14A — January 17 - 30, 2014 — Mid Atlantic Real Estate Journal
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2014 F orecast
Nancy Erickson, Cushman & Wakefield Portfolio optimization, new momentum define NJ retail market
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rebranding/remodeling, re- negotiating of existing stores (sometimes with a smaller footprint to lower occupancy costs). On the flip side, more and more landlords are filling their vacancies with alterna- tive retailers, such as quasi- medical and seasonal pop-up stores. Crossing over, we are finding that office buildings are looking to upgrade or again add amenities into their retail space. For example, we have been approached by several landlords wanting to change out their fitness tenants. Two years ago, they would have been grateful just to have the current tenant paying rent. What “traditional” ten- ant categories are most active? While dollar and discount type stores had been the trend during the downturn, today’s health craze has spurred the rapid growth of gyms, massage and healthy food franchises. Fitness concepts like Life Time Fitness are rapidly expanding into alter- native locations like vacant grocery stores at shopping centers and amenity space at office properties. Massage Envy has opened several new locations in New Jersey. This trend is also evident with an increase in smaller specialty food markets like Trader Joe’s and Fairway in downtown
markets and shopping cen- ters previously dominated by fashion and apparel chains. Additionally, New Jersey con- tinues to see new children’s entertainment concepts and growth in educational-focused retailers proving successful. Franchises like School of Rock and stores catering to hobbies, like AC Moore, continue to grow here and nationally. Are new tenants coming into New Jersey? New Jersey, in particular, has become a target market for retailers that have been successful in other parts of the country and abroad, and are now ready to take their concepts to the East Coast. For example, we represent 99 Ranch, an Asian food grocer concept out of California, who is actively seeking space here. While Manhattan is the retail mecca, New Jersey of- fers opportunities in densely populated areas for big box retailers with large land re- quirements such as Cabela’s and CarMax. Also, up-and- coming New Jersey downtown and residential developments have brought fashion and food retailers across the river from Manhattan. Has ecommerce had a tangible impact on re- tail real estate? How are bricks-and-mortar retail- ers responding? E-commerce is just so easy.
If we did not have to go to physical locations for our hair, massage, nails, fitness classes, dry cleaners and (of course) frozen yogurt, we would not. But certain retail categories will always need storefront lo- cations, which is good news for retail brokers and landlords. In addition to traditional personal services and din- ing tenants, we are seeing a huge influx of medical/health services organizations going into retail strip centers, and an increase in daycare chains turning empty buildings into fun, bright learning centers. Additionally, a number of ex- isting retailers that are doing well on the Internet are opting to downsize or open smaller footprints, which is generating activity. If you had a crystal ball, what would it show for 2014? So far, 2013 has proved to be positive in many respects. Retailers have found enough confidence in their analyses to move forward with previously halted expansion plans. For ex- ample, Kool Smiles and Reso- lution Dental grew from two to 140 locations from 2004-2010, then slowed development to re- evaluate all aspects of the busi- ness including operations, site selection and so forth. They ul- timately just announced more growth for 2014. We also have several new-to-the-state large town Manhattan. “Leeward wanted proximity to New York City and looked at a number of sites in Northern New Jersey,” said Baumstein. “Glenpointe provides that proximity, as well as a class A office environment for the company.” H Capital has relocated to Glenpointe from Parker Plaza in Fort Lee, NJ. “The firm was looking to expand and wanted to go to an up- scale building,” said Baum- stein. “After an extensive site search, Glenpointe ultimately provided the best possible so- lution for the company’s very specific requirements.” Glenpointe is strategically situated at the intersection of I-80 and I-95, just three miles from the George Washington
retailers coming in with eight- to 12-acre requirements. That may take some time to match up in our highly dense state, but the demand represents a positive indicator overall. Additionally, a number of projects that were on hold have broken ground. Our offices sit across from MetLife Stadium (home to Super Bowl XLVIII in February) and the adjacent AmericanDreamdevelopment. Twice over the past couple of months, I have taken a tour of the future Mall of East Rutherford site there, and the plans are exciting. With all of this in mind, we are expecting positive things for New Jersey retail in 2014. Prior to heading Cushman & Wakefield’s New Jersey retail team, Erickson for eight years specialized in national tenant representation with the com- pany’s Manhattan headquar- ters office. Other key members of her group include Gabriela Iannotta and Jennifer Sofia. As landlord representatives, they represent more than one dozen New Jersey retail properties totaling more than 225,000 s/f. Their regional and national tenants include Hess, Cabela’s, Burger King, ASAP Urgent Care, Retro Fitness, Kool Smiles, School of Rock, 99 Ranch, The Vein Clinic, London Day School, several specialty startups and others. n Bridge, with easy access to NewYork, New England, and such major thoroughfares as the New Jersey Turn- pike, Garden State Parkway, Routes 4 and 46, and all area airports. The 650,000 s/f complex on 50 acres encom- passes the Glenpointe Centre West, East and Atrium of- fice buildings, the 350-room Teaneck Marriott Hotel and Conference Center, and the 26,000 s/f Glenpointe Spa & Fitness Center. Approvals are in place for the 242,150- square-foot Glenpointe Cen- tre South. Cushman & Wakefield is currently marketing office units ranging from 1,000 to 12,500 s/f at Glenpointe as well as the entire Glenpointe South. n
AST RUTHERFORD, NJ — The economy in recent years has placed
real estate portfolio op- timization as a high priori- ty for Garden State retail- ers and retail l and l o r d s . According to
Nancy Erickson
Nancy Erickson , director of the New Jersey retail team at commercial real estate services firm Cushman & Wakefield in East Rutherford, this has resulted in a number of notable market shifts – as well as strong demand for experienced brokers who can help evaluate strategies and head expansion plans. In the following interview, Erickson discusses the state of New Jersey retail, its changing tenant base, the impact of e-commerce and what 2014 may bring. What significant changes have taken place in the lo- cal retail market? The recovery momentum continues to rise steadily, with more leases being ex- ecuted and deals completed than in the immediate past. Retailers are focusing largely on the strategic placement of new stores (for example, Hess is now looking only at inter- sections with traffic lights), and the relocation, closing, TEANECK, NJ — Com- mercial real estate services firm Cushman &Wakefield has arranged 8,500 s/f of of- fice leases at Glenpointe in Teaneck. In separate transac- tions, Leeward International, Inc. has signed a 5,100 s/f headquarters lease, and H Capital has inked a 3,400 s/f lease. The East Rutherford, NJ-based team of Richard Baumstein , Marc Graham and Christian Politan rep- resented both the tenant and Glenpointe owner Al- fred Sanzari Enterprises of Hackensack, NJ in both transactions. For Leeward, a manu- facturer and distributor of women’s apparel, the trans- action marks a relocation to New Jersey from Mid-
Baumstein, Graham, & Politan of Cushman & Wakefield arrange 8,500 s/f of office leases at Glenpointe in Teaneck
Glenpointe
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