expe-
rience.
As developers push to embrace these
new parameters, certain areas are
benefitting. “There was a shift after the
recession to higher-density projects in
high-growth areas,” saidWill Damrath,
vice president, Regency Centers.
Demand is high for quality inline
and mixed-used space that is 10,000
square feet and smaller, said a Q4
2015 CBRE Marketview report. Several
mixed-use projects with ground-floor
retail are coming on line this year,
including 1777Wewatta, Dairy Block
and 2450 S. University Blvd.
Restaurant retailers are seeking to
capitalize on this experiential trend
with their own twists on unique din-
ing options, such as the farm-to-table
and many fast-casual spots populating
the metro area. Kelly Greene, president
of Urban Legend Retail Group, writes
more about this impact in his article
on Page 16.
With the plethora of restaurants
in the metro area, more research is
required on every restaurateur before
leasing, said Damrath. Regency Cen-
ters predominately deals with grocery-
anchored shopping centers and says
some of the most active tenants are
restaurants. One example he gave was
for a vacant space that garnered inter-
est from a Mexican restaurant and a
burger restaurant. Before coming to
a decision, the team researched the
businesses’ other locations, finances,
competitors as well as their credit.
They ended up forgoing the one with
better credit because they believe the
other shop would activate the corner
better, he said.
As the market stays hot, developers
said the challenge with high-density
projects and smaller boutiques is that
the total volume put in place is down,
and it is expected to stay down.
From an overall market perspective,
the retail market is strong and the
outlook for 2016 is positive. In 2015,
investment activity totaled nearly
$1.1 billion, which was a 66.1 percent
increase from 2014, according to the
CBRE report.The annual retail absorp-
tion was positive at 578,805 sf, and
the average direct asking lease rates
– $17.19 per sf triple net – were up 8.8
percent year over year.
Michelle Z. Askeland
303-623-1148, Ext. 104
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