Western Real Estate Business

MAY 2018

Western Real Estate Business magazine covers the multifamily, retail, office, healthcare, industrial and hospitality sectors in the Western United States.

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56 • May 2018 • Western Real Estate Business www.REBusinessOnline.com SAN BERNARDINO COUNTY FOCUSES ON RETAIL ATTRACTION FROM ECOMMERCE TO EXPERIENTIAL The ecommerce evolution has inspired San Bernardino County to hone in on its current retail offerings, future shopping endeavors and the industrial support services it will need to usher the region into the new retail environment. By Reg Javier C alifornia leads the nation in job growth this year, hitting all- time high employ- ment in December 2017, according to the UCLA Ander- son Forecast. While that news may not be surprising, the report also cited an important economic shift. It stated that the state's inland regions, includ- ing San Bernardino and Riverside counties, are outpacing some of the tech-dependent regions like the Bay Area in terms of job creation. Market trackers and economists across the country are citing a similar growth trend for the Inland Empire. RCLCO, a real estate analytics com- pany, reported that the Riverside- San Bernardino metro area was one of the top 25 U.S. metros with the greatest growth between 2010 and 2015 in the number of Millennials. This nation-leading surge in popula- tion growth, especially among Mil- lennials, has driven significant new retail activity in San Bernardino County. This extends to all sectors from ecommerce-driven industrial to ground-up retail development to "eatertainment" and experiential tenant expansions. The New Retail - Industrial The Inland Empire remains a top- performing industrial market. Cush- man & Wakefield's 2018 to 2019 indus- trial forecast predicts that the Inland Empire will see some of the greatest net occupancy gains and new product deliveries in North America by 2019. At closer look, this activity is largely driven by ecommerce. Eloy Covarrubias, senior vice presi- dent at CBRE, notes the extremely low vacancy rates in Orange and Los An- geles counties have driven major ex- pansion to the Inland Empire. "New state-of-the-art facilities in San Bernardino County are in high demand, especially since they better accommodate the demands of name- brand e-commerce tenants," he says. Mike Del Santo, senior vice presi- dent of portfolio management at Alere Property Group, an industrial devel- oper active in the Western U.S., also sees this first-hand. "Size matters," Del Santo says. "The big operators who are serving their customers directly, whether it's Amazon, Home Depot, Lowe's or Target, need a building footprint that is adequate to support the popula- tion they serve, which, in Southern California, accounts for 35 to 40 mil- lion people." Amazon has really been the game changer and the catalyst for what's go- ing on in terms of how people operate, how they hire, how buildings are de- Javier CIM Group recently kicked off its Montclair Place redevelopment, which includes the construction of a new wing to accommodate entertainment and restaurants. The 1.2-million-square-foot Montclair Place regional mall is also set to receive a new AMC Dine-in Theatre.

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