Consumers Still ♥ Brick-and-Mortar
Valentine’s Day has come and gone—and it was retailers who were feeling the love this year. According to the National Retail Federation (NRF), early sales projections leading into the holiday were estimated to reach a near record of $19.6 billion, an increase from $18.2 billion last year. U.S. consumers individually were expected to spend an average of $144 on Valentine’s Day, also up from last year’s $136.57. The NRF reports these retail numbers are the second-highest in its survey’s 15-year history. Additionally, the majority of Valentine’s Day retail sales were expected to be made in a physical store, including department stores, discount stores, specialty stores, florists, or local small businesses.
This healthy holiday spending is reflective of the upwards trend across the U.S. over the past year. The 2017 official Holiday Season (November & December) rounded out with total retail sales estimated to be more than $690 billion, a whopping 5.5% aggregate increase over 2016, indicating the strongest holiday season growth rates since 2010. Shoppers spent an average of $842 on gifts and holiday-related items versus $714 in 2016. Furthermore, 85% of total sales were by retailers with a physical presence.
These statistics confirm and reiterate that the retail real estate industry is thriving, and the rise of ecommerce hasn’t changed that. Yes, we’ve read the bloated headlines about “the retail apocalypse,” “the death of shopping centers,” and “the Amazon effect on retail” but the real story is that ecommerce sales account for less than 12% of total retail sales. It is also estimated that over half of those online sales actually go to brick-and-mortar retailers. Even though ecommerce sales are growing considerably, online giants such as Amazon still only account for a small percentage of the overall market.
As we saw this past Valentine’s Day and during the 2017 Holiday Season, consumers prefer to shop in-store. In fact, 90% of holiday shoppers made purchases from retailers with a physical presence. In the retail game, successful stores are actually using ecommerce to their benefit, giving consumers more options and convenience to make their purchases. Omnichannel buying options, like click-and-collect and click-and-ship, are enhancing the brick-and-mortar shopping experience and boosting sales at physical stores.
To add even more sentiment to your post-Valentine’s Day heart: In the past year, we saw more retail store openings than closures and store openings are expected to outpace closures over the next 5 years (according to Zebra Technologies-IHL Group study). In 2017, the retail market had 4,080 net store openings.
And… To put the icing on the heart-shaped cupcake, retail sales are expected to continue to increase for the next several years. Many experts forecast that overall retail sales will rise between 3.8% and 4.4% in 2018 over last year. That certainly warms my heart.
On track with the rest of county, the retail landscape here in the Gulf South region is solid. Occupancy rates in our centers remain high. Retailers are reporting strong foot traffic and higher-than-anticipated sales numbers—especially those who are learning to adapt to consumer demands and offering unique shopping experiences. We are also attracting and welcoming many new-to-market stores and restaurants.
So, on Valentine’s Day, today, and every day, let’s remember to advocate for and show a little love to our brick-and-mortar retail friends.
Marty Mayer
President & CEO
Mobile area primed for future growth
Mobile Aeroplex at Brookley establishes surrounding area as prime position for sustained growth in the commercial real estate industry.
Mobile, Alabama, and its surrounding region are experiencing unprecedented growth due to a low cost of doing business, diverse commerce base, intermodal transportation options, and quality lifestyle. Businesses and corporations are flocking to the area, bringing with them an increased workforce and a plethora of new economic opportunities.
One specific area of note is the positive trend in the market surrounding Brookley field. Economic activity is thriving in this area, and an influx of significant commercial real estate development is expected within the next few years. With the advent of numerous new businesses and the resulting inflow of employees and their families, this is a natural site for the emergence of convenience stores, gas stations, hotels, restaurants, and much more in the near future.
Most of the area growth is spearheaded by the recent expansion of Mobile Aeroplex at Brookley. Spread over 1,650 acres in southwest Mobile, the Aeroplex is now the largest industrial and transportation complex in the region, combining rail, road, and water along with a state-of-the-art airport. Currently, more than 75 companies employing some 3,600 people are housed in the complex, including Airbus U.S. Manufacturing Facility, Airbus Engineering, FedEx, Signature Air Support, Safran USA, Continental Motors, VT MAE, MAAS Aviation, among many others—and it’s growing daily.
Late last year, Airbus announced its largest single deal to build aircraft for Indigo Partners, whose airline portfolio includes Frontier, JetSMART, Volaris, and Wizz Air. The contract includes 430 aircraft and is valued at $49.5 billion. Airbus was also selected by Delta Air Lines to manufacture as many as 200 jetliners, with delivery of the first 100 beginning in 2020.
Airbus and Bombardier also announced an agreement to form a partnership to build Bombardier’s C Series passenger jets. This deal could result in the addition of a second aircraft assembly line at Mobile Aeroplex, creating a proposed 400 to 500 more direct jobs in the area, and would represent an investment of hundreds of millions of dollars. Reports also estimate that establishing “the necessary C Series facilities” would create 1,900 direct jobs, 1,000 indirect jobs, and 3,000 induced jobs during construction.
In December, the Mobile County Commission approved its share of incentive packages for Safran USA and Continental Motors. This process will move forward plans for Safran—a new tenant at Brookley—to open a new manufacturing operation. The company plans to invest $1 million in starting the operation and will hire approximately 20 employees. Continental Motors is planning a $60 million investment to build an entirely new facility to house its existing operations at the Aeroplex.
Furthermore, this thriving industrial park has the potential of becoming Mobile’s new international airport—a proposal to move Mobile Regional Airport from west Mobile to Brookley field is gaining steam. This move would completely change the landscape of the area by placing the airport at the center of our region’s economic activity. With the recent support of Congressman Bradley Byrne and many other local community leaders, a feasibility study could be underway soon. “If we undergo a feasibility study and the study shows that Brookley is a viable airport for commercial activity, then there is no reason why we should not entertain that,” said Chris Curry, Executive Director of the Mobile Airport Authority, which oversees the Mobile Downtown Airport, Mobile Regional, and the Aeroplex at Brookley Field.
The Mobile Aeroplex at Brookley is already home to many of the world’s leading aerospace suppliers, and major transportation companies, and it continues to expand every day. It is serving as a major catalyst for surrounding area growth and investment in the region. But people living and working here currently have limited options for eating, shopping, and other needed services. Because of this, we will undoubtedly see an increase in the demand for commercial amenities and new developments such as retail and restaurants.
The time is right for commercial growth in the area surrounding Mobile Aeroplex at Brookley. Anyone with interest in getting in on the front end of a burgeoning market should pay close attention to this space. The growth is starting small, but it will certainly progress quickly over the next few years. I look forward to being a part of the historical evolution of Mobile!
National Association of REALTORS® Selects Beth Cristina as Commercial Committee Chair
Stirling Properties’ Senior Broker Associate, Beth Cristina, ALC, has been selected as the 2018 Commercial Committee Chair for the National Association of REALTORS® (NAR). She assumed the role on January 1, 2018, and will serve for a one-year term.
The Commercial Committee’s purpose is to identify, monitor, review, analyze, and recommend policies addressing commercial real estate industry issues and trends, with a focus on affecting business solutions that help members achieve their business goals more effectively.
“Beth’s role on the committee will help to bring value and benefit to the association’s 1.3 million members, the nation’s 75 million real estate property owners, and the numerous individuals striving to achieve homeownership,” said Elizabeth Mendenhall, 2018 NAR President, who made the appointment. “I know Beth cares deeply about our profession, our industry, and the clients we serve, and she will help to guide us forward; I am proud to have her serve as Commercial Committee Chair.”
As Committee Chair, Cristina will help to advance the organization’s 2018 goals, which include involving committee members in outreach with large brokerage firms to increase brand awareness and membership; developing commercial member testimonials on the value of the REALTORS® Political Action Committee (RPAC); and working with NAR Consumer Communications Committee to increase the amount of advertising relating to commercial brokerage.
“I’m excited and grateful for the opportunity to take on this leadership role. I’m honored to serve on NAR’s Commercial Committee and to contribute to the decision-making process and help shape the direction of the association and its policies,” said Cristina. “Volunteering is crucial for the future of our business. President Ronald Regan said it best ‘The work of volunteer groups throughout our country represents the very heart and soul of America. They have helped make this the most compassionate, generous, and humane society that ever existed on the face of this earth.’”
Cristina has over thirty-eight years of successful experience in commercial real estate sales, leasing, development, and investments. Her qualifications include retail and office market analysis, tenant/landlord and purchaser/seller representation, marketing sales, leasing strategies, and consulting services. She has earned numerous awards and recognition throughout her career, including Outstanding Achievement in Commercial Real Estate, Realtor of the Year, and Woman of the Year.
Most recently, she served as the 2017 NAR Commercial Committee Vice-Chair. She is also affiliated with several business and professional organizations, including Realtor Land Institute (RLI); Louisiana Realtors (LR), where she served as 2015 President; New Orleans Metropolitan Association of Realtors (NOMAR), where she served as 2005 President; and Commercial Investment Division (CID) of NOMAR, where she served as President for 2000 and 2008.
The National Association of REALTORS® is America’s largest trade association, representing over 1.3 million members, including NAR’s institutes, societies, and councils, involved in all aspects of the residential and commercial real estate industries. Membership is composed of residential and commercial realtors who are brokers, salespeople, property managers, appraisers, counselors, and others engaged in the real estate industry.
Beth Cristina can be reached at (504) 620-8127 or bcristina@stirlingprop.com.
GBRAR Names Scott Macdonald as CID President
Scott Macdonald
Baton Rouge, LA Office
The Greater Baton Rouge Association of REALTORS® (GBRAR) has named Scott Macdonald, Stirling Properties’ Senior Sales & Leasing Executive, as 2018 President of its Commercial Investment Division (CID). Scott will hold the position for a one-year term.
The GBRAR CID is the oldest local commercial real estate organization in Louisiana. The CID exists to unite those involved in the commercial and investment real estate business; to foster knowledge, education, integrity, professionalism and quality workmanship in this field of real estate; and to encourage the exchange of specialized information among the members.
As president, Macdonald will be responsible for providing leadership, fiduciary oversight, and strategic planning for the CID. He will act as a representative in the community, speak on behalf of, and advocate for the organization, as well as work to create opportunities for CID leaders to be connected to their work and committed to the organizations’ mission, values, and goals.
Macdonald’s priority focus for 2018 is to increase the CID membership through offering informative educational courses geared to the commercial real estate sector. Macdonald commented, “We currently have over 200 real estate professionals involved, but I would like to see that number increase this year by focusing on events for members that incorporate a mixture of continuing education with social events.”
“It’s an honor to have been elected as president of the CID this year. One thing I have learned is that leadership is a relationship. When you have a good relationship with others, you work more effectively—you share a common goal and a consistent purpose,” said Macdonald. “I hope to build upon the relationships I have developed to advance the interests of our members and our industry as a whole.”
Macdonald is a member of Stirling Properties’ Commercial Brokerage Division for the Baton Rouge office. His focus is on office and industrial leasing and sales. He has more than 18 years of commercial real estate experience and a background that includes the negotiation and successful closing of over $550 million in leasing/sale transactions. Macdonald is an active member of GBRAR and previously served on the Board of Directors as CID President-Elect in 2017.
The Greater Baton Rouge Association of REALTORS® serves more than 2,200 REALTOR® and Affiliate members. GBRAR is affiliated with the Louisiana Association of REALTORS® and the National Association of REALTORS®, and works to provide its members with the tools they need to remain successful. GBRAR serves East Baton Rouge, West Baton Rouge, Livingston, Iberville, East Feliciana, West Feliciana, Ascension, Point Coupee, and St. Helena Parishes.
Scott Macdonald can be reached at smacdonald@stirlingprop.com or (225) 201-0142.
Matherne’s Market to be Retail Anchor Tenant in LSU’s Nicholson Gateway
LSU announced today that Matherne’s Market will be the retail anchor tenant in the university’s new Nicholson Gateway Development Project, currently under construction on a 28-acre site of the Nicholson Drive Corridor, between West Chimes Street and Skip Bertman Drive.
Matherne’s Market will occupy 17,063 square feet of the roughly 50,000-square-foot retail component of Nicholson Gateway, which will primarily serve residents of the project, the LSU community and visitors.
“Matherne’s Market is an ideal addition to Nicholson Gateway,” said Steve Waller, LSU assistant vice president of residential life and housing. “We are excited to offer our new student residents access to a well-established local grocery store, just steps from their apartment doors. An on-site grocer is an amenity that will enhance the Nicholson Gateway living experience for the more than 1,500 students who will call this new space home.”
Tony Matherne, co-owner of Matherne’s Market, said, “We are very excited to bring our new Matherne’s Market concept to the Nicholson Gateway project at LSU! This Market will have the same offerings and ‘feel’ as our downtown location. We believe that our new store format, with a focus on fresh, specialty and prepared foods, catering and online shopping, with pickup and delivery options, highlights our company strengths and delivers the products and services that our customers want and need. Although our new format is smaller in size than our previous Baton Rouge supermarkets, this will be a full-service market that will provide the residents, students, faculty and staff, and visitors to LSU, as well as the residents and businesses of the surrounding area, with a clean, friendly and inviting shopping experience.”
Matherne said, “Our over 35 years of retailing experience gave us the confidence to downsize the footprint of the store while improving the customer’s experience. Our carefully selected product assortments provide great variety in all product categories, while also allowing us to improve upon the shopping experience for customers. Our new format is efficient for customers to shop for the items they want with the convenience they demand.”
The LSU Property Foundation, an affiliate of the LSU Foundation, is facilitating Nicholson Gateway. Stirling Properties is serving as the retail developer and leasing broker on the project, working with the prime developer, Georgia-based RISE, which specializes in student housing. Stirling Properties will also handle ongoing retail property management.
Slated for completion by this fall, Nicholson Gateway will include 763 units of apartment-style housing for over 1,500 students, with associated residential support spaces, such as lounge spaces, study areas, community gathering places and retail food service. The project, focused on the largest underdeveloped tract of university-owned property that is adjacent to the campus core, will turn what has traditionally been the back of the campus into an exciting new gateway district.
For retail leasing information, please contact Dottie Tarleton at dtarleton@stirlingprop.com or 225-922-4253 or Rhonda Sharkawy at rsharkawy@stirlingprop.com or 504-620-8145.
For student leasing information, visit lsu.edu/nicholson. Information about the overall project is available at nicholsongateway.com.
Retail Brokers Network (RBN) Names Chris Abadie 2018 President
The Retail Brokers Network (RBN), one of the nation’s largest retail real estate networking groups, has selected Chris Abadie, Stirling Properties’ Vice President & Manager of Commercial Brokerage, as its 2018 President. He assumed office on January 1, 2018 and will serve for a one-year term.
As President, Abadie will be responsible for helping grow the RBN brand, representing RBN at industry related events, recruiting new RBN brokerage offices, and facilitating education, networking, and sharing of brokerage “Best Practices” between the 65+ RBN member offices.
This year, RBN plans to expand the organization by adding affiliated members in major metropolitan markets, as well as in underserved markets across North America. Also, it plans to increase business for members through the coast to coast platform.
“I am honored to have been chosen to serve as RBN President for 2018 and to support our mission of growth for the organization,” said Abadie. “With the dynamic changes to retail real estate across the country, it is more important than ever to have trusted advisors who are the experts in their fields and the geography in which they operate. At RBN, we are fortunate to have a powerful network of independent brokerage companies to rely on. Through that network, our members can offer adept guidance on the real estate needs of clients locally, regionally, and nationally.”
Abadie manages Stirling Properties’ Commercial Brokerage Division and is responsible for overseeing all aspects of commercial operations throughout each of the company’s brokerage offices. His focus includes directing sales efforts, new business development, and recruitment and training of new agents.
Abadie is affiliated with ICSC (International Council of Shopping Centers) and holds the designations of Certified Retail Property Executive (CRX), Certified Leasing Specialist (CLS), and Certified Commercial Investment Member (CCIM). He is a member of the Louisiana CCIM Chapter, the Commercial Investment Division (CID) of the New Orleans Metropolitan Association of Realtors (NOMAR), and RBN.
He served as the 2017 President-Elect of RBN and as a member of the National Executive Committee, Tenant Council, Investment Sales Council, and Southeast Regional Council. Abadie also serves on the East St. Tammany Chamber of Commerce Board of Directors, as well as the Workforce Development Board serving St. Tammany, St. Bernard, and Plaquemines Parishes.
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