20B — November 28 - December 11, 2014 — Shopping Centers — M id A tlantic
Real Estate Journal
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S hopping C enters
Walmartopens42,000 s/f at MarketSquare
For The Gallery in Philadelphia PREIT announces Century 21 store as anchor tenant P
VIRGINIA BEACH, VA — McLeskey & Associates an- nounced that MarketSquare, a neighborhood center at 2866 Virginia Beach Blvd. in Virgin- ia Beach, has reached another milestone with the 42,000 s/f Walmart Neighborhood Mar- ket that opened to the public on Nov. 5, 2014. MarketSquare is co-an- chored by Hobby Lobby, a 53,000 s/f store that opened in October and One Life Fitness that will open a 51,000 s/f fit- ness center in December. McLeskey & Associates developed the center in the 1970s. Originally, the major tenant was Woolco, a Wool- worth outlet. The center had a history of tenants over the decades including HQ, Hills, Ames and Farm Fresh, which vacated the property at the end of 2013. “When Farm Fresh vacated, we saw the opportunity to reposition the center to at- tract great national, region- as strategic downsizings by such chains as Radio Shack, Game Stop and Shoe Carnival,” said R.J. Brunelli senior vice president Ron DeLuca . Notably, no new big-box va- cancies were seen along the central corridors since the firm’s 2013 survey. Among the spac- es absorbed over the past 12 months, the remaining 62,600- s/f in the long-vacant former Lowes building at Seaview Square on Rtes. 35 in Ocean Twp. was subdivided between Big Lots and the Sky Zone tram- poline park. Coupled with the aforementioned leases for AC Moore, Guitar Center and sev- eral smaller spaces, the vacancy rate in the once-struggling, approximately 800,000 s/f out- door center was lowered to just over 10%; the 65,000 s/f former Value City building is the big- gest single remaining space. Also on Rtes. 35, indoor arcade Funtime America opened in a 27,000 s/f Eatontown space vacated several years ago by Avalon Carpets. Elsewhere in the region, big- box absorptions along Rtes. 9 included two deals on the Freehold Raceway Mall ring road: Huffman Koos leased a 33,000 s/f space that previ- ously housed Marshall’s, as the once-bankrupt furniture brand continues its expansion under new ownership, and Bob’s Furniture opened in the 22,000 s/f space once occupied by Office Depot. The two stores
al and local retailers,” said chief executive officer Cheryl McLeskey . “Our strategy was to renovate the center and create a vibrant market area that reflects the quality of the surrounding neighborhoods. Once we started introducing this opportunity to national tenants, they immediately saw the potential of the surround- ing neighborhoods and demo- graphics along the Virginia Beach Blvd. corridor.” With the three anchor ten- ants secure, McLeskey & As- sociates will complete renova- tions to the remainder of the center that includes two ad- ditional buildings with small retail shops starting at 1,500 square feet up to an outparcel opportunity that can accommo- date a 5,000 s/f building. The renovations will be complete in spring 2015. MarketSquare, originally named Lynnhaven Shopping Center, has a new name to complete the repositioning. n join fellow furniture retailer Raymour & Flanigan in the ring road strip. Additionally, Hobby Lobby opened its second location along the corridor at Friendship Plaza in Howell, taking the 20,700 s/f former AC Moore space and approxi- mately 50,000 s/f of adjoining vacancies. Hobby Lobby will soon be joined in the center by a World Class Shop-Rite, which took over the Pathmark supermarket and a portion of the Kmart store, both of which closed since the time of the 2013 survey. On Rtes. 1 in North Brunswick, Crunch Fitness took the remaining 26,400 s/f of the long-vacant Office Depot in Commerce Center. Besides the move of Shop- Rite into Friendship Plaza, other notable big-box leases in- volving new sites or spaces that were still occupied at the time of the firm’s 2013 survey includ- ed the openings of a 136,000 s/f Target and 152,000 s/f Costco at the new North Brunswick Town Center on Rtes. 1; the signing of Whole Foods at Al- laire Plaza on Rtes. 35 in Wall Twp., where the chain will take an approximate 40,000 s/f space created from the recently closed Brielle Sports Club and adjoin- ing small-store vacancies; and Nordstrom Rack’s deals for 35,000 s/f spaces at Mercer Mall on Rtes. 1 and the expanded Crossroads at Eatontown on Rtes. 35 (anchored by Macy’s Furniture). n
hiladelphia, PA — PREIT announced Century 21, the New York-based fashion retailer and department store, as the anchor tenant of the rede- velopment of The Gallery. Recognizing PREIT’s transfor- mative vision for The Gallery and the value of the location in the heart of Philadelphia, where mass transit, tourism, the residential population and employment base converge, Century 21 has chosen the site as the location for the chain’s first venture outside of the New York market. “With this transaction, our vision to create Philadelphia’s only transit-oriented, retail anchored multi-use property offering accessible luxury re- tailing and artisan food expe- riences is becoming a reality,” said Joseph Coradino , CEO of PREIT. “Century 21 is the ideal brand to change the OLD BRIDGE, NJ — An improved picture in both ‘big- box’ and smaller store spaces combined to push the retail vacancy rate along central New Jersey’s major shopping corridors to a six-year low of 7.6% from 9.8% in 2013, accord- ing to the latest study by R.J. Brunelli & Co., LLC . Looking back over the past 10 years, the 2014 figure compared with the high of 10.5% in 2011 and low of 3.4% in 2006. In all, the Old Bridge-based retail real estate brokerage’s 25th annual study of the cen- tral NJ market found 2.33 mil- lion s/f of vacancies in the 30.94 million s/f of space reviewed along State Highways 1, 9, 18 and 35 in Mercer, Middlesex and Monmouth counties, and a small section of Ocean County. The region’s most heavily re- tailed road, Rtes. 35, experi- enced the steepest decline in vacancies, followed by Rtes. 9 and 1, while Rtes. 18 showed a slight increase. The study found availabilities in 180 of the 815 sites visited throughout the region during this year’s third quarter. As in the past, R.J. Brunelli’s study evaluates shopping centers and freestanding buildings exceed- ing 2,000 s/f —including res- taurants, auto service facilities and vacant auto dealerships whose location and configura- tion makes them viable for retail use. Regional malls and centers under construction or in
The Gallery
“For over 50 years, we’ve been a destination within the New York market for high-end fash- ion consumers looking for in- credible values, and now we’re excited to share our unique shopping experience with the city of Philadelphia. Century 21 is proud to become a part of the Philadelphia community as well as the newly re-launched Gallery.” n Richard J. Brunelli, president of the firm. Indeed, vacancies in big-boxes along the four cor- ridors were trimmed by a net of 293,814 s/f , or 27%, to 796,053 s/f . Concurrently, the region’s inventory of vacant smaller (sub-20,000 s/f ) spaces was reduced by a net of 324,211 s/f , or 17.4%, to 1.54 million s/f . “This contrasted sharply with what we saw in northern New Jersey, where a very strong reduction in big-box vacancies was partially offset by rising vacancies in smaller spaces,” he noted. In all, the big-box share of total vacancies on the central corridors slipped to 34.1% from 36.9% in 2013. The big drop in the central region’s inventory of empty spaces below 20,000 s/f was fueled by multiple leases with some of the company-operated and franchised chains named above, as well as others like STS Tires, Turning Point, 7Eleven, Advanced Auto, and Pet Valu. Additionally, the central corridors saw a number of single-location leases in the 10,000- to 20,000 s/f range with chains like AC Moore, Fur- niture King, Harbor Freight, Guitar Center, CVS, Mattress Factory, Party City, Smash- burger, as well as a variety of local operators. “These deals offset the impact of closures from bankrupt chains like Coldwater Creek and Dots (the latter now being resurrected under new ownership), as well
retail landscape of this city and attract new shoppers to the Market East corridor and more exceptional first-to-region retailers to the project.” “This move represents an im- portant time for Century 21 De- partment Store as we continue to grow our brand and expand throughout the east coast,” said Raymond Gindi, CEO of Century 21 Department Store.
Retail vacancy rate in CNJ slides to 7.6%, lowest rate in six years the early or mid-stages of major redevelopment are excluded. Taken together with the year-over-year decline reported last week in the vacancy factor for six northern NJ highways to 7.3% from 8.1%, the overall north/central vacancy rate for the 10 retail corridors surveyed by the firm fell to 7.4% in 2014 from 9.0% a year ago. R.J. Brunelli found a total of 4.52 million s/f of empty space in the 61.06 million s/f reviewed in the two regions, with big-box spaces (20,000 s/f and above) accounting for 1.45 million s/f , or 32.2%, of the vacancies.
The improvement in the two regions was triggered by a sig- nificant number of new leases that accounted for more than 3.4 million s/f during the past 12 months, according to the firm’s research. Big-box chains doing multiple deals across the two regions’ corridors included Nordstrom Rack (Rtes. 10, 1 and 35); Hobby Lobby (Rtes. 1, 9 and 46); and Big Lots (Rtes. 10, 1 and 35). Smaller-space operators with multiple deals along the corridors were led by R.J. Brunelli client Dollar Tree (five locations), followed by Jersey Mike’s, Med Express and Tiger Shulman martial arts (each with four). “While empty big-boxes con- tinued to be absorbed in cen- tral New Jersey during 2014, one interesting development was the steeper reduction in smaller-store vacancies,” said
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