If bankrupt national retailer Forever 21 closes a store in Miami-Dade, it most likely will be its 41,000-square-foot showroom on Lincoln Road, according to the company.
Does that mean Lincoln Road’s notoriously high rents in 2018 averaging $300 per square foot, according to Cushman & Wakefield have gotten even too expensive for national brands?
The property owner of the Lincoln Road location, registered under Comco LLC, could not be reached for comment.
But the move didn’t surprise Jaime Sturgis, CEO of Fort Lauderdale-based Native Realty, who was not involved in the transaction. “This is an opportunity for [Forever 21] to trim the fat,” he said. The specialty store announced last week that it had filed for Chapter 11 bankruptcy.
The $67 million Lincoln Road streetscape makeover led by the same team behind New York City’s High Line, James Corner Field Operations, will only make commercial properties and activity more enticing, said Stephen Bittel, chairman and founder of Terranova, which owns much of the Lincoln Road retail space.
As for those sky-high rents, they didn’t last. Rent since have cooled off, said Greg Masin, senior director at Cushman & Wakefield.
Now, asking prices are closer to about $250 a square foot, he said — and that’s having the desired result. “We see activity increasing and demand for both new and existing types of uses increasing.”
Said Bittel, “streets always evolve. Retail streets lead that change. This will give that property owner the opportunity to replace that space with a more exciting retailer, and at a higher rent.”
Across Miami Beach, about 7% of storefronts are vacant. That’s well above the county’s overall projected vacancy rate of 5.1%, according to Marcus & Millichap.
Another vacancy on Lincoln Road doesn’t make Miami Beach Vice Mayor Ricky Arriola happy. “It would be a massive hole in Lincoln Road,” he said — but it may just be an opportunity for something better. “That’s an opportunity to move from big box to mom-and-pop, small stores.”