Fast food and retail chains are performing strong in the Southeast's net lease sector.

MIAMI—Orlando's steady economic growth has supported both new residential and office development in the suburbs, providing areas for retailers to expand. In Orlando's core, as well in the communities of Ocoee, Clermont, Windermere and Winter Garden, work is progressing on thousands of new residences, according to Marcus & Millichap's latest retail report.

Though many of these areas are already densely populated, Downtown Orlando and other active submarkets are attracting more retailers, entertainment options and service providers to traditional retail space, the firm reports. This, M&M says, has sparked additional tenant and investor demand for value-add assets within or near the market's growing areas.

“The Central Florida retail market is currently experiencing an upturn, but it's nothing like the upturns we've seen in the past when the market was driven by big box retailers,” James Mitchell, senior vice president at CBRE, tells GlobeSt.com “We are seeing a flight to smaller retailers leading new developments, especially in high-growth residential trade areas that are leading the country in housing statistics.”

(Here are two questions landlords need to ask before leasing to new retail tenants.)

Mitchell reports the demand for spaces in infill areas like Lake Nona on the east side and Hamlin on the west side is extremely high. There are still spaces available, he says, but they're filling up fast and rents are among the highest in Central Florida.

“We're also seeing a trend towards new-to-market retailers that want to be the first of their concept type to occupy the highest profile space in these submarkets,” Mitchell says. “Emerging concepts from other parts of the country find Florida very attractive and are on the hunt in the Orlando area, which is very attractive due to its growing population and thriving tourism industry.”

(Find out why some retailers are thriving despite Amazon's growing influence.)

(Here are two questions landlords need to ask before leasing to new retail tenants.)

(Find out why some retailers are thriving despite Amazon's growing influence.)

Instant Insights /

Four Submarkets Seeing Retail Benefits From Rising Residential

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