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Atlantic Park Development Passes Critical Milestone

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Norfolk Retail Q3 Marketview

Market Overview
The Norfolk retail market experienced 14,069 square feet of positive net absorption throughout Q3 2020, which resulted in a vacancy rate of 6.5%.  The Peninsula propped up the market, experiencing 46,906 square feet of positive net absorption and ending the quarter at a vacancy rate of 7.2%.  The Southside experienced 32,837 square feet of negative net absorption and ended the quarter at a 6.2% vacancy rate.

Over the last 15 years, the average market vacancy rate is 5.8%, with the Southside averaging 5.5% and the Peninsula averaging 6.3%.  Although the market is currently seeing a higher vacancy rate than the market average, there is optimism, as the effects of COVID-19 are beginning to subside, and the upcoming holiday shopping season should help prop up many retail businesses in the short term.

Average asking rents (NNN) ended Q3 2020 at $13.69 across all retail product types, which remains unchanged quarter-over-quarter but is $0.17 less year-over-year.  The Southside ended Q3 2020 with an average asking rent of $13.43, while the Peninsula followed with an average asking rent of $14.21.

Key Events

Atlantic Park, a mixed-use surf park and entertainment center at the Virginia Beach Oceanfront is getting closer to construction, with the proposed project progressing through the development process farther than any other previous proposal for the site.  In September, the developer of the proposal, Venture Realty Group, met a deadline to prove they can secure the necessary financing for the project.  This allows for more formal design plans to get under way, with a groundbreaking still at least a year away.  If this development comes to fruition, it will bring 230,000 square feet of retail space to the market.

The Commonwealth of Virginia remains in Phase 3 of its reopening plan.  Although many businesses are still struggling due to the pandemic, positive signals are being evidenced, such as the easing of the United States unemployment rate from a high of 14.7% in April to 7.4% in August.

Strong sales activity continued during Q3 2020 in the Norfolk market.  J&J Investments purchased the 86,201 square-foot Newport Market Place from Frontier Development LLC for $5.8 million, or $67.28 per square foot.  Dominion Marketplace LLC purchased the 75,506 square-foot Dominion Marketplace from Focused Chesapeake LLC for $4.9 million, or $64.90 per square foot.  Lastly, Chesapeake Virtual Offices purchased the 43,375 square-foot Campostella Corners Shopping Center from Yagen Rental Properties LLC for $3.5 million, or 
$80.69 per square foot.


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Atlantic Park Development Passes Critical Milestone

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Related Experts

Chris Read

Senior Vice President

Norfolk - Main

Chris Read specializes in the sale and leasing of retail property for Colliers | Virginia.  As the Director of the Retail Services Team in Norfolk, Virginia, he has extensive recent and long-term experience generating positive results to owners, developers and tenants in the retail sector for over 24 years.

On behalf of national and regional clients, Chris has achieved success on a multitude of assignments including, but not limited to, shopping center leasing and sales, site selection, new retail developments, land subdivisions and parcel sales to end users, tenant-mix strategies, architectural guidance/shopping center design, big box leasing, redevelopment projects, portfolio leasing/sales, tenant representation, complex contract negotiations, investment sales and surplus property dispositions.  This knowledge base presents a thorough understanding of special requirements to furnish a personalized approach to individual client needs. 

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Ned Brooks

Senior Vice President

Norfolk - Main

Ned Brooks joined the Retail Leasing and Sales Team of Hampton Roads in 1999. He develops and implements marketing strategies for shopping centers, property owners, buyers, and tenants by providing in-depth market analysis, site selection, lease and sales negotiation services. Ned was called on by Navy Federal Credit Union, the world’s largest credit union chain, for a major branch expansion in Hampton Roads and beyond. To date, he has completed over 30 branch locations. More recently, he was selected by Aldi US to assist with their grocery store expansion in the region. There are currently 15 completed transactions and more pending. In his over 30-year involvement in commercial real estate, he has exclusively represented over 50 centers in the Hampton Roads marketplace and served dozens of retailers in both Virginia and North Carolina. His assignments range from box disposition and general sales of land and buildings, to tenant representation and shopping center leasing.

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Kevin OKeefe

Senior Vice President

Norfolk - Main

Kevin O'Keefe specializes in both tenant and landlord representation, as well as investment and end user sales for Colliers Virginia.   With 19 years experiences, Kevin has the ability to provide clients with market knowledge, including the latest market inventory, rental rates and general market conditions in Hampton Roads.

Kevin is currently responsible for leasing over one million square feet of shopping center properties in the Hampton Roads region, as well as performing market analysis, site selection, and contract negotiation for various local, regional and national retailers. 

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Natalie Hucke

Senior Vice President

Norfolk - Main

Natalie Hucke is a member of the retail brokerage group at Colliers Virginia. With 19 years of experience, she specializes in both tenant and landlord representation, as well as investment and end user sales. She provides clients with market knowledge, including the latest market inventory, rental rates and general market conditions in the Hampton Roads area.

Natalie is currently responsible for leasing over one million square feet of shopping center properties in Hampton Roads, as well as performing market analysis, site selection, and contract negotiation for various local, regional and national retailers.

View expert

Tyler Brooks

Vice President

Norfolk - Main

Tyler Brooks joined the team in December 2011 as a Retail Leasing and Sales Associate. Tyler’s prior career included marketing-oriented assignments in San Diego, Las Vegas, and Florence, Italy. As part of the Retail Leasing and Sales team, he provides services to developers, landlords, tenants and property owners by using different marketing strategies to service his clients. As a retail specialist, Tyler will serve his clients with detailed knowledge of the Hampton Roads area. 

In 2015, Tyler and two other associates won the leasing business of Greenbrier Marketcenter, thepremier shopping center in Chesapeake, VA. In 2016, Tyler and another associate leased a 350,000SF center in Newport News from 25% occupied to 95% in less than a year. They also back filled a50,000 SF Kroger (which was vacant for eight years). Tyler and team, in 2019 leased over 18 spaces in a Virginia Beach shopping center (Lynnhaven North) in three months that had been vacant for years. 

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