Retail landlords see Atlanta market 'turning the corner,' Coro Realty president says
Original story featured on Atlanta Business Chronicle August 10, 2021
Shops at Spire, A Coro Realty property, is located at the intersection of 7th and Peachtree Streets
The retail market is turning the corner with rising leasing activity and rent growth, Coro Realty President and Managing Partner Robert Fransen told Atlanta Business Chronicle.
Rental rates are returning to near pre-pandemic levels, he said.
"The market is hot," Fransen said. "Most of our tenants' sales are up significantly."
Sales volume for the company's retail tenants have not reached pre-Covid levels, but Fransen said, "it's much better than it was six months ago.''
Georgia, unlike other states, did not go through a retail shutdown. Plus, at Coro's properties within the urban core, where vaccination rates were the highest in the state, people have generally continued to shop and frequent restaurants, Fransen said.
Retail landlords have posted three consecutive quarters of positive net absorption since the fourth quarter of last year, according to CoStar. Metro Atlanta has 2.2 million square feet of retail space under construction, with nearly 70% pre-leased.
In Buckhead, retailers such as The Yard Milkshake Bar , plan to opens a location on the ground floor of the Modera Prominence Apartment, a 318-unit, 5-story project. At Phipps Plaza, Le Macaron, a Florida-based French pastry chain, will move into a 1,600 square-foot space.
Coro Realty has 60% of its portfolio invested in retail and owns prominent properties near the Eastside Trail including Midtown Place shopping center. During the worst of the pandemic, it allowed tenants to make partial payments and offered rent deferrals, Fransen said.
"They realize it wasn't our fault, and it wasn't their fault," he said. "Let's figure out a way to get through this."
Concerns remain about the Delta variant possibly affecting a rebound for stores and restaurants. Some federal safety nets for retailers have disappeared. The nation's Paycheck Protection Program (PPP) ended May 31. "I don't want to say we've fully turned the corner," Fransen said, "but the vast majority of our portfolio is back to paying rent the way they should."