Swelling Enrollment Turns Schools into Welcome Retail Tenants in the Southeast
Sep 29, 2009 11:49 AM, By Mike Janssen
Ledbetter and Shorter administrators confirmed that the school is also weighing whether to move its business school into another Ledbetter retail property in Rome, but would not share additional details as the deal remains unresolved. That move could occur by early next year.
Back near Atlanta, in the affluent suburb of Sandy Springs, Gwinnett College has moved one of its three Georgia campuses into the Sandy Springs Crossing shopping center. There it occupies 11,000 square feet in a space previously rented out for parties and weddings, according to Michael Davis, Gwinnett’s president.
The Gwinnett campus was previously housed behind a shopping center in nearby Dunwoody. Gwinnett began seeking a new space when the launch of a massage program boosted enrollment from 280 to about 400. “There’s no doubt that when the economy is down, our business goes up,” Davis says.
The school found itself needing more classrooms and parking, and Davis was also not satisfied with its visibility. It was in a freestanding building behind a Kroger and other retailers, far from the nearest busy road and with no signage. “Nobody knew where we were,” he says. “Now we’ve got about 45,000 cars a day going by.” Finding adequate parking did pose a problem—Davis says Gwinnett looked at 20 locations that ultimately were unable to accommodate his students. At the Sandy Springs center, Gwinnett students park in spaces set aside for them, away from retailers.
In transition
The toll Florida’s glut of foreclosures has taken on retailers in the state has been well documented. Yet the prevalence of homes going for cut-rate prices has also given a boost to real estate companies, which have been taking on additional employees to handle the extra business.
This created an opportunity for Larson Educational Services, a school in Fort Myers specializing in licensing and continuing education for mortgage brokers, real estate agents and community association managers who run Florida’s multitude of gated communities. The family-run school opened its doors in November 2008 at Royal Palm Square, a mixed-use office and retail site undergoing a transitional phase.
“What really worked for us was finding a place that didn’t work for anybody else,” says Brad Larson, a co-owner and general manager of Larson Educational Services. The school had struggled to find a suitable and affordable space in Fort Myers. Although retailers were already showing reluctance to expand in Florida last fall, property owners were asking high prices—around $25 per square foot, Larson says. “The prices weren’t reflecting the vacancy rate,” he says, but landlords remained unwilling to cut a deal.
Larson also sought adequate parking—one lease fell apart because the property’s 250-space lot couldn’t handle the 40 or 50 students who would be attending the school at any given time. “Every single space we looked at—not a one of them has a tenant in them right now,” Larson says.
Then the school found Royal Palm Square. Its network of paths crisscrossing around fountains and palm trees made it an attractive destination for Fort Myers shoppers. But larger malls opened and began drawing away customers, and a new bridge cut off a main artery to the center, diminishing foot traffic. Royal Palm Square began to lose retailers, and rents fell.
Today, the property’s courtyards make it a less appropriate fit for most retailers, says Robin Mathews, vice president of asset management with Stavins and Axelrod Properties, which owns Royal Palm Square. But Larson doesn’t require the drive-by visibility that some retailers might seek.
Larson’s new two-classroom facility occupies a space made from three separate units, which included a clothing store and an administrative office. Because the school was short on cash when it moved into Royal Palm Square, it had most of the $55,000 it spent on building out the space rolled into its lease. Larson is paying $16 per square foot at the 3,600-square-foot location.
Brad Larson says the site is proving to suit the school’s needs. It is easy to access from nearby Cape Coral and other areas. And other vacant units nearby are boxlike spaces well-suited for additional classrooms. “There’s an opportunity to build a campus here,” he says.
Acceptable Use Policy blog comments powered by Disqus
