Attached is an article regarding Safeway’s recent purchase of a new three acre site in the heart of Honolulu’s Commercial Real Estate Market post “Great Recession”. This site formerly housed a Cadillac dealership, which has been closed for approximately the last year. Safeway has an existing store very nearby that was not able to be enlarged, but does very high gross sales. Safeway is paying a price very close to top of the market, even prices that have not been seen in two or three years. At nearly $200 per square foot for the land, this will buoy land prices in the heart of Honolulu at least for the rest of this year. Many of us had thought that land prices would start to drop, but this single transaction shows a very motivated buyer with a known history for strong sales reinvesting in the heart of Honolulu’s population.
In January, I presented a 2009 summary and 2010 forecast presentation on the Hawaii Retail Market for CCIM. This video is the second of three parts of the presentation (the powerpoint slides used in the presentation are available or download here).
This video focuses on Shopping center vacancy, new tenants and sales ideas. Outlined below are the main points of the video:
Recent Vacancies: For Circuit City, most of their vacated space has not been released. About two-thirds of their stores are still vacant, which means there are 45,000 SF concrete boxes that are sitting vacant.
For Hawaii, we’re keeping our eye on Blockbuster, as they occupy approximately 120,000 SF here. Should they decide to pull out of the market, we’d be losing 20+ stores at about 5,000 SF a piece, many located in shopping centers.
Expanding Retailers: Slides 11 and 12 list Tenants who have opened in 2009, spent money, made the investment, and took the risk. These are very few and far between.
Ideas for Landlords: The key is to create momentum, and increase advertising. Hire merchandising consultants because most Tenants are not capable of producing great storefronts. They could gain a lot from a professional consultant. Twitter campaigns are working for impulse daily specials, such as a restaurant tweeting a daily special.