The Hampton Roads retail market experienced not much change in market conditions in the first quarter 2018. The vacancy rate increased to 5.2%, up slightly from the fourth quarter. Net absorption was negative 36,016 square feet, and can be expected to remain negative through the rest of 2018 due to the large amounts of big box vacancies. Rental rates are up slightly this quarter, ending at $13.47 per square foot per year.
The largest retail news in the first quarter of 2018 included two closing announcements - Toys 'R' Us and Farm Fresh.
Out of the 32 Farm Fresh locations in Hampton Roads, 8 have been purchased by Kroger; 10 by Harris Teeter-which is a subsidiary of the Kroger Co.- and 3 by Food Lion, leaving 17 remaining big box openings in the market. The Kroger Co, which now will operate 18 stores in the region after the Farm Fresh acquisition, has placed its Southern Chesapeake store on hold indefinitely. There are five Toys 'R' Us and three Babies 'R' Us in the Hampton Roads market which will be closed by the end of the second quarter. The Norfolk Sam's Club, which closed in January, also remains vacant. Like other markets, Hampton Roads is continuing to face the challenge of backfilling other vacant big-box stores.
Chesapeake Square Mall was purchased this quarter by local apartment and home developer Kotarides, who has not announced plans for the mall. The mall is the company's first retail venture.
Green Flash's 58,000 square foot brewery in Virginia Beach abruptly closed in March, listing the facility and all of its' contents for sale. The facility has attracted interest from local and national brewers.
Hampton Roads Retail Snapshot 2018 Q1
Author: Statia Gibson
Date Published: 04/15/2018