WALNUT CREEK — Despite all the talk in recent years of troubles on Main Street, business is once again starting to boom in Walnut Creek’s downtown.
Businesses owners are getting back to business, with the retail vacancy rates of downtown stores falling by more than 25 percent in the last four quarters to 3.2 percent, according to real estate experts.
“Statistically, numerically, the market is really at pre-recession levels,” said John Cumbelich, a Walnut Creek-based commercial realty agent who specializes in retail. “There are only 75,000 square feet of vacant space in a market of 2.35 million square feet; that is not a lot of space.”
At the height of the economic meltdown, Walnut Creek’s vacancy rate was at 7 percent. While that might seem low in surrounding cities, Walnut Creek has always been a fundamentally stronger market, Cumbelich said.
“Compared to historic levels in Walnut Creek, we saw a vacancy spike that exceeds anything we have on record for the retail downtown core,” he said.
The proof of new life is the shops and restaurants popping up all over town. In the past few months newbies include La Boulange de Walnut Creek, the Giants Dugout store, Bosphorus Turkish Cuisine and Ã˜L Beercafe & Bottle Shop. On deck to open — Opa, a Greek restaurant next to Prima; Farm to Table Cafe; Nothing Bundt cake; and The Corner’s Tavern.
On Sept. 6, Rick Delamain opened his restaurant Cypress, an American-French
contemporary brasserie, on Locust Street. It is in the same location as Vesu, a restaurant that closed in April less than a year after it opened.
Delamain, a restaurant veteran, took a chance to open in a sluggish economy. But he said he is confident in the restaurant’s success because Walnut Creek is the “culinary capital of the East Bay.”
“This is a local joint that everyone can come to,” he said. “We are strategically positioning ourselves that we will grow with the economy and we will have a strong position.”
Another indication of downtown revitalization are business owners refurbishing the outside as well as the inside of their businesses, said Ron Gerber, economic development manager for the city.
Such examples include the former Delle Stelle building on Main Street currently under renovation for a restaurant and The Corners and Walnut Creek Boulange taking over the former Bing’s space. Farther up Main Street, the construction of a new Dirito Brothers Volkswagen 30,000-square-foot dealership continues.
“When you see this kind of commitment it speaks well for downtown vibrancy,” Gerber said.
But less vacancy doesn’t necessarily mean rents have rebounded to pre-recession levels. In the historic (traditional) downtown, rents go from $36 to $60 per square foot a year, which is good, but for premium retail spaces such as across from Broadway Plaza or in Plaza Escuela, the rents are 20 percent lower than pre-recession. The likely reason: Prospective tenants take on more risk because that space is more expensive, so they have to feel confident before signing a long-term lease, Cumbelich said.
“We have been in unstable economic times, and until that recovers fully, we are going to continue to see caution for premium rentals,” Cumbelich said.
Other positive indicators include The Village at 1500 Newell project, a mixed-use development that will offer 40,000 square-feet of retail, set to break ground next year; and of course, Neiman Marcus, which opens in March.
The benefits of Neiman will be seen in the next few years as “super premium retailers” such as Prada and Gucci will finally consider Walnut Creek a possibility because Neiman is an anchor, Cumbelich said.
“Walnut Creek is the only choice” in the East Bay for those types of stores to set up shop, he said.
Walnut Creek downtown is bouncing back – Walnut Creek Real Estate News
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