Hawaii retail
vacancy droppingThe statewide rate has fallen
to 6.9% as new shopping center
owners spur interest
There are still plenty of vacant spots in Hawaii shopping centers, but they are beginning to find tenants, according to a new survey by the commercial real estate firm CB Richard Ellis.
The statewide retail vacancy rate has fallen to 6.9 percent from 7.3 percent at the beginning of the year, the firm reported.
CB Richard Ellis' senior director of research, Jeffery Hall, believes that ownership changes among Hawaii shopping centers have generated new levels of excitement that will bring the vacancy level down to about 6.3 percent in the coming year.
He cited the acquisition of Ward Center and Ward Warehouse by Ala Moana Center owner General Growth Properties, the sale of the Koko Marina Shopping Center in Hawaii Kai to a California investment group and the purchase of the Queen Kaahumanu Center on Maui by Los Angeles-based Somera Capital Management.
"Everyone wins" when new investors come in with new visions, fresh ideas and capital on retailing.
The departure of retailer JC Penney from Ala Moana Center, Pearlridge Center, the Prince Kuhio Plaza in Hilo and Queen Kaahumanu in January opened up 400,000 square feet of retail space. The Pearlridge space was later taken over by a neighboring business, Inspiration Home & Office Furnishings, which is reconfiguring the two-story building and looking to sub-lease some of it.
The Ala Moana space vacated by Penney's, 180,000 square feet, also is slated for a variety of new tenants, but details have not been announced.
Meanwhile, the Royal Hawaiian Shopping Center is undergoing changes and getting a new Cheesecake Factory restaurant and hotel spaces in Waikiki also have been getting new tenants.
There will be a major injection of retail space once Outrigger Enterprises Inc. gets its $300 million Beach Walk development under way, but Outrigger has expressed confidence that it will fill the 100,000 or so square feet it has planned.
For now, researcher Hall's check of 200 shopping centers statewide showed 1.6 million square feet of shopping center space is empty, out of a total of 23.4 million. Oahu has 1.1 million square feet vacant, 7 percent of its 16.1 million square feet of total space. Maui has 263,000 square feet vacant, or 7.2 percent of a total of 3.6 million. The Big Island has the lowest vacancy level, 5.7 percent, with 143,000 square feet empty out of 2.5 million, and Kauai is showing a retail vacancy level of 6.1 percent, with 71,000 square feet vacant out of a total of 1.2 million.
Hall said his research suggests more than another 112,000 square feet of that vacant space statewide will find occupants next year.
