The imminent arrival of Target at Storke Plaza has cemented the retail area south of Hollister Avenue at Storke Road as Goleta’s primary destination for retailers, according to Hayes Commercial Group.
“In Goleta, the big story is Kmart’s closing in October, to be replaced by Target following upgrades to the center,” according to Hayes Commercial Group’s Q2 report. “This change will further establish the Hollister and Storke area as the center of gravity for Goleta retail.”
The report noted that there is four times more retail space available east of the airport than west of the airport toward Storke Road.
The Calle Real Center “has been struggling to attract and retain tenants,” the June 28 report states. “Despite two leases completed this year, there remain seven spaces currently available comprising 18 percent of the property.”
However, Craig Zimmerman, president of the Towbes Group, which owns the shopping center, said that the shopping center is in a much better place today than it was six months ago.
“Clearly retail has struggled against e-commerce,” Zimmerman said. “But what we are seeing is a pickup in Calle Real.”
The center’s two largest vacancies are the former Outback Restaurant and El Pollo Loco, on the north side of the center. Zimmerman said Towbes has deals in place for both buildings that will be announced soon.
The arrival of Target in the former Kmart building is going to “further cement the different paths of the two shopping centers” in Goleta, he added.
Zimmerman said local entrepreneurs are interested in Calle Real, while the big box retail brands are targeting the Camino Real Marketplace and Storke Plaza.
Calle Real has a good mix of unique food offerings, exercise studios and medical facilities, he said.
Zimmerman acknowledged “a big shakeout” in both shopping areas, and said the Target will help all nearby retail.
“Target is going to be a good thing for Goleta retail overall, with the only caveat being the ability of the area to handle the increased traffic impacts,” he said.
According to the Hayes report, landlords are asking a 42-percent premium per square foot west of the airport, compared to the eastern part of the city. Still, the report states, Goleta’s retail vacancy rate is only 1.9 percent, compared to the national average of 10.2 percent.
The retail vacancy rate for Santa Barbara’s State Street, between the 600 and 900 blocks, is 11 percent, according to the Hayes report.
Goleta became a city in 2002 when voters chose to incorporate.
Goleta has experienced a rush of housing development in the past half-decade that has pleased many developers and business leaders, but the new apartments and homes have some longtime locals fuming over traffic impacts, particularly at the corner of Storke and Hollister.
For decades, Goleta’s primary shopping areas were the Calle Real Center, Old Town Goleta and Storke Plaza. However, new housing development on the western end of Goleta has attracted a wide variety of big retailers.
Goleta is a city in its retail adolescence, but the arrival of Target in 2019 will launch the community of 30,000 people into civic adulthood.
Mark Ingalls, property manager for the Camino Real Marketplace, said the complex is “the south coast’s primary regional shopping center” partly because it hosts national anchors such as Costco, Home Depot, Best Buy, and soon-to-open Home Goods.
“We offer unique shopping options for South Coast residents which are not otherwise available within a 50-mile radius,” Ingalls said. “The heart of western Goleta also provides the perfect home for the Camino Real Marketplace, due to both its proximity to UCSB and access to employees and residents of Goleta.”
The Camino Real Shopping Center, Ingalls said, is different from the Calle Real shopping center because it serves as a community hub.
“In addition to hosting national tenant anchors, Camino Real functions as a gathering place for Goleta residents and visitors alike,” Ingalls said. “Patrons who visit the marketplace can enjoy the variety of local and unique restaurant options, retail services, and entertainment.
“The shopping center hosts a movie theater, and also supports local community recreational activities, such as Ice in Paradise, and Girsh Park.
Camino Real Marketplace sits in the center of the bulk of the development that has taken place in Goleta within the last 10 years.
Ingalls also welcomes Target to Goleta, along with the anticipated improvements to the Storke Plaza shopping center.
“These additions will largely complement western Goleta’s existing retail landscape, and will enable patrons to more easily combine shopping trips,” Ingalls said.
Overall, Goleta is poised to grow, as Santa Barbara struggles with retail downtown.
“Goleta’s retail climate offers an alternative to Santa Barbara’s downtown shopping experience,” Ingalls said, noting Goleta’s plethora of free parking. “The variety of centrally located shopping options and services, as well as the abundance of great restaurants, provides Goleta with an advantage in competing for both south coast retail sales and sales tax revenue.
“We continue to remain optimistic about Goleta’s position in retail on the South Coast.”
Goleta Mayor Paula Perotte said she is excited see the growth of retail at Storke and Hollister.
“I expect that it will supplement and complement the wide range of shopping options for Goleta residents and visitors, while providing many economic benefits,” Perotte said. “At the same time, I’m committed to staying vigilant about mitigating traffic and other impacts that many are concerned about in this busy corridor.”