The retail sector in West Michigan remains a strong one despite the challenges of persistently high inflation, rising interest rates and economic uncertainty, according to the latest research from Colliers.
In its second quarter West Michigan Retail Report, Colliers says that retail sales and traffic both remain resilient as as shoppers have steadily returned to strip centers, lifestyle centers and even some indoor malls after the COVID-19 pandemic.
This doesn’t mean, though, that Grand Rapids and the rest of the West Michigan retail sector doesn’t face challenges. The local retail sector saw 219,610 square feet of negative absorption in the quarter. Colliers, though, says that this is more of an indicator of big-box stores moving out of their spaces than it is weakness in the West Michigan market.
The retail sector saw a fairly low vacancy rate of 5.74% during the second quarter, while overall asking lease rates in the Western Michigan market rose to an average of $15.01 a square foot.
Highlights during the second quarter include the opening of Western Michigan’s first indoor pickleball facility, All In Pickleball Gym. This 21,000-square-foot facility is located in Byron Center, Michigan.
This is part of a larger trend of experiential retail targeting Grand Rapids and Western Michigan. As Colliers reports, in the third quarter of 2022, a wine and flower-arranging concept called Good, Good, Good Wine and Flowers purchased 1590 Plainfield NE. During the same quarter, GolfTEC signed a 6,025-square-foot lease in Grandville, Michigan’s, Bucktown Shopping Center. Exhibition Hub, a venue for large art exhibitions, signed a 20,000s-square-foot lease in the Green Orchard Shopping Center.
Another big experiential addition to the market happened in the first quarter of 2023, when Big Mini Putt Putt signed an 8,296-square-foot lease in the GRid70 building at 70 Ionia in downtown Grand Rapids.
Another trend cited by Colliers? Developers have continued to add retail to their mixed-use development projects instead of office space. This includes the proposal of 1,800 square feet of retail to go with 526 apartments in the Creston neighborhood of Grand Rapids and the proposed 1880 Sligh Building project that that will include apartments and 21,823 square feet of retail space.
