2018 retail projections with charts · houston’s new . retail real estate market projections...
TRANSCRIPT
1.30.2018
2018
FOR FURTHER INFORMATION CONTACT:
Ed Wulfe (713) 621-1700(713) 627-3073 (Fax)[email protected], TEXAS
23% DECREASE IN RETAIL DEVELOPMENT PROJECTED
Wulfe & Co.’s 25th Annual Retail Survey projects 3.3 million square feet of new retail shopping
center space will be built and opened in the greater Houston area in 2018. This represents a
more typical year for Houston’s new retail real estate market projections compared to the very
active 2016 and 2017 construction levels which averaged 4.4 million square feet each year,
according to Ed Wulfe, Chairman & CEO, of Wulfe & Co., a Houston-based retail real estate
brokerage, development and property management firm. “This year’s square footage
projection is realistic and appropriate when considering that the square foot average over the
previous ten years was 3.0 million per year”, Wulfe added.
Other factors contributed to the projected tapering off of new retail construction in 2018
including the impact of Hurricane Harvey which pushed completion of construction on several
projects into 2019. Also during 2017, many major retail chain stores focused on improving the
integration of their ecommerce business into their overall retail marketing efforts to improve
both their online business and store sales, and they succeeded.
Many of the discount stores, supermarkets and general merchandise stores converted certain
areas of existing store space into distribution center areas to most efficiently provide pick-up
and delivery of merchandise ordered online.
1.30.2018
2
In 2018, retailers, large and small, will continue to successfully integrate physical and digital
operations as consumers broaden their shopping experiences to online markets. Today,
almost all major retailers have augmented their physical store operation with online shopping
as they strive to offer customers a seamless physical and digital shopping experience.
The retail development activity projected for 2018 for the greater Houston area offsets the
aggressive expansion of retailers to serve the extensive suburban growth created by the
single-family and multi-family housing booms of recent years particularly along the Grand
Parkway. This growth will continue as recently projected by Metrostudy with their five percent
increase of 28,500 new single-family home sales in 2018 and Apartment Data Service’s
prediction of 7 - 8,000 new multi-family units to open in 2018.
Many of the new retail developments for the coming year are either already under
construction, have fully executed leases with national chain stores, or are being self-
developed by retailers such as supermarkets who will either own or lease the properties with
only an estimated 20% devoted to spec space.
HEB will dominate new retail construction and represent 16% of 2018’s projected growth with
six new stores planned. Kroger will open two of their 100,000 SF plus prototype stores.
Recent newcomer, ALDI, will add ten of their smaller 19,000 SF stores to the Houston market
and Sprouts will open one of their neighborhood supermarkets. In addition, H-Mart, a 54-store
national chain of Asian supermarkets, will open their third Houston store containing
approximately 50,000 SF in Katy.
According to supermarket market share figures from The Shelby Report’s East Texas/La.
Division, HEB is number one in the grocery market with its 91 stores and 26.6% share;
Walmart has 101 stores and a 25.1% share; and Kroger, with its 112 stores, has a 22.5% share
in the very competitive environment.
Costco will open one new 150,000 SF store, and there will be one new home improvement
center by Lowes and one by Home Depot. Most significantly, there will be six new theaters
and four new LA Fitness facilities. Pinstripe will open a 34,000 SF bowling/restaurant concept.
Neither Walmart nor Target discount stores will open a store in 2018.
1.30.2018
3
“Even with the new retail space, overall retail occupancy in Houston will continue strong and
approach an all-time high rate of an estimated 95%. Retail rental rates will increase slightly in
response to the limited availability of shopping center space, higher land and development
costs and estimated increases in interest rates. With the area’s continued growth along with
the expansion needs of both established and new-to-market retailers, the competition for
available space in well located, retail developments, is intense in spite of the higher rental
rates,” Wulfe stated.
Another ever growing challenge facing the shopping center industry today is the need to re-
tenant and or recycle closed store space. A hard look must be taken at the future of marginal
regional malls due to the loss of certain anchor department stores and the closing of a
number of mall-focused national chain retailers. Innovation in tenant mix, reconfiguration of
buildings and space, continuous refurbishing of properties, and adaptation of alternative uses
is necessary to keep existing retail space relevant now and into the future.
Houston’s retail market has been able to continue its growth and vibrancy even with the
slowdown in its energy sector reporting the sixth lowest cost of living among the nation’s
twenty most populous metropolitan areas. “Our diversified economy is resilient and will be
augmented by a continued growth in employment, with an estimated 45,000 to 70,000 new
jobs to be created in 2018, assuming the price of oil remains relatively stable. Houston’s
unemployment rate currently is low at 4.3%,” Wulfe stated.
As in the past few years, another inherent part of the retail real estate growth is the aggressive
growth of new national, regional, and local restaurant operations of all types and sizes.
Houston has gained national and international recognition for its many outstanding new,
innovative and creative food venues. Houston restaurant concepts and chefs have been
featured in many national and international articles for their creativity and skill in their new
concepts today more than in the past. From casual dining to upscale specialty dining, the
restaurants generate traffic, create energy and bring life to a project and play an ever-
increasing role in its success and vitality.
Another noticeable trend throughout the Houston area is the expansion of the healthcare
industry to more convenient, accessible, and less expensive retail sites. The locations include
1.30.2018
4
suburban hospitals, urgent care centers, clinics, outpatient facilities and professional offices.
The healthcare industry is making a concerted effort to deliver their services directly to the
consumer where they live or work to capitalize on the benefits of a retail location with its
abundant and convenient parking and accessibility.
Wulfe & Co. is a commercial real estate firm specializing in the retail real estate marketplace,
and has now produced this annual retail survey of Houston’s retail market for twenty-five
years. The firm is active in shopping center leasing, sales, development, property
management, and consulting, and enjoys long-term relationships with local, regional, and
national retailers, developers, owners, and financial institutions.
Wulfe & Co. 2018 Projection-23% decrease from 2017
Prepared By:
Research Department
0
1
2
3
4
5
6
7
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
6.26
3.07
0.941.21
1.94 1.95
2.37
3.23
4.564.27
3.28
Squa
re Feet ( M
illions)
Year
Greater Houston Retail Forecast3.3 Million Square Feet of Retail Space
to be Built and Opened in 2018,a 23% Decrease from 2017
1/24/2018 1:01 PM
Prepared By:
Research Department
Supermarkets30% Home Improvement
6%
Theaters7%
Discount Stores4%
Other Anchors28%
Spec Space25%
Greater Houston Retail Forecast By Category3.3 Million Square Feet of Retail Space
to be Built and Opened in 2018
1/24/2018 1:02 PM
FOR FURTHER INFORMATION CONTACT:
Ed Wulfe (713) 621-1700 (713) 627-3073 (Fax) [email protected] HOUSTON, TEXAS
9.2% INCREASE IN RETAIL DEVELOPMENT PROJECTED
Wulfe & Co.’s 24th Annual Retail Survey projects 4.98 million square feet of new
retail shopping center space will be built and opened in the greater Houston area
in 2017. These additions to Houston’s extensive retail real estate market
constitute a 9.2% increase over the 4.5 million square feet completed in 2016.
This impressive increase over the strong results of 2016 reflects Houston’s
continuously strengthened position in the retail real estate sector, according to
Ed Wulfe, Chairman & CEO, of Wulfe & Co., a Houston-based retail real estate
brokerage, development and property management firm.
The substantial development activity projected for 2017 for the greater Houston
area is a result of the demand created by the single-family and multi-family
housing booms of recent years; plans by existing retailers to protect market
share; the impact of new retailers eager to open stores in the market; and
population growth. Many of the new developments for the coming year are either
already under construction, have fully executed leases with national retailers, are
being self-developed by retailers, or include planned new projects of major
development firms in response to the active retail real estate marketplace.
2017
2
The majority of the new retail space will be either owned or leased by major
retailers, including supermarkets, discount stores and power retailers. There will
only be approximately ten percent of speculative small store space available for
lease, which is another indicator of Houston’s strength.
Supermarkets will continue to dominate new retail construction and represent
23% of 2017’s projected growth with 21 new stores planned. Kroger will open six
more of their 123,000 SF prototype stores. HEB will open three additional 100,000
SF markets and one Joe V’s Smart Shop. Recent newcomer, ALDI, will add ten of
their smaller 19,000 SF stores to the Houston market and Walmart will open one
of their neighborhood supermarkets, added Bob Sellingsloh, President of Wulfe &
Co.
According to supermarket market share figures from The Shelby Report’s East
Texas/La. Division, HEB is number one in the grocery market with its 92 stores
and 26.4% share; Walmart has 102 stores and a 25.3% share; and Kroger, with its
112 stores, has a 23.6% share in the very competitive environment.
Wulfe & Co.’s 2017 Annual Survey reflects that in addition to the substantial
amount of new supermarket space to be added, Walmart will be opening three
and Target will open two of their super store concepts. Costco will open a new
150,000 SF store and At Home will open three of their 100,000 SF stores. Total
Wine, who initially entered the Houston market late last year, will open six of their
25-35,000 SF stores. Also, for the first time in several years there will be three
new home improvement centers, two by Lowes and one by Home Depot. Most
significantly, there will be seven new theaters; two new Lifetime Fitness
locations, one new LA Fitness, and a new VillaSport Athletic Club and Spa.
Pinstripe will open a 34,000 SF bowling/restaurant concept. Altogether, a total of
4.98 million SF will be built and opened in 2017. This is the highest level of retail
growth since 2008, Wulfe stated.
Much of this activity serves suburban growth markets with many new major retail
projects capitalizing on the Grand Parkway’s proximity to new residential
developments.
3
“Even with this aggressive expansion of new retail space commitments, overall
retail occupancy in Houston will continue to strengthen and approach an all-time
high rate in excess of an estimated 94%. Retail rental rates will increase slightly
in response to the limited availability of shopping center space and higher land
and development costs. With the area’s continued growth along with the
expansion needs of both established and new-to-market retailers, the competition
for available space in well located, well tenanted retail developments, is intensive
in spite of the higher rental rates,” Wulfe added.
In 2017 the retail real estate sector must address the rapidly evolving challenges
relating to the convergence of retailers’ physical and digital environments as
consumers broaden their shopping experiences to online markets. Today, almost
all major retailers have augmented their physical store operation with online
shopping as part of their merchandising strategy to offer customers a seamless
physical and digital integrated shopping experience. According to First Data,
online holiday sales rose 12% accounting for 21% of all holiday spending which
is up 15% from last year.
Another ever growing challenge facing the shopping center industry today is the
need to reconfigure and re-tenant the marginal regional malls due to the loss of
certain anchor department stores and the closing of a number of mall-focused
national chain retailers. Innovation in tenant mix, reconfiguration of buildings and
space, continuous refurbishing of the property, and adaptation of alternative uses
can keep regional malls relevant throughout 2017 and into the future.
As reflected this year and the past few years, Houston’s recent financial and
employment cutbacks in the energy markets have not noticeably affected
Houston’s retail real estate sector, and Houston’s retail market has been able to
continue its growth and vibrancy. Houston’s year over year population growth
amounted to 40,000 new residents, second only to New York, according to the
Census. Houston also has the sixth lowest cost of living among the nation’s
twenty most populous metropolitan areas. Our diversified economy is resilient
and will be augmented by a return to growth in employment, estimated to be
approximately 29,700 new jobs in 2017.
4
Another inherent part of the retail real estate growth is the unfolding of new
national, regional, and local restaurant operations of all types and sizes. In the
past few years, Houston has gained national and international recognition for its
many outstanding new, innovative and creative food venues. The restaurant
concepts and chefs have been featured in many national and international
articles for their creativity and skill that they offer Houston patrons. From casual
dining to upscale specialty dining, from fast food to gourmet cuisine, the
restaurants generate traffic, create energy and bring entertainment to a project
and play an ever-increasing role in the success and vitality of a retail property.
Another growing trend that is gaining momentum throughout the Houston area is
the expansion of the healthcare industry to more convenient, accessible, and less
expensive retail locations. The locations include suburban hospitals, urgent care
centers, clinics, outpatient facilities and professional offices. The healthcare
industry is making a concerted effort to deliver their services directly to the
consumer with the benefits of a retail location with convenient, ample parking
and easily accessible medical facilities and services.
“Although Houston’s overall development environment is projected to experience
a slowdown in new office building and multifamily construction this year, the
vacancies should not have a material effect on the continued growth and
development in 2017 of retail properties and in the immediate future,” Wulfe
added.
Wulfe & Co. is a commercial real estate firm specializing in the retail real estate
marketplace, and has produced this annual retail survey of Houston’s retail
market for twenty-four years. The firm is active in shopping center leasing, sales,
development, property management, and consulting, and enjoys long-term
relationships with local, regional, and national retailers, developers, owners, and
financial institutions.
01.11.2017
Wulfe & Co. 2017 Projection9.2% increase over 2016
Prepared By:
Research Department
0
1
2
3
4
5
6
7
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
3.92
6.26
3.07
0.941.21
1.94 1.95
2.37
3.23
4.56
4.98
Squa
re Feet ( M
illions)
Year
Greater Houston Retail Forecast4.98 Million Square Feet of Retail Space
to be Built and Opened in 2017,an 9.2% Increase over 2016
Prepared By:
Research Department
Supermarkets23%
Home Improvement6%
Theaters5%
Discount Stores20%
Other Anchors36%
Spec Space10%
Greater Houston Retail Forecast By Category4.98 Million Square Feet of Retail Space
to be Built and Opened in 2017
FOR FURTHER INFORMATION CONTACT:
Ed Wulfe (713) 621-1700 (713) 627-3073 (Fax) [email protected] HOUSTON, TEXAS
33% INCREASE IN RETAIL DEVELOPMENT PROJECTED
Wulfe & Co.’s 23nd Annual Retail Survey projects 4.53 million square feet of new
retail shopping center space will be built and opened in the greater Houston area
in 2016, representing a significant 33% increase over the previous year, according
to Ed Wulfe, Chairman & CEO, of Wulfe & Co., a Houston-based retail real estate
brokerage, development and property management firm.
In 2016 shopping centers in the greater Houston area will continue to reflect
robust activity as a result of the demand created with the single family and multi-
amily housing boom of the past four years, Houston’s average population growth
of at least 100,000 annually and the positive influence of the strong national
economy.
The majority of new retail space is either owned or leased by the individual
stores, like many supermarkets, discount stores and power retailers, and there
will only be approximately thirteen percent of speculative small store space
available for lease. Many of the new developments for the coming year are either
already under construction, have fully executed leases with financially strong
national retailers or are being developed by major development firms in response
to the vibrant retail real estate marketplace.
2016
2
As occurred last year, supermarkets will dominate new retail construction and
represent 39% of 2016’s projected growth with 28 new stores planned. Kroger
will open nine of their 123,000 sf stores, HEB will open five of its 100,000 sf
prototype markets, Walmart will open four of their neighborhood supermarkets,
Whole Foods will open one, and recent newcomer ALDI will add nine of their
smaller 18,000 sf stores to the market.
According to supermarket share figures from The Shelby Report’s East Texas/La.
Division, HEB has taken over the lead of the grocery market with its 91 stores and
25.9% share; Walmart has 92 stores and 25.2%; and Kroger with its 111 stores
has 23.6% in the very competitive environment.
Wulfe & Co.’s Annual Survey also indicated in addition to the substantial amount
of new supermarket space to be added in 2016, Dick’s Sporting Goods, a major
well-known national sporting goods chain is entering our market with the
addition of six new stores of approximately 50-100,000 sf; Academy will add two
new 63,000 sf stores and Cabella’s will open one 72,000 sf store. In addition
Costco will open a new 150,000 sf store and Walmart will open another 180,000 sf
Walmart Superstore. Also there will be six new theaters; three new 24 Hour
Fitness centers and one LA Fitness facility. Altogether a total of 4.53 million
square feet will be built and opened, which will be the highest amount since 2008.
Much of this activity serves suburban markets to the North, Northwest, West and
Southwest, with many new major retail projects capitalizing on the Grand
Parkway’s evolution. There are also six mall expansions planned and several
mixed use developments within the urban core.
“With this high expansion of new retail space commitments, overall retail
occupancy in Houston will continue to strengthen and achieve an all-time high
occupancy rate in excess of 94%. Retail rental rates will also continue to
increase driven by the limited availability of shopping center space and the
higher land and development costs. With the area’s vigorous growth coupled
with the expansion needs of established and new-to-market retailers, the
competition for available space in well located, well tenanted and highly desirable
3
retail developments, is aggressive, even at ever-increasing higher rates” Wulfe
added.
The evolution of e-commerce continues to mature and grow, and is approaching
fifteen percent of total retail sales. “Convergence” is the buzz word and the on-
going convergence of physical and digital retail merchandising is taking hold and
is the prevailing trend of today. Today’s shopper uses online capability to locate
and select merchandise capitalizing on comparison shopping. In many cases
they actually purchase and pick up the merchandise in the stores thus
complementing the stores’ sales and traffic. Today almost all major retailers
have implemented their online capabilities as part of their merchandising strategy
to offer customers a seamless physical and digital integrated shopping
experience.
While the impact of recent financial and employment cutbacks primarily in the
energy markets in Houston has softened retail sales, retail real estate has not
experienced a downtrend in comparison to the results encountered in the other
commercial real estate segments, like office and multifamily. The lower cost of
fuel has increased spendable funds for consumers and is reflected in increased
sales among retailers and a reduction in consumer debt. Early reports on the
season’s holiday sales are exceeding projections, especially online.
Houston’s diversified economy is resilient and augmented by solid growth in
employment in the medical, construction, petro chemical and Port of Houston
industries. Job growth is estimated to be 20-25,000 in 2016. Houston has the
third lowest cost of living among the nation’s twenty most populous metropolitan
areas.
Another inherent part of the retail real estate growth we are experiencing is the
unfolding of new national, regional and local restaurant operations of all types
and sizes. It has been estimated approximately three hundred new restaurants
and bars open each year in Houston. From casual dining to upscale specialty
dining, from fast food to gourmet cuisine, they generate traffic, energy and
entertainment for a project and play an ever-increasing role in the success and
4
vitality of retail properties. In the past few years Houston has gained national and
international recognition for its many excellent new, innovative and creative
restaurant concepts and chefs.
Another noteworthy emerging trend gaining momentum throughout Houston is
the expansion of the healthcare industry to more convenient and accessible
suburban shopping center locations for suburban hospitals, emergency care
centers, clinics, outpatient facilities and professional offices in a concerted effort
to take healthcare to the consumer.
“This growth supports and justifies additional retail to serve the ever-increasing
population and need of the consumer for goods and services. People are
continuing to move to Houston from other areas of the country with or without
jobs, because of the potential for employment and opportunity. Although in
Houston’s overall development environment there is projected to be a slowdown
in new office building and multifamily construction this year, it should not have a
material effect on retail growth in the area” Wulfe added.
Wulfe & Co. is a commercial real estate firm specializing in the retail real estate
marketplace, and has produced this annual retail survey of Houston’s retail
market for twenty three years. The firm is active in shopping center leasing,
sales, development, property management, and consulting, and has established
relationships with local, regional and national retailers, developers and owners.
Wulfe & Co. 2016 Projection33.4% increase over 2015
Prepared By:
Research Department
0
1
2
3
4
5
6
7
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
3.58
3.92
6.26
3.07
0.94
1.21
1.94 1.95
2.37
3.40
4.53
Squa
re Feet ( M
illions)
Year
Greater Houston Retail Forecast4.53 Million Square Feet of Retail Space
to be Built and Opened in 2016,a 33% Increase over 2015
Prepared By:
Research Department
Supermarkets39%
Theaters6%
Discount Stores9%
Other Anchors33%
Spec Space13%
Greater Houston Retail Forecast By Category4.53 Million Square Feet of Retail Space
to be Built and Opened in 2016
5.9
6.5
7.1
7.7
8.4
9.2
9.9
0
1
2
3
4
5
6
7
8
9
10
11
2010 2015 2020 2025 2030 2035 2040
Popu
lati
on (M
illio
ns)
Source: The Perryman Group
Houston Area Population Forecasts
2015
FOR FURTHER INFORMATION CONTACT:
Ed Wulfe (713) 621-1700 (713) 627-3073 (Fax) [email protected] HOUSTON, TEXAS
56% INCREASE IN RETAIL DEVELOPMENT PROJECTED
Wulfe & Co.’s 22nd Annual Retail Survey projects 3.71 million square feet of new
retail shopping center space will be built and opened in the greater Houston area
in 2015, representing an increase of an impressive 56% over the previous years’
2.37 million square feet, according to Ed Wulfe, Chairman & CEO, of Wulfe & Co.,
a Houston-based retail real estate brokerage, development and property
management firm.
Supermarkets will dominate new retail construction and represent 43% of 2015’s
growth with 32 new stores planned. HEB will open seven, Kroger will open four
plus expand two, Walmart will open four of their neighborhood market stores,
Whole Foods and Sprouts will each add two, Fiesta and Trader Joe’s will each
open one, and relative newcomer ALDI will add eleven of their smaller 18,000 sf
stores to our market.
According to supermarket share figures from The Shelby Report’s East Texas/La.
Division, Walmart with its 92 stores has 25.5% of the grocery market; HEB with its
87 stores has 25.1% and Kroger with its 111 stores has 23.8%.
2
Most importantly, because the majority of new retail space is either owned or
leased by the individual stores, like many supermarkets, discount stores and
power retailers, it is in their best financial interest to own and operate their
stores, leaving only 15-20% of speculative space to be leased in the coming year.
Wulfe & Co.’s Annual Survey also indicated in addition to the substantial amount
of new supermarket space to be added in 2015 there will be one new 180,000 sf
Walmart Superstore; a new 165,000 sf Gallery Furniture store; one new Lowe’s
home Improvement center; five new theaters; three new Academy stores and two
new Ross stores when combined with the supermarket space will altogether
make up the total of 3.71 million square feet, the highest amount since 2008.
“With this high activity of new retail growth we project that higher retail
occupancy rates will exceed a seldom achieved rate of 92 % this year. Retail
rental rates will also continue to increase driven by limited availability of
shopping center space, higher land costs and higher construction costs for
materials and labor to build or remodel new retail facilities,” Wulfe stated.
The recent financial cutbacks in the energy markets are proving somewhat
beneficial to the retail market. The lower cost of fuel has increased spendable
funds for consumers and is reflected in increased sales among retailers and a
reduction in consumer debt. Additionally, the projected slowdown in
construction of multifamily and office developments will improve on the
availability of construction materials and workforce for retail projects and will
expedite construction schedules in a more competitive environment.
Another characteristic of the retail growth we are experiencing across Houston’s
expanding markets is the growth of new national, regional and local restaurant
operations of all types and sizes. From casual dining to upscale specialty dining,
from fast food to gourmet cuisine, they generate traffic, energy and entertainment
for a project. Restaurants play an ever-increasing role in the success and vitality
of retail properties, including financial. In the past few years Houston has gained
national and international recognition for its many new, innovative and creative
restaurant concepts and chefs.
3
An emerging trend also gaining momentum is the expansion of the healthcare
industry to more convenient and accessible shopping center locations for
emergency care centers, clinics, outpatient facilities and professional offices.
This activity is further supplemented by the on-going addition of smaller
hospitals in suburban locations in an effort to take healthcare to the consumer.
With all of the growth in the retail marketplace the competition is vigorous for
available space of all types and sizes, even at the ever-increasing higher rates for
well located, well tenanted and highly desirable retail developments throughout
the greater Houston area, Wulfe added.
This aggressive development illustrates the broad based depth and diversified
strength that Houston’s economy experienced last year with the addition of
approximately 120,000 new jobs during the past twelve months and the new
projections for an estimated 63,000 new jobs in 2015.
With a metro Houston area population of 6.3 million today and projections for
continued growth to 7.4 million by 2020, we have seen our multi-dimensional
economy achieve one of the nation’s lowest unemployment rates at 4.5%.
Houston’s well known and highly appealing lower costs of living warrants further
acknowledgement as one of the strongest and leading growth markets in the
United States and further supports continued expansion of its retail marketplace.
The impressive growth has fueled new home sales to record levels and resulted
in reducing residential inventory to a few months’ supply. Homebuilders started
30,000 new single family homes last year and an aggressive 25,000 new single
family homes are projected to be started in 2015, with many in master planned
communities, according to Mark Dotzour, Chief Economist from Texas A & M Real
Estate Center.
4
With almost 19,000 new multi-family residential units delivered in 2014 and with
the Apartment Data Services projecting 20,000 units to be delivered in 2015
multifamily development exceeds annual production in any of the past several
years as Houston continues to densify with many mid-rise and high-rise projects
within the urban core.
This population and housing growth supports and justifies the additional retail to
serve the ever-increasing need of the consumer for goods and services. People
are continuing to move to Houston from other areas of the country with or
without jobs, because of the potential for employment and opportunity. Although
in Houston’s overall development environment there is projected to be a
slowdown in new office building and multifamily construction this year it should
not have an effect on retail growth this year.
The evolution of ecommerce continues to mature and grow, and is approaching
about ten percent of total retail sales. Online capability is often used to locate
and select merchandise and for comparison shopping, but in many cases the
merchandise is actually purchased or picked up in the stores and complements
the stores’ sales and traffic. Today almost all sophisticated retailers have
implemented their own online capabilities as part of their merchandising strategy
and capitalize on the inherent features and advantages of each.
Wulfe & Co. is a commercial real estate firm specializing in the retail real estate
marketplace, and has produced this annual retail survey of Houston’s retail
market for twenty two years. The firm is active in shopping center leasing, sales,
development property management and consulting and has well-established
relationships with local, regional and national retailers and shopping center
developers and owners.
Wulfe & Co. 2015 Projection56.4% increase over 2014
Prepared By:
Research Department
0
1
2
3
4
5
6
7
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
3.17
3.58
3.92
6.26
3.07
0.941.21
1.94 1.95
2.37
3.71Squa
re Feet ( M
illions)
Year
Greater Houston Retail Forecast3.7 Million Square Feet of Retail Space
to be Built and Opened in 2015,a 56% Increase over 2014
Prepared By:
Research Department
Supermarkets43%
Home Improvement3%
Theaters8%
Discount Stores5%
Other Anchors23%
Spec Space18%
Greater Houston Retail Forecast By Category3.7 Million Square Feet of Retail Space
to be Built and Opened in 2015