Colorado-Real-Estate-Journal_372210

Page 8 — Retail Properties Quarterly — November 2023 www.crej.com DEVELOPMENT Downtown Westminster 8877 Eaton Street - Westminster, CO New restaurant and retail space for lease in Downtown Westminster. Join tenants: Alamo Drafthouse, Bonchon, Tap & Burger, Origin Hotel, Marczyk Fine Foods, Lash + Company, 100% Chiropractic, PetVet 365, and Pediatric Dental. Future commercial development and projects adjacent to parking garage. City-wide events year- round at Center Park (Fall Harvest Festival, Craft Beer Fest, Movies in the Park). 601 E. Colfax Avenue Denver, CO 3,684 SF turnkey restaurant available for Lease with a 91 person capacity. Large patio with outdoor bar, cabanas,  re pits and a 245 person capacity. Newly renovated in 2022. 8 designated parking spaces. Currently being operated as Tom’s Starlight. DO NOT DISTURB Tenant. Over 25,000 CPD on Colfax Avenue. Trade area features 241,537 residents with an average household income of $141,743 and 255,899 day time employee’s within a 3-mile radius of the site. Former Google Of  ce/ Event Space with 165 parking spaces. 34,000 SF - Main level + 7,000 SF Mezzanine. Available all or part. Possible uses include: Retail, Restaurant, Event Center, Catering Company, Entertainment, Fitness, Indoor Amusements, etc. 2600 Pearl Street Boulder, CO Dakota Village 10027 W. Remington Avenue Littleton, CO 10,007 SF Available for Lease fronting Kipling St. Former Big 5 Sporting Goods. Quick access to C-470. Trade area features 139,420 residents with an average household income of $142,477 and 39,015 day time employee’s within a 5-mile radius of the site. DO NOT DISTURB Tenant. Tenant is operating through February 1, 2024. Former Arby’s 5800 Olde Wadsworth Boulevard Arvada, CO 1.04 acres on the NEC of Ralston Road and Olde Wadsworth Blvd. 2,405 SF with drive-thru available for lease. OT-RR Zoning, Arvada. Dense residential and daytime populations. 2,963 SF freestanding building with drive thru. Hard corner of W. Colfax Avenue location with over 28,000 vehicles per day. 458,000 daytime population located in the heart of Denver trade area. 10-minute drive to Downtown Denver. Casa Bonita out lot, located in the fast-growing Edgewater neighborhood. Former Arby’s 6441 W. Colfax Avenue Lakewood, CO Philip Hicks & Robin Nicholson Ken Himel & Shawn Peel Allen Lampert David, Hicks & Lampert Brokerage is the premiere retail brokerage  rm in the Rocky Mountain Region. 5750 DTC Parkway Suite 200 Greenwood Village, CO 80111 303.694.6082 www.dhlb.com Philip Hicks & Mike Sangaline Pearl St Ken Himel & Shawn Peel Peter Thorne & Philip Hicks L ooking back over the last half-century, possibly more than any other real estate classification, the retail devel- opment prototype has shown resiliency, yet distinction, almost by decade. In this article, we’ll explore those prototypes and their respec- tive time periods, briefly touch on how e-commerce and COVID-19 affected tenant and developer per- spectives, discuss current trends and prognosticate on what the next decade’s configuration will look like. In the 1970s and 1980s, the super- regional mall was the prototype of choice. Think Buckingham Square, Town Center at Aurora and the Westminster Mall (two of which are gone now). During the 1990s, devel- opers focused on service-oriented businesses surrounding a neighbor- hood grocery store. In the 2000s, with highly leveraged loans and the rapid expansion of big-box stores, power centers became the format du jour, with the square footage of some of these outdoor centers rival- ing those of the enclosed mall. Think Aurora City Center, Larkspur, Corner- star and the Shoppes at Northglenn. Thereafter, consumers wanted expe- riences and developers pivoted cre- ating lifestyle and mixed-use devel- opments with ground-floor retail, apartments above and a central gathering place for events, which helped fuel the rapid growth of infill high-rises and four- and five-story wrap apartments. Think McGregor Square, Streets of SouthGlenn, Bel- mar, and Cherry Creek North. All the while, as prototypes morphed and were incorporated into the mainstream, the e-commerce revolution gained momentum and fueled concern about the death of bricks-and-mortar retail stores. Throw in the pandemic, resulting in store closures and the American consum- er’s requirement – and now pen- chant – for shop- ping from home, and the demand for large-scale shopping destinations diminished and continues to do the same. The U.S. Census Bureau reports that from 2018 through 2022, with total store and non-store sales growing from about $1.22 trillion to about $1.62 trillion, e-commerce sales have grown from $111 billion (9.2% share) to $231 billion (14.3% share). So although e-commerce sales do now equate to a meaningful share, the death of retail was highly exaggerated as consumers still like to touch and feel before making a purchase. So what are we developing today and into the near-term future? A retail real estate development model revolves purely on tenant sales projections. The more sales tenants generate, the higher rents they can pay, and we, therefore, see an increase in delivered square foot- age. But challenges and mitigating factors in today’s environment cause minimal development. Other than higher land prices, higher construction costs, higher loan rates, tenant bankruptcies and tenant consolidation, developers have smooth sailing. With higher land prices, you have to go vertical. With verticality and higher construction costs and higher loan rates, you have to be more eco- nomical in design of finished prod- uct and size. With tenant bankrupt- cies and consolidation, demand for new space is less. Use Bed, Bath & Beyond as an example. It closed 475 stores covering its various brands, and it barely made headlines. In fact, most landlords were happy to take their space back because it was accretive with the lack of available space, allowing them to relet those former stores at higher rates. Think about it this way: If you are a retailer and can lease a second-generation space now (versus a year or two from now when a project is actually delivered) at a lower rent, typically in a desirable location with good co-tenancy, why would you seek brand-new construction? So current market conditions are a win-win for tenants and owners of existing prod- uct, but not for developers. Retail development is continuing its evolution Lance Taylor Vice president of acquisitions and development, Newmark Merrill Denver submarket retail deliveries and demolitions since 2006 Please see Taylor, Page 22