Retail activity in Sonoma County remained strong through the first half of 2007, despite a slight increase in vacancy from 2.6% at year-end 2006 to 3.0% at the end of second quarter 2007. The annual average asking rental rate increased slightly from $25.38 per square foot (NNN) at year-end 2006 to $25.73 per square foot (NNN) at the end of second quarter 2007.
Terranomics tracks 42 retail centers throughout Sonoma County, representing a total GLA (gross leasable area) of approximately 5.7 million square feet. The retail center inventory in the county is comprised of 37.8% (2,172,402 square feet) of power centers, 33.4% (1,596,631 square feet) of neighborhood centers and 27.8% (1,916,776 square feet) of community centers.
Sonoma County is experiencing significant growth, including expansion of existing retailers and debuts for companies throughout the county. Starting in the south, Home Depot opened its first Home Depot Yardbirds branded store in Sonoma County on Lakeville Highway, on the east side of Highway 101 in Petaluma.
Regency continues to move forward with the entitlements for East Washington Place, to be located at Highway 101 and E. Washington Street in Petaluma. The 22-acre project is proposed to have approximately 342,713 square feet of retail space with proposed tenants including Target, Circuit City, Cost Plus World Market, PetSmart and Borders Books. Completion is estimated for 2010.
Commercial development is proposed for the 18-acre parcel located at the northwest corner of Highway 101 and Old Redwood Highway (on the existing Petaluma Golf Center). Details of the proposed development will be unveiled later this year.
Newman Development Group is progressing with the development of approximately 90,000 square feet of retail space adjacent to Lowe’s at The Marketplace at Cotati Commons. The project, located at the northwest corner of Highways 101 and 116, is scheduled to break ground in fall 2007.
The first phase of the Sonoma Gateway Shopping Center, at Highway 101 and Rohnert Park Expressway in Rohnert Park, was delivered to the retail tenants in second quarter 2007.
The first retail tenant, Bears, Buddies & Toys, opened in August. This is the first Northern California store for the children’s boutique and party venue. Phase 2 and 3, totaling approximately 20,000 square feet of additional retail space, will be delivered in 2008.
Grocery Outlet signed a lease for the former Albertsons’ building at the North Bay Centre in Rohnert Park.
Santa Rosa’s new housing growth area, centered around the intersection of Highway 12, Stony Point and Sebastopol Roads, is also experiencing some of the largest commercial growth in the city. On the southwest corner, Weingarten Realty Investors is moving forward with its proposed conversion of the former Home Base and Rite Aid site to a Wal-Mart adjacent to Food Maxx at Stony Point Plaza. The 24-hour store will total approximately 103,000 square feet. Sonoma County’s third Oliver’s Market is under construction at the former Ralph’s location at Third Street and Stony Point Road.
Red Mountain Retail Group successfully retenanted the former Circuit City site bordered by Highway 101, Cleveland Avenue and Steele Lane north of Coddingtown Mall with Orchard Supply Hardware. Retailers adjacent to the parcel (in the redeveloped Rite Aid portion of the center) include a 20,000-square-foot Staples and the first North Bay TJ Maxx. An additional 5,000 square feet of pad space is currently available for lease.
The redevelopment of Coddingtown Mall into an open-air, high-end retail destination is moving forward. The converted center is proposed to include a specialty grocery outlet, bookstore, movie theater, lifestyle shop tenants, upscale restaurants and, potentially, a residential component. Transformation of the center is expected to be complete in Fall 2009.
