Oahu Retail Market Report Q2 2019

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Windward Mall

Big Box Closures Continue to Impact Retail Market

Key Takeaways

  • This past quarter, Sears closed its Windward Mall location leaving a 130,000 square foot vacancy that boosted Windward Oahu’s retail vacancy rate from 3.87% to 11.61% and increased the island’s overall rate.
  • The Oahu retail market lost 102,398 square feet of occupancy during the second quarter of 2019, resulting in vacancy rates rising from 4.36% at the end of the first quarter to 5.00% at the end of June 2019.
  • The growth in air passenger arrivals is projected to slow from 5.3% and 5.9% in 2017 and 2018, respectively, to a modest 2.6% this year. Visitor expenditure growth is forecast to slow to 1.1% in 2019, down from over 5.6% in 2017 and 2018.
  • Over the past year, the single-family median home price fell to $766,750 for a 2.9% drop.
  • Colliers projects that leasing activity should remain healthy for the near term, as several large retailers with pending occupancies are planned for the next few quarters.
  • If an economic slowdown occurs, and is met with additional big box and soft good retailer closures, then it will create apprehension over our longer term retail outlook.

Summary Statistics

2Q2019 Retail Market

 YTD Net Absorption:  (27,649) SF
 Vacancy Rate:  5.00% 
 Avg. Asking Rent Range:  $3.56-$4.64 PSF/Mo 
 Avg. Asking Rent NNN:  $4.17 PSF/Mo 
 Avg. Operating Exp.:  $1.38 PSF/Mo

Hawaii Retail Market Report

Oahu Retail Market Report Q2 2019

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Related Experts

Mike Hamasu

Research & Consulting Director

Hawaii - Honolulu

Michael brings to Colliers Monroe Friedlander, Inc. over 25 years of marketing and marketing research experience. Michael has directed research efforts at commercial brokerages with a focus on providing information to assist in strategic decision making for real estate investors and brokerage clientele. This effort reported on nearly 600 million square feet of commercial/industrial properties in the San Francisco Bay Area.

Having been quoted in the Wall Street Journal, USA Today, Real Estate Forum and Commercial Property News as well as other regional publications, Michael has been recognized for his detailed analysis of the commercial real estate marketplace and has  become the recognized source for commercial real estate trend analysis and forecasts for Hawaii’s marketplace.

In addition to managing the primary and secondary research efforts in the collection of commercial office, retail and industrial market information and statistics, Michael established the company’s real estate consulting division. Utilizing market factors such as: vacancy rates, absorption, net effective rents, and sales comparables, this consulting unit is able to advise developers, investors, property owners, and tenants on current and projected market trends.

PROFESSIONAL EXPERIENCE
Whitney Cressman Limited — Commercial Real Estate Marketing Research Director
Directed brokerage, internal research efforts, and generated real estate consulting assignments at a busy boutique firm in San Francisco Bay area. Served as the principal liaison to press and media. Analyzed office, retail, and development site criteria for market demand and feasibility.
Cushman & Wakefield — Commercial Real Estate Research Services Manager
Oversaw the compilation of market analytics for 600 million square foot commercial and industrial markets throughout the San Francisco Bay area. Recognized nationally and regionally for innovative data management and analysis. Selected to serve on a national career development board for research services. Directed research staff of 12 in five Bay area markets.
Identified by brokers as a manager achieving service excellence.

CONSULTING ASSIGNMENTS
• Development Feasibility Analysis
• Market Demand and Absorption Report
• Broker Opinion of Value 
• Highest and Best Use Studies
• Real Estate Portfolio Analysis
• Strategic Positioning Study
• Market Rent and Vacancy Forecasts
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