Increasing consumer confidence, a recovering housing market and tourism growth are paving the way for a bright 2015 in retail, industry experts say.
"As the economy becomes more stable, businesspeople will feel more confident starting new businesses," said Samantha Stratton, spokeswoman for the Florida Retail Federation. "It's easier to rally a loyal customer base during these times."
Retailers are now more willing to invest in the opening of additional shops because they believe they can count on "more reliable customers" who will stay in South Florida and not put their houses on the market and move to a new region looking for jobs, Stratton said.
"Consumer confidence is still on the rise as we are coming out of the recession," she said.
Tourists from Latin America, Canada, Europe and elsewhere also are continuing to flock to Florida and, fortunately for retailers, they bring empty suitcases to fill them up with merchandise found at bargain prices, Stratton said.
Broward and Palm Beach counties are poised for growth as available retail space becomes harder to find and more expensive to obtain in Miami-Dade County, said Russell Bornstein, a senior vice president at CBRE, a global real estate services firm.
"You are going to see Broward and Palm Beach counties catch fire like Miami did," Bornstein said.
Vacancy rates in Miami-Dade are around 3 percent, while Broward and Palm Beach are around 7 percent to 8 percent, he said. Asking rates for retail spaces in Miami-Dade are about $40 per square feet, compared with $18 to $20 in Broward and Palm Beach counties, according to Bornstein.
"Retailers that did not get into Miami-Dade County will push into Broward and Palm where there's still some opportunities," Bornstein said.
Developers of several major projects are likely to continue approval processes and construction.
Projects lined up for opening in 2016 or later include:
• Sawgrass Mills: The Sunrise shopping center is expanding its luxury shopping promenade, The Colonnade Outlets at Sawgrass Mills. It has begun constructing an additional 80,000 square feet for 30 luxury outlets and full-service restaurants. It's slated to be completed in 2016.
• DaniaLive Marketplace: a 1.3 million-square-foot open air Dania Beach destination, comprised of big-box stores, restaurants, a hotel and apartments. Aventura-based Master Development has said the first phase of the project would open in late 2015 but could be pushed to 2016.
• The Galleria at Fort Lauderdale: In 2014, the mall's owner, Keystone-Florida Property Holding Corp. said it had $1 billion plans to build housing, hotel rooms, walkways and bike lanes around the Fort Lauderdale mall to make the area a walkable community. Construction would start this year, if approved by the city, and be completed in phases over seven years.
• Metropica: Developer Joseph Kavana plans to break ground this year on Metropica, a project in Sunrise slated to include up to 2,500 condos, 300 townhomes, commercial and office space and a 2-acre park deeded to the city. It will take about 10 years to complete the $1.5 billion project.
While few large retail centers will open this year in South Florida, several are likely to undergo redevelopment and upgrades, especially properties built around the 1970s and 1980s, Bornstein said.
Other trends likely to continue in 2015, according to retail experts:
• Medical practices looking for high visibility locations within retail plazas rather than be tucked away in medical office buildings.
• Banks trying to keep occupancy costs down by opening smaller locations since more customers are now banking online.
• Office Depot and OfficeMax closing and downsizing stores due to their merger.
• Online retailers putting more emphasis and effort into same-day delivery
"A lot of it will be about the last leg, how the product gets from retailer to the customer," says Alan Bush, chief strategy officer for Northlake Partners, a retail consultancy in West Palm Beach.
• Retailers and consumers becoming more concerned about cyber security, "you'll see a fundamental change on how people secure their payments," whether that is consumers using Apple Pay, another encrypted device or retailers convincing customers that their payment systems are secure, Bush said.
• Retailers focusing more on personalizing shopping experiences. For example, "if you have a smartphone with the Publix app, Publix might tell you there's a special on milk today, based on your shopping history," Bush said.
http://www.sun-sentinel.com/business/fl-retail-outlook-2015-20150102-story.html
