Attachment

2Q16: Columbia Retail Market Report
Vacancy Rates
Vacancy
Direct SF
4,000,000
Total SF
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
2014 2q
2014 3q
2014 4q
2015 1q
2015 2q
2015 3q
2015 4q
2016 1q
2016 2q
0
Year by Quarter
Rental Rates
Source: CoStar Property®
Rental Rates
$13.00
General Retail
Overall Retail
$11.50
$11.00
$10.50
2014 3q
2014 4q
2015 1q
2015 2q
2015 3q
2015 4q
2016 1q
2016 2q
$10.00
Year by Quarter
Net Absorption
Net Absorption & Under Construction
Source: CoStar Property®
900,000
Absorption
Retailers continue to express interest in the Columbia Metropolitan Statistical
Area (MSA), continuing momentum that began in 2015. Columbia’s second
quarter overall retail vacancy slipped even further down to 6.0% and
market absorption was strong spiking to 493,141 square feet (SF). Top
existing grocers, like The Fresh Market and Kroger, are moving forward with
stores to meet the needs of a growing residential population in Columbia.
As the market awaits those deliveries, other major grocers are preparing
to open in the Midlands. The highly anticipated, ±153,000 SF Costco
Wholesale Warehouse, located off of Piney Grove Road and Fernandina
Road, is scheduled to open this August. In addition, Sam’s Club opened
a new 136,000 SF store recently this summer at the Village of Sandhill.
$12.50
$12.00
2014 2q
Grocers Aggressively Expand As New
Players Enter Columbia Market
800,000
UC Inventory
700,000
600,000
Also, a major grocery chain dominating the European marketplace is planning
a massive United States expansion, with three stores planned for South
Carolina. Lidl, described as a cross between Walmart and Trader Joe’s,
has proposed two locations in Columbia and a third in Orangeburg. The
company spokesman says they are hoping to have stores open by or before
2018. Lowes Foods, a Winston-Salem based grocery chain, announced
plans for two stores during the second quarter in the Lexington submarket.
Overall the retail market is seeing significant ground-up construction and
redevelopment of older shopping centers as the desire for quality space
grows. Columbia’s major retail corridors: Harbison, downtown Columbia, the
Golden Triangle (generally Forest Acres to Garners Ferry Road within the I-77
loop), Northeast Columbia and Lexington continue to see the most activity.
500,000
400,000
300,000
200,000
100,000
0
2014 2q
2014 3q
2014 4q
2015 1q
2015 2q
2015 3q
2015 4q
2016 1q
2016 2q
(100,000)
Year by Quarter
Trends for 2Q16
NET ABSORPTION
Source: CoStar Property®
VACANCY RATE
Harbison (Dutch Fork/Irmo market):
This submarket continues to be the premiere shopping corridor
in the Columbia market. Costco plans to open the doors at its first
Midlands store and fifth South Carolina store on August 10 at Piney Grove
Road and Fernandina Road. Also, a new Publix grocrey store is set to open in
September off Chapin Road and will be the flagship store for Chapin Crossing.
Downtown Columbia (Central Business District):
Driven by the University of South Carolina’s rapidly growing student
population, new retailers are calling downtown Columbia “home.” The new
student housing explosion (with the vast majority opening this August)
has increased the demand for retail and restaurants, breweries and bars.
The Casual Pint, a Tennessee craft beer maker, celebrated its grand
opening at 807 Gervais Street. The adaptive reuse for Columbia’s old
fire department headquarters on Senate Street has been leased to three
different restaurant concepts which should begin construction this year.
Continued on Page 2
CONSTRUCTION
RENTAL RATES
807 Gervais Street, Suite 301
Columbia, South Carolina 29201
+1 803.254.0100
www.naiavant.com
Columbia MSA
RETAIL MARKET REPORT
2nd QTR 2016
Market Indicators
u



Vacancy
Rental Rates
Net Absorption
Construction
Survey Summary
Building Type
Retail
Building Size
10,000 SF & Up
Occupancy
Single & Multi-Tenant
Result: Total RBA in SF
51.9M SF
Vacancy by Type
Single Tenant: 27.9M SF
3.6%
Shopping Centers: 15.2M SF
8.2%
Power Centers: 2.6M SF
4.8%
Malls: 6.0M SF
12.0%
Total Retail
6.0%
Rental Rate by Type
Single Tenant
$12.65/SF
Shopping Center
$10.62/SF
Power Center
$9.14/SF
Malls
$14.98/SF
Total Retail
$12.28/SF
Contact our experienced retail specialists for more details
on the statistics offered in this report.
Also, longtime plans to build a Kroger anchored mixed-use development on the
former Capital City Stadium continues to move forward. The city of Columbia’s
Planning Commission gave unanimous approval to request to rezone the property
from a light industrial district to general commercial. Conceptual plans include
a Starbucks, apparel store and drive-through pharmacy. In other news in this
submarket, The Army Navy Store downtown on Main Street has closed and a
6-lane bowling alley will take its place, according to the developer. Renovations are
estimated at $4-$5 million for the historic structure. Over at 1635 Main Street, plans
unfold for Lula Drake wine bar. Smoothie King, a healthy concept smoothie shop,
is opening on Lincoln Street in the Vista as well as Palmetto Twist, a monogramming
boutique. A 10-screen “luxury” cinema at The Commons at BullStreet was
announced to serve as an anchor for the 85 planned retailers (400,000 SF) in the
mixed-use center. The theater will include a full-service restaurant and bar with
a creative American bistro cuisine (targeted completion Summer 2018). Hughes
Development also delivered over 26,000 SF of prime retail space in the ground
floor of the First Base Building in the second quarter. The Arnold Companies
dedicated West End Alley in the 700 block of Gervais Street with a couple
new restaurants including Tin Lizzy’s Cantina as well as City Bar and Fondue.
The Golden Triangle:
This area is generally defined from Forest Acres near Trenholm Plaza over to
Garners Ferry Road (within the I-77 beltway), stretching also to include the Whole
Foods anchored Cross Hill Market and Target anchored Shoppes at Woodhill
area. The Beach Company closed on the long anticipated former Cardinal
Newman School on Forest Drive for their $58 million mixed-use development.
Conceptual plans include approximately 42,000 SF of retail to help satisfy the
strong demand and tight vacancy in this coveted submarket. On the outskirts
of Forest Acres, Piggly Wiggly has announced plans to close its longstanding
store on West Beltline Boulevard by years end. Hickory Tavern Grill and Raw
Bar, along with MOD Pizza, will be located side by side at Shoppes at Woodhill.
Hickory Tavern will occupy 6,000 SF and MOD will occupy about 2,400 SF.
Northeast Columbia:
This submarket is excited to welcome The Fresh Market on Two Notch Road,
one of two new stores in Columbia. The location is currently under construction
with expected delivery in early fall 2016. It will anchor the Shoppes at Two
Notch. This submarket leads the Columbia market in construction activity, with 7
buildings currently under construction, totaling ±205,941 SF. Kroger was delivered
officially opening its doors July 20. The ±124,000 SF grocery story is a one-ofa-kind concept in the Palmetto State with upscale service departments, a drivethru pharmacy, fuel center, Starbucks, apparel department and more. The store is
located in the Killian’s Crossing shopping complex. Famous Toastery announced
it will open its first location in Columbia at the former McAlister’s Deli building at
119 Sparkleberry Lane with more locations opening next year. Lidl submitted a
site plan for a new grocery store at Hardscrabble Road and Summit Parkway.
Cayce /West Columbia:
Walmart opened a 24-hour neighborhood market at 1355 Knox Abbott Drive in Cayce comprising 41,000
SF (grocery, pharmacy and fuel station).
A new Goodwill Store also opened this summer at 2119 Sunset
Boulevard in West Columbia with 35,000 SF including a Goodwill retail store, donation center and outlet store.
Lexington:
Lexington has the lowest vacancy out of all the submarkets at 1.8%. This submarket will be the home to two new Lowe’s Food
Stores. The Winston-Salem based chain plans to build a store at the corner of U.S. 1 and Charter Oaks Road, with a second
location to be built on Hope Ferry Road at U.S. 378. These will be the company’s first stores in the Midlands and plan to open
in late 2017. The Fresh Market is building a third new store in the Midlands on Highway 378 in the heart of Lexington. Lidl also
submitted site plans for a new store at the 5200 block of Sunset Boulevard across from Walgreens and Aldi. In addition to
grocery, Lexington Town Hall is preparing to debut its 900-seat outdoor amphitheater this fall. It will be one of the largest
venues of its type in the Columbia area and the Town hopes to attract shoppers to the specialty retail hub taking shape.
2
SOME OF THE DATA IN THIS REPORT HAS BEEN GATHERED FROM THIRD PARTY SOURCES INCLUDING COSTAR GROUP, INC. AND
HAS NOT BEEN INDEPENDENTLY VERIFIED BY NAI AVANT. NAI AVANT MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE
COMPLETENESS OR ACCURACY THEREOF. ALL RENTS ARE PER SQUARE FOOT PER YEAR UNLESS OTHERWISE NOTED.
807 Gervais Street, Suite 301
Columbia, South Carolina 29201
+1 803.254.0100
www.naiavant.com
Columbia MSA
RETAIL MARKET REPORT
2nd QTR 2016
Submarket Statistics
DUTCH FORK/ IRMO
RBA: 4,514,038 SF
Net Absorption: 73,221 SF
Vacancy: 4.4%
Vacancy Less Mall: 4.2%
Rental Rate: $12.81
NORTH COLUMBIA
RBA: 2,434,849 SF
Net Absorption: 14,770 SF
Vacancy: 9.5%
Rental Rate: $7.12
NE COLUMBIA
RBA: 11,686,046 SF
Net Absorption: 173,823 SF
Vacancy: 6.3%
Vacancy Less Mall: 5.3%
Rental Rate: $15.89
FOREST ACRES
RBA: 3,951,422 SF
Net Absorption: 9,900 SF
Vacancy: 12.1%
Vacancy Less Mall: 5.3%
Rental Rate: $10.48
ST ANDREWS
RBA: 6,750,394 SF
Net Absorption: -7,413 SF
Vacancy: 4.9%
Vacancy Less Mall: 4.4%
Rental Rate: $11.62
LEXINGTON
RBA: 4,776,383 SF
Net Absorption: 66,862 SF
Vacancy: 1.8%
Rental Rate: $16.71
KERSHAW COUNTY
RBA: 3,174,883 SF
Net Absorption: 13,183 SF
Vacancy: 4.2%
Rental Rate: $6.02
COLUMBIA CBD
RBA: 2,578,407 SF
Net Absorption: 21,139 SF
Vacancy: 4.9%
Rental Rate: $22.19
CAYCE/ WEST COLUMBIA
RBA: 6,575,035 SF
Net Absorption: 40,532 SF
Vacancy: 6.4%
Rental Rate: $9.68
SE COLUMBIA
RBA: 4,444,443 SF
Net Absorption: 71,348 SF
Vacancy: 3.7%
Rental Rate: $12.16
Significant Transactions
SOLD
Columbia
LEASED
Columbia
JACKSON SQUARE, FOREST DRIVE
±24,702 SF RETAIL CENTER
ALOFT, 823 LADY STREET
±5,033 SF RESTAURANT SPACE
Buyer: 3875/3955 Faber Place, LLC
Tenant: COA Agaveria & Cocina, LLC Price: $8,475,000
3
SOME OF THE DATA IN THIS REPORT HAS BEEN GATHERED FROM THIRD PARTY SOURCES INCLUDING COSTAR GROUP, INC. AND
HAS NOT BEEN INDEPENDENTLY VERIFIED BY NAI AVANT. NAI AVANT MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE
COMPLETENESS OR ACCURACY THEREOF. ALL RENTS ARE PER SQUARE FOOT PER YEAR UNLESS OTHERWISE NOTED.
807 Gervais Street, Suite 301
Columbia, South Carolina 29201
+1 803.254.0100
www.naiavant.com
Columbia MSA
RETAIL MARKET REPORT
2nd QTR 2016
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4
SOME OF THE DATA IN THIS REPORT HAS BEEN GATHERED FROM THIRD PARTY SOURCES INCLUDING COSTAR GROUP, INC. AND
HAS NOT BEEN INDEPENDENTLY VERIFIED BY NAI AVANT. NAI AVANT MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE
COMPLETENESS OR ACCURACY THEREOF. ALL RENTS ARE PER SQUARE FOOT PER YEAR UNLESS OTHERWISE NOTED.
807 Gervais Street, Suite 301
Columbia, South Carolina 29201
+1 803.254.0100
www.naiavant.com
Columbia MSA
RETAIL MARKET REPORT
2nd QTR 2016
For more information, contact one of our experienced professionals:
Todd Avant, CCIM
Chief Executive Officer
tavant@naiavant.com
Bruce Harper, SIOR
Broker-In-Charge
bharper@naiavant.com
Patrick Palmer, CCIM
Director of Retail Services
ppalmer@naiavant.com
Laura Kovacich
Senior Broker
lkovacich@naiavant.com
Dail Longaker
Senior Investment Broker
dlongaker@naiavant.com
Rob Lapin
Senior Broker
rlapin@naiavant.com
Bobby Hathaway
Senior Broker
bhathaway@naiavant.com
John Metts
Brokerage Associate
jmetts@naiavant.com
Featured Lisitings
FOR LEASE
PRIME RETAIL SPACE
The Apartments At Palmetto Compress
612 Devine Street
Columbia, SC
±7,900 SF Retail/Restaurant Space
Lease Rate: $28.00 - $30.00 SF, Gross
5
SOME OF THE DATA IN THIS REPORT HAS BEEN GATHERED FROM THIRD PARTY SOURCES INCLUDING COSTAR GROUP, INC. AND
HAS NOT BEEN INDEPENDENTLY VERIFIED BY NAI AVANT. NAI AVANT MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE
COMPLETENESS OR ACCURACY THEREOF. ALL RENTS ARE PER SQUARE FOOT PER YEAR UNLESS OTHERWISE NOTED.
807 Gervais Street, Suite 301
Columbia, South Carolina 29201
+1 803.744.9800
www.naiavant.com