Retail Preliminary Trends, Q2 2020

National Highlights

Net absorption in the retail market was negative 1.125 million square feet in the second quarter, the lowest since the second quarter of 2018; while new construction of 365,000 square feet was the lowest since the prior recession.

 

Retail: National Vacancy & Rent Trends

Source: Moody’s Analytics REIS

 

Statistics by Metro

In the retail sector, which includes neighborhood and community shopping centers, vacancy rate changes ranged from -0.6% (Little Rock) to +0.6% (Greenville). Most metros saw very little change in vacancy. That said, every metro posted an effective rent decline in the quarter led by Dayton (-1.1%) as well as Orlando, Ventura County, Austin, Fort Lauderdale, Sacramento, and three other metros that all had declines of 0.8%.

 

Conclusion

The lack of response in the retail sector was especially striking given that many retailers were already suffering from diverted e-commerce sales even before the coronavirus struck. While many retailers have reopened in the last month, many may not survive a second wave of the virus that has crippled economies in much of the south and west.

 

Note: Preliminary trends are subject to revision.
Copyright © 2020 Reis Inc.

 

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