(As seen on WZZM TV 13) According to the Commercial Alliance of Realtors, the retail real estate market improved significantly last year: The sales volume of retail properties rose by 68 percent in 2012 from the previous year.
The market’s biggest gains were recorded in the usual areas: 28th Street SE, Knapp’s Corner sector on East Beltline Avenue, and in Grandville near RiverTown Crossings Mall where CWD Real Estate Investment opened Bucktown. Bucktown landed a new Target, ULTA and Maurices, with Cabela’s set to open soon.
The CAR report said Cabela’s will “draw an even larger consumer base” and “location, traffic counts and the demographics of these areas are the main drivers” for the success the retail sectors had last year.
In addition, the report indicated real estate prices stabilized last year because demand increased and supply was absorbed in the main retail quarters. “When competition for space grows, consumer confidence slowly elevates and vacancy rates drop,” read the report.
Besides an increase in sales volume, the number of retail sales transactions grew by 49 percent last year in comparison with 2011, and the selling price was closer to the listed price in 2012 than it was a year earlier.
“The shrinking of the gap between list and sales prices shows that values are rising and buyers are willing to pay more for properties than last year because a greater opportunity is present in the market,” read the report.
CAR reported there were 220 retail transactions last year compared to 149 in 2011.
Retail leasing also was up last year. Vacancy rates fell and available Class A retail space is limited. That demand for space has resulted in slowly rising rent prices and fewer tenant concessions from landlords. The area’s secondary retail markets also are improving, according to CAR, but those sectors still are experiencing pressures on pricing and landlord concessions.
“A marked increase in new retail construction in the prime retail corridors signals the start of increased demand for business expansion and new business entering the West Michigan area,” concluded the report.
Rod Alderink of NAI Wisinski of West Michigan, Dave Denton of DAR Development, Earl Clements of Colliers International West Michigan and Aaron Muller of Ben Muller Realty wrote the CAR report.