Shopping Centers Today

APR 2017

Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)

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A P R I L 2 0 1 7 / S C T 63 the strong sales volumes that they are seeing in Utah, along with the strong workforce, Utah becomes a very luring location for these retailers." Recent data show that the area's retail vacancy rate fell by 40 basis points to 5.4 percent last year and that rents jumped from $18.38 per square foot in 2015 to $20.86 per square foot in 2016, according to Cushman & Wakefield. The explosive population growth has generated a residential construction boom. "A lot of people are calling Salt Lake City how Denver looked 10 years ago," said Nick Clark, senior director of retail at Cushman & Wakefield and a 20-year veteran of the local market. "The amount of housing growth cannot be overstated here." Most of that residential construction is concentrated in the southwest portion of Salt Lake County and the northern portion of Utah County and involves both single-family and apartment-complex development. Thus the bulk of the recent retail construction is occurring in those same areas. To serve this growing population, supermarket chains have been particularly active in the Salt Lake market. "They continue to be the gold standard for local retail," said Clark. Salt Lake City–based Smith's Food & Drug is set to open units in Saratoga Springs and Springville this year, while Whole Foods is on track to open in a new center in Park City, and a Lee's Marketplace is to open in North Salt Lake. "In the next three to five years, barring a slowdown or a hiccup in the economy, I think you'll continue to see more retail construction here just following the massive amount 10 miles south of downtown Salt Lake City, and which is set to open in 2018. The report of another compelling demographic comes from the University of Utah, which is projecting that upwards of 49,000 state residents yearly will be turning 20 years old over the next 12 years. This trend may bode well for additional urban development, observers say. Though Clark acknowledges that Salt Lake City is still very much a suburban retail market, the growing numbers of younger professionals are driving much of the recent focus on downtown. Over the past two years, 1,500 multifamily units have been developed downtown, and an additional 3,800 units are under construction. There is growth of restaurants, bars and other entertainment in general. "Ten years ago you'd come downtown and there was nobody here on Friday or Saturday nights, everybody was going home," said Clark. "Now downtown is vibrant, and it's a lot more fun, quite frankly." Salt Lake City is also unique in that of housing," said Clark. "You're going to start seeing a lot more out- of-state developers looking in this market as well." In the growing southwestern quadrant are the 2 million-square-foot District and the 1.5 million-square- foot Jordan Landing centers, both of which dominate the market just now. But more retail is needed. "Due to the residential growth, those two projects are now not enough to sustain that growth, and so we are seeing some other major projects that are under development or under planning right now," said Moore. Among these is a mixed-use center called Mountain View Village, which CenterCal Properties is building on an 85-acre site in Riverton, You'll continue to see more retail construction. You're going to start seeing a lot more out-of-state developers looking in this market" "

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