Thousands Chase Deals in Las Vegas
- May 21, 2013
Surging demand, new retail concepts and stirrings of new development were the talk of the Las Vegas Convention Center on Monday during the first day of RECon, the International Council of Shopping Centers’ annual spring convention. It is impossible to tell how many deals will emerge from the event, but as thousands of real estate professionals roamed the vast halls of the 3.5 million-square-foot facility, participants reported a sense of renewed optimism about the market.
“Going into the show, we have more meetings this year than last year,” said John Bacon, vice president of marketing with Cole Real Estate Investments. As of Monday morning, the firm’s acquisition team had scheduled about 240 meetings and the leasing team had about 110 meetings on the calendar. “Our leasing people were getting calls as late as Friday night” from attendees hoping to schedule meetings at the last minute, Bacon added.
Conversations with a variety of attendees revealed optimism fueled by stepped-up interest in investment sales, leasing and development. “The net-lease industry as a whole is hot,” said Stan Johnson Co. managing director Harold Briggs Monday morning at the firm’s booth in the convention center’s south hall. The company’s net-lease retail transaction volume posted a 50 percent year-over-year increase during the first quarter, outperforming the company’s office and industrial sales growth by a considerable margin. One noteworthy net-lease retail trend is the participation of institutional investors, particularly in the $50 million to $100 million range, Briggs reported. “You’ll see five or six institutional buyers compete for portfolios of 15 to 20 assets,” he said.
Owners exhibiting at the show confirmed on Monday that renewed tenant interest is pushing them to adjust their tactics. Scott Prigge, senior vice president of property operations for Regency Centers Corp., said that pet supply stores, fitness centers and fast-casual restaurants are leading the way. Quick-Service restaurants, said Prigge, “can’t get enough space.”
Underscoring his point, a variety of fast-casual restaurant brands like Subway, Smashburger and Jersey Mike’s are using RECon as a bully pulpit to bring attention to their expansion programs and identify suitable space for new locations. Demand for space in desirable locations has improved to the point that Regency aims to backfill a vacant space with the best possible tenant. This year the company is also rolling out a company-wide campaign to review best practice in customer service.
Other restaurant niches besides are commanding the attention of RECon attendees. Chef-driven restaurants are catching on, especially as part of redevelopment in core urban areas that appeal to members of Generation X and Generation Y, according to James McCandless, director of retail for Streetsense, a diversified Bethesda, Md.-based consulting, design and development firm that is a member of the X Team network of service providers and consultants. Another X Team member, Legend Retail Partners, recently rolled out its new Urban Legend affiliate in an effort to tap into the growing chef-driven restaurant market, reported Legend partner David Larson.