As we look forward through the end of 2021, everyone wants to know how retail tenants are doing out there. NAI Elliott Northwest Retail Advisors team are in the field, working with commercial retailers and building owners every day to help them achieve their goals. What they have seen varies by market and location.
According to George Macoubray, VP, Retail brokerage, there’s a divergence between who is being successful and who’s not. If you’re a suburban drive-thru or restaurant that’s adapted your business to the ‘new normal,’ than you’re probably doing great. On the other hand, urban restaurants that have traditionally relied on their interior environment which often doesn’t translate to delivery or to-go, are struggling.
Nick Stanton, Senior Associate, sees 2021 shaping up to be a much better year than 2020. Like George, he’s also seeing a lot of activity in the suburban retail space, especially in restaurants but vacant former grocery stores and fitness center spaces are still struggling to get leased. Recently, there has been new activity from discount retailers and large format home goods retailers popping up in the market. Nick predicts that we will see these retailers eventually take over the anchor and box spaces in large shopping centers and drive activity to those areas.
Gael Zongazo, Broker, is also seeing retailers that want to reactivate and get back into the world. There are entrepreneurs looking for opportunities in busy shopping plazas and continue to elevate their business. Gael has also seen larger national tenants looking to potentially downsize to slightly smaller spaces.
While there is growth happening, George acknowledges that some of it is impeded by supply chain and hiring problems. Mattress and furniture stores that rely on products made overseas are struggling to get inventory. Restaurants are struggling to find drivers to deliver supplies to their various locations. Busy businesses are still working to bring their staff up to full capacity.
While we don’t know for certain what’s ahead, 2021 has seen growth in many areas and we continue to see busy pockets in the commercial retail sector.