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Market Report

Milwaukee Retail Investment Forecast

2022 Outlook

Racine and Washington Counties Pilot Retail Rebound;
Lingering Headwinds Downtown Will Soon Fade

Leisurely development pace funnels tenants to existing properties. Builders in Milwaukee will finalize fewer than 200,000 square feet for the third straight year in 2022, with stock expanding by just 0.4 percent since the start of 2020. By comparison, inventory grew by an average of 1.3 percent per year from 2015-2019. This drastic slowdown stopped availability from rising too extensively during the pinnacle of pandemic-induced lockdowns. Minimal construction is also accelerating vacancy compression as the recovery progresses, with tenants backfilling vacated spaces amid a lack of new floorplans to choose from. This has been most evident in Racine and Washington counties. Vacancy is down at least 90 basis points relative to each submarket's 2020 peak, and average asking rents jumped more than 10 percent relative to both counties' pandemic-era lows. On the other end of the spectrum, marketed rents plummeted downtown amid rising availability. This should, nevertheless, be a short-term setback for the area, as a broader return to offices will likely replenish foot traffic and tenant demand. Longer term, new hotels near the Deer District and revitalization projects, like the Harbor District, present tailwinds.

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