Mar
27

Columbia Retail Market Overview

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COLUMBIA, S.C. RETAIL MARKET

South Carolina’s capital city kept a steady course with the arrival of new big box and grocery-anchored centers and the first phase of Sandhill Station, the new expansion of wildly successful Village at Sandhill. The city is expected to maintain its moderate retail climate as the nation heads into a period of economic uncertainty. “Occupancies have held in the 93 to 94 percent range,” says Rox Pollard, principal and manager of the retail services group for Colliers Keenan in Columbia. “We have not seen a downturn in retail on any level including strip variety or freestanding.” The city reported more than $47 million in capital investments last year and an increase in population and job growth. Colliers Keenan reported 291,626 square feet of big box and big box-anchored spaces were absorbed in the first half of last year, and prime retail space ranged from $17 to $35 per square foot due to escalating land and construction costs in new developments.

The largest player on Columbia’s retail stage is the Village at Sandhill by Columbia-based Kahn Development; the 300-acre behemoth has introduced more than 1 million square feet of retail to the city. The village/lifestyle concept has proven to be extremely popular, and was designated as a finalist for the 2007 International Council of Shopping Centers’ Design and Development Award for “best mixed-use retail center above 500,000 square feet.” The project is currently 70 percent complete, with the option to add approximately 300,000 square feet. “Vacancy rates have not been a problem,” says Alan Kahn, president of Kahn Development. “We are continuing to lease up our existing centers and have enjoyed pretty good occupancy. We haven’t seen any downturn yet. As far as rental rates, we are getting about the same as we have seen during the last two years.”

Kahn recently completed the first phase of Sandhill Station, a 220,000 square foot retail center on the 30 acres adjacent to the Village at Sandhill. The initial phase is a 17,000-square-foot specialty retail center tenanted by Family Christian Bookstore, Sleep King and CiCi’s Pizza. Kahn will also rehab an existing 50,000-square-foot building on the property in Phase 2. Sandhill Station will be completed in three or four phases in 2011.

In downtown Columbia, Charleston-based The Beach Company will introduce a new mixed-use development including commercial space and residences. CanalSide will be located at the intersection of Taylor and Williams St., and the project will feature 35,000 square feet of retail. Phase 1 of CanalSide will include 305,140 square feet of residential and 12,791 square feet of complementary commercial space. The project is expected to complete in December 2008.

Big box-anchored shadow centers sprouted up across the cityscape, including four Wal-Mart Supercenters located in northeast Columbia, northwest Columbia and two in Lexington County. Lexington Pavilion, a Target-anchored center, opened on Highway 378. Walgreens will open a location on Hopes Ferry Road and Interstate 78 in March, with more stores planned for the Columbia area, and Delhaize Group opened a new Food Lion. On the horizon, Costco and Trader Joe’s are reportedly investigating the local retail market.

Restaurant driven retail also made a big impact on Columbia’s retail market, “The small strip development has been very popular in the Midlands for several years,” Pollard says, “It follows a trend that more retailers want to be out on the road versus an inline grocery anchored center.” Restaurants that have headlined smaller centers include Salsarita’s, Shane’s Rib Shack, Moe’s and Five Guys Famous Burger and Fries.

Columbia’s retail market has maintained a positive status that’s expected to continue into 2008. Though retail is tapering off from the extensive development of yesteryear, the capital city is expected to weather the change well. “Our area will be fairly steady,” Kahn says. “…a steady increase, just not extraordinary.”

— Jia Gayles

http://www.southeastrebusiness.com/articles/MAR08/cover1.html

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BLOG NOTE:

I wanted to point out that the Village at Sandhill was one of only four centers in the United States nominated for the 2007 International Design and Development Awards. Congratulations to Kahn Development!

MBD
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