Urban Retail Properties is Overly Popular
Although the Urban retail market is overly
popular, who or what in our industry is actually thriving in this period of a
declining cap rate yield curve is rarely discussed.
In 2009, I wrote an article about the apparent high rate of
attrition in the net lease brokerage community. Brokers couldn’t afford to be
brokers, developers couldn’t develop, tenants shut down plans for new stores
and closed existing locations. So what happened to everyone that hung in there
and stuck it out? The cream has risen to the top. Developers of Urban retail properties that stuck to what they knew, maintained and fostered existing
relationships, and made people aware that they weren’t going anywhere fared
extremely well when it became time to start building again. They had more
opportunities to purchase land for new buildings or redeveloped vacant
buildings.
The development team may have become a little smaller with a
lot more multitasking within their ranks, but what it made them more efficient
service providers. Developers realized that collective thinking and pooled
efforts of fewer people made each project more manageable for any specific
property. Developers found that scale was important and it was unique to each
property.
