RECon Preview: What’s in Store for Real Estate’s Biggest Show?
- May 17, 2013
Renewed development, technology, taxes on internet sales and other retail trends will be in the air when 32,000-plus professionals gather at the Las Vegas Convention Center next week for RECon, commercial real estate’s largest event.
Attendees at the International Council of Shopping Centers’ annual spring convention will be pursuing deals and connecting with clients in an atmosphere marked by some upbeat metrics. Colliers International reported on Wednesday that shopping centers absorbed nearly 4.5 million square feet during the first quarter as average asking rents rose 0.3 percent to $14.80 per square foot and vacancy improved from 10.09 percent to 10.06 percent nationwide.
New retail center development and expansion is on the minds of many professionals. “One of the things I’m focusing on is trying to identify (the location) and the velocity of new shopping centers,” said Mark Keschl, national director of Collier’s retail services group. “So far during the first quarter, we’re starting to see green shoots of new centers.” He cited outlet centers as a category that has been subject to considerable buzz, as well as some projects. But, he added, rumored projects of all categories must still land tenants in order to advance beyond the talking stage. In addition to talking deals on behalf of their various clients—retailers, restaurants, owners and investors—Colliers professionals will be taking time to walk the show floor and scope out new retail and restaurant concepts, Keschl said.
An increasingly upbeat assessment of the market is prompting Kemper Development Co. to reveal details of a planned $1.2 billion expansion of the Bellevue Collection, its mixed-use property in Bellevue, Wash. “We are excited about what’s going on in the market,” said Jennifer Leavitt, vice president of marketing. She points to such indicators as 48 consecutive months of improving sales in the company’s retail portfolio and increasing interest in high-end retail, along with strong demand for the property’s office space. Kemper Development regards this year’s RECon more as an opportunity to introduce clients to its plans than as a place to sign tenants to the new space.
In addition to development and leasing opportunities, retail real estate investment will also be in the air at RECon. Heading into the show, the retail real estate investment atmosphere has been somewhat sketchy, asserts Gerard Mason, executive managing director for Savills. “Right now it’s kind of a Mexican standoff,” he said. REITs and other institutional investors are flush with cash, and deploying capital is a higher priority than filling their coffers through asset sales. As Mason sums up the dilemma: “You can’t sell, because you don’t need the money, and you can’t buy, because nobody’s selling.” New product is difficult to come by these days, but Mason said he expects retail property trades to pick up later in the year as investment managers look to meet goals for allocating capital.