PLACES: Issue 3

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Starting PLACES Insights, highlights and key information to navigate the retail real estate industry.

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ach issue of PLACES will start right here. The Starting PLACES section of PLACES magazine is devoted to highlighting the best posts from our blog (blog.places-magazine.com), providing updates from previous articles and suggesting appropriate resources to better understand the ever-changing retail real estate environment.

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Charlotte Light Rail

PLACES Continued LA’s Hot Retail Destination

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MELROSE SHOPPING DISTRICT

BEVERLY BLVD SHOPPING DISTRICT FARMERS MARKET THE THIRD GROVE ST SH OPPIN G DIS TRICT

DISTRICT LA BREA

In the last issue of PLACES, LA-based SVP of Investments, Tom Gilmore wrote an article describing one of LA’s hottest retail districts. While impacted by the current economic and retail environments, the area remains a primary shopping district for both the local Los Angeles market and visiting tourists. The area runs from La Brea Avenue to Robertson and encompasses the cross streets of Melrose Avenue, Beverly Boulevard, and Third Street. Today, the street front retail is a mix of eclectic shops that range from vintage clothing to ďŹ ne home furnishings in a gritty urban backdrop. Madison Marquette recently acquired 1.9 acres on 18 parcels along South La Brea Avenue between 1st and 2nd Streets in Los Angeles, California. The acquisition is part of a joint venture with the previous landowner Bomel Companies. The acquisition encompasses almost the entire block and includes seven buildings totaling 87,000 square feet of existing retail and oďŹƒce space. Madison Marquette’s preliminary plans call for rehabilitating the deteriorating structures and re-conďŹ guring them for retail, restaurant, and oďŹƒce uses. Large format retail, eclectic shops, and new residential housing already surround the block. Other nearby retail destinations include the Farmer’s Market, The Grove, Third Street, and Melrose.

PLACES MAGAZINE

The last issue of PLACES reported on the initial success of the light rail system in Charlotte and the rise of the historic Southend neighborhood. Ridership has declined since that report, falling 18% from the peak last July–January. Still, with an average of just under 14,000 trips per month in January 2009, ridership is up 17% year-over-year. The Charlotte Area Transit System (CATS) attributes the decrease in ridership from last summer to lower gasoline prices and the growing unemployment rate in Charlotte. Regarding the unemployment situation, CATS Chief Executive Keith Parker explained, “Locally it’s gone up 50% in an 18-month period. People use us to get to and from work — that’s what we are for.� A Marcus & Millichap report projects Charlotte will lose 22,000 jobs in 2009, after losing 15,600 last year. Still, the report also cites that retail demand remains consistent and that 1.2 million square feet of retail space will come online in 2009. The residential sector has slowed as a dozen projects along the light rail line have now been delayed or canceled as developers decide to wait for the economy and housing market to recover. Despite the delays, developers remain bullish on the transit corridor. “As we come out of this cycle, I can’t imagine a better place to be,� says Greg Pappanastos, president of Argos Real Estate Advisors. The city of Charlotte is also still bullish on mass transit, voting in April to extend the current blue light rail line and build the new purple line North from the city, despite higher cost projections and lower revenue.

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S TA R T I N G P L AC E S

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