At the risk of sounding cliché . . . . . . . with this ever changing real estate market and the impact of the subprime market fiasco, now more than ever the importance of LOCATION, LOCATION, LOCATION is quite evident!!
National trends, specifically in the Southeast, are showing us retail property prices are beginning to decline moderately as the market works to correct itself from the “kool aid” days we’ve enjoyed over the past few years. The bulk of this “correction of the market” is concentrated in lower tier markets and we are seeing some of this correction in Middle GA.
Tightening of lending policies have created some difficulties for the average retail developer. Whereas a year ago a retail developer could go vertical with little or no preleasing in place, now some lending institutions are requiring as much as 25-35% preleased as well as higher amounts of up front capital. As a result, developments are being looked at with a new set of eyes — in some cases the development have to “stand on it’s own” irregardless of the financial wherewithal of the actual developer.
Nationally, consumer preferences are changing the way developers look at a piece of developable retail property. Rising fuel costs have increased consumer awareness and according to ICSC, we are seeing shoppers becoming more efficient by visiting malls less often but spending more when they do shop.
This consumer awareness and preferences of shopping more efficiently is driving developers to focus on much larger mixed use developments such as massive lifestyle concepts and high-density mixed use projects. This is evident in Middle GA with the new massive retail developments in South Bibb County and North Macon.
Are you ready for the rollercoaster ride???
There is proposed 1,750,000 sf of new development proposed for market with deliveries beginning this year 2008 through 2010.
- Warner Robins (Russell Pkwy) – Proposed 350,000 sf mixed use dev consisting of retail, hospitality, office & restaurants
- Eisenhower Crossing – Home Depot & HH Gregg & PetSmart (HH Gregg new in market)
- Macon Mall – Recently signed a deal with Steve & Barry’s in approx. 50,000 sf — repositioning & should evolve into something different with an emphasis on discount retailers
SOUTH BIBB COUNTY
- Hartley Station – Hartley Bridge Road development
Major mixed use development; 1st 2 phases will consist of approx 134,000 sf or grocery anchored; Target Delivery 2010
Proposed Phase 1 consists of approx 69,000 sf
Proposed Phase 2 consists of approx 75,000 sf
NORTH MACON – of the 1,750,000 —– 1,600,000 is under development or being planned in North Macon:
- Shoppes @ River Crossing
- Approx 750,000 sf
- Phase 1 opening Spring 2008
- Phase 2 opening Fall 2008 (with Circuit City & Dick’s to open early 2009)
- Option on 25 +/- acres on corner of Wesleyan & New Forsyth for expansion
- Lullwater Village and Marketplace @ Bass
- 380,000 sf
- Target Delivery date 2010
- Marketplace at Bass to be developed as Phase 2 upon completion of Lullwater Village
- North Macon Towne Center – Major mixed use development
- Approx 107,000 sf of retail & office with first phase scheduled to be delivered 2009. Development will consist of retail, office, hospitality & apartment lofts. 80,000 sf hotel on board.
- Sembler under option (35 +/- acre tract) – 370,000 sf actively marketing
With the amount of new quality development coming online this year and future years, we expect to see an interception of dollars that is currently being spent in Atlanta. This has been a significant outflow of retail $’s from Macon to the upscale shopping opportunities just north of us . . . . now we will be able to retain these $’s.
As a whole, the retail sector will feel some fallouts from the single family housing markets but we are hoping the impact in Middle GA will be minimal . . . .
As one of my peers put it in a recent sales meeting . . . . Middle GA doesn’t see big booms in commercial RE so we shouldn’t experience big busts in commercial RE either.
The good news is people have to shop . . . . and with the upcoming developments and the shift in our market, we can stay in Middle GA and do just that.
Ladies & Gentlemen, keep your hands & feet in the car at all times . . . .and enjoy the ride . . . . .
Wendy Pierce
Commercial Real Estate Agent
Macon Commercial Office
478-746-9421