Weekly Perl: A Commercial Real Estate News Recap

Marc Perlof • October 31, 2025
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Fed Cuts Rates Again, Boosting Confidence in CRE Recovery

In a closely watched decision, the Federal Reserve cut its benchmark interest rate for the second consecutive month. The new target range of 3.75% to 4% reflects continued efforts to ease financial conditions and stabilize capital markets, even as economic signals remain mixed...


A blurry picture of a clothing store with clothes on display.

Furniture retailer Arhaus opens largest store yet as part of US expansion

High-end furniture retailer Arhaus has opened its largest store to date in Los Angeles as part of larger nationwide expansion plans, while other retailers scale back growth in the face of consumer uncertainty and rising inflation...

A car is parked in front of a sign that says 223

Australian footwear brand Blundstone expands US bootprint

An Australian footwear firm known known for its popular Chelsea boots opened its first brick-and-mortar store in Los Angeles, with plans to expand in Oregon and Colorado.

Blundstone, founded in 1870 in Tasmania, Australia, opened a 1,274-square-foot store at 3212 W. Sunset Blvd. in L.A.'s Silver Lake district, with plans to open locations by early next year in Portland and Boulder, Colorado, according to the Chain Store Age trade publication...


The front of an aldi store with a sign in front of it.

Back in the black: Demand for retail space turns positive

After recording the first consecutive quarterly declines since 2020, retail demand is back in the black heading into the final quarter of the year.



Net absorption, or the net change in retail space occupancy, totaled 2.3 million square feet nationally during the third quarter, a significant improvement from the first half of the year when the national retail market posted negative 20 million square feet of net absorption...


City Manager’s rapid plan for the city turns the Chi Train into an Express

City Manager Oliver Chi has been on the job in Santa Monica for just over three months and in that short time he’s learned enough to envision an entirely new Santa Monica. One built on business friendly permitting, large events, enhanced safety, targeting causes of local homelessness and reducing government micromanagement...


Blaming tariffs, children’s apparel chain Carter’s to close 150 stores

Young children's apparel retailer Carter's is closing 150 low-margin stores and letting go of 300 office employees as it reels from the impact of tariffs like other U.S. chains.


The Atlanta-based company, with over 1,000 retail locations in North America and Mexico, on Monday announced the belt-tightening measures when it reported its fiscal third-quarter earnings. Carter's cited the hit that President Donald Trump's tariffs are taking on its business, cutting into its profits. It estimated that the gross pre-tax earnings impact of additional import duties will be about $200 million to $250 million on an annualized basis...

Cap Rates Fall As Sector Trends Drive Q3 Net Lease Market

Cap rate trends in Q3 showed a break from macro-driven narratives, with investors prioritizing tenant durability and sector momentum, reports GlobeSt. Car wash properties led the decline, averaging 6.27%, down 20 bps from last quarter. Quick Quack assets priced as low as 5.50%, while Mr. Clean listings topped out at 7.13%. Convenience stores followed, with Wawa averaging 4.79%, 7-Eleven at 5.27%, and Circle K at 5.66%...

Starbucks sales improve, but profit drops after US store closings


Starbucks said sales grew for the first time in about two years, but acknowledged the coffee chain's turnaround could take years as it closes locations and lays off hundreds of corporate employees.



The Seattle-based company reported $9.6 billion in revenue in its fiscal fourth quarter, up 5% from the year-earlier period, as global store sales edged up 1%, lifted by growth in international markets. U.S. sales were flat year over year, an improvement over the 6% decline reported in the year-earlier period...

New restaurant to anchor main shopping hub in Pacific Palisades following fires

A high-profile chef, restaurant group and a well-known developer are planning a new eatery to anchor Palisades Village, the marquee shopping center for the fire-ravaged neighborhood in Los Angeles.



James Beard Award-winning chef Nancy Silverton is teaming up with landlord Caruso and restaurant management firm River Jetty Restaurant Group to open an Italian American steakhouse called Spacca Tutto in August 2026...

Will LA’s $30 Minimum Wage Reshape Retail Real Estate or Just Empty Storefronts?

By Marc Perlof • October 27, 2025
If you own retail real estate, here’s what might change for you. The hospitality workers’ union UNITE HERE Local 11 is pushing a bold new initiative to raise the City of Los Angeles $30 minimum wage for all city employees by July 1, 2028¹. While the first ordinance covered hotel and airport workers, the union’s latest ballot measure would extend this wage citywide². As an expert in retail real estate, here’s what that means for your properties. Higher wages will immediately impact tenant affordability and rent-to-sales ratio calculations that drive lease viability. Many retailers operate with payroll costs at 25 to 35 percent of gross revenue, leaving little cushion for a wage that’s nearly double the current state minimum of $16/hour³. When margins tighten, tenants face a choice: raise prices, cut staff, or negotiate rent. For landlords, that translates into valuation pressure because commercial property values depend on stable rental income. The small business impact in Los Angeles could be profound. Independent restaurants, boutiques, and service operators, the lifeblood of local shopping centers, run on razor-thin profits. If forced to meet a $30 wage, some may relocate to cities like Burbank or Glendale, where municipal wage laws are lower, or close entirely⁴. That shift could spark short-term vacancy spikes and longer lease-up periods. Still, there’s a possible upside. When low-wage workers earn more, they spend more locally. For well-positioned centers with necessity-based tenants: grocers, pharmacies, quick-service restaurants, rising wages could strengthen revenue resilience. Key takeaways for retail landlords: Audit tenant financial health and exposure to rising payroll costs. Review lease clauses that address operating-cost pass-throughs. Model new rent-to-sales thresholds under a $30 wage scenario. Track tenant retention and market-rent shifts across nearby cities. Prepare for valuation adjustments as cap rates reflect greater income volatility. If you own retail real estate in the City of Los Angeles, now’s the time to stress-test your portfolio. Let’s review your leases before this wage shift hits. Call or DM me for more information. When the $30 wage arrives, will higher pay strengthen LA’s consumer base or hollow out the city’s small-business retail core? #LosAngeles30MinimumWage #RetailRealEstateInLosAngeles #TenantAffordabilityAndRentToSalesRatio #SmallBusinessImpactLosAngeles #CommercialPropertyValuesLosAngeles

Weekly Perl: A Commercial Real Estate News Recap

By Marc Perlof • October 24, 2025
Toys"R"Us opening 10 flagships, 20 seasonal shops — here are all the locations The brick and mortar comeback of Toys"R"Us is moving into high gear ahead of the toy industry’s busiest season. In September, the retailer said that, in partnership with Go! Retail Group, it was planning to open 10 flagships and 20 seasonal holiday shops in the U.S. by year's end...

Own Property Near a Bus Stop? You May Be Sitting on a 40% Value Boost Overnight.

By Marc Perlof • October 20, 2025
If you own commercial real estate within California, here’s what just changed for you. In Los Angeles, properties near transit stations sold for 20–40% more than similar sites that were not near transit.⁴ Now that same price boost is coming to the entire state of California. As of October 10, 2025, SB 79 is now law. It increases the value of any commercial or retail property near a bus stop or train station, even small strip malls, gas stations, auto shops, and old buildings. This is not just another Sacramento update. SB 79 does not “suggest” upzoning, it forces cities to allow more housing near transit, even if they don’t like it. What Makes SB 79 Different? Most zoning rules let cities say “yes or no.” SB 79 removes the “no.” It creates a guaranteed building minimum that every city must follow. It’s not a limit, it’s a baseline. Cities can allow more, but not less. Why Property Owners Win Developers pay more when they know exactly what they are allowed to build. Before SB 79: land value was based on city politics. After SB 79: land value is based on state law. That means your old commercial building can now be worth more, not just for income today, but for building potential tomorrow. SB 79 — Guaranteed Building Rights Near Transit If your property is within ½ mile of a major bus or rail stop, the state now gives you automatic building rights, even if the local zoning says otherwise.⁵ Why This Matters Cities can add rules, but they cannot block SB 79’s minimums.¹ Your strip mall or auto shop could be a “rent now, build later” goldmine.² Developers will bid based on future building rights, not just today’s cap rate. If you own a strip mall, office, auto shop, warehouse, or storefront near transit, you now have state-backed development power. Want to Know Your New SB 79 Value? Do you want to sell your property as “Just another tenant building…” or “State-approved development site with income attached”? Call or DM me for your SB 79 Land Value Review. The law is signed. Timing matters. Do you capture the premium now, or let somebody else flip your SB 79 dirt? #SB79 #RetailRealEstate #TransitOrientedDevelopment #CaliforniaHousingBill #LandValueBoost
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