Richmond retail market softens with grocery store vacancies
Richmond’s retail real estate market continued to soften in the second quarter with the closure of the Martin’s Food Markets grocery chain and the sale of Virginia Center Commons, an older shopping mall in Henrico County that has seen an uptick in vacant spaces.
According to a market report from CBRE | Richmond, the region’s overall retail vacancy rate stood at 7.2 percent.
Much of the vacancy comes from three Martin’s stores that were not picked up by Publix in a sale last year in which the Florida-based grocer bought 10 area stores.
“The fate of the remaining stores will impact the retail market in the future, either continuing to drive up the vacancy rate or having relatively no impact on the total available space,” the report says.
Despite Martin’s departure, other new grocers have flocked to the market. In addition to its purchase of the Martin’s stores, Publix opened a store in July at the Nuckols Center Shopping Center in Henrico County. It also has plans for another new store in Mechanicsville at Brandy Creek Commons.
Aldi and Lidl, German-based grocers, have both joined the market. They are constructing smaller standalone buildings.
Lidl had opened open four stores by late July, while Aldi has opened more than 12 stores in the region over the past year.
“… With the tidal wave of new grocers to Richmond, there is growing concern that Richmond may become overgrocered, which could potentially lead to future store closures. While it is too early for speculation, we will continue to monitor the health and growth of the grocery segment since it has become the primary driver of new development in Richmond,” the report says.