By Rochelle Broder-Singer | 8/10/2008
''Retail follows residential'' has always been a maxim in real estate.
And as housing prices soared and new condos multiplied, retail too saw glory days. In 2007, average asking rent at most retail shopping centers in Broward County grew for the fifth straight year. And in Miami-Dade County, retail rents hovered at nearly $30 a square foot in 2007, reports real estate services firm CB Richard Ellis.
But this year, the housing bust has put a big dent in consumer spending, and unemployment is up sharply. That means a dramatically changed retail real estate scene.
''Apprehensive,'' is how Stephen Bittel, chairman of Miami Beach-based real estate developer, broker and manager Terranova Corp., puts it. ''You've got everyone -- developers and landlords on one side and tenants and banks on the other -- fearful to commit capital to anything new,'' he said.
Retailers are either closing stores or scaling back locations. Slowing spending is squeezing ''mom and pop'' operators out of the market. That trickles down to shopping center developers, which are having more trouble securing tenants and lenders. In turn they are getting more willing to cut deals on rents and tenant improvements.
''Projects that were being planned are being rethought as tenants retreat,'' said broker Lyle Stern of Koniver Stern Group in Miami Beach.
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