This issue, Kerry Veach, co-owner of RE/MAX Southern Real Estate, and Jerry Sullivan of Century 21 Blue Marlin Real Estate address the actual numbers of the current commercial property conditions.
Veach has been a licensed real estate broker in Florida and Alabama for over 22 years and is a member of the RE/MAX Hall of Fame.
Sullivan has been involved in commercial and residential real estate for over 14 years, including management, construction and ownership of a successful real estate company here on the Emerald Coast.
Beachcomber readers are encouraged to submit real estate questions to email@example.com.
By Kerry Veach, Broker/Owner
RE/MAX Southern Real Estate
Commercial real estate is a hot market in Destin. I’ve gotten a lot more inquiries this year from investors who are looking for income-producing real estate. Commercial real estate websites like LoopNet are driving investors, and they’re looking at our market with unprecedented interest. They lean toward commercial real estate spaces that are already leased and generate at least an eight percent capitalization rate.
Currently, the Emerald Coast Multiple Listing Service (MLS) has 58 commercial properties, ranging from a single office to connected retail spaces. Of those, twelve are already sold and closed or pending, for a total of $16.3 million.
Right now, Old South Centre in Destin is a prime example of what investors are looking for in commercial real estate. Located right on Emerald Coast Parkway, it’s a five-acre property with six office buildings, three warehouses, and is 93 percent leased.
The tenants include doctors, attorneys, and consultants, and they provide stable income. Plus, they present a low rollover risk and simultaneously share a mutual interest with the investor—to boost the property’s value to increase business.
In fact, Old South Centre is already at an eight percent cap rate. The caliber of the tenants and customers Destin attracts is a prime motivation for investors to seek commercial real estate here.
Additionally, tracts of land are piquing investors’ interest. In fact, most of the high-end sales are tracts of land intended for future development of office buildings and retail space. These tracts range from a half-acre lot to multiple-acre plots.
Ultimately, investors look to experienced local realtors at RE/MAX Southern to guide them to sound investments in Destin’s commercial real estate market.
By Jerry Sullivan, Century 21 Blue Marlin
I’m encouraged by the state of commercial real estate.
In the past 12 months, we’ve seen 33 sold commercial properties and four pending sales, and 26 lease and two pending leases in the commercial sector. Our area’s year-round season makes the market very appealing to companies looking to take advantage of the high foot traffic.
Doreen Baca with our “PURE” sales teams provided this Five Retail Trends of the Current Market list which could be important for you to understand when making commercial real estate decisions.
1. Redevelopment and Repositioning. With large retail chains such as Macy’s announcing store closures, many shopping center owners have to deal with the loss of anchor stores. Some have announced creative ways of dealing with the vacant space, such as adding restaurants, small shops or entertainment venues. We’ve also seen some shopping centers add open-air shopping promenades.
2. Special Experiences. Customers no longer want to just shop—they want experiences. Retail landlords are responding by adding routine events such as farmers markets, Friday night movies and outdoor fitness. Some even go so far as to add major experience elements such as a bowling alley. The longer a customer is inclined to stay around a particular mall, the more likely it is that he or she will purchase there.
3. Expansion. Yes, we’ve heard a lot about stores closing, but many retailers are in expansion mode. Off-price stores like Burlington are thriving, while specialty grocers, health and wellness businesses, home goods stores and fast-casual restaurants are growing and taking new space as well.
4. Technology. Big data. Artificial intelligence. Beacon technology. Projection mapping. Get familiar with these terms. Technology helps retailers better understand their customers, and helps customers shop more efficiently.
5. Omni-channel. Brick-and-mortar retailers are getting smarter, utilizing omni-channel retailing to better compete with online sellers. This is when retail integrates different methods of shopping available to consumers (e.g., online, in a physical store, or by phone).
It’s our company mission to enable Century 21 Blue Marlin agents to provide best-in-class brokerage services to all who aspire to buy and sell real estate throughout Florida’s Emerald Coast. For more information, please call (850) 837-7800 or visit C21BlueMarlin.com.