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Retail leads commercial real estate growth in hot markets

Even as much of the state’s building activity focuses on residential growth, commercial real estate is also flourishing in several areas. Southaven, Jackson, Hattiesburg and the Gulf Coast are among the hottest of the hot spots.

Chuck Roberts, who’s been a commercial Realtor in Southaven for a number of years, said the area has experienced growth for several years and it’s still hopping.

“We cover most of North Mississippi — DeSoto, Marshall, Tate and Panola counties — and it’s still very much in a growth pattern,” he said. “I don’t see any indication that the commercial boom is slowing down.”

He says Southaven is the primary area of growth with Olive Branch and Hernando also experiencing activity. With a population of 40,000, Southaven is the largest city in the area.

“It’s everything; retail, restaurants and national chains, with warehousing and industrial growth significant, too,” Roberts said. “The cost of commercial real estate varies according to size and location.”

A commercial Realtor in the Jackson area since 1993, Bill Cook said the market is very strong in suburban areas surrounding the Capital City, primarily Madison and Rankin counties and South Hinds County around the Byram area.

“Inside Jackson, most of the development from a retail standpoint is primarily focused on things to serve the existing population, such as fast food places and auto parts stores,” he said. “There’s very little going on for multi-family development. I’ve seen projects turned down in the past year in places that were appropriate.”

Cook added that the only thing in commercial real estate happening in the city is the revitalization of downtown. However, the demand for office space is not as great as it was due to office construction in the cities of Madison, Pearl, Brandon and Byram.

“There’s also very little in new industrial space in the city,” he said. “We represent a number of properties in the city, and it’s a tough sale unless it fits the market.”

Asked if commercial property in Jackson is holding its value, he answered, “No. When properties become vacant, it definitely becomes a buyer’s market. A lot of buyers who want to go into business try to get real bargains from those who want to get out of the city.”

He says that’s the reality, and that it’s a real struggle to get people to do business in the city now. However, distribution centers are still locating there. “That’s because they don’t have to have shoppers coming to their locations,” he said. “It’s all about crime.”

Cook, who’s lived in Jackson all his life, sees significant commercial development in the areas surrounding the city with big retail projects on the drawing board for Madison and Rankin counties.

“It’s fueled by residential development in those areas as the demand for various services grows,” he said.

The reality for the Hattiesburg area is growth and more growth, according to Andy Stetelman, whose family has been in real estate there since 1933. He said his own career in the business began at age 15 when he obtained his driver’s license and became a gopher.

“Hattiesburg and the Pine Belt area are hot and there’s a demand for property,” he said. “If it’s priced right, it will sell. It’s a great time to be involved in real estate, and I’m having a wonderful time.”

Stetelman doesn’t know where all the people are coming from to fuel this activity but sees affordable property moving quickly.

“We’re seeing property move that we thought would never move. We call it third- and fourth-generation property,” he said. “We’re seeing miraculous things happen. An example is warehouse property built in the 1940s on the outskirts of Hattiesburg. It has not been in demand, but the lack of space and affordability is making it desirable.”

He said some of those tenants are short term and others are industrial types for these properties. “These areas did not sell before because they don’t have accessibility to highways and the interstate, and they got old and tired,” he said. “Now it doesn’t seem to matter.”

A retail boom in the area that has been happening for several years is continuing. The latest announcement is for the location of Gander Mountain, an outdoor retailer that will occupy the former K-Mart building that has been vacant for four years. A 25,000-square-foot gym and a restaurant will also open in this vicinity.

“A lot of big stores, including Kohl’s, now want to come here,” he said. “We’re usually fourth or fifth in line for most big retailers, behind Southaven, Jackson, Tupelo and the Gulf Coast.”

Stetelman says downtown Hattiesburg is thriving, too. “We’ve done more lease activity downtown in the last six months than we have done in years,” he said. “There’s a lack of space there now.”

Downtown is abounding with restaurants, antiques, arts and crafts and book shops. He said he pictures the district as a cleaned up Bourbon and Beale streets.

“We still have potential in the south end of town where development has been selective,” he said. “The Evelyn Gandy Parkway in Petal is another hot spot that’s becoming a popular thoroughfare.”

Contact MBJ contributing writer Lynn Lofton at llofton656@aol.com.

About Lynn Lofton

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