LAS VEGAS, May 22, 2017 /PRNewswire/ -- Today JLL launched
its inaugural City Retail[i] report at ICSC
RECon in Las Vegas, which reveals
the 10 most affordable and desirable retail corridors in
the United States based on average
asking rent per square foot. These shopping districts have growing
populations of working millennials, rising foodie scenes, and
trendy mixes of up-and-coming retailers and well-known brands.
These factors combine to create affordability and stability - the
ideal scenario for retailers and investors that want to
expand.
"In retail, store location is everything – pick the wrong corner
and your brilliant concept can fail," said Naveen Jaggi, President of Retail Brokerage and
Capital Markets, JLL. "We know that sometimes retailers want that
prime main-and-main location, but just don't have the budget. So,
we looked at core U.S. cities to find more affordable areas for
retailer expansion."
The Top 10 Most Affordable Prime Urban Retail Corridors:
According to JLL, prime rents in these 10 corridors are the most
affordable on a per-square-foot basis:
- Market East, Philadelphia: Once home to vacant lots and
failed fortress malls, Market East now attracts large-format
retailers looking to tap into the swelling millennial and
empty-nester population. Market East's average asking prime retail
rent is $50 p.s.f., with annual rent
growth of 25 percent.
- Wicker Park, Chicago:
This edgy, off-the-beaten path foodie destination is seeing an
uptick in residential development, piquing international investor
and retailer interest. Wicker Park's average asking prime retail
rent is $55 p.s.f., with annual rent
growth of 4.5 percent.
- Pike Street, Seattle:
Filled with a stable collection of apparel and restaurants, Pike
Street serves Seattle's CBD and is
expanding east toward Capitol Hill with new restaurants. Pike
Street's average asking prime retail rent is $65 p.s.f., with annual rent growth of 18.2
percent.
- Fulton Market, Chicago:
Once a hub for industrial and meat distribution, Fulton Market in
the West Loop submarket is known for its killer restaurant scene,
but is now garnering attention from apparel retailers and investors
as it becomes a growth market for corporate headquarters. Average
asking prime retail rent is $75
p.s.f., with annual rent growth of 8.9 percent.
- The Marina, San Francisco: This corridor has seen a
spike of athleisure and boutique fitness studios, adding to its
long-standing assortment of neighborhood retail and restaurants.
The average asking prime retail rent is $85 p.s.f., with annual rent growth of 7.7
percent.
- University Avenue, Silicon Valley: Palo Alto's tech boom is creating a retail sea
change with more non-chain boutiques and home goods stores moving
in to University Avenue. The average asking prime retail rent is
$90 p.s.f., with annual rent growth
of 7.9 percent.
- Hayes Valley, San
Francisco: Opportunities for investment and new
storefronts in Hayes Valley is shrinking as housing values increase
and entertainment venues play host to tourists. The average prime
asking retail rent is $90 p.s.f.,
with annual rent growth of 4.7 percent.
- Design District, Miami:
Textile and furniture factories once lined the Design District,
which is now a curated assortment of luxury retailers, art
galleries and restaurants. Phase II of development will add 60 new
tenants to the market. The average prime asking retail rent is
$95 p.s.f., with annual rent growth
of 2.2 percent.
- Metro Center, Washington,
DC: Well positioned between the White House and Chinatown,
Metro Center is where people go to shop at well-known brands and
discount retailers. The average asking prime retail rent is
$100 p.s.f., with annual rent growth
remaining flat.
- Fillmore, San Francisco: It's been eight years since
the transformation of the Fillmore
corridor started, and today luxury lite retailers are dominating
the retail scene. The average asking prime retail rent is
$115 p.s.f., with annual rent growth
of 13.6 percent.
Prime Urban Retail Corridors are the New High Streets
High streets – main strips of high end retail, like Michigan
Avenue or Rodeo Drive – have been top targets for investors for
years. But shopping districts now stretch beyond a linear street,
creating corridors with mixes of brands, restaurants and
entertainment. Some of these corridors are existing and
established, with a large concentration of high-credit tenants like
Upper 5th Avenue, the Beverly Hills Triangle or Michigan
Avenue. Others are emerging, with tenants of varying credit
profiles and mixes of local retailers and restaurants like the
cities indicated in our top 10 list.
"We expect the value of real estate in these select corridors to
rise over the long-term, and retailers to remain vigilant in their
expansions. But, as competition rises and consumer buying habits
shift, retailers will search for opportunities to get more bang for
their buck," concluded James Cook,
Director of Retail Research, JLL.
JLL is the largest third party retail property manager in
the United States with more than
1,000 centers, totaling 125 million square feet under management,
lease and sale. The firm has more than 150 retail brokerage experts
spanning 35 markets, representing over 1,000 retail clients. In
2016, JLL's retail team completed 1,200+ leases on transaction
management and lease renewals, generated $65.3 million in savings to clients through
restructuring services, negotiated 950+ leases for retailers and
1,200+ leases for landlords and completed more than $5.4 billion of investment sales, dispositions
and financing for investors. For more news, videos and
research from JLL's retail team, please visit:
www.jllretail.com.
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About JLL
JLL (NYSE: JLL) is a leading professional services firm that
specializes in real estate and investment management.
A Fortune 500 company, JLL helps real estate owners, occupiers
and investors achieve their business ambitions. In 2016, JLL had
revenue of $6.8 billion and fee
revenue of $5.8 billion and, on
behalf of clients, managed 4.4 billion square feet, or 409 million
square meters, and completed sales acquisitions and finance
transactions of approximately $136
billion. At the end of the first quarter of 2017, JLL had
nearly 300 corporate offices, operations in over 80 countries and a
global workforce of more than 78,000. As of March 31, 2017, LaSalle Investment Management had
$58.0 billion of real estate under
asset management. JLL is the brand name, and a registered
trademark, of Jones Lang LaSalle Incorporated. For further
information, visit www.jll.com.
[i] City Retail looks at a total of 37 prime urban retail
corridors across 12 North American cities. According to JLL,
a prime urban retail corridor is a nationally recognized
shopping district that is distinguished by its mix of high street,
national and international tenants. It is typically named for the
most notable retail street within the corridor.
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SOURCE JLL