56 • September 2015 • Western Real Estate Business www.REBusinessOnline.com
fraction of what they were before the
meltdown. New housing drove much
of their growth, and that is also well
below historic deliv-
eries. So the supply
and demand equa-
tion is out of whack
by historical stan-
dards."
Though new de-
velopment may
have slowed in Cali-
fornia, this is not a
case of "no news is
good news." It actu-
ally spells very good news for savvy
landlords who maintain well-posi-
tioned centers, as tenants now have
fewer spaces to choose from.
"This trend has caused a continued
decline of vacancies, combined with
increasing market rents, which are
due to improving economic condi-
tions and a lack of new construction,"
says Kyle Matthews, CEO and chair-
man of Los Angeles-based Matthews
Retail Group. "As a landlord, it really
puts you in a position of leverage if
and when you have a vacancy come
available. It allows the landlord to
push rents and dictate lease terms."
Landlords' Market
With more demand than supply,
WREB's experts confdently declared
that most of California's retail land-
scape favors the landlord. These land-
lords, in turn, are looking to fll any
existing vacancies with the highest
quality tenants, according to Rick Ri-
vera, president and CEO of Centers
Business Management's (CBM) West
Los Angeles ofce.
"Landlords are pleading for credit
tenants," he says. "They want to fll
their vacancies with A-plus credit ten-
ants on long-term, triple-net, corpo-
rate-guaranteed leases."
Rivera believes it's post-recession
jitters and a conscious efort to not re-
DEVELOPING TRENDS
Progressive Real Estate Partners will serve as the retail leasing team for Metro at Main, a mixed-use project in Corona that will
include 868 luxury apartments and 60,000 square feet of ground-foor retail.
CALIFORNIA from page 1
Donahue
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