2016 Retrospective: Real Estate: Post-Election Retail Activity Picks Up
Many retailers were sitting on the fence before the presidential elections to see which way the political gate was going to swing.
But now that Donald Trump has been elected to take office in January, retailers are out shopping for shops. “Things have been picking up since the election,” said Philip Klaparda, senior associate at Dembo Realty, a commercial real estate agency in Beverly Hills. “We have been extra busy since the second week of November.”
Melrose Avenue seems to be getting a new lease on life. The part of the street west of La Cienega Boulevard has gained greater interest, sparking monthly retail rents of around $20 a square foot.
New to the avenue is Lululemon Athletica, which opened Nov. 22 after shuttering its Robertson Boulevard space. Also moving over from Robertson Boulevard to Melrose Avenue was Ted Baker London. Adding to the high-end mix of retailers has been French contemporary retailer Zadig & Voltaire, which opened on Melrose with its fifth Los Angeles–area store.
Next year, Dean & DeLuca and Hudson Jeans will be debuting flagship stores on the western edge of Melrose Avenue, and Michael Stars will make its long-anticipated opening on the street.
Even Melrose Avenue just east of La Cienega Boulevard is starting to see increased activity. The Reformation just signed a lease for a flagship store at 8000 Melrose Ave. and Golden Age, a retro fashion boutique, is moving into 8012½ Melrose Ave.
Monthly retail rents are still reasonable at $6 a square foot. “We see good things happening between Fairfax and La Cienega,” Klaparda said. “New storefronts are being built out.”
Melrose Avenue’s success has come at the expense of Robertson Boulevard. Many retailers on that street have picked up and moved blocks away to hopping Melrose.
Retail vacancy rates on Robertson are still around 15 percent this year. But there are signs of resurgence. The high-end coffee brand Blue Bottle is negotiating to take over the space once occupied by the defunct Newsroom Café, which closed in 2014. The entire building is being renovated, which should be a boon for the street.
While Fraser Ross closed his Kitson store early this year, he is back in the same space with Kitross. Other new stores on Robertson are Italian retailer IDD and New York–based Jovani, which sells evening gowns and dresses.
The street has become popular with pop-up stores. Activewear retailer Carbon38 opened a pop-up in November as did pajama and loungewear retailer Sleepy Jones.
Rents hover around $8 to $10 a square foot, which haven’t been that low since 2005. In 2007, they were inching up to about $17 a square foot. “Robertson is on sale. If you want to get in on Robertson, this is the time to do it,” Klaparda said.
There is no room to be found on tony Rodeo Drive in Beverly Hills. To get a spot, you have to buy a building. This year, the parent company of Louis Vuitton paid $122 million—or $19,405 a square foot—for the yellow House of Bijan building at 420 N. Rodeo. Late last year, Chanel paid $152 million, or $13,217 a square foot, for a larger building it was leasing on Rodeo Drive.
The Bijan store still has a few years left on its lease, but LVMH, the parent company of Louis Vuitton, is expected to open a retail outpost for one of its brands after the lease expires.
Monthly retail rents on Rodeo Drive are around $60 a square foot.