San Antonio Retail Investment Forecast
Improved Visitor Tally and New Residents in Northeast Suburbs Highlight 2022 Retail Investor Contemplations
Revival of traditional drivers, new tailwinds to help ease vacancy. From an economic standpoint, San Antonio is on solid ground entering this year, with a job count on par with the recording prior to the pandemic. Additionally, the metro's population will grow at a pace more than twice as fast as the national average in 2022. This expansion coincides with homebuilding activity in Comal and Guadalupe counties, where developers are building a cluster of subdivisions and multifamily communities. Consumer spending and leasing velocity in these counties are poised to strengthen as these new dwellings are filled and the inhabitants desire convenient shopping and services. Vacancy in the two submarkets also rests below the market average, so stronger demand should produce rent gains. Meanwhile, retail in the urban core is highly reliant on tourism, with destinations like the River Walk and the Alamo driving foot traffic to nearby shops. Hotel metrics indicate that tourism recovery is underway, as metro room occupancy during the second half of 2021 was only 240 basis points below the same six months in 2019. Positive economic trends and more visitors support the strongest retail absorption in six years during 2022.