According to economist Ted C. Jones, US retail sales and the demand for goods resulted in the freight rates for 20 foot containers from Shanghai to the US to increase approximately 125% in the past 12 months.
Another economist, Elliott Eisenberg PhD, also states that retail sales are terrific and that though we are buying goods online and curbside during the pandemic, it shows that consumer consumption has recovered.
What does that mean for commercial real estate in general and retail space specifically? I think there is a lot of pent up demand for going out, mingling with people, touching, feeling and trying on what people want to buy. With all of the people moving to South Florida, I think retail is going to rebound and will do so quickly. The products and services may change, but people still want an experience when they shop. At least I do!
From bottom left: Salty Donuts Key Lime, White Chocolate Tres Leches, Guava + Cheese, and Traditional Glazed
From bottom left: Salty Donuts Key Lime, White Chocolate Tres Leches, Guava + Cheese, and Traditional Glazed
Quick Disclaimer: I rarely eat doughnuts and when I do, it is usually only a jelly doughnut. A long time ago, a very non-nutritious friend of mine told me that the jelly doughnut was the most perfectly balanced food because it contained all of the 5 basic food groups. When I asked her how she figured that, she told me with a straight face, “The dough is the bread/grain group, the jelly is the fruit group, and they are made with milk and eggs.” I pointed out that she was missing the vegetable group and she responded that they are fried in vegetable oil! Anyway, I digress and have made this disclaimer longer than I thought.
Remember several of years ago when cupcakes, large and mini, were everywhere? Cupcake wedding cakes, cupcake birthday cakes, bridal showers, you name it, there were cupcakes and little cupcake shops were popping up in neighborhoods everywhere. I rarely eat cupcakes either, but I did enjoy all of the new, creative flavors that popped up when the cupcake craze hit. The craze hasn’t necessarily died down, I am happy to say that both Misha’s Cupcakes and Buttercream Cupcakes in Coral Gables near South Miami are both still around and are very popular. Misha’s are still so popular that you can find them at Miami International Airport.
But we’ve moved on in the carb alphabet from the “c’s” to the “d’s” for the latest food fad. Although they actually started popping up in 2015-2016, stores are opening up second locations and Instagram activists are snapping away. In South Miami, Honeybee Doughnuts has been open since 2016, they are frequently closed when I drive by because they sell out so often, and they are opening a second store in The Falls Shopping Center. Their doughnuts are works of art and extremely Instagrammable.
The Salty Donut has been around since 2015, since it started as pop-up in Wynwood. They recently opened their second store, this one in South Miami. They too have a cult following and I am sure the reason they opened up in South Miami was to satisfy their customers in the southern end of the county who spent countless hours driving to their Wynwood location.
Mojo Donuts, with locations in Hollywood and Miami, are opening up a third location in Coral Gables/South Miami. Mojo Donuts also has fried chicken, so I guess they are the new “chicken and waffles”.
Renovation is nothing new to investors who look for value-add properties. Sometimes a fresh coat of paint, new fixtures, or an exterior update are all that is needed for a new owner to be able to boost rents.
Renovated Office Building on Red Road in South Miami, FL
I have read several articles lately about re-purposing buildings, and there is a great example of one in Coconut Grove. Touzette studios designed a mixed use office and retail building out of a parking garage.
Previous parking garage being repurposed to office – Mary Street, Coconut Grove, FL
The Shoppes at Sunset Place and Cocowalk are a combination of all three.
Construction of new office space at CocoWalk – Coconut Grove, FL
Make it easy for consumers to find what they are looking for. In a recent blog Is Veganism Going Mainstream, I discussed how Marshalls was making it easier for vegan shoppers to identify purses that coincide with the shopper’s values. In addition to Marshalls highlighting vegan purses, Whole Foods also makes it easy for consumers following specific dietary guidelines, such as Paleo, Whole 30, Gluten Free etc., to find products that meet their requirements without them having to read every label.
Make it experiential. Whether you own or operate an individual store, a chain of them or a shopping center, the consumer has to experience something beyond the shopping itself. Retailtainment was first used back in 1999 by sociologist and author George Ritzer
Make it interactive. Books and Books, the independently owned local bookstore is amazing at interacting with their customers. In addition to having knowledgeable staff, they have a cafe with great food, spaces for getting together and socializing and they offer book signings and readings by authors. Patrons come early have dinner or a cocktail, socialize, buy the book, and interact with the author. You can’t get that from online shopping and, in spite of technology (or maybe because of it) people want to have places where the can interact.
Make it Instagram and Pinterest worthy: Instagram, Facebook, Pinterest and the rest of social media has made it essential that whether it is food, clothing, real estate, spaces and places, whatever it is you are selling has to be Instagram and Pinterest worthy. Two places in Miami do that extremely well. Miami Design District and Wynwood. Don’t believe me? Go into Instagram and #miamidesigndistrict to view 158,000 posts or #wynwood to view over 2.4 million posts.
Make it about community. Several of the places already discussed such as Books and Books, the Miami Design District, and Wynwood are great examples. FootWorks in South Miami has running clubs and helps train you for half and full marathons, Dharma Studio in Coconut Grove offers free yoga classes three times a week in the Grove, and Aventura Mall has all sorts of events scheduled throughout the year. If you are in an area that has one, check with your local Business Improvement District and see how you can get involved to bring more traffic to your store.
The home-style Southern cooking is simple yet high quality, using seasonal, local and organic ingredients and the atmosphere is casual and friendly. Whether you are a millennial or not, you will appreciate both the food and Southern hospitality at this local favorite.
Food has always been important in retail centers; all you need to do is check out the food court at any major mall to see how much space is devoted to food. Increasingly, more formal sit-down restaurants are what is needed to drive traffic to malls, strip centers, or downtowns. Dadeland Mall added many dining options when they renovated several years ago, Downtown Dadeland is starting to bustle with the addition of The Brick and Barley to their tenant list, and Brickell City Center has a variety of restaurants, including Quinto La Huella, Pubbelly Sushi, and American Harvest to name a few.
A couple of days ago a wrote about what South Florida will look like in 2070 if we continue developing the way we are. The state of Florida is growing by 1,000 people per day, making traffic unbearable and threatening our quality of life. Luckily, there are many projects going on in South Florida that will improve our community and increase property values around them. Three of them include:
As a huge fan of Pubbelly and Barceloneta in South Beach, I am thrilled that Barceloneta is coming to South Miami. For those of you who have never been to the South Beach location, you are in for a treat. Barceloneta is a hip, happening, low key tapas bar with great food and an even better vibe. They are on schedule to open the first week in December where Origins Restaurant used to be.
A green corridor comprised of Cutler Bay, Palmetto Bay, Pinecrest, South Miami, Coral Gables, Miami and Miami Shores has been formed to assist in financing energy related improvements to property. Formaly named The Property Assessed Clean Energy District (PACE), this new corridor will enable businesses and residents to finance energy related improvements to their properties through a special assessment on their property. This program is strictly voluntary and provides a list of contractors as well as energy efficiency assessments. If you can save money on your electric bill, would you take advantage of this program?
Yesterday I attended a Tier 1 workshop put on by MDX to explain the US 1 express lane project development and environment study. Considering how large this proposed project is and how many residents and businesses it will have an effect on if it goes through, there were not a lot of people in attendance.
Based on the current study, the express lanes will have potential overpasses at each intersection on the busway where there is currently a traffic light. The maximum height of these overpasses will be 24-25 feet high, which is the height of the Metrorail track.
The impact on the abutting neighborhoods of having this expressway will be significant. While trying to ease congestion on US 1 and decrease travel times from the southern end of the county to the Metrorail stations are laudable goals, as currently conceived, I think the project is going to create havoc on the neighboring communities and create more traffic, not less, along the corridor. Having an extra 2-3 lanes of “express” cars exiting at the end point will create a logjam. Add to that the plans to link the expressway to the Turnpike and the Palmetto and you get the picture.
This project will have a significant impact on the surrounding neighborhoods as well, with the potential to affect property values, mostly downward in my opinion.
If the whole goal is to get people out of their cars and onto Metrorail, wouldn’t it be a smarter use of taxpayer dollars to build Metrorail down to the southern part of the county as originally proposed. If they add express buses to the bus lanes, that could also help.
If you live in any of the neighborhoods that abut the busway, please contact Tere Garcia, Public Information Officer at MDX. Her number is 786-277-9292.
