The retail sector continues to surprise, with savvy entrepreneurs opening experience-based concepts that continue to draw crowds.

Just consider the performance of this sector in Nebraska’s largest city. Omaha’s retail sector remains a strong performer, with many retailers new to the market now targeting the city and its suburbs.

Sam Rolfe, associate broker with The Lerner Company, said that demand from tenants for retail space remains high throughout the market.

“Vacancies in good retail spaces are few and far between,” Rolfe said. “It’s not easy to find good second-generation space in major shopping centers, grocery-anchored centers or centers in high-traffic, high-accessibility areas. Those spots go quickly.”

Rolfe pointed to the restaurant slice of the retail sector. Restaurant tenants are increasingly looking for second-generation space in Omaha but are often struggling to find it. This space is attractive because of how costly it can be for restaurant users to build a space from scratch.

“You’ll read doomsday headlines about the real estate market today,” Rolfe said. “But we are quite a bit sheltered from that in Omaha. We are still a community where people want to get up and go shopping. They want to see people from the neighborhood and get out of their homes. You still get that small-town feel in Omaha even though we are a respectably large market.”

Rolfe said that he saw the strength of Omaha’s retail sector first-hand when he recently attended ICSC Las Vegas. At the vendor showcase, he continually encountered retailers who wanted to set up shop in Omaha.

That is a difference from years past in which many national retailers didn’t include Omaha in their expansion plans.

National retailers that once focused mostly on the coasts are now targeting Omaha and the Midwest, Rolfe said. They like the stability and resilience of cities such as Omaha.

This doesn’t mean that there isn’t some slowdown in the Omaha retail sector. Investment sales, thanks to higher interest rates, remain down in this sector, Rolfe said.

“For investment sales to start to happen in larger numbers again, people are going to have to come to terms with how the world is now and not how it was a year-and-a-half or two years ago,” Rolfe said. “It is a waiting game now. People are waiting to see what the Fed does and how people react to that. But regardless of what the Fed does, there has to be a coming to terms with how things are. People have to adjust their strategies based on that.”

And what are customers looking for when it comes to new retail concepts in Omaha? Rolfe said that experiential real estate remains popular. That includes concepts such as indoor miniature golf, pickleball courts, indoor golf simulators and high-end arcades and bowling alleys targeted toward adults.

Quick-service restaurant concepts are also popular, Rolfe said. He pointed to Buffalo Wild Wings, which is now offering a grab-and-go concept in Omaha.

“It seems that retailers in the food area are increasingly moving in one of two directions,” Rolfe said. “They are either pumping out food and having people come through and grab it or they are offering additional elements of entertainment and experience to keep them in the restaurant. The middle ground is losing steam.”

Rolfe said that he expects Omaha’s retail sector to remain strong in the coming years. He pointed to a new development planned along North 120^th Street between Maple and Fort streets. Named Tranquility Commons, this project will bring new retailers, restaurants and hotels to this section of Omaha, though construction is not expected to begin on this phase of the development until sometime in 2027.

Jason Fisher, chief executive officer with Cushman & Wakefield/The Lund Company in Omaha, said that as in all markets, certain commercial sectors are performing better than others in Omaha.

He pointed to the retail sector. Outside of large, indoor shopping malls, the retail sector here is thriving, Fisher said, with a vacancy rate as low as he can remember.

“Years ago, the storyline was that we were witnessing the death of brick-and-mortar retail,” Fisher said. “It has actually proven to be the opposite.”

Experiential retail has helped the sector, Fisher said, with companies that offer experiences such as Topgolf doing big business in the market. As Fisher said, you can’t provide an experience like bowling, knocking golf balls in the air or competing in pickleball online.

“Experiential retail is popping up all over Omaha,” Fisher said. “And that is a good thing for the retail sector.”

Fisher pointed, too, at the area’s industrial sector. The vacancy rate for this sector remains low, even though tenant demand for warehouse and manufacturing space has slowed slightly. The industrial market here has also delivered a significant amount of square footage in recent years, which is also slowing demand for new space.

As Fisher said, for the first time in a long time, the supply of industrial space in Omaha is outpacing the demand for it.

But even with that trend, the industrial vacancy rate is low. Fisher said in the first quarter of this year, Omaha’s industrial vacancy rate was still under 3%. For the last two-and-a-half years, this vacancy rate was at or below 4%, he said.

Fisher said that he expects industrial starts to continue to slow here until the demand from tenants rises again.

“It’s a natural slowdown while our development community waits for the absorption to catch up,” Fisher said. “In 2021 and 2022, demand was significantly outpacing supply. This feels like a natural correction. There are broader reasons for some of the slowdown in tenant demand, too. The distribution world is a little slower year-over-year. People are delaying and pausing some projects that were potentially in the works. It’s like everyone is taking a breath.”

The office market here is seeing more challenges, of course, as it is across the country, Fisher said. But the sector, as others say, is still showing resiliency despite these challenges.

Fisher said that he is seeing robust demand from tenants interested in renting out higher-quality space. The flight-to-quality movement that has seized the office sector is playing out in Omaha, too, Fisher said.

“When CEOs decided to bring back employees into the office whether on a hybrid system or full-time, there was an emphasis placed on making the office commute-worthy,” he said. “A lot of businesses made moves. During the last year, that flight-to-quality created a lower vacancy rate in our office sector. Our office market right now is being propped up by Class-A space the flight to quality.”

Vacancy rates in Omaha’s multifamily sector have ticked up slightly, Fisher said. Much of that is because of the significant amount of new supply that has been delivered in Omaha. Much of the new apartment products have been delivered on the fringes of the Omaha market, mainly in the west suburban areas. Fisher said that Omaha saw a record number of apartment deliveries in 2023.

This new product has increased vacancy rates slightly and slowed the growth of monthly apartment rents, Fisher said.

“It’s going to take a while to get all those new deliveries fully absorbed,” Fisher said. “There are also some new-construction projects on their heels. We expect there to be a little softness in absorption in the multifamily sector, especially in the suburban areas, for the foreseeable future here.”

Like others, Fisher is waiting, too, for investment sales to pick up in Omaha’s commercial real estate market. That hasn’t happened yet, even with the Fed stabilizing its benchmark interest rate.

Fisher said that there is a lot of capital siting on the sidelines today. Investors will deploy those dollars eventually, he said.

“It feels like once the convergence of seller expectations and significant capital needed to be placed happens, we might see transaction activity break loose,” Fisher said. “We are fortunate to be in the Midwest. The slowdown in transactions isn’t as severe in the Midwest as it is in other parts of the country. But we have definitely seen investment volume fall. Transaction activity is sluggish.”

Fisher did say that there is demand in the Omaha market for sale-leaseback transactions in the office sector. During the last 12 months, these transaction types have helped prop up Omaha’s investment-sales numbers, Fisher said.

Fisher said that the Lund Company operates in six states. The company recently received 37 offers on a multifamily property in Texas. Fisher said that is a sign that there is capital ready to be placed once investors again understand what a normal market in today’s environment looks like.

“Properties that are on the market are getting a lot of eyes on them,” Fisher said.

JLL Capital Markets arranged acquisition financing for Monticello Apartments, a newly renovated, 1970-vintage, 116-unit, multifamily community in Fort Worth, Texas.

JLL worked on behalf of the borrower, Price Realty, to secure the five-year, fixed-rate financing through Freddie Mac. The loan will be serviced by Jones Lang LaSalle Multifamily, LLC, a Freddie Mac Optigo℠ lender.

Monticello Apartments is located at 154 N. Bailey Ave. just off of State Highway 199 in the Intown Fort Worth / University submarket. The property has outstanding access to several major thoroughfares, including Interstates 30 and 35, and is close to some of Fort Worth’s largest employers, including Lockheed Martin and Fort Worth ISD. Additionally, Monticello Apartments is surrounded by a collection of lifestyle amenities, including Montgomery Plaza, The River District, Fort Worth Convention Center, Sundance Square and The Dickies Arena.

The property consists of 22 two-story apartment buildings with 56 one-bedroom and 60 two-bedroom units, averaging 952 square feet each. Units feature walk-in closets, patios or balconies, washer/dyers, stainless steel appliances and air conditioning. Monticello Apartments also offers on-site amenities, including a swimming pool, laundry facility, covered parking and on-site management and maintenance.

The JLL Capital Markets Debt Advisory team representing the borrower was led by Senior Managing Director John Brownlee, Director Bo Beidleman, Associate Blake Morrison and Analyst Aaron Craig.

JLL Capital Markets is a full-service global provider of capital solutions for real estate investors and occupiers. The firm’s in-depth local market and global investor knowledge delivers the best-in-class solutions for clients — whether investment sales and advisory, debt advisory, equity advisory or a recapitalization. The firm has more than 3,000 Capital Markets specialists worldwide with offices in nearly 50 countries.

Houston-based multifamily developer Vero Sade unveiled a multimillion-dollar makeover of 3700M, a 381-unit luxury high-rise at 3700 McKinney Ave. in Dallas. Vero Sade simultaneously debuted its club living concept in Dallas.

Originally built in 2014, the 21-story trophy asset located in the highly sought-after Uptown submarket now brings the energy and life of a social club into the multifamily space with high-design and memorable, high-frequency programming, ranging from chef demonstrations and themed fitness classes to poolside pampering and guest lectures.

Helming the project’s design rebirth was East Coast design shop, Good City Studio, whose practice includes a mix of high-profile multifamily properties, private clubs, health and wellness offerings and hotels, including Colorado’s Snowmass Club, Equinox Hotels and Philadelphia’s acclaimed Fitler Club – a project from Vero Sade’s parent company, Vero Capital. Inspired by the intersection of home and hospitality, the re-envisioning of 3700M was intended to foster social connections, and as such, Vero Sade and Good City Studio completely upended the existing layout, turning lackluster spaces into meaningful places.

Rooted in elegance with a spirit of eclecticism, the project features crisp modern lines, plus colors, textures and patterns rooted in nature. Adding a bold counterpoint is the artistry of contemporary Italian furniture sourced from CASA, a Vero Sade company and one of the country’s premier showrooms. Every selection has special intention for the designer and client – from the books that dot the tables and shelves to the forthcoming art gallery, which will debut with several pieces from the private collection of Kelvin Beachum, alumnus of Southern Methodist University, offensive tackle for the Arizona Cardinals and investor in Vero Sade.

The heart of 3700M is the seventh floor, 6,700-square-foot amenity level with postcard views of the surrounding city. A hub of activity and activation, it now encompasses premier indoor and outdoor elements including an array of welcoming lounge and seating areas, rooftop pool with cabanas and summer kitchens, yoga studio, expansive 24/7 fitness center outfitted to premium club standards with Technogym equipment, plus a wellness terrace for additional programming. Further buoying the hospitality orientation of the property, Vero Sade has an all-day café concept with a menu of morning must haves, including coffee and pastries, as well as lunch and midday grab-and-go items. Craft beer and cocktail service is anticipated to launch this month.

The building’s previously underutilized ground floor lobby has been transformed into a two-story, 6,000-square-foot multipurpose venue geared to both residents and the general public. The chic duplex serves as a unique event space as well as creative coworking space with private offices for rent.

Also completely revamped, the building’s residences take apartment living to new heights with studio, one- and two-bedroom homes spanning 562 to 1,475 square feet and featuring graciously proportioned open-concept living spaces, as well as oak flooring and floor-to-ceiling windows throughout. Chef-inspired kitchens showcase built-in pantries, light wood cabinetry, quartz countertops and upgraded stainless steel appliances. Additional highlights include spa-like baths and walk-in closets. Select units offer balconies or patios.

A percentage of units have been allocated for short-term rentals and have been fully outfitted in high style for discerning travelers and locals seeking furnished accommodations for a minimum of one week. Short term visitors enjoy full access to building amenities, as well as programming, creating a resort like experience for business or leisure stays.

3700M is a pet-friendly property with a newly unveiled dog run. It also features EV charging stations, part of a portfolio-wide partnership with Xeal.

SRS Real Estate Partners completed the $9.11 million sale of a newly developed 6,461-square-foot convenience store property occupied by TXB in the Austin, Texas, region.

Situated on 4.52 acres of land at 145 Lehman Road in Kyle, Texas, the property has a 20-year, corporate-guaranteed triple net lease in place. TXB, or Texas Born, is a family of customer-oriented convenience stores and quick food operations with more than 48 locations in Texas and Oklahoma.

SRS Capital Markets Executive Vice President and Managing Principal Patrick Nutt and Senior Vice President William Wamble who are based in Florida represented the seller, a Southeastern U.S.-based private developer. The buyer was a Virginia-based 1031 exchange buyer.

TXB was named by CStore Decisions as the winner of its 2023 Convenience Store Chain of the Year. The property is situated on a signalized intersection in a dense retail corridor and is near the Interstate 35 on/off ramp.

Year to date, SRS Capital Markets has completed approximately $731 million in deal volume comprised of 182 transactions in 34 states. SRS currently has in excess of 698 properties actively on the market with a market value surpassing $3.7 billion.

PartnersReal Estate arranged the sale of a 19,279-square-foot multi-tenant medical/retail property at 9707 Anderson Mill Road in Austin, Texas.

Partners’ Ryan McCullough and Sean Anderson represented the seller, Scott M. Morledge and Bruce A. Wencel, in the transaction. The buyers, Abhishek Mathur and William George of Excelsior Capital, represented themselves.

The team procured multiple offers and secured favorable seller-financing terms to help the property owner preserve sale value amidst difficult market conditions. The buyer was a national medical/retail investment fund in a 1031 exchange.

Renters looking for more space are in luck: A new report says that the average size of new apartment units in 2023 increased substantially when compared to a year earlier.

According to RentCafe’s latest apartment-size report, released in early June, the average size of a new apartment in the United States stood at 916 square feet in 2023. This is largely because developers added a greater number of two- and three-bedroom apartment units last year.

That number is a big increase from 2022, when the average size of a new apartment in the United States was only 889 square feet, largely because of the higher number of studio and one-bedroom apartments that developers added to the nation’s multifamily stock.

Where renters live, though, helps determine how large their apartment unit is likely to be.

RentCafe found that the average size of new apartments stood at 1,173 square feet in Gainesville, Florida, in 2023, tops in the nation.

The first Midwest market on RentCafe’s list was Knoxville, Tennessee, which boasted an average new apartment size of 1,057 square feet. That is 18.1% bigger than in 2013. Knoxville’s average new apartment size ranked fourth in the country last year.

Coming in at 10th place on RentCafe’s list was Louisville, Kentucky, with an average new apartment size of 1,017 square feet, 15% larger than 10 years ago. Overland Park, Kansas, ranked 17th, with an average new apartment size of 985 square feet, the only other Midwest market in the top 20.

In Minneapolis, the average size of new apartments stood at 780 square feet in 2023, while the average size of all apartmnts was 713 square feet. Those numbers stood at 865 square feet and 827 square feet in Madison, Wisconsin, and 835 square feet and 788 square feet in Milwaukee.

And in Chicago? The average new apartment in 2023 boasted 801 square feet, while the average size of all apartments was a more snug 704 square feet.