Friday
Jul202012
Freestanding development outpacing centers in 2012
Friday, July 20, 2012 at 12:47PM U.S. developers cut back on the amount of new shopping center space they opened in the first half, with many building freestanding retail properties instead. CoStar Group pegs the current number of U.S. shopping centers at 111,348 — reflecting the addition of 83 new properties since the end of last year.
"At this pace the number of net centers should be a historically low 160 for the year,” said Michael P. Niemira, ICSC’s chief economist and director of research. “That’s significantly less than the 255 net new properties opened in 2011 and the 333 properties opened in 2010.”
Most of the property growth between January and June came from small, unanchored, convenience (strip) centers, which accounted for 55 properties, or two-thirds of the overall increase, CoStar reports. The story is different when considering the aggregate square footage of new GLA opened in the first half, according to Niemira. He says 32 percent of the first‐half GLA increase came from eight community centers, 25 percent was from 19 neighborhood centers, 22 percent consisted of one regional mall, 12 percent was convenience/strip centers, and about 9 percent was from one outlet center.
“The new trend that has appeared since 2010 is that relative gains are larger in freestanding retail space than in shopping centers,” Niemira said. “In 2010 the balance shifted, with 83 percent more new freestanding space relative to shopping centers, 62 percent more in 2011, and so far in 2012 freestanding retail space is growing almost three times as fast as shopping centers. Overall, the shopping center industry has entered a mature phase of development in the U.S., which is no surprise.”
