[caption id="attachment_20887" align="alignright" width="108" caption="Jennifer Hibbitts"][/caption]
[caption id="attachment_30855" align="alignright" width="108" caption="Mark Koenig"][/caption]
The Marin County shopping center real estate market ended 2010 with an overall vacancy rate of just 4.4 percent, according to the Terranomics year-end retail report. One year ago the rate was 6.3 percent.
Vacancy peaked in the county in mid-2009 at 6.4 percent and has been heading steadily downward ever since. Consider this: two years ago as we headed into the "Great Recession" amidst a flurry of retailer bankruptcies -- Mervyn's, Circuit City, Linens 'N Things, Gottchalk's -- many analysts expected retail to be the last commercial real estate sector to recover.
Yet, at a national level, there is a strong case to be made now that retail only follows multifamily in terms of overall strength.
There will be a continued upgrading of tenancies and back-filling of vacancies at shopping centers throughout the county.
Grocery players in Marin remain particularly active. Woodlands Market will open at the Boardwalk in Tiburon, which was formerly occupied by Boardwalk Market. Boardwalk Market will be relocating their business to Marinwood Plaza, to the former Bell Markets' space.
In Fairfax, the Good Earth will be relocating for a larger store to the 22,000 square foot former Albertson's. DeLano's closed its Mill Valley and Tiburon locations. CVS is proposing to open in Tiburon, but its 23,000-square-foot Mill Valley store is still available.
At San Anselmo's Red Hill Plaza, Safeway plans remodeling. Whole Foods Market opened its third and fourth stores in the county in 2010 on DeLong Avenue in Novato and on East Blithedale Avenue in Mill Valley. Additionally, Mi Pueblo Foods opened in March 2010 in a former Circuit City in San Rafael's Canal neighborhood.
At Town Center Corte Madera, Urban Outfitters recently opened in former Pier 1 Imports space. Additional openings later this year at the center include Circle Bank, Elite, a new high-end sporting goods store from Sports Authority and TD Ameritrade.
New tenant deals in The Village at Corte Madera likely to open in 2011 include Tommy Bahama, Madewell, Free People, North Face and Ann Taylor Loft, with is relocating from Town Center Corte Madera.
At Strawberry Village in Mill Valley, the prime 10,000-square-foot former Smith & Hawken space was backfilled by Bliss Furniture.
At Marin Country Mart, formerly known as Larkspur Landing, owner J.S. Rosenfield & Co. of Santa Monica continues to reposition the center as a "country mart." New boutique tenants include Miette Bakery, Erica Tanov women's wear, James Perse apparel, Twig & Fig stationary, Benjamin eyewear, Rustic Bakery and George pet boutique. There continue to be changes to landscaping and hardscaping as well as a new farmer's market on Saturdays.
The current average asking rent for shopping center space in Marin is $29.42 per square foot per year on a triple-net basis. It's a sharp decline from $33.78 just a year ago, but it does mark an increase from $27.87 two years ago.
Keep in mind that these numbers reflect a wide range of shopping center types and classes and work best as an overall benchmark for the region.
First-tier shopping centers are posting rental rate growth and will continue to do so throughout the year. Second-tier centers will remain flat or experience limited rental growth and third-tier centers will continue to face downward pressure on rents.
