According to the Q4 2013 Retail Market Report, the commercial real estate market in South Carolina is picking up steam. The report, released by Colliers International, cites the recent increase in retail activity as a key driver for the market rebound.
As 2013 ended, the overall vacancy rate of 9.27% for the Greenville, SC retail market, down 55 basis points from the third quarter of 2013. However, the vacancy rate was 148 basis points higher than year-end 2012 due largely to big box closures. For instance, K-Mart closed at 2100 Wade Hampton Boulevard and Food Lion closed at 1207 W. Wade Hampton Boulevard. Others, such as Toys R Us and Babies R Us have relocated to Magnolia Park adding vacant space to the market. Fortunately, many spaces are receiving attention and won’t be vacant for long.
-The Greenville, SC retail market ended 2013 with an occupancy rate of 90.73%.
-Big box closings in 2013 led to increased availability of anchor space, mostly in East Side and Haywood Road submarkets, but spaces are being backfilled by new tenants.
-Magnolia Park continues to draw new tenants to South Carolina.
-Hotel developments planned for Downtown Greenville.
-DSW Shoe Warehouse, Jo-Ann Fabric and Craft Store and TJ Maxx will occupy the former Circuit City and Toys R Us boxes on Haywood Road.
-Additionally, Conn’s plans to occupy the former Babies R Us location on Haywood Road.
-Part of the former K-Mart on Wade Hampton Boulevard has leased to Planet Fitness and Ollies Bargain Outlet. Approximately 50,000 square feet of the 104,000 square foot box remains vacant.
The Haywood Road retail corridor ended 2013 with the highest vacancy rate in the market at 30.42%, up from 27.56% at year-end 2012. This increase is a result of retailers shifting from the Haywood Road to Woodruff Road retail corridor, but will improve as retailers backfill vacant big box spaces along Haywood Road.
•Wal-Mart Neighborhood Market opened its second South Carolina location at 2014 Wade Hampton Boulevard. The other location is in Greer, SC.
•Magnolia Park, the former Greenville Mall being redeveloped by Menin Development Inc. attracted more tenants and is now 90% committed.
•Nordstrom Rack, Yard House, Tucanos Brazilian Grill and Destination XL are the most recent tenants to commit to the center.
•Existing tenants include Rooms to Go, Costco, Regal Cinemas, Toys R Us, Babies R Us and Jared Galleria of Jewelry.
•Cabela’s is under construction and is anticipated to open Spring 2014. The store will be the first southeast location for the sports and outdoors retailer. The company has announced plans for two more locations in the Carolinas. The stores will be in Rock Hill, SC and Garner, NC and are to open in 2015.
•Hotels are increasing in Greenville’s downtown providing an opportunity for retailers, specifically restaurants, to locate in the area.
•Earlier this year, McKibbon Hotel Group, Inc. announced plans to open an Aloft Hotel over Greenville’s new parking garage. The hotel will have 144 rooms and an outdoor pool and is expected to open in early 2015.
•An Embassy Suites hotel is planned on the Reedy River and will include a high-end restaurant and bar, rooftop venue and the only year-round indoor swimming pool downtown. The 156-room hotel is expected to open in 2016 and is being developed by Greenville-based Windsor-Aughtry Co.
•A planned Home 2 Suites by Hilton at 350 N. Main Street is up for review. The 117 room, 4-story hotel is to be developed by Sycamore Investment Group
•A 140-room upscale boutique brand hotel is also up for review and will be located at River and Broad Streets.
YEAR IN REVIEW
•Sky Zone Indoor Trampoline Park entered the South Carolina market with a 45,562 square foot park at Market Place Shopping Center, 2465 Laurens Road.
•Anthropologie, Tupelo Honey Café and Brooks Brothers opened at Project ONE in Downtown Greenville.
•Restaurants expanded their presence in the region as new restaurants entered the market. Restaurants new to the area include Chuy’s, Toby Keith’s I love This Bar and Grill, Firebirds Wood Fired Grill, Tablefields, Dave and Busters, Bad Daddy’s Burger Bar and Wingstop.
•BlueCross Blue Shield opened its first upstate retail location at Magnolia Park. The South Carolina BLUE Retail Store sells individual health insurance policies and group plans.
•DSW Shoe Warehouse located at Crosspointe Plaza at 877 Woods Crossing.
•A new 71,000 square foot shopping center broke ground in Greenwood and is anticipated to complete in the spring of 2014. Publix will occupy 49,000 square feet and serve as the center’s anchor tenant.
•Suber Commons, a new 12,000 square foot retail strip center is being developed at Wade Hampton Boulevard and N. Suber Road in Greer. The center is to include tenants Doctors Express, Heartland Dental and IHOP.
IN THE MONTHS AHEAD
2014 is likely to bring improvements to Greenville’s retail market. Older vacant centers provide redevelopment opportunities which will draw retailers to the center. Asking rental rates are anticipated to increase for shop space as smaller retail spaces are in higher demand than large spaces. Construction of new centers will appear as quality space becomes scarce.
AROUND THE STATE
Redevelopments are springing up throughout South Carolina and new retailers are entering the growing markets.
> The Midtown redevelopment at the corner of King and Spring Street broke ground during the fourth quarter of 2013. The $80 million project on upper King Street will include a 10 story dual branded Hyatt House and Hyatt Place Hotel with 304 rooms, retail shops and a 7 story parking structure. The redevelopment will consist of four new structures and two renovated buildings giving the project a total of 433,000 square feet.
> Bass Pro Shops Outdoor World announced plans to open in North Charleston at the intersection of I-26 and Northside Drive. The store will be the primary anchor for a two million square foot mixed-use development and will include an Uncle Buck’s Fishbowl and Grill, a nautical-themed bowling alley and restaurant. Construction is to begin in 2014 and be completed in 2015.
> H&M announced plans to open a second Charleston store. The 20,000 square foot store will be located at Tanger Outlet Center. H&M’s first Charleston store opened along King Street in the fourth quarter of 2013.
> Dickey’s Barbecue Pit entered the Charleston market with a North Charleston restaurant located at 7620 Rivers Avenue in a center with co-tenants Barnes & Noble and Guitar Center.
> Georgia-based Bright-Meyers plans to redevelop the site of a former K-Mart at the intersection of Fort Jackson Boulevard and Garners Ferry Road into approximately 98,000 square feet of retail space. The redevelopment, to be called Rosewood Crossing, will house national tenants Marshalls, Michaels and PetSmart and is anticipated to complete in the fall of 2014.
> The Harbison Boulevard retail corridor will be seeing a new shopping center on Park Terrace Drive behind Columbiana on Park. The planned center is to be located on 10.3 acres, formerly the site of Roadhouse Grill and Staples, and is to be developed by Dallas-based The Seitz Group. Plans include three buildings totaling approximately 116,000 square feet. Academy Sports & Outdoors will be the center’s anchor tenant with its second Columbia location. The store’s first location is In the Village at Sandhill in Northeast Columbia. Guitar Center will also be locating at the new center. The store will be the retailer’s first Columbia location but third location in the state.
> Earlier this year, construction began on a new retail center on Two Notch Road across from the Village at Sandhill. The 71,000 square foot center is to open early in 2014 and will include tenants Hobby Lobby, Great Clips, Vitamin Shoppe, Select Comfort and Aspen Dental.