Retail Top & Bottom Markets: Effective Rent Growth
Four out of the top five retail markets are a carryover from last quarter. Seattle, Orlando, and Miami are all actually in the exact same spots (the top 3) and Syracuse moved over one spot. While the top three markets had year-over-year growth rates ranging from 4-5%, the nation as a whole had a growth rate of a modest 1.6% year-over-year. This is the same national growth rate that we saw last quarter, and it is only slightly down from the 1.9% year-over-year growth rate we presented in 2018 Q1. This quarter is more of the same for the retail sector.
Furthermore, as the retail sector changes, subtypes such as freestanding restaurants and volume discount stores will perform very well while other more traditional subtypes may struggle. Lexington, as seen in the graph above, epitomizes this phenomenon. Although it is the bottom market on the chart with the worst overall growth rate (-3.4%), Lexington had some of the best-performing properties of the metros listed. At the same time, it also had some of the worst-performing properties, dragging down its average growth rate.