Sperry Van Ness International Corporation’s (SVNIC) 2015 Top Markets to Watch Reports assess the current state of the national commercial real estate market, and identify micro-trends within specific geographic regions and industries for 2015. Today we are delving into the 2015 Top Retail Markets to Watch. Not the largest or the most actively contested markets, the 2015 Retail Markets to Watch are each at an important juncture that presents unique opportunities for investment. Together, they reflect the diversity of trends that is driving the economy and commercial real estate performance in markets across the country.
Top Retail Market to Watch: Orlando, FL
Investors frustrated by rock-bottom yields in gateway markets may find the right balance of lower asset prices and improving market performance in Orlando. Investment activity has picked up, but the recovery in prices has lagged, reflecting a slow rebound in occupancy and rent growth. While retail rents were flat in 2014, CoStar projects that rent growth will accelerate past an annual rate of 5% by 2016.
Downtown Orlando is sometimes criticized for a lack of weekend activity, but plans are in the works to enliven the city center and introduce new live–work–play opportunities to this Central Florida market. Investors are adding more entertainment draws to the tenant mix. Orlando Fashion Square, sold in 2013 for $35 million, added a bowling alley last August and will become the home of Orlando’s first Element by Westin hotel. The Artegon Marketplace is adding a mix of specialty draws like International Hot Glass, a DIY glass-blowing studio and art gallery, and Gods & Monsters, a 19,000-square-foot comic book concept. A new mall is in the works, as DDR broke ground on the new Lee Vista Promenade in December, despite Target pulling out as one of its proposed anchor tenants.
To read more on Orlando and other top retail markets, download the full version of the 2015 Top Retail Markets to Watch report here.
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