Retail Rents, Pricing Not Going Down Anytime Soon
Retail may be nearing the top, but we're not coming down soon, many of our panelists said during our Retail & Restaurant Roundup last week. Franklin Street's Monetha Cobb (above), who moderated a panel of development gurus, says rents are near a top on what the typical retail tenant can afford.
“I feel momentum picking up,” says Loudermilk Cos' Robin Loudermilk.
Robin also says land prices are still high, making new developments difficult to pencil out. In fact, if you haven't tied up land for development, he predicts it's too late since sellers still have “stars in their eyes” when it comes to pricing their properties.
“I think we'll have an economic rollback,” he says, "but I think there's still a runway on some of the land prices."
Robin and Monetha were part of a lineup of developers and brokers that included Marcus & Millichap's Michael Fasano, North American Properties' Ron Pfohl and Halpern Enterprises' Jack Halpern at the JW Marriott in Buckhead last week.
Restaurants are still a darling tenant for many retail developers. Jack highlighted his redevelopment in Smyrna, the 48-acre Shops at Belmont project. The development, which will include medical office and retail, will feature a majority of local restaurants.
“Over half the square footage in that project is devoted to restaurants,” Jack says, adding they're all locally run operations. “We take chances with people whose credit might not pass muster with larger retail owners.”