The The Wall Street Journal recently highlighted a significant trend in commercial real estate: the resurgence of grocery-anchored open-air neighborhood shopping centers as prime investment opportunities. Our partner James S. Corl from Cohen & Steers was quoted. We’ve acquired three centers with Cohen & Steers in the last 12 months.
The article highlights that grocery-anchored value centers, with a complementary tenant mix of stores like coffee shops, yoga studios, and medical centers, are demonstrating remarkable resilience and stability.
That’s the bread and butter of our portfolio of 70 centers (and growing!). This is what DLC Management Corp. has been investing in and shouting from the mountain tops for years.
What’s driving the trend?
- Limited New Construction: Since the 2008-09 financial crisis, there's been a notable slowdown in the development of new retail spaces, leading to increased demand for existing properties. Post pandemic, new development has virtually stopped due to increases in construction costs.
- High Occupancy Rates: Open-air centers boast higher occupancy rates compared to enclosed malls, attracting institutional investors seeking stable returns.
- E-commerce Synergy: Retailers are effectively integrating physical stores with online operations, offering services like curbside pickup and in-store returns, enhancing customer convenience.
- Shifts in Work Patterns: The rise of flexible work schedules has increased foot traffic to local centers, as consumers spend more time in their neighborhoods.
As we continue to navigate the evolving retail landscape, it's evident that well-positioned neighborhood shopping centers are not only meeting current consumer demands but also offering compelling opportunities for investors.
I’ve been saying this is the golden age of open-air retail. Here it is.
Read the full article here. Subscription may be required: https://on.wsj.com/3BWHZi6
#CRE #RetailRealEstate
