Food, fitness, ICSC 2017 and, of course, millennials were the themes of the New Jersey chapter meeting of the National Association of Industrial and Office Properties on Tuesday.
“The overall feeling coming out (of ICSC) was the importance of millennials pretty much making the decisions at this point, and we’re kind of following their lead with what they are going to do next,” Nancy Erickson, executive managing director at Colliers International, said. “The importance of food, entertainment and even the discount T.J. Maxx and Marshalls and stores like that are tenants that are growing and aren’t being affected by the internet.”
“For food, millennials and the rest of us are looking for something unique. It seems that the national chains are out there, and they’re going to do well, but it is the uniqueness and the ‘out of the box’ that is going to succeed in food.”
Erickson was joined by a senior director at Cushman & Wakefield, Brian Whitmer; Chief Information Officer Herbert Eilberg of Urban Edge Properties; and the co-founder of Stanbery Development, Mark Pottschmidt.
Stanbery Development, according to Pottschmidt, has already begun to see the importance of food and retail at its project currently under construction in Parsippany.
“It all comes down to the location, the visibility, the demographic, but also the tenant mix,” he said. “We’re leading with food where we would lead with fashion. So, it has completely turned around.”
Stanbery has developed 11 different "Lyfestyle Centers" in New Jersey and Pennsylvania, New York and Florida. The development firm is currently developing its mixed-use District at 1515 project in Parsippany and Hanover Township.
“The theme we are watching develop is capital finding quality or quality finding capital in retail,” Whitmer said. "The shopping centers that we’ve had, we’ve found buyers for all of them and there seems to be transparency in the caps developing.
“We’re seeing the capital and the buyers come back into the market; that means data points, which gives comfort to sellers. Now, we’re starting to become more rapid. A lot of that has been strategic dispositions. Whether it’s the urban edges, the REITs, they’re selling their noncore, secondary, tertiary product.”
But, although the panel was confident in the outlook for retail in key markets, it is also aware of the impact e-commerce is having in the market.
“Your millennial may be looking at the phone, may be looking at an iPad, they may be in the car, whatever it is, but it’s about providing the basics: convenience, value, customer service, etc.,” Eilberg said. “We believe the retailers that can provide those things in good locations are going to be successful.”