Weekly Retail Real Estate News

Marc Perlof • July 28, 2023
Third Street Promenade in Southern California Works to Get Its Mojo Back


In the world of retail, the mantra for success is location, location, location. But that formula hasn’t been working too well for the Third Street Promenade, the breezy seaside pedestrian shopping mall in affluent Santa Monica, California, where a modest home sells for $1.6 million and the average annual household income is $158,000.


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Trader Joe's, Food 4 Less See Visits Increase YoY in California


With nearly 40 million residents, Placer.ai describes the Golden State as a “a high-value grocery market due to its robust visitation.” Since January 2023, year-over-year (YoY) grocery visits have consistently outperformed the national average. From January to June of this year, grocery visits in California have increased 3.1%, 4.5%, 4.2%, 2.3%, 0.1% and 3.8% YoY each month while the grocery sector nationwide has its ups-and-downs in terms of traffic.


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PacWest Bancorp Bought By Banc Of California, A CRE-Heavy Local Rival


Banc of California is swooping in to buy Beverly Hills-based PacWest Bancorp. Post-merger, the combined bank will have about $36B of assets — less than what PacWest alone had at the end of March, Bloomberg reported. It will also have $25.3B in total loans and $30.5B in total deposits, the companies said. Although the Banc of California was the smaller of the two institutions, the new entity will operate under the Banc of California name.

 

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Study: Sales of secondhand goods will hit $325 billion


New research indicates the market for secondhand merchandise is growing rapidly. According to the 2023 Reuse Report from online secondhand marketplace Mercari, the resale market is expected to grow by an estimated 87% to $325 billion by 2031 from $174.1 billion in 2022. Nearly nine in 10 surveyed U.S. consumers planning to shop secondhand in the coming year; and one in three surveyed Gen Z consumers expect to buy more secondhand items and spend more time on online resale platforms.

 

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New pop-up pickleball court coming to the Promenade


Only a blank canvas can be transformed into a work of art and that’s what’s happening on the Third Street Promenade, albeit quite slowly. The latest empty lot to be turned into something really rather interesting is the former site of the Adidas store, 1231 3rd Street (Adidas is now at 1337 3rd St). The 10,000 sq ft space is set to be reworked into an indoor pickleball club, complete with a bar and chill out areas.


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Ashley to ‘refresh’ all stores with new design


Ashley HomeStore has a new name. But that’s not all. The furniture and mattress retailer said it will refresh its stores nationwide to reflect its modernized look and feel. The refresh rollout comes after the company initiated a rebrand last year with a new logo and name change from Ashley HomeStore to Ashley.


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Firehouse Subs Believes Brand Will Resonate ‘Across the World’


If Mike Hancock was going to take an opportunity outside of Tim Hortons, it was going to have to be a rare one. The 6-foot-7 former defensive end, who played in the Canadian Football League with the Toronto Argonauts, had a first-row seat to the near-mythical nature of the coffee chain. There’s one for every 10,000 Canadians, and some 80 percent of residents reportedly visit Tim Hortons every month. That frequency is even higher than McDonald’s in the U.S., where CEO Chris Kempczinski previously suggested roughly 80 percent of the population shows up at least once each year.

 

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Where are online grocery shoppers going?

A new survey has some troubling data for digital grocery retailers. According to first quarter 2023 analysis of more than 58 million shopper baskets of actual purchase data across the U.S. and Europe from SymphonyAI, more than half (52%) of e-commerce grocery shoppers left the online channel over the last year. Further analysis of those lapsed customers reveals that while 60% are reverting to the retailer’s brick-and-mortar location, 40% have left that grocery retailer altogether.

 

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Retail sales inch up in June — but not in all categories


Retail sales edged up in June as consumers continued to shop. Retail sales in June inched up 0.4%  from May and were up 3.3% year-over-year, according to the National Retail Federation, whose calculation excludes automobile dealers, gasoline stations and restaurants to focus on core retail. In May, sales were also up 0.4% month-over-month and were up 4.4% year-over- year.


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Giant Company names president


Ahold Delhaize USA said that John Ruane has been named brand president of The Giant Company. He has served as interim president of the chain since the departure of Nick Bertram in September 2022.

Prior to being appointed interim president, Ruane served as senior VP and chief commercial officer for The Giant Company, leading the merchandising and marketing teams to develop and implement customer-centric strategies that support the continued growth of the brand, while also improving customers’ experience and the overall value proposition, the company said.


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Babies R Us makes a comeback — at American Dream


Just as BuyBuy Baby bid bye-bye to its stores, its longstanding and ardent competitor has itself been reborn.

Babies R Us — which was acquired by brand management firm WHP Global in 2021 —is back in brick-and-mortar, opening a location at American Dream,  the massive three million sq.-ft.-plus entertainment and retail center in the New Jersey Meadowlands.  At 10,000 sq.ft., the new Babies R Us store has a much smaller footprint than the brand inhabited in its previous life.


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By Marc Perlof September 12, 2025
Cherished Malibu Seafood Shack The Reel Inn May Rebuild After State Reversal  Malibu’s one-of-a-kind seafood spot, The Reel Inn, may once again serve its signature fish puns and fried and grilled platters on Pacific Coast Highway after the state reversed its earlier position that blocked the restaurant’s return, according to Eater LA...
By Marc Perlof September 8, 2025
Hey, Retail Real Estate Rockstars! The Big Beautiful Bill (H.R. 1) has completely changed the rules for State and Local Taxes (SALT), which is great news for any property owner who has ever cringed when they see their tax bill. For those of you investing in retail real estate, this is the kind of victory that calls for a double espresso and a fresh pro forma. We're talking about actual tax relief in 2025. Let's dissect it. What Just Happened? The SALT deduction cap, once stuck at $10,000 per household, has officially increased to $40,000 for joint filers and $20,000 for single filers — but only between 2025 and 2029. After that, it’s back to the old cap unless Congress re-ups¹. Important Clarification for Property Owners While the IRS frames the new SALT cap in terms of individual filers ($20,000 single / $40,000 joint), the impact depends on how your retail property is owned: LLCs, Partnerships, and S-Corporations (Pass-Throughs): Income, expenses, and property taxes flow through to the owners’ personal returns. The higher SALT cap allows greater deductions here, boosting post-tax cash flow for the individual owners. Trusts & Estates: Similar pass-through treatment, meaning beneficiaries or trustees may capture the benefit depending on structure. C-Corporations: The SALT cap generally doesn’t apply, since corporate taxes are calculated differently and deductions follow corporate rules. REITs (Public or Private): REITs have their own tax regime, but shareholders who receive pass-through income may benefit at the individual level. Direct Individual Ownership: If you hold the property in your own name, property taxes fall directly under the SALT deduction rules. If you live in a high-tax state like California, New York, or New Jersey, this means you can deduct a lot more of your state income, property, and local sales taxes on your federal returns. Why Retail Property Owners Should Care More Deductible Property Taxes You can lower your taxable income on your federal return by deducting a larger portion of your high property taxes on retail assets. Boosts Post-Tax Cash Flow Increased deductions = less tax paid = more cash in your pocket. Offsets Reassessment or NNN CAM Spikes With inflation and property tax reassessments squeezing margins, this SALT cap increase gives you some room to breathe¹. Attractive to High-Income Buyers New investors seeking tax efficiency may find your retail property more alluring if you offer larger deductions. Strategic Planning Window: 2025–2029 These changes expire after 2029, so use this window wisely — structure sales, 1031 exchanges, or renovations when you can best leverage the deduction bump¹. Real Data, Real Impact The original SALT cap from the 2017 Tax Cuts and Jobs Act was projected to cost Californians alone over $12 billion in lost deductions annually². Nearly 30% of households in high-cost areas maxed out the previous SALT deduction limit². What About NNN Leases? Here’s the twist: if your property is on a triple-net (NNN) lease, your tenants — not you — pay the property taxes. For Landlords: The SALT cap change doesn’t directly benefit you, since you aren’t the one writing the property tax check. For Tenants: They may be able to deduct more of those property taxes on their federal returns, depending on how their business or personal tax filings are structured¹. Smart Move: Share this info with your tenants. Suggested Subject Line for Tenant Email: “You May Benefit from New Tax Deduction Rules (H.R. 1)” A simple note saying, “The new federal tax law (H.R. 1) increased the SALT deduction cap for 2025–2029. Since you pay property taxes under your NNN lease, this may be relevant for your tax planning. Please confirm with your CPA.” That small gesture positions you as knowledgeable, supportive, and proactive — which builds goodwill and strengthens tenant relationships. If you’re considering a sale, refinance, or exchange between now and 2029, let’s talk strategy while this deduction window is wide open #RetailRealEstate #CommercialRealEstate #TaxStrategy #SALTdeduction #PropertyOwners
By Marc Perlof September 5, 2025
The Iconic Reel Inn Malibu To Say Goodbye After 36 Years Plans to resurrect The Reel Inn Malibu after the Palisades Fire have been shelved following a decision by the California Department of Parks and Recreation not to renew the restaurant’s lease, as reported by The Wall Street Journal. The move effectively closes a 36-year chapter for the 144-seat seafood shack on Pacific Coast Highway, long recognizable for surfboards on the walls, clever signage, chalkboard menus, and the relaxed Malibu customers...
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