National, Regional Grocers Expand Across The Carolinas To Satisfy Demand

by Alex Tostado

Grocery stores are the bellwether for retail health in the top markets of North Carolina and South Carolina. They are a reflection of job and population growth and are often a catalyst for future retail opportunities, anchoring both new shopping centers and mixed-use projects throughout the two-state region.

The Carolinas are battle tested when it comes to the grocery segment, with several local and regional players headquartered in the area and actively leasing space. It came as a blow, then, when homegrown specialty grocer Earth Fare decided to close its Asheville, North Carolina headquarters and close all of its locations following a Chapter 11 bankruptcy protection filing in early February.

Local retail experts don’t believe that the Earth Fare saga is a canary in the coalmine for future grocer distress in the Carolinas. Joaquin Canals, broker at Raleigh-Durham brokerage firm NAI Carolantic, says that the Earth Fare model was ultimately flawed and finally succumbed to outside competition and internal pressures.

“Earth Fare is very niche-oriented and faced incredible competition,” says Canals, citing Whole Foods Market and Sprouts Farmers Market among others. “Earth Fare’s closing doesn’t reflect on the local supermarket environment, which right now is very healthy based on the number of stores and their sales numbers.”

Pierce Mayson, managing principal of SRS Real Estate Partners’ Investment Properties Group, says that the dark stores left behind by Earth Fare should prove attractive to other grocers.

“For the good locations, local grocers are agreeing to take down some of that space,” says Stonis. “The good ones should get gobbled up quickly, the others may pose a challenge.”

In the Carolinas, several grocers have made headlines in recent months with new store openings and announcements, so much so that it’s natural to wonder if the region can support many more stores. Alan Freeman, partner at TSCG, says it’s important to note that the grocery sector is inherently a hyper-local business.

“You can’t put an overall number on the amount of grocery stores a market can handle,” says Freeman. “Traditionally, grocery stores have a pretty small trade area. If you’re trying to determine if there are too many grocers in a given market, it all depends on the immediate trade areas surrounding those stores.”

True that a grocer’s immediate trade area is its home base, but Wegmans, a chain of mega-sized grocery stores based in Rochester, New York, is proving that a grocer’s impact can have a more extensive reach. Fans of Wegmans, self-proclaimed as “Wegheads,” travel far and wide to shop at Wegmans stores, which typically include in-store restaurants and expansive produce, meat and bakery departments.

Wegmans opened its first North Carolina store, and its 100th location overall, last September in Midtown East, a shopping center in Raleigh’s Wake Forest submarket that Regency Centers developed. Local media outlets report that more than 30,000 shoppers attended the grand opening. Wegmans is investing heavily in the Raleigh-Durham metro area, with five new stores under construction or planned in Cary, Holly Springs, Wake Forest and Chapel Hill.

Publix is another grocer making a push into the Carolinas, especially in the urban districts. The Lakeland, Florida-based grocer opened in West Edge in downtown Charleston last year and will anchor Kane Realty Corp.’s upcoming 417-unit Peace Apartments community underway in downtown Raleigh.

Early this year, Armada Hoffler announced a new joint venture project in Uptown Charlotte called Ten Tryon. The 15-story, $95 million mixed-use building will feature a ground-level Publix store upon completion, which is expected for summer 2022.

Keely Hines, vice president of Foundry Commercial’s Charlotte office, says that the new Publix will be a much-needed addition to that particular corridor in Charlotte.

“The Publix coming to Ten Tryon will initiate more growth on the north side of the central business district toward the University and NoDa submarkets,” says Hines. “The Publix should cover the grocery needs in Uptown Charlotte for at least the next decade, because we have the urban Harris Teeter and a Whole Foods Market already in Uptown.”

Publix is set to open a new store on Charleston’s James Island within the Riverland Market shopping center, and it also opened its new, smaller format Greenwise concept in nearby Summerville, South Carolina. Publix is also anchoring the Treelight Square shopping center that’s part of the Wendell Falls master-planned development in the Raleigh suburb of Wendell.

Harris Teeter, a supermarket chain based in the south Charlotte suburb of Matthews that Kroger acquired in 2014, is expanding across the region as well. The grocer is opening a new location at West Ashley Circle in Charleston’s West Ashley submarket, and it will also anchor the new NorthPointe mixed-use project near downtown Greenville this summer.

“Having a full-size, 40,000- to 50,000-square-foot Harris Teeter on the north side of downtown is going to be huge for those residents,” says Lance Byars, senior brokerage associate at Colliers International. “Over the last three or four years, there’s been some good grocery growth in the Upstate.”

The Fresh Market is a grocery chain that focuses on giving its shoppers a European market experience with its produce, bakery and butchery departments flowing into one another in an open setting. This past fall, the grocer decided to keep its headquarters in Greensboro, North Carolina, a city in the Triad region that has been getting a fair bit of attention from the grocery category recently.

Greensboro has a central location in the state and great interstate access, prompting Publix to choose the city as the home for its $300 million cold storage distribution center that is currently underway. The facility will allow the grocer to support its stores and customers in the Carolinas and Mid-Atlantic regions.

Trader Joe’s also opened a new store in October within Brassfield Shopping Center in Greensboro, and Sprouts Farmer Market opened a store along Battleground Avenue in August.

“Some of the big national grocery stores are looking for more sites on Battleground Avenue, there’s been a lot of interest following the new grocers opening,” says Garret Bedrin, partner of The Bedrin Organization. The New Jersey-based company owns several shopping centers in Greensboro, as well as the other Triad markets of High Point and Winston-Salem. Bedrin cites the recently completed Interstate 840 Urban Loop for the bullishness from grocers and other retailers about the area.

“The Urban Loop opened right at Battleground Avenue in December, and it’s been a tremendous catalyst,” says Bedrin. “We’re constantly getting calls from new retailers, food and beverage users and service tenants about Battleground Avenue.”

Other expanding grocery concepts in the Carolinas include Salisbury, North Carolina-based Food Lion, which opened two stores last October in Raleigh and Goose Creek, South Carolina. The grocer is also expanding its online grocery pickup service Food Lion To-Go, which is akin to Kroger’s ClickList, Harris Teeter’s Expresslane and Whole Foods Market’s Prime Now services.

The Acquisition Front

In late February, Continental Realty Corp., a privately owned investment firm based in Baltimore, purchased Mount Pleasant Towne Centre. The 510,000-square-foot, open-air center in Charleston’s Mount Pleasant suburb is home to tenants including Belk, Regal Cinema, Arhaus, lululemon athletica, Old Navy and newcomer Peloton. Continental Realty purchased the asset from a joint venture between Miller Capital Advisory and the California Public Employees’ Retirement System (CalPERS) for $147 million.

The sale is a marquee example of the way that retail properties are trading in the Carolinas today, according to Don McMinn and Zach Taylor, who lead Marcus & Millichap’s Taylor-McMinn Retail Group. The pair has noticed that more private investment firms are buying and that institutional investors and REITs are looking to sell.

The buyer pool for shopping centers in the Carolinas is trending more private. Marcus & Millichap’s Taylor-McMinn Retail Group recently brokered the $12 million sale of Riverside Crossing, a shopping center in Greer, South Carolina. A private family office, JohnCo LP, purchased the Lowes Foods-anchored center. (representative photo of Lowes Foods)

“The buyer pool for shopping centers has dramatically changed over the past few years,” says McMinn.

REITs have gone from 41 percent of the buyer pool to 7 percent since 2014 on multi-tenant shopping centers trading above $10 million, according to research from Institutional Property Advisors and Real Capital Analytics.

“At the same time, private buyers have basically doubled from 33 percent to 64 percent,” says McMinn.

The Taylor-McMinn Retail Group’s recent listings in the Carolinas showcase the shift. The group brokered the $12 million sale of Riverside Crossing, a newly built shopping center in the Upstate South Carolina city of Greer. A private firm, JohnCo LP, purchased the Lowes Foods-anchored center.

“Our marketing campaign had to tap into a private buyer pool that had not previously reviewed the asset and saw more value than the usual suspects,” says Taylor. “We found a family office in a 1031 exchange that fit both criteria.”

The emergence of private buyers for shopping centers in the region is directly linked with the low interest rate environment for today’s borrowers. The 10-year Treasury yield stood at 1.59 percent as of this writing, which is more than 100 basis points less than what the benchmark rate was a year ago. Even with compression in the rate over the past year, Jesse Shannon, chief investment officer of Atlanta-based Branch Properties LLC, expects interest rates to trend even lower in the months ahead.

“With more than $17 trillion in foreign debt being held at negative interest rates, Branch views the low interest rate environment in the United States as being part of a sustained trend toward 0 percent interest rates,” says Shannon. “This will continue to have an effect on both leveraged yields within the retail asset class and downward pressure on cap rates.”

Kyle Stonis, managing principal of SRS Real Estate Partners’ Investment Properties Group, says that lower borrowing costs are enticing private buyers attracted to the yields they can only find in the retail sector.

“The capital market environment right now with the low interest rates and the attractive terms on retail assets has given the retail acquisition market a stabilizing effect,” says Stonis. “People are coming to retail for the yield, they can’t get much yield with industrial or apartments. The cash-on-cash return for retail investors right out of the gate is a game-changer.”

Raleigh-based Rivercrest Realty Investors is a private firm that bought recently in the market. The company purchased White Oak Crossing in Garner from Chicago-based shopping center REIT InvenTrust Properties Corp. for $92 million.

In October, First Washington Realty purchased Harvest Plaza, a nearly 100,000-square-foot shopping center in Raleigh anchored by Walgreens and Planet Fitness, for $21 million. The Bethesda, Maryland-based investment and management firm is also privately owned.

Another private firm making waves on the acquisition circuit in the Carolinas is LBX Investments, a retail investment company based in Beverly Hills, California. In recent months the company purchased Oakbrook Station Shopping Center in Summerville for $22.2 million and Terraces at University Place in Charlotte for $12.2 million.

Even though the buyer pool is trending private, institutional investors and REITs are still acquiring shopping centers, albeit more selectively.

“Institutional investors are taking down very core, grocery-anchored assets in select markets,” says Stonis.

New Market Properties LLC, a subsidiary of Atlanta-based REIT Preferred Apartment Communities Inc., recently purchased Wakefield Crossing in Raleigh. The 75,927-square-foot shopping center is anchored by Food Lion.

Susan McGuire, partner and retail platform leader at Foundry Commercial, says that institutional capital is also attracted to mixed-use properties in the Carolinas top markets.

“The carve out of retail as part of mixed-use is attractive to investors that understand the dynamics of the sector,” says McGuire.

In late November, a fund managed by The RMR Group purchased Bowers, an adaptive reuse project in Charlotte’s South End that once housed the historic Bowers Fiber plant. Local private investment firm White Point Partners sold the project for $31 million. Completed in 2018, Bowers is fully leased to tenants including Artisanal Brewing Ventures, Chef Alyssa’s Kitchen, SentryOne and Investor Management Services.

In December, Starwood Real Estate Income Trust Inc., a non-traded REIT managed by Starwood Capital Group, purchased the Exchange on Erwin for $111 million. The mixed-use property, situated adjacent to Duke University in Durham, North Carolina, features apartments, medical office space and retail space, including a Chipotle Mexican Grill and The UPS Store, among others.

Raleigh Is Striking It Rich

In their annual Emerging Trends in Real Estate 2020 report, the Urban Land Institute (ULI) and Pricewaterhouse Coopers (PwC) ranked Raleigh-Durham Number 2 in the report’s Overall Real Estate Prospects list of U.S. Markets to Watch, trailing only Austin, Texas. ULI and PwC cited the market’s three research universities — Duke University, University of North Carolina at Chapel Hill and North Carolina State University — the Research Triangle Park, tech job growth and homebuilding as reasons why investors and developers would be wise to plant a flag in the market.

Houston-based Hines and Columbia, South Carolina-based Columbia Development are heeding the call with Fenton, a 2.5 million-square-foot mixed-use project underway in the Raleigh suburb of Cary, North Carolina. Nick Garzia, director of leasing for the Southeast at Hines, says that the developers were attracted to the Raleigh-Durham market because of how well its demographic profile threaded the needle for what they look for in a target market.

Fenton is one of five Wegmans-anchored projects underway in the Triangle area. Located in Cary, the 2.5 million-square-foot project will also include Class A offices, retail, restaurants, a CinéBistro, open spaces and a hotel.

“The Triangle is one of the few markets in the country with high incomes and low-cost-of-living, and we became convinced the Triangle has a great future and we are proud to participate in its evolution,” says Garzia. “The Triangle trailed only Austin and Orlando in employment growth over the past few years, yet the percentage of the population with college and graduate degrees is on par with San Jose and Washington, D.C., and ahead of New York and Austin.”

There is also nothing of this scale that exists in Cary currently. Fenton will feature open green spaces, Class A offices, residences and a concentration of retail, dining and entertainment tenants. Garzia says that Fenton’s site work began last year and the developers will begin going vertical on the project this summer.

“Our leasing team expects to make many significant announcements this year, including new shopping, dining, entertainment, fitness and service tenants, as well as a hotel partner,” says Garzia. “Fenton’s retail space is approximately 60 percent leased right now, with more than 30 percent under negotiation.”

Already on board is Wegmans and CinéBistro, as well as Sephora, Free People, Cru Wine Bar, Honeysuckle Gelato, M Sushi, Bailey’s Fine Jewelry and Superica, a Ford Fry Tex-Mex concept.

“Best-in-class, chef-driven restaurants play a critical role in creating the Fenton experience,” says Dotan Zuckerman, principal and vice president of leasing at Columbia Development. “We’re foregoing mainstream chain restaurants to create a concentration of local and regional chef talent that will bring about an exciting dining destination for the town of Cary and the Triangle.”

In the city of Raleigh itself, Atlanta-based Jamestown and Grubb Ventures recently announced Raleigh Iron Works, a planned mixed-use project that will feature 90,000 square feet of retail space, in addition to office space and multifamily residences. The co-developers will renovate historic steel mills and warehouses at the site that were once part of Peden Steel for the project, which will come on line in phases between now and 2023.

Washington, D.C.-based Hoffman & Associates, formerly PN Hoffman, is also in the planning stages for Seaboard Station, a $250 million mixed-use development planned for downtown Raleigh. The project will be the first outside D.C. for the developer, which is still in the planning stages of Seaboard Station. Triangle Business Journal reports the project will be built in three phases and total 800,000 square feet.

Other mixed-use developments in various stages of development in the Triangle area include Fallon Co.’s Raleigh Crossing; KDC and Research Triangle Foundation of North Carolina’s Hub RTP within Research Triangle Park; Leyland Alliance’s Twin Lakes Center, another Wegmans-anchored project in west Cary; and MOSAIC, ECO Group’s 44-acre mixed-use development underway near Chatham Park in Pittsboro, North Carolina.

Edgewater Ventures, a new development firm in Raleigh headed by former capital markets experts at JLL, is the new kid on the block and is actively seeking mixed-use development opportunities around the region. Justin Good, principal of the new company, says that retail, though often occupying the smallest footprint in a mixed-use development, remains a vital component.

“You don’t just throw just any retailer in those spaces. It’s about creating a place and bringing in uses that are complementary,” says Good. “The retail scene can provide a lot of value from a street-level standpoint. When you can control your front door as a developer and provide retail that is complementary to your vertical uses, that’s a recipe for success.”

Adaptive Reuse in Charlotte

The south side of Charlotte is continuing its thunderous momentum of office growth. As of year-end 2019, the city’s south submarkets, namely the bourgeoning urban South End district and the more suburban SouthPark area, had an overflowing amount of new office space in the development pipeline.

“In 2019 there was approximately 3.4 million square feet of office space delivered in the south side of Charlotte, and there’s another estimated 4.5 million square feet coming,” says Stonis of SRS. “Where there’s office growth, there’s residential growth, and that means retail will follow. From a retail perspective, there is substantial interest in the south side.”

Mayson, Stonis’ partner at SRS, says that the office traction on the south side of Charlotte is one that retail investors of all categories have taken to heart.

“Every listing we put out on that side of Charlotte gets a ton of attention,” says Mayson. “We’ve sold centers in Pineville and Indian Trail, and then we’ve got one we’re marketing in Matthews. It’s not necessarily always the sexiest grocer or tenant base for some of these centers, but investors love the growth story of the south side of Charlotte.”

Charlotte’s South End has emerged as one of the top submarkets in the entire Southeast, largely because of its cool factor with a growing millennial workforce. The submarket boasts four stops on the Lynx blue line and residents have access to Interstate 277 and the Rail Trail, an urban trail spanning 3.5 miles.

Hill Partners Inc. is a shopping center owner and manager with deep roots in the South End, having moved its headquarters to the submarket more than a decade ago. Robert Spratt, the firm’s president, says that South End’s amenities and access to talent are the reason why firms like LendingTree, Allstate, Dimensional Fund Advisors and EY are now coming to the neighborhood.

“It’s a great spot for our headquarters, we can walk to shops and restaurants and cafes and take the light rail if we need to,” says Spratt. “The transformation of the area has been quite nice to see.”

To feed off the momentum in South End, and to buy into the neighborhood’s industrial past, Foundry Commercial’s Hines says that developers are choosing to reposition existing buildings rather than build traditional shopping centers and mixed-use projects.

“There’s not a whole lot of neighborhood grocery-anchored centers being developed right now, it’s more adaptive reuse with developers finding cool old warehouses and older buildings and either tearing them down or trying to preserve the integrity of the old unique buildings,” says Hines. “This creates unique office space and retailer opportunities for restaurants and breweries, as well as residential.”

Edens opened its expansive Atherton project last year, which offers 115,000 square feet of retail space and gathering space along the Rail Trail. Edens’ development partner, Crescent Communities, also delivered 346 new apartments in the project, which is an adaptive reuse of the historic Atherton Cotton Mills.

“Edens landed a number of national retailers like Anthropologie, Sephora, Warby Parker, the second DryBar in the market, lululemon athletica and Barry’s Boot Camp out of Los Angeles,” says Spratt.

Other retailers and restaurants at the $100 million project include Madewell, Free People, O-Ku and West Elm. Coming this year are The Eagle Food & Beer Hall, Paint Nail Bar and the Trolley Barn Fermentory.

Another popular adaptive reuse project in South End is Optimist Hall, which debuted in August and is still opening new retailers and restaurants. Atlanta-based developer Paces Properties and its partner White Point Partners brought a food hall to the $60 million development, offering concepts ranging from fried chicken to Indian. Food truck Papi Queso opened its first brick-and-mortar location at Optimist Hall, which also debuted the Fonta Flora Brewery in January, the third location for the brewery based in Morganton, North Carolina.

Asana Partners, a prolific owner of urban mixed-use and adaptive reuse centers in its hometown of Charlotte and in Atlanta, has been the owner of Design Center of the Carolinas for nearly four years. The adaptive reuse development comprises three brick buildings and includes an iconic water tower. Asana Partners recently brought Twenty Degrees Chocolates and Superica to the project, which includes boutique office space.

Other adaptive reuse projects in the area include two projects from local developer Beacon Partners. LoSo Station is a project near the Scaleybark Light Rail Station on the southern edge of South End that will include 1 million square feet of office space, a boutique hotel, rooftop entertainment, retail plazas, multifamily residences and 50,000 square feet of retail and restaurants.

The other is The RailYard, which includes 300,000 square feet of creative office space and 30,000 square feet of retail, including Rhino Market & Deli, Orangetheory Fitness, North Italia, Bishops Haircuts and Stir. The project will also include the CentroRailYard apartment complex, which is being developed by Centro Cityworks and Ascent Real Estate Capital.

In the city’s SouthPark submarket, Childress Klein is underway on Apex SouthPark, which will feature worship space for investment partner SouthPark Church and 88,000 square feet of ground-floor retail and entertainment space, as well as apartments and a 175-room Hyatt Centric hotel that is slated to open in summer 2021.

Also in SouthPark, Lincoln Harris is underway on a $50 million revamp of Phillips Place, which the firm took full ownership of last summer. The project will include the expansion of the existing Restoration Hardware (RH) into a two-story, 41,000-square-foot gallery and showroom. The new RH will also feature a rooftop restaurant, one of only seven RH locations to have one.

Despite the heavy concentration of adaptive reuse and mixed-use projects in the area, there are some smaller retail being developed on the south side. Konover South is underway on a small, traditional shopping center in southwest Charlotte’s Steele Creek district. Called Freeman Retail Center, the 32,000-square-foot property will likely include a national steakhouse concept, bank, cell phone retailer and healthcare tenants. Konover South plans to break ground early this year and deliver the property next spring.

Though the lion’s share of new development is on the south side of Charlotte, the north side also has some momentum in its favor. Topgolf announced in early February its intention to build its second Charlotte location on the city’s north side near University of North Carolina-Charlotte and Charlotte Motor Speedway.

Hines expects that the same driver that spurred development in the South End will do the same on the north side of town: transit.

“The initial growth on the south side was a direct reaction to our Lynx rail system,” says Hines. “Now that the north side rail line has been completed, we’re going to see a similar growth pattern heading that way.”

One project on the north side of Charlotte that is seeing some significant attention is Camp North End, an adaptive reuse of a historic, 75-acre manufacturing facility that ATCO Properties & Management and Shorenstein are co-developing.

Book retailer That’s Novel Books opened a shop in late February at Camp North End, and other tenants coming soon include Free Range Brewing, Wentworth & Fenn, Bleu Barn Bistro, Bow Ramen and Leah & Louise. The project also offers event space and boutique offices, as well as an art gallery and Hex Coffee, among other food and beverage options.

Another project in the works on the north side is General Assembly, a project led by Austin-based Artesia Real Estate. The adaptive reuse development will replace the 1930s-era City North Business Center to include new offices and 24,000 square feet of retail and brewery space.

South Carolina Densifies

In South Carolina’s top two metros, Charleston and Greenville, retail brokers note a similar economic driver for both markets: the South Carolina Ports Authority (SCPA). The Port of Charleston and Inland Port Greer near Greenville have catapulted the local economies for both metros, bringing in new distribution centers and manufacturing facilities, as well as thousands of jobs. Recent companies opening in those two markets include Pierburg US, Alorica, AIRSYS Cooling Technologies, DC Machine, Carver Maritime, R&E Automated Systems, Urban Electric Co., U.S. Waffle Co. and A&R Logistics.

These firms were attracted to SCPA’s infrastructure and the available labor pool, as well as existing automotive and aerospace manufacturers that have a significant presence in the two markets.

“The infrastructure of Charleston has helped support the job growth,” says TSCG’s Freeman. “The backbone of the Charleston economy is Port of Charleston. The tourism is the heartbeat, but the port is why Boeing, Volvo and Daimler all landed here.”

Vitre Stephens, senior vice president of Avison Young’s Charleston office, says that the job growth has helped propel population growth in the city, which is helping support its retail market with some recent deliveries.

“About 26 people per day move to Charleston, it’s growing three times faster than the U.S. average,” says Stephens. “Forty one buildings totaling 900,000 square feet were delivered in metro Charleston in 2019, and we have about 175,000 square feet of retail currently under construction. Retail is still doing well in Charleston.”

The largest new retail project in metro Charleston is Nexton Square, the retail and dining component of the 4,500-acre master-planned Nexton community in Summerville. RealtyLink is filling out the project with several concepts, including Taco Boy, Halls Chophouse, Bad Daddy’s Burger Bar, Tropical Smoothie, Nelson Wine & Spirits, Bey + Eloise, Crescent Moon Orthodontics, Bold Fitness, Diamond Nail & Spa and Southern First Bank, among others.

Freeman says that the Nexton Square project is a reflection of both the job growth in Summerville and the city’s abundance of entitled land, which is difficult to come by in the high barrier to entry Charleston market.

“The daytime and residential population is exploding in that submarket,” says Freeman. “Retail will follow, especially when the land is already entitled.”

In addition to the new Publix- and Harris Teeter-anchored centers and the Home Depot, Floor & Decor and Costco stores that opened recently, the most active retail activity in the market is the backfilling of closing stores. In addition to the three Earth Fares in metro Charleston, several other concepts have shuttered space, only to have other retailers backfill those locations.

“The closing of stores and backfilling is an active part of the market,” says Freeman, who recently arranged Aldi’s lease that replaced a shuttered Barnes & Noble at Northwoods Marketplace in North Charleston.

On King Street, historic Charleston’s famed retail high street, shoppers are noticing many new names sprinkled along the corridor. These include Orvis, Luna, Amanda Lindroth, CBD Social, Madewell, SaltLife and OMG Candy. These retailers and eateries are taking over spaces left behind by tenants such as Banana Republic, Sneaker, Tasty Thai & Sushi and Smoke BBQ.

Lance Byars of Colliers International says backfilling second-generation space is also occurring in the Upstate region. Byars recently helped replace a former rue21 and hh gregg at Anderson Station in Anderson, South Carolina, with a new Kirkland’s and Big Lots. Charter Spectrum also opened a new end cap store at the center.

“We were able to increase NOI by pushing rents despite the turnover,” says Byars. “Owners with good real estate are adapting to the change and taking advantage. We believe we will have more interest from other junior anchor spaces if and when more space becomes available.”

In Greenville, most of the new retail development is occurring in and around the downtown district as it remains the hub of office and residential growth.

“Downtown Greenville has been a hot submarket, and it will continue to be as we grow,” says Byars. “The majority of the longtime, established restaurants are located there and performing well. As far as retail, Brooks Brothers, Anthropologie and others are all part of that North Main and Washington area.”

Just north of downtown, Central Realty Holdings and ECI Group are co-developing NorthPointe, the Harris Teeter-anchored center on the North Main area of Greenville that is slated to open this summer. Situated at the intersection of Wade Hampton Boulevard, East Stone Avenue and North Church Street, the project will also feature 21,396 square feet of inline retail space.

Camperdown, Centennial American Properties’ $200 million mixed-use development underway, will likely change the gravity of downtown Greenville more southward, according to Lance Byars of Colliers International.

Downtown, Centennial American Properties is underway on Camperdown, a $200 million mixed-use project that will replace the former Greenville News office headquarters on South Main and Broad streets. The project will feature a new AC Hotel, office tower, parking garage, apartments and more than 110,000 square feet of new retail space.

“Camperdown will probably shift the gravity of downtown southward,” says Byars. “It’s going to give some regional and national restaurants the chance to have some premier space in downtown Greenville. Groups from Charleston, Atlanta, Charlotte and others will have the chance to expand in Class A space in Greenville, which is tough to find.”

The metro Greenville area is also home to some adaptive reuse projects, including Taylors Mill and the planned Greer Mill, which the Greer City Council approved the mixed-use rezoning last summer. Pinkys Revenge Arcade and Game Lounge is opening soon at Taylors Mill, which houses the Southern Bleachery Venue, 13 Stripes Brewery and The Farehouse.

Outside traditional grocery-anchored shopping centers, adaptive reuse projects and mixed-use developments, the most often discussed retail story continues to be the reshaping of the American mall, several of which are transforming in the Carolinas.

JC Penney closed department stores at Myrtle Beach Mall and Citadel Mall in Charleston’s West Ashley submarket. The Medical University of South Carolina (MUSC) recently opened up its West Campus in the 126,000-square-foot space left behind.

The 1.3 million-square-foot Citadel Mall is also leased to HBO, which is filming the series The Righteous Gemstones onsite. One of the main storylines in the first season of the TV show is a new mega church that opened in a shuttered Sears department store at the mall.

Additionally, Citadel Mall is also set to be transformed into Epic Center, which could span as much as 4 million square feet of retail, offices, apartments and hotels.

— By John Nelson. This article originally appeared in the March 2020 issue of Shopping Center Business.

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