United States Retail Outlook Q3 2023
Limited supply a drag on leasing activity
- Keisha Virtue
- Grant Emery
- Saul Lua
- James Cook
- Ebere Anokute
Despite concerns over inflation and high-interest rates, retail sales continue to grow. However, leasing activity is constrained by the limited availability of desirable retail space, higher operating costs, labor shortage, and increased interest rates. Retail real estate is experiencing a significant shortage of available space, with the availability rate below historical averages. M&A transactions buoyed retail capital markets activity, while power center deliveries remained low, leading to low vacancy rates and steady rent gains. Overall, there is a shift in consumer spending towards experiences and the need for retailers to adapt to changing consumer behavior.
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