Retail Performance Gap Widens
population growth and consumer purchasing power in the U.S. continues to
increase the retail sector’s performance gap, according to Jones Lang LaSalle’s
Summer Retail Outlook.
centers that are well-tenanted and ideally-located are seeing vacancy rates
near 4 percent, and we expect them to see further improvements,” said Greg
Maloney, president and chief executive officer of Jones Lang LaSalle
Retail. “However, underperforming centers that can’t sustain the needed sales volumes
to remain competitive due to their surrounding demographic may continue to
trend downward, and require eventual demolition, rebranding or a conversion.”
overall consumer confidence dipped during the past year, an uptick occurred
this summer due to rising stock and housing values and declining gas prices and
debt levels, according to the report. As the year progresses, consumers are
once again expected to yield to increasing unemployment rates and slow income
16.9 million square feet of development in the pipeline, new retail supply has
dropped to the lowest level in a decade. New supply is primarily “big-box
single-tenant stores anchored by discount retailers,” according to the report.
restrained supply and ongoing store closings have kept absorption flat in 1H13.
Major markets including Atlanta, Dallas, Seattle, and South Florida’s Palm
Beach County saw the largest year-over-year vacancy declines in the country.
“The retail market is making strides toward improvement, but there are
still major hurdles to overcome before we see complete restoration,” Maloney