At ARC Properties, retail real estate is a key segment of our portfolio, so it's exciting to see positive developments on the horizon for this sector of commercial real estate. In a recent article from Bisnow (full article linked here), Brad Buchanan, managing director at JLL Capital Markets in Atlanta, shared some valuable insights, synopsis below.
With the Federal Reserve easing monetary policy, retail real estate transactions in the Southeastern United States are anticipated to increase, according to Buchanan. He highlighted the region's strong economic fundamentals and the retail sector's resilience against e-commerce and pandemic disruptions, which are attracting renewed investor interest and a broader range of lenders willing to finance acquisitions.
Buchanan noted that unanchored and grocery-anchored retail assets are particularly desirable, with the Southeast being a prime target for capital allocation. Great for anyone looking in our region. Investors are shifting focus from other regions and asset types to retail, which offers better risk-adjusted returns. Despite previous challenges, retail has proven its strength, supported by a lack of new multitenant developments and a high occupancy rate of around 96% in open-air retail spaces.
As debt availability improves, lenders are becoming more flexible, expanding their criteria beyond just grocery-anchored properties. Buchanan advises commercial real estate professionals to capitalize on the current momentum in retail, as the healthy supply-demand dynamics indicate a strong transactional period ahead. Looking to 2025, he expects declining interest rates to further boost activity and retail asset performance.
As always, we are available to assist you with any of your commercial real estate needs and are just a call or message away.
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