Two recent strip mall sales and vacancies of only 10 percent among others are two indicators that retail demand outside of downtown Traverse City is back.
A purchase agreement on a strip mall in Acme Township was signed last week, according to Tom Krause of Krause Realty Solutions. That follows the bank sale of the Hickory Corners strip mall on TC’s Fourteenth Street in December.
Nearby Kids Creek Marketplace on Division will be looking at 90 percent occupancy if all goes well with negotiations in the coming weeks for one of two available spaces, says Dan Stiebel, associate broker with Coldwell Banker Commercial Schmidt in Traverse City.
The growth in strip centers is correlated to a retail boom in downtown TC; downtown is at virtual 100 percent occupancy, so retailers seek the next closest and best locations, say commercial real estate experts.
“We put three major tenants in Kids Creek Marketplace last year – Plato’s Closet, SVS Vision and Biggby Coffee,” says Stiebel. “Demand has been strong and there are a number of national and local retailers looking for space in Traverse City right now.”
Kevin Endres, owner/associate broker of Three West in Traverse City, echoes that demand is high and inventory is tight.
“Strip retail vacancy is less than 10 percent (near downtown),” says Endres. His firm is the new property manager and leasing agent for Hickory Corners, and notes the corner space that just opened up (due to the closing of Mocha Tan Tropics) won’t last long.
“There are 17,000 cars driving by daily, going 20 miles per hour,” says Endres. The 1,211 square foot space is listed at $2,320 per month plus utilities.
John Dressler, who owns the strip mall in the 500 block of E. Eighth Street, had a “tremendous amount of demand” for the 2,400 square foot space after White Tiger Martial Arts recently relocated.
“I could have asked for more money and I know that because I was offered more money,” he says, but ultimately leased it to Old Mission Multigrain Bakery and Café, a tenant that has a nice synergy with the Bon Vin wine shop he opened there in 2011 after purchasing the strip mall from the bank.
Dressler says the easy accessibility and the strong traffic – an estimated 25,000 cars a day pass by – make it a great retail spot just a few streets away from Front Street. In just one month since opening, the bakery has exceeded its expectations for walk-in business, he says.
The one challenge with the spot, however, is the crumbling condition of Eighth Street’s infrastructure. “I ultimately plan to do a major overhaul of the building façade, but would hope to do it in conjunction with the city,” he says. “Something has to happen here.”