Shopping Center Business

MAY 2015

Shopping Center Business is the leading monthly business magazine for the retail real estate industry.

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308 • SHOPPING CENTER BUSINESS • MAY 2015 Interview by Randall Shearin and Jaime Lackey From Fifth Avenue to Nashville — Gene Spiegelman of Cushman & Wakefeld comments on activity in thriving retail markets across the U.S. Expanding Opportunity A s cities across the U.S. evolve and grow, we in the industry look to predict where the next oppor- tunities lie. While the top international and domestic brands still vie for those coveted high street locations, which grow more expensive each year, creative de- velopers seize unique opportunities to bring high-quality projects to thriving markets. To find out which markets of- fer the best opportunities for retailers and developers, Shopping Center Business talked with Gene Spiegelman, who was recently named vice chairman and head of North American Retail Services with Cushman & Wakefield. SCB: Gene, Tell us what you are doing in your new role at Cushman & Wakefield. Spiegelman: I've been at Cushman & Wakefield 15 years this October. When I joined Cushman & Wakefield, we had about five retail brokers around the U.S. That was the extent of [our retail] busi- ness. In 2000, I brought a company here, called Retail Development Partners. I ar- rived with a team of seven and the struc- ture for the business. Bruce Mosler [who served as CEO of Cushman & Wakefield from 2005 to 2010 and became chairman of global brokerage services in 2011] was just stepping out of brokerage into man- agement to become president of North American operations. Bruce knew that we needed a strong retail component to our business because he had the ex- perience of working on the first several H&M deals that landed in the United States from our European colleagues. He knew we needed retail to match the retail business in Europe and Asia. From a broker's seat, I've played a material role in the leadership, management and ongoing growth in this business, both in the U.S. and at the global level. I've had a very successful run here. As I like to say, I work well for Cushman & Wake- field, and it works well for me. I've had a wonderful professional career in retail, spanning 23 years now. In December last year, our president and CEO, Ed Forst, asked me to take on the role of leading retail services in North America and I ac- cepted the role. I very quickly integrated into the new role because I understand our business. I know all of our people, I know the people throughout our service lines — office, industrial, consulting — and I know my colleagues here and abroad. My opportunity here is to fulfill a vision that we started with 15 years ago. We have a highly collaborative retail practice. We have very successful businesses, primarily in the urban core centers throughout the United States. We play in that specialty retail world. We have a great balance of tenant and landlord representation and an amazing client list. We are supported by, in my opinion, the best brand in the business. SCB: Let's talk about what you are see- ing in the major retail markets across the U.S. We've seen improvements across the board since the end of the recession. When you compare high streets today, where do U.S. high streets rank globally? Spiegelman: If you look at how the recession affected the real estate market, the high streets were the most resilient sector of the marketplace, followed by the top-tier super-regional and regional malls and other key segments of the shopping center community, including lifestyle cen- ters and grocery-anchored centers. Shop- ping centers populated by 'category killer' retail concepts such as Circuit City, Lin- ens 'N Things, and Borders were really challenged during the recession. Grocery- anchored retail was much more stable. Although high streets were the most resil- ient component, they still struggled when we went into 2009 and 2010. We defi- nitely saw increased availability and low asking rents. But [the high streets] jumped back nicely. If you look at the trend line from 2008 to year- end 2014, we have reached new market highs in most markets, particularly in the urban high street markets. It is quite a story. The urban centers benefit from so many factors. People want to live closer to where they work, they want the culture and energy of cities, and these cities have the best job creation. Cities benefit from substantial tourism, whether domestic or international. These key factors re- ally drive cities and drive retail. From the global perspective, the top 10 most expensive [retail] locations are: 1) Fifth Avenue in New York between 49th and Central Park; 2) Causeway Bay in Hong Kong; 3) Times Square in New York; 4) Central in Hong Kong; 5) Tsim Sha Tsui in Hong Kong: 6) Avenue des Champs- Elysees in Paris; 7) Madison Avenue; 8) New Bond Street in London; 9) Pitt Street Mall in Sydney; 10) Fifth Avenue between 42nd and 49th Street [in New York]. So in the top 10 most expensive locations, the United States — particularly New York — occupied 40 percent of the top 10. If you look at the most expensive locations in the U.S., of course, New York's Fifth Avenue, Times Square, Madison Av- enue and Lower Fifth Avenue hold the top four positions. Followed by L.A., San Francisco (Union Square and Post Street), Chicago and Miami. Gene Spiegelman

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