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Retail rental projections bode well for 2016, reveals report

Healthy outlook in retail rental landscape.

February 23, 2016

Retail rent growth is expected this year given the national vacancy rate in the U.S. dipped to 5.9 percent in Q4 of 2015 and the pace of construction in 2015 is projected to stay on course.

The year 2015 saw 20 million square feet of net absorption, according to a CoStar report, though just 12 million square feet of new retail footprint came into play during the final quarter.

Current retail building trends include more urban mixed-use in cities including Miami, Honolulu and New York City as developers aren’t as focused on suburban-based new shopping centers.

There is 70 million square feet of new shopping center space being built, and it represents the most robust activity since the recession several years ago, according to Suzanne Mulvee, director of retail research at CoStar.

Healthy rent growth is expected in premiere retail districts but likely not be as strong as in past years.