SOUTHEAST SNAPSHOT, MAY 2007

Hampton Roads Retail Market

Mixed-use and town center development continues to sustain the greatest activity in the Hampton Roads retail market. A healthy mix of traditional grocery-anchored centers and big box developments are underway throughout the region as Harris Teeter and Farm Fresh have recently opened new grocery stores. North Suffolk is one of the hottest areas in the region as it is being fueled by strong residential growth and higher incomes generated by the Modeling and Simulation industry that has created a technology corridor. Meanwhile, the greater Williamsburg area’s retail sector is extremely active with four projects underway, ranging from 120,000 to 500,000 square feet.

In the Princess Anne corridor of Virginia Beach, the 450,000-square-foot Landstown Commons is being built. Meanwhile, the first tenants, Chicos and Jos. A. Bank, have opened at the Chesapeake Town Center. A new town center has been announced for north Suffolk that is scheduled to have 1 million square feet upon completion; and a new Harris Teeter-anchored center has also been announced in north Suffolk. Some of the major retail developers in the Hampton Roads market that are involved in these projects include Armada Hoffler, Ellis Gibson, The Goodman Company, Frontier Development, Kahn Development and S.L. Nusbaum.

As for future development, there is a long list of quality tenants anxious to enter the Pembroke area of Virginia Beach. There are two significant projects just west of the town center that are completing site plans. Upon completion, these projects should bring some new and exciting retailers to the market. The Hampton Roads retail market is in very good shape with vacancy rates just under 5 percent. The forecast looks good for the future as retail and mixed-use developments continue to break ground.

— Ed Kimple is managing broker for Thalhimer’s Virginia Beach, Virginia, office.


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