What the future holds for restaurants and other businesses in Baton Rouge’s retail sector

Heading into 2020, Baton Rouge’s retail sector looked promising, with vacancy rates slightly down over 2019, rental rates significantly up and most experts predicting a strong, though not necessarily banner, year.

When the coronavirus pandemic forced the shutdown of the economy for eight weeks in mid-spring, however, the retail sector—including bars, restaurants, and gyms—were among the hardest hit. How they will recover in the months to come and what it means for their landlords is, at this point, anyone’s guess.

“I hope I wake up next year at this time and it’s all just a bad memory,” says Mark Hebert of Kurz and Hebert Commercial Real Estate. “Let’s just pray by next year it’s all a bad memory.”

Depending on whose predictions you believe and what network news you watch, the downturn and the pandemic might be over by then. But there are plenty of reasons to think it might not be.

In the meantime, landlords are trying to figure out what to do with tenants that are bringing in just a fraction of the business they were last year at this time, if they’ve reopened at all.

“Everybody is looking for relief,” says Donnie Jarreau, who manages 3 million square feet of commercial real estate. “Everybody’s having trouble except the discount chains, the dollar stores.”

What a difference a few months makes. Before the crisis, vacancy rates in the market’s retail centers were averaging about 9.09% compared to 9.33% the year before.

In addition, rental rates for non-anchor space were averaging some $19.60 per square foot, a 10% increase over 2019’s $17.90 and the highest level of the past five years.

Read on for the rest of the story, which appeared in the June issue of Business Report.