Retail Posts a Positive Second Quarter
The Metro Detroit retail market continues to post positive figures in the second quarter of 2017. Vacancy rates decreased to 5.9%, rental rates inched up and absorption is positive. 261,887 square feet were delivered in the second quarter, with 445,001 square feet still under construction by the quarter’s end.
Right sizing retail is the name of the game in Metro Detroit. Several large department stores such as Macy’s, J.C. Penney, Kmart, and Sears closed locations throughout our region but activity in discount stores like T.J. Maxx and various other home, apparel and cosmetic stores continue to do well. Aldi announced plans to expand stores to nearly one thousand nationally including three new stores in Michigan.
Online giant, Amazon, is opening three large fulfillment centers in Southeastern Michigan and recently acquired Whole Foods Market. While online shopping continues to thrive, two-thirds of shoppers still visit brick and mortar stores before or after their purchase. As the way in which we shop changes, so does the retail model for success. In addition to retailers offering customers the ability to shop with ease online, retailers are rethinking their brick and mortar stores in an effort to stay relevant. Consumers want an experience while shopping and because of this we’re seeing more and more retailers popping up in downtown walkable communities featuring an array of shops, restaurants, and entertainment. Stores with smaller footprints and more seasoned sales professionals are leading the way in retail now.
In recent news, the performance apparel giant, Under Armour opened a shop in downtown Detroit. The store will feature an array of performance clothing and footwear including Detroit featured designs. Many restaurants and trendy eateries are opening in downtown areas. In Detroit, Atomic Chicken opened up in New Center and Founders Brewing Taproom (out of Grand Rapids) announced plans for a downtown Detroit location soon. In downtown Berkley, a new restaurant and bar, The Berkley Common opened its doors in the former and long standing Berkley Front location. The restaurant will feature fresh food with a twist and plans to source its food locally.