Vail Valley commercial real estate market remains steady
Despite uncertainty, deals are being done, including the sale of Gypsum's Tower Center
Commercial and residential real estate are very different things, particularly when it comes to number of transactions and their value. But like residential sales, the local commercial real estate market seems solid.
As the name implies, NAI Mountain Commercial specializes in commercial sales and leasing in the valley.
The market is “kind of all over the place,” NAI Vice President Erich Schmidt said.
“Over the last 60 days, anything we had under contract (prior to the COVID-19 outbreak) and with financing arranged, closed,” Schmidt said.
But, he added, a few deals have been pushed back, but have either closed, or are expected to.
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One of those deals was for Tower Center in Gypsum. That property is 74 acres just east of the Stratton Flats neighborhood. The town of Gypsum in 2007 zoned the property for retail space, including a possible big box retailer.
The original plan never came to fruition, and the retail landscape has seen significant changes in the intervening years — new big physical retail space is rare today.
Still, the undisclosed buyer paid just more than the $2.5 million asking price.
Schmidt said that “out of market” developer has definite plans for the property.
“I’m excited to see what they do,” he said.
While that big deal has closed, Schmidt said “there’s a lot of uncertainty” in the commercial market. Still, he added, the Eagle River Valley is “landlocked,” with little available private land. Any vacant land with development potential draws interest.
“People are making bets that we’ll see more migration from metro areas into areas like ours,” he said.
But existing retail space is quiet at the moment, thanks to the virtual shutdown of the valley’s economy in mid-March, Schmidt said. But, he added, landlords in general have been “helpful” in working out deals with tenants.
“No matter what business you’re in, you can project revenues down 10%, 20% or 30%, but no one projects zero revenue,” he said.
Landlords and tenants have both been calling about working to help people with lease payments.
The Vail Town Council is also considering a plan to help landlords and tenants keep their lights on. The council at its June 2 meeting is expected to continue discussions on what that plan might look like.
Help for small business, whether it’s rent relief or towns deferring sales tax payments, is crucial going forward, Schmidt said.
“It’s in everybody’s interest not to have dark (retail) spaces,” Schmidt said. At this point, “Everybody’s coming together to try to work things out,” he added.
Vail Daily Business Editor Scott Miller can be reached at firstname.lastname@example.org.