ICSC: Deals are Back
The rise of e-commerce and the fall of the US economy led to fewer retail deals over the past five years, JLL Americas retail chief Greg Maloney told us at ICSC in Vegas this week. But with the economy back to pre-recession levels, retail deals are starting to close in big waves, especially around hot job growth markets on the coasts. Bricks-and-mortar stores are more resilient than even the harshest critics thought, Greg says (the Big Bad Wolf could've told you that), since there's nothing like an in-person experience: "You can't replace the touch and feel aspect of retail."
Increased activity is causing retail owners to rethink existing properties, says Cushman & Wakefield Americas retail head Matt Winn. Dormant shopping centers are having to evolve, he adds, which means adding a unique mix of uses like healthcare instead of the same old fashion and food. It also means adding newer local concepts to spice things up. (Adding spicy foods might also increase trips to the healthcare tenants. That's what we call synergy.)
Weingarten Realty CEO Drew Alexander isn't looking to add trendy flavor-of-the-month design features into existing or future centers, going more for a classic, elegant look for common areas and storefronts to keep projects timeless—and more importantly, to keep customers coming back. LA, Seattle, and DC are growth areas for Weingarten, Drew tells us, and the firm is part of one of DC's largest scale projects, developing the retail portion of the Walter Reed Medical Center redevelopment.
Madison Marquette CIO David Brainerd says curating a retail mix should be about more than achieving the highest rent, a strategy the firm is sticking to with the lease up for DC's massive Wharf project on the Southwest Waterfront. Madison, PN Hoffman, and the other development partners are talking with several celebrity chefs (Mike Isabella and Stephen Starr, among others) about the 3.2M SF complex, but will also look to add neighborhood serving offerings like a movie theater and athletic concepts.
