Shopping Centers Today

OCT 2018

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

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T H E C O M M O N A R E A N E W S F R O M A LL C O R N E R S O F T H E I N D U S T R Y A ROUNDUP OF RECENT RETAIL REAL ESTATE TRANSACTIONS 8 RENTS, NOI ARE UP, OCCUPANCY IS STEADY 10 TEN LUCKY SHOPPERS FIND THEY'RE HEADED TO TRANSYLVANIA 12 CIRQUE ITALIA TURNS MALL PARKING LOTS INTO BIG TENTS 14 TESCO TURNS OLD SHOPPING BAGS INTO PARKING LOT BLACKTOP 16 R etail property owners are increasingly turning to the senior-living sector to help drive trac to their centers and to promote additional uses for vacant land. "We are seeing this collision of uses come together in individual properties, [enabling facilitation of ] a lifestyle where you can live, work and now even retire and have all the ame- nities around you in close proximity," said Greg Whitney, a Los Angeles– based senior vice president of retail development at JLL. Consider the 330-unit senior-hous- ing community being built to replace a former Canadian Tire anchor store in the enclosed Galeries Aylmer shop- ping center, in Québec. †is commu- nity, called L'Initial, is being devel- oped by Le Group Maurice, one of Canada's largest developers of housing for seniors. Upon its completion sometime next February, L'Initial will join the center's existing supermarket and will link directly to the rest of Galeries Aylmer's 72 retailers, which include a health clinic, a pharmacy, a liquor store and a movie theater. †e center is within walking distance of the town of Aylmer, which has retail shops of its own. Demand for senior housing, both present and future, is clear. At present, the American Association of Retired Persons reports, some 10,000 baby boomers turn 65 every day, and the organization anticipates that this pace will continue into the 2030s. By 2061, some 3 million people in Québec will be age 65 or older, according to Le Groupe Maurice. †ough senior-housing construc- tion is comparatively slow versus the broader multifamily residential indus- try, it nonetheless comprises signi›- cant numbers of residents. According to the National Investment Center for Seniors Housing & Care, senior-hous- ing construction starts during the second quarter totaled 4,083 units: 2,065 independent-living and 2,018 assisted-living units. †is was up by 3.3 percent from the ›rst quarter, and 28,000 new senior-housing units are still to see completion this year, according to research from Lancaster Pollard, which arranges ›nancing for senior-housing developers. †e renewed focus on senior housing as a viable-partner option for retail landlords comes as department store closures have forced many retail center owners to consider alterna- tive uses, observes Todd Caruso, a CBRE senior managing director who oversees the ›rm's work with retail landlords in the Americas. "I like the trend very much, because it is spurring activity," said Caruso. "It has been driven by the disruption, and the disruption is shining a light on those assets that need to transform and adaptively reuse them." Whitney agrees. "In today's envi- ronment, with rising land costs [and] with a shrinking amount of total retail demand, you are seeing the integration of these two uses together to make sense of the economics of many projects," he said. "We are seeing a lot of the 'B' and 'C' malls look to residential and seniors-hous- ing uses to ›ll space and rightsize the amount of retail that they have." Perhaps not surprisingly, demo- graphic shi§s are a major catalyst behind this movement. "†e resident today is di¨erent from the resident of 20 years ago," said Beth Mace, chief economist of the National Investment Center. "Today's resident is really more of what we call the Silent Generation — right before the baby boomers and a§er the Greatest Generation." †e age of a typical resident in se- nior housing now is 82 or older, says Mace, and today the oldest boomer is about 72, so the boomers have some time yet before they become the dominant residents of senior housing. "However, the baby boomers have inªuence," said Mace. "Because they are o§en the decision maker for where their adult parent moves, they are major inªuencers." Senior-housing developer Harbor Retirement Associates is known for selecting sites based on the types of retailers that have located to an area. Combining retail with housing for the elderly offers developers and retailers a lucrative new opportunity as 10,000 U.S. baby boomers turn 65 each day By Ben Johnson Senior moment 6 S C T / O C T O B E R 2 0 1 8

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