Grand Rapids is in the middle of a retail boom, with the occupancy rate of retail properties in the market soaring to 91.06 percent in the first quarter of 2016.
That is just one piece of good news from the first quarter West Michigan retail report recently released by Colliers International.
And Jeff Hainer, senior research analyst with Colliers, says that he expects the influx of new retailers in the Grand Rapids market to only continue throughout the rest of 2016 and into next year.
“There is a ton of demand for retail space in Grand Rapids,” Hainer said. “We are seeing national companies that usually stick to the big traditional markets and hadn’t considered Grand Rapids in the past circling our market. They are now confident enough to take the plunge. Companies like Trader Joe’s are a good example. Brokers and community members have been working with these big companies for a while now. They were in wait-and-see mode. Now we are seeing an influx of national demand in Grand Rapids.”
Grand Rapids’ economy is on the rise, Hainer, which is helping to attract more national retailers. Hainer said that the city is attracting a steady stream of start-ups, too. Grand Rapids is even becoming known as a haven for independent breweries, earning the nickname Beer City, USA.
“The downtown market has been especially active recently,” Hainer said. “Developers are redeveloping existing buildings into retail use. But we are also seeing new construction. And when we are seeing new multifamily or office construction, we are increasingly seeing smaller retailers taking space in the ground floor of, say, a new office building.”
According to Colliers’ research, retail absorption was positive for a third consecutive quarter in the West Michigan region in the first quarter of the year. Leasing activity in West Michigan in the first quarter increased 34.7 percent, according to Colliers’ report.
Hainer said that some of the hottest retail spots in the Grand Rapids market include the Shops at CenterPoint at 28th Street SE and East Beltline Avenue SE and the Breton South Village development. Breton South recently nabbed Seattle-based culinary retailer Sur La Table, which began its build-out this spring.
Hainer said that Colliers, though, is keeping a close look at the Village of Knapp’s Crossing development. Last year, the developer that has since taken over the development — Lormax Stern Development Co. — signed leases with seven retailers, including five restaurants. The restaurants include Potbelly Sandwich Works, Pieology and Bagger Dave’s. The Knapp’s Crossing development will include 260,000 square feet of retail space and 1,000 parking spaces once complete.
Knapp’s Crossing initially struggled when the original developer of the project suffered financial setbacks. That has since changed, Hainer said.
“The new developer saw opportunity here,” Hainer said. “This is the development we are really excited about today.”
Hainer said that the future of the West Michigan retail market looks especially bright today. National retailers such as Freddy’s Frozen Custard and Steakburgers and Adobe In & Out are now operating on Plainfield Avenue NE in Grand Rapids. Menchie’s Frozen Yogurt, GNC, Pure Sleep, Lady Janes and PNC Bank will soon open at Knapp’s Crossing. Panera Bread plans to build a new location on 28th Street SE and IRON Restaurant and Atwater Brewing Co. will soon open in Grand Rapids, too.