Retail Continues to Thrive Internet sales continue to have an effect on brick and mortar locations causing retailers to close non-performing locations, downsize or be sold. In other cases, retailers are expanding their foot print, but not as large of footprints as seen in the past. Albertson s announced its plan to purchase the remaining 2,500 Rite Aid pharmacies that are not being purchased by Walgreen s. The deal is slated to close in the second half of 2018. Claire s Boutique filed for bankruptcy protection but will keep the five locations open in as they restructure their debt. in 2017, Toys R Us filed for bankruptcy and announced it will sell or close all 800 U.S. stores. Babies R Us announced that it is closing the location in North. Bi Lo filed for bankruptcy protection and announced the closing of four Tri-County area stores with a total of 19 across South Carolina. Walmart is building less brick and mortar locations as it focuses on online business. It recently canceled plans to build a Sam s Club in Summerville. In January 2018, Sam s Club began to close 63 U.S. locations while 12 stores were turned into warehouses to increase delivery productivity of its digital sales. In North, Krispy Kreme announced that it will add a second Tri-County location. Floor & Décor announced its plans to build a 75,000 sf store in Aviation Square on Rivers Avenue. H&M disclosed that it will close 170 failing stores by the end of the year, but has plans to open 220 new stores; one of which being a new 20,000 sf store in Northwoods Mall. Gander Mountain reopened in the Promenade at Northwoods Shopping Center on Rivers Avenue as Gander Outdoors. In Summerville, Aldi announced plans to add a third location in the Tri-County area which will be built down the street from Earth Fare. Nexton Square broke ground on 140,000 sf with signed leases that include Halls Chophouse, an assortment of restaurants, retailers and service providers. In downtown, Courier Square located at Columbus and Meeting Street welcomed its first apartment tenants. When the project is complete there will be 226 apartments, 650 space parking garage and 70,000 sf of retail and office space on a 12 acre site. Church s Chicken closed its doors at the longtime Line and Meeting Street location due to legal and financial troubles. This is one of 24 locations throughout South Carolina and Georgia that is being closed. In, Rogue Motion Boat Storage & Sales opened in the former Food Lion at St. Andrews Boulevard and Sycamore Avenue until its Johns Island location is completed in an estimated five years. In Mt. Pleasant, Market at Mill Creek broke ground which will be anchored by a 50,000 sf Lowes Foods with shop space. Crunch Fitness announced it will open in the former Ross at Belle Hall Shopping Center. Lowe s Home Improvement opened its second Mt. Pleasant location in January 2018. The restaurant scene continues to grow at a remarkable pace with 21 restaurants opening this quarter, 12 restaurants closed and 15 announced coming soon.
20,840,768 sf $22.66 psf Submarket Indicators Daniel Island Clements Ferry 99,789 99,789 4.1% 9.1% 10.1% 4.5% 4.5% 9.1% 11.1% 6.8% 6.8% $21.81 Downtown 1.9% 3.1% 3.5% 2.6% 1.8% 5.3% 6.7% 7.6% 4.4% $53.70 $53.25 $50.94 $50.02 $50.60 East Islands Mount Pleasant 3,994,330 3,860,749 5.7% 6.6% 6.4% 5.4% 4.4% 6.2% 7.3% 8.1% 7.2% $24.41 $24.23 $23.92 $24.24 $22.32 1,058,192 1,058,192 4.0% 5.2% 5.4% 5.9% 5.6% 4.3% 5.5% $14.08 $16.74 $13.73 $13.42 $13.18 4.8% 5.2% 6.9% 5.5% 7.3% 6.3% 8.7% 7.8% 7.8% $13.15 $12.53 $14.69 $13.68 $13.59 3,639,783 3,639,783 3,627,783 3,627,783 3,532,783 2.0% 2.5% 3.9% 2.7% 3.2% 2.9% $18.56 $19.45 $19.68 $20.51 $18.20
Submarket Indicators (Continued) 3,965,535 3,965,335 2.4% 3.0% 3.7% 4.6% 4.8% $16.01 $16.54 $16.71 $16.56 $15.77 0.6% 1.1% 2.2% 2.5% 2.2% 0.8% 0.7% 2.1% 3.0% $24.56 $27.18 $25.01 $23.97 $18.71 Tri-County Submarkets Daniel Island Clements Ferry Downtown Summerville East Islands Mount Pleasant Ladson North Daniel Island Mount Pleasant Johns Island James Island
Market Overview Tri-County Area 21,583,703 21,483,703 21,415,333 21,415,333 21,297,637 4.0% 4.9% 4.3% 4.2% 6.3% 5.9% 5.7% $22.66 $22.70 $23.08 $22.85 $20.06 Net Absorption 211,901 259,719 (134,454) 109,789 (40,914) Notable Leases Tenant Type Address Market SF Halls Chophouse Nexton Square, Hwy 17-A & I-26 7,266 Jamison Hard Cider Company 1033 E Montague Avenue 4,860 La Hacienda Central Island Square, 864 Island Park Drive Daniel Island 4,314 Taco Boy Nexton Square, Hwy 17-A & I-26 4,107 Cabana Burger Live Oak Square, 3088 Maybank Highway 3,177 Notable Sales Buyer Address Market SF Sale Price CP2 Realty, LLC The Shoppes at Centre Pointe 48,000 $8,650,000 VCKH's Magnolia, LLC IHOP, 1521 Savannah Highway 2,894 $2,800,000 LBS Associates, LLC Family Dollar, 1624 E Montague Avenue 8,320 $2,100,000 193 King JE, LLC 193 King Street Downtown 6,418 $1,760,000 Ibrahim & Aida Dabit North River Center, 2080 Northbrook Blvd 15,305 $1,495,000 Trends to Watch Brick & Mortar Retail continuing to move from brick & mortar to the Internet. Rental Rates Rental rates are continuing to climb. Large Anchors Large anchored developments coming online throughout the Tri-County area.
Retail Terms and Definitions Total Square Footage Retail inventory includes all multi-tenant and single tenant properties at least 25,000 square feet. Downtown retail inventory includes King Street and Market Street retail spaces as well as properties at least 25,000 square feet. Retail Buildings Classifications Super Regional Centers are properties with greater than two million square feet of space, drawing from a trade area encompassing multiple smaller submarkets. Sub Regional centers include centers of 500,000 square feet or greater that service one main submarket exclusively. Single Tenant retail includes power center tenants in free-standing centers as well as stand-alone retailers. Large Strip Centers are car oriented strip retail centers of 150,000 square feet or greater. Small Strip Centers are centers of 50,000 to 150,000 square feet, and include many local and grocery anchored centers. Vacancy and Availability The vacancy rate is the amount of physically vacant space divided by the inventory and includes direct and sublease vacant. The availability rate is the amount of space available for lease divided by the inventory. Net Absorption The net change in physically occupied space over a period of time. The dollar amount asked by landlords for available space expressed in dollars per square foot per year in most parts of the country. Retail rents are reported on a triple net basis where all costs include, but not limited to, real estate taxes, insurance and common area maintenance are borne by the tenant on a pro rata basis. The asking rent for each building in the market is weighted by the amount of available space in the building. This has the effect of causing rental rates on larger spaces to affect the average more than that of smaller spaces. The weighted average asking rental rate is calculated by taking the ratio of the square footage associated with the rental rate on each individual available space to the square footage associated with rental rates on all available spaces, multiplying the rental rate by that ratio, and then adding together all the resulting numbers. Asking rental rate averages only includes Direct Space being offered for lease directly from the landlord or owner of a building. It does not include Sublet Space being offered by another tenant trying to sublet an already leased space. Contact Information Vitré Ravenel Stephens Senior Vice President 843.513.7555 vitre.stephens@ David Mantek Vice President 843.412.3663 david.mantek@ Avery Martin Bishop Associate 843.406.5586 avery.bishop@ Kisha Lyles Associate 864.426.5937 kisha.lyles@ Tate Walkush Marketing Coordinator 843.266.0716 tate.walkush@ For more information on this report, please contact: Charlene Aydelotte Massey Business Operations Manager, Researcher 843.725.7200 charlene.massey@ 1315 Ashley River Road, South Carolina 29407 United States Researcher Comments Market research data and transaction information is now provided by CoStar. 2018 Avison Young - South Carolina, Inc. All rights reserved. E. & O.E.: The information contained herein was obtained from sources which we deem reliable and, while thought to be correct, is not guaranteed by Avison Young.