+ 2012 Year End Market Report

GREENVILLE
RETAIL
MARKET REPORT
Q42012
NO RESERVATIONS IN RETAIL
Or are there? For the first time since 2010
the Greenville/Spartanburg retail market has
experienced some negative absorption numbers, although vacancy has made a steady
march downward from 7.7% in 2010 to the
current vacancy rate of 6.7% at year-end
2012. The lowest vacancy was recorded at
year-end 2011 at 6.4%, and now we are just
beginning to see a slight tick upward in vacancy to go along with those negative absorption numbers. So what’s happening in
the retail market?
Over the past three years, the Greenville/
Spartanburg retail market seemed untouched by the economic crisis for the most
part. We did see retail giants like Circuit City
exit the market altogether leaving vacant big
box space, but it was not long before retailers—big name retailers—backfilled those
empty spaces, although in cut-up smaller,
more efficient footprints. There was a little
more challenge for other areas with empty
big box space such as the Laurens Road retail
sub-market, but that area has also settled
into a decent retail backfill and remains the
“king of car sales” with its Motor Mile of
dealerships.
VACANCY
7.7%
7.5%
7.1%
6.4%
6.9%
6.7%
We may yet see another challenge near Haywood Road with the exodus of Babies R Us
and Toys R Us as they plan to follow the retail crowd to Woodruff Road sometime in
2013.
Overall statistics of the retail market as reported by CoStar show net absorption in
2012 as a negative 39,259 square feet. Not
too bad when you consider the drop in
absorption in second QTR 2012 of a negative 375,915 square feet. Of course this
was offset by a positive absorption of
136,878 square feet in third QTR and a
positive 215,623 square feet absorbed in
first QTR.
Rental rates in the retail market are the
lowest they have been since 2010 when
the average rent was $9.93. Rates dropped
again in 2011 to $9.82, and another drop
to the current average rental rate of $9.37
is reflective of the stalled absorption rates.
Co-Star reports the total retail inventory as
82 million+ square feet in nearly 10,500
retail buildings and centers across six Upstate counties, including Greenville, Spartanburg, Anderson, Laurens, Pickens, and
Cherokee.
Sales activity showed improvement in the
retail segment over the previous year.
Retail center sales activity in the first nine
months of 2012 recorded 20 retail sales
with a total volume of $51,376,638, translating to a per square foot price of $80.94.
This compares to the first nine months of
2011 where 18 retail transactions occurred
with a total volume of $46,275,854, a per
square foot price averaging at $57.87. One
of the largest retail transactions occurred
in fourth QTR 2012 with the sale of the
194,488 square foot Shoppes of Plaza
Green in Greenville. This center sold for
$28,800,000, or $148.08 per square foot.
Another noteworthy sale in fourth QTR
2012 was the former Sam’s Club building
on Laurens Road, a 133,143 square foot
free-standing retail structure, which sold
for $3,250,000. This project was only on
the market for four months and was listed
and sold by Lee & Associates-Greenville.
Greenville:
#1 BEST CITIES FOR JOBS
THIS SPRING
Forbes (2012)
AT A GLANCE
VACANCY RATE
6.7%
NET ABSORPTION
39,259 SF
RENTAL RATES
$9.37/SF
Source: 2012 CoStar Group, Inc.
ABOUT LEE & ASSOCIATES
ABSORPTION
+277K
What’s in store for the Greenville/ Spartan
burg retail market in 2013? There really are
no reservations about the health of the retail
market. With improvement in nearly every
segment of the CRE industry, it leaves little
doubt that retail will continue its growth
patterns as well. The world of retail is everchanging, but we’ll never have reservations
about it.
+233K
+141K
-15K
+69K
-375K
Lee & Associates is the largest broker owned firm in the
nation, with 47 locations across the nation. With a roster of
nearly 750 expert brokers, Lee & Associates provides a wide
range of specialized commercial real estate services. Since
1979, our seasoned and motivated shareholders and professionals have been offering comprehensive and quality service
nationally and locally in a proactive manner. We develop
customized solutions for all your real estate needs through
our market-to-market knowledge in all property types. Lee &
Associates is dedicated to providing unmatched expertise,
service and insight and strives to meet client’s needs with
economy, ingenuity and integrity.
105 East North Street | Suite 200 | Greenville, SC 29601 | 864.704.1040 | lee-commercial.com
1
OUR MARKET DEFINED
In an effort to bring additional value to our clients and potential customers, we have chosen to provide market insight into the
more core area of the Greenville/Spartanburg industrial market. The chosen geographical areas (shown on the map page) have
been selected based on our tracking of the market activity for several years. As in all reports, the actual numbers of transactions
and type of transactions in any such year will impact the overall statistics. As always, our team of professionals are available to
discuss in greater detail any questions that you may have to determine how your decision-making process can be enhanced by
greater market knowledge.
—P. Randall Bentley, President, Lee & Associates-Greenville
INVENTORY
MARKET REPORT | YEAR END 2012 | RETAIL
MARKET
VACANCY
ABSORPTION
QUOTED
# BLDGS
TOTAL RBA
TOTAL SF
VAC %
Q4 2012
TOTAL 2012
RATES
NE QUADRANT
889
17,590,543
1,360,016
7.7
-222
21,433
$9.55
SE QUADRANT
829
16,932,505
1,025,202
5.4
-3,689
-47,583
$11.45
SW QUADRANT
101
1,486,236
221,590
12.4
-4,200
-35,492
$5.29
NW QUADRANT
928
18,034,900
1,387,711
7.7
-3,451
26,856
$9.55
CBD RETAIL
93
673,521
44,302
6.6
-4,800
-8,634
$16.12
SUBMARKET EXPERT ANALYSIS
Sub-markets defined by Lee & Associates-Greenville are displayed on the map page as Northeast, Southeast, Southwest and
Northwest Quadrants. Sub-market statistics for this defined retail market are based on a total inventory of 54,717,705 square
feet in 2,840 retail buildings and centers which have an RBA of 5,000 square feet and above. The overall statistics at year-end
2012 for these defined Quadrants reveal a total of 4,038,821 square feet of vacant space, a 7.5% vacancy rate, slightly higher
than the overall market vacancy rate of 6.4%. This higher vacancy rate is attributable to the troublesome SW Quadrant with a
vacancy rate of 12.4%. This particular Quadrant has the smallest retail volume and is not known as a retail powerhouse area.
Its retail market consists of smaller centers and stand-alone buildings with a healthy dose of “mom and pop” type businesses;
therefore, its impact on the overall retail market is not substantial.
HOT TOPICS IN RETAIL
Attracting New Business to the Upstate
Cabela’s Inc.
The outdoor retailer plans to open a new store in Magnolia
Park, at the site of former Greenville Mall, by spring 2014.
The retailer sells hunting, fishing, and outdoor gear, to name
a few. The store is expected to employ approximately 235 full
time employees, and additional part-time and seasonal employees as necessary. “South Carolinians are part of an exceptional outdoor tradition and share the Cabela’s lifestyle and
values. We wanted to build a store in the Greenville area to
recognize that,” Cabela’s CEO Tommy Millner said in a news
release. “We are also excited about the opportunity to expand our retail footprint in the Southeast.”
GSA BUSINESS
Greenville Named in
AMERICA’S
GREATEST
MAIN
STREETS
Travel & Leisure (2012)
2012 TOP LEASES (Based on Leased SF)
ADDRESS
2645 Laurens Road
SUBMARKET
SF
QTR
TENANT
TYPE
NE Quadrant
27,104
1st
Big “O” Dodge
New
700 Standing Springs Road SW Quadrant
21,840
1st
Undisclosed
New
190 E Blackstock Road
SE Quadrant
15,550
2nd
GB Shoe Warehouse
Renewal
905 S Batesville Road
NE Quadrant
13,813
2nd
Dollar Tree
New
*127 E Blackstock Road
SE Quadrant
10,781
3rd
Cingular Wireless, et. al.
Renewal
2012 TOP SALES (Based on Sales Price)
ADDRESS
SUBMARKET
SF
SALES PRICE
SP/SF
SELLER
BUYER
The Shoppes of Plaza Green NE Quadrant
194,488 $28,800,000
$148.08
Andrade Development Co.
PlazaGrille Limited
Partnership
*2519 Laurens Road
133,143
$24.41
Dune SC Sub I, LLC
Verdae Properties
NE Quadrant
$3,250,000
*Lee & Associates Transaction
105 East North Street | Suite 200 | Greenville, SC 29601 | 864.704.1040 | lee-commercial.com
2
OUR MARKET DEFINED
CBD
Total SF……………..……..±673,521
Available SF..................±46,371
% Vacant……………………..... 6.6%
Rental Rate…..................$16.12
Northeast Quadrant
Total SF…………………….. ±17,590,543
Available SF………………... ±1,768,227
% Vacant……………………………... 7.7%
Rental Rate………………........... $9.55
MARKET REPORT | YEAR END 2012 | RETAIL
Northwest Quadrant
Total SF…………………….. ±18,034,900
Available SF………………...... ±717,039
% Vacant…………………………….. 7.7%
Rental Rate……………………......$9.55
Southwest Quadrant
Total SF…………………...... ±1,486,236
Available SF………………..... ±252,988
% Vacant…………………………... 12.4%
Rental Rate…………………..........$5.29
Southeast Quadrant
Total SF…………………….. ±16,932,505
Available SF………………... ±1,547,565
% Vacant…………………………… .. 5.4%
Rental Rate…………………........$11.45
What’s New In Greenville?
Plans are currently in the making to bring several new restaurants and
retailers to historic downtown Greenville. Specifically, retailer Anthropologie is scheduled to open in early to mid-year of 2013. Anthropologie offers women’s clothing, shoes, accessories and home décor.
According to Greenville Mayor, Knox White, “ We knew this spot and
the size of this space might be our last, best chance to get a serious
retail footprint in downtown Greenville and to make downtown
Greenville once again a destination retail for the whole region.”
Additionally Tupelo Honey Café, a restaurant out of Asheville,
NC ,plans to open their 4th store in Greenville this summer. With a
menu full of unique southern dishes, such as sweet potato pancakes
and southern fried chicken BLTS, customers are bound to come back
wanting more. Owner, Steve Fabitore, said Greenville is an ideal place
to open a new location and they are excited to be a part of downtown
Greenville.
GSA Business & Active Rain.com
The information contained herein has been obtained from third sources, which are deemed reliable. Lee & Associates -Greenville has not independently verified its accuracy and makes
no representations, guarantees or express or implied warranties regarding the accuracy of the information herein. Data sources are continually revised and updated, causing both
historical and forecast information, data and analysis to change as new information is added. Third-party data source: CoStar Group
105 East North Street | Suite 200 | Greenville, SC 29601 | 864.704.1040 | lee-commercial.com
3
MARKET REPORT | END YEAR 2012 | RETAIL
LEE & ASSOCIATES-GREENVILLE TRANSACTION HIGHLIGHTS
127 E. Blackstock Road
Spartanburg, SC
±10,781 SF (Total)
SE Quadrant
2519 Laurens Road
Greenville, SC
±133,143 SF
NE Quadrant
200 North Main Street
Greenville, SC
±3,385 SF Unit
NW Quadrant
8595 Pelham Road
Greenville, SC
±5,333 SF
SE Quadrant
3530 HWY 153
Powdersville, SC
±6,00 SF (Total)
NW Quadrant
306 Wade Hampton Boulevard
Greenville, SC
±11,616 SF
NE Quadrant
LEE & ASSOCIATES-GREENVILLE AVAILABLES
38 Ray E. Talley Court
Simpsonville, SC
±9,670 SF
FOR SALE
1021 South Main Street
Greenville, SC
±3,880 SF Unit
FOR LEASE
111 E. Blackstock Road
Spartanburg, SC
±7,478 SF (Total)
FOR SALE
127 E. Blackstock Road
Spartanburg, SC
±11,992 SF (Total)
FOR SALE
107 Cannoy Lane
Clemson, SC
±34,928 SF
FOR SUB-LEASE
2475 Boiling Springs Road
Boiling Springs, SC
±5,022 SF
FOR LEASE
105 East North Street | Suite 200 | Greenville, SC 29601 | 864.704.1040 | lee-commercial.com
4