Tuesday, April 23, 2013

Rents Rise in US Shopping Centers as Vacancy Rate Falls

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Link to article:
U.S. Shopping-Center Rents Climb As Less Space is Added

After the economic slowdown in 2008, construction of new shopping centers slowed in the US.  Now the result is that the fewer vacancies in exxisting centers has allowed owners to raise rents for the scarce spaces. Regional malls saw vacant space fall to 8.3 percent in 2013's first quarter, down from 9 a year earlier.

Excerpt: "'It’s a slow but consistent recovery,' Ryan Severino, a Reis senior economist, said in a telephone interview. 'There’s nothing being built, so as long as there’s any semblance of demand, it’s pushing vacancies down slightly and rents up slightly.'

Retail landlords are benefiting from a slowly improving labor market and little competition from new shopping centers. The jobless rate dropped to 7.7 percent in February, the lowest since December 2008, from 7.9 percent the previous month, the Labor Department said. In the first quarter, 873,000 square feet (81,000 square meters) of new shopping centers became available, down 57 percent from a year earlier, according to Reis.

Occupied shopping-center space rose by a net 2.73 million square feet in the third quarter, compared with 2.68 million square feet in the previous three months and 3.51 million square feet a year earlier, Reis said."

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