Barbara Denham, Senior Economist from Reis, comes on The Commercial Real Estate Show to discuss the retail property market, including performance, vacancy, and cap rate trends. Some highlights of this interview include:
- Starting to see a trickle in impact of store closures on retails property market
- Some declines in rents and increases in vacancy in some markets trickling in
- Overall rent grew on average in prior year while vacancies declined
- Restaurants are adding jobs while retailers cut
- Seeing an uptick in retail cap rates, 50 to 75 basis points, as investors become skittish about store closures and fear of a coming deluge
- Believes risk premium is bigger factor in recent uptick as opposed to rising interest rates
- Smaller markets are suffering the most
- Florida a bright spot
- Neighborhood and local strip centers
- Grocery anchored strip centers seem like solid assets, should do well
- Seeing growth in miscellaneous entertainment like trampoline parks, go-cart tracks, yoga studios