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Office • Industrial • Retail • Multi-Family
100 Grandville Ave SW Suite 100Grand Rapids, MI 49503
Wisinski ofWest Michigan
*Also serving the Kalamazoo & Southwest Michigan areas from ourKalamazoo office*
Retail Market ReportWest Michigan Q4 - Year End 2017
616.776.0100 www.naiwwm.com
Class A Retail Trending in the West Michigan Market GRAND RAPIDS
The MarketRetail Market Trends
- Rod Alderink Partner, Associate Broker
36.4Median Age
$71,795Average Household Income
3.4%Unemployment Rate
36,247Total Businesses
Grand Rapids-Wyoming, MI Metropolitan Statistical Data.Source: U.S. Census Bureau
2017 was another fantastic year for retail stores. While the year started with media hype surrounding some by-gone era stores like Sears and Kmart, the trend for West Michigan retail from Grand Rapids to Kalamazoo to the Lakeshore has been positive steady growth and the addition of new stores. Our West Michigan economy is so strong, the vacant stores left by MC Sporting Goods and Family Christian stores were repurposed very quickly. MC’s flagship store on 28th SE will now be our area’s first Ashley Furniture Store. Woodland Mall continues to solidify its strength as the area’s premier mall by eliminating the Sears location and making way for the area’s first Von Maur Department Store and other in-mall and outlot users. Finding class “A” retail space in the primary corridors is very difficult. Several new retail centers are being built along the East Beltline north of Knapp St. While the face of retail is changing, this new construction combined with other hot neighborhood areas like the lower west side, Wealthy Street and the Michigan Street corridor, continue to demonstrate that in West Michigan there are far more retailers opening stores or expanding their footprint size than closing locations. Around our area, we continue to pursue additional locations for Petco, Tim Hortons, and Arby’s. The Fast Casual dining classification continues to show strong growth with no signs of slowing down. Hudsonville will see the opening of a new Meijer store in 2018. “Investment sale activity also remained strong in the West Michigan area, with several notable retail centers in West Michigan transacting. However, as with retailers and consumers, investors’ appetite for retail is changing. Grocery anchored centers, smaller neighborhood centers, and centers with strong tenant rosters are trading, as these tend to be more insulated from online competition.” Said Cameron Timmer, Investment Sales Specialist 2017 was an amazing year for our Retail Group here at NAI, and we begin 2018 with strong optimism that this will be another strong year for retail real estate sales and leasing. Please let any member of our team know how we can help you.
1,058,079Total Population
Cover Feature: 2627 E. Betline Ave. SE
RetailSales & LeasesQ4 2017
SOLDCommercial Real Estate Services, Worldwide.
Wisinski ofWest Michigan
194-198 West River Valley Dr.8,027 SFInvestment Sale
4443-4469 Breton Rd. SE 31,002 SFInvestment Sale
SOLD
LEASED
SOLD
LEASEDLEASED
2627 Rochester Rd.14,356 SFTenant: Petco
1760 44th St. SW, Suite 41,265 SFTenant: Boost Mobile
Market Activity
› Sara’s Sweets Bakery, a family-owned business, just signed a 10-year lease for a 1,300 square-foot space in a new development at 2365 E. Beltline Ave. NE. The move was needed to accomodate the business’s growth. Bill Tyson, of NAI Wisinski of West Michigan assisted Sara’s Sweets with the lease deal, while Doug Taatjes and Hillary Taatjes Woznick, also of NAI Wisinski of West Michigan, are handling the leasing for the remaining spaces in the new retail center.
› Canopy by Hilton announced plans to build a new, 164 room hotel in downtown Grand Rapids. They will partner with Lodgco Hospitality and Olsen Loeks Development. Canopy by Hilton is scheduled to open in late 2019. The project will occupy city parking lots 4 and 5, south of Van Andel Arena.
› On December 4th, MVP Sports Clubs opened a new venture in Jenison. 4G Athletic is a new concept, unlike the facilities and activities typically associated with MVP Sports Clubs. Housed in an 11,000 square-foot building on Port Sheldon St., 4G Athletic will be a boutique studio-based facility. The building was ideal because of its openness, which allowed MVP Sports Clubs to incorporate four studios into one.
8233-8275 Byron Center Ave. SW23,931 SFInvestment Sale
2365 East Betline Ave. NE1,300 SFTenant: Sara’s Sweets Bakery
West MichiganRetail Submarket Statistics
Retail Statistical Changes Year-over-Year and Quarter-over-Quarter
CONSTRUCTIONASKING RATESVACANCY RATENET ABSORPTION
3Q17 vs. 4Q17
4Q16 vs. 4Q17
2017 Q4 Retail Snapshot
Submarket Total RBAVacant
Available SFVacancy
Rate
Total AverageNNN Rate ($/SF/Yr)
Total Net Absorption (SF)
Lakeshore
Community 1,508,212 42,321 2.8% $8.08 1,383
Neighborhood 1,508,212 42,321 2.8% $8.08 1,383Strip 1,036,125 77,319 7.5% $11.55 2,736Total 4,052,549 161,961 4.0% $8.97 5,502NortheastCommunity 445,573 113,920 25.6% $4.67 0Neighborhood 1,115,603 96,645 8.7% $8.26 -3,693Strip 682,609 24,670 3.6% $10.24 6,327Total 2,243,785 235,235 10.5% $8.15 2,634NorthwestCommunity 473,200 12,411 2.6% $17.85 -6,975Neighborhood 723,807 29,839 4.1% $7.14 0Strip 564,919 37,957 6.7% $10.92 4,913Total 1,761,926 80,207 4.6% $11.32 -2,062SoutheastCommunity 760,897 4,440 0.6% $10.75 0Neighborhood 2,681,258 277,103 10.3% $10.07 31,216Strip 1,744,241 115,344 6.6% $12.74 13,229Total 5,186,396 396,887 7.6% $11.07 44,445SouthwestCommunity 1,658,417 287,210 17.3% $7.52 -93,149Neighborhood 960,605 39,664 4.1% $9.48 1,640Strip 981,896 66,864 6.8% $12.31 -7,678Total 3,600,918 393,738 10.9% $9.35 -99,187Overall Total 16,845,574 1,268,028 7.5% $9.83 -48,668
CONSTRUCTIONASKING RATES
VACANCY RATENET ABSORPTION
*Disclaimer: Historical data figures are subject to change based upon the timing of when CoStar receives market information. NAIWWM uses the numbers available at the time each quarterly report is published.
Retail Total Market Report
2
2
22
2 2
Interpretation
Vacancy rates for Neighborhood and Strip have both decreased from Q3 2017. We see the largest increase in vacancy rates in the Community category from 10.3% in Q3 2017 to 12.8% this quarter.
Interpretation
The rental rates for Neighborhood and Strip have decreased from Q3 2017. We see the greatest change in rental rates for the Strip category, from $11.14 in Q3 2017 to $11.96 this quarter.
Methodology | Definitions | Submarket Map
Community CenterA shopping center development that has a total square footage between 10,000 - 350,000 SF. Generally will have 2-3 large anchored tenants, but not department store anchors. Community Center typically offers a wider range of apparel and other soft goods than the Neighborhood Center. Among the more common anchors are supermarkets and super drugstores.
Strip CenterA strip center is an attached row of stores or service outlets managed as a coherent retail entity, with on-site parking usually located in front of the stores. Open canopies may connect the storefronts, but a strip center does not have enclosed walkways linking the stores.
Neighborhood CenterProvides for the sale of convenience goods (food, drugs, etc) and personal services (laundry, dry cleaning, etc.)
Absorption (Net)The change in occupied space in a given time period.
Available Square FootageNet rentable area considered available for lease; excludes sublease space.
Average Asking Rental RateRental rate as quoted from each building’s owner/management company. For retail, a triple net rate is requested.
RBAThe total square footage of a building that can be occupied by, or assigned to a tenant for the purpose of determining a tenant’s rental obligation.
DeliveriesBuildings that have their certificate of occupancy and are allowed to be moved into by the tenant/purchaser.
Vacancy RateAll physically unoccupied lease space, either direct or sublease.
SF/PSFSquare foot/per square foot, used as a unit of measurement.
Southwest
Northeast
Southeast
Northwest
Lakeshore
Methodology: The retail market report includes community, neighborhood, and strip retail buildings within each of the defined submarkets. For definition of product type, please see below.
Through our relationship with NAI Global, we have access to over 400 NAI affiliate offices throughout the world. NAI Wisinski of West Michigan: Local Knowledge, Global Reach, Achieve More.
Doug Taatjes, CCIM, SIOR616 292 [email protected]
Hillary Taatjes-Woznick616 242 [email protected]
Tim Platt616 575 [email protected]
Gary Steere616 575 [email protected]
Russ Bono616 242 [email protected]
Jeremy Veenstra616 242 [email protected]
Marc Tourangeau, MBA269 207 [email protected]
Stanley Wisinski III, SIOR, CCIM616 575 [email protected]
Bill Tyson616 242 [email protected]
Todd Leinberger616 242 [email protected]
Cameron Timmer616 485 [email protected]
Meet Our Team
Retail SpecialistsRod Alderink616 242 [email protected]
Dane Davis269 459 [email protected]
Dick Jasinski616 575 [email protected]
Scott Nurski616 242 [email protected]
Joshua Jacobs269 459 [email protected]
NAI Wisinski of West MichiganAt a Glance
Achieve More.Local Knowledge. Global Reach.
NAI Wisinski of West Michigan was formed in the spring of 2011 when NAI West Michigan merged with The Wisinski Group. This merger brought together two successful, reputable companies to form what is now the largest indepen-dently owned commercial real estate firm in West Michigan.Our focus is simple: building client relationships for life. We do this by utilizing the rich diversity of skills and specialties of our agents and staff, actively listening to our clients, offering market appropriate advice, providing access to the indus-try’s most current and proven technologies, and delivering the best possible service to each and every client.NAI Wisinski of West Michigan is headquartered in Grand Rapids, MI and maintains a second location in Kalamazoo, MI. Our company provides all facets of commercial real estate services, including brokerage and property management, throughout the entire West Michigan region.
100 Grandville Ave SW Suite 100Grand Rapids, MI 49503616. 776. 0100 www.naiwwm.com
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@naiwwm
nai-wisinski-of-west-michigan
Wisinski ofWest Michigan
Office • Industrial • Retail • Multi-Family
