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Market Report

Orlando Retail Investment Forecast

2022 Outlook

Vigorous Employment and Population Gains Bolster Retail Spending;
Vacancy Retreats to 15-Year Low

Demographic growth fuels retail demand. Orlando's retail fundamentals have fully recovered from the health crisis as robust in-migration and employment growth helped offset steep drops in foreign tourism. Retailers absorbed more than 1.4 million square feet of space in 2021, lowering metrowide vacancy to a 15-year low and lifting the average asking rent to a cyclical high. Several factors indicate the market will sustain this positive performance in 2022. Orlando's rate of employment growth is expected to lead the nation, with the local population slated to elevate by 52,000 residents. Additionally, international travel will likely increase as pentup demand is released. Favorable demographic trends and increased levels of tourism support a further rise in consumer spending, encouraging retailer expansions that will drive demand for available space. Although construction activity is expected to rise, the majority of the pipeline is pre-leased heading into this year. This will require space-seeking vendors to browse the metro's limited vacant stock, promoting additional vacancy compression and rent gains throughout this year.

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