Seattle-Tacoma Retail Investment Forecast
Robust Population and Employment Growth Bolster Investor and Retailer Confidence in the Puget Sound
Availability nears historic low. Entering this year, vacancy in Seattle-Tacoma was the lowest among all major metros in the United States, and market conditions will continue to improve. Seattle's diverse economy is encouraging robust in-migration to the region, with the metro's population expected to increase by over 48,000 residents in 2022. Furthermore, job growth will outpace the national average this year, lifting total employment above the metro's pre-pandemic peak, and the median household income beyond $95,000 per year. The boost in discretionary earnings, coupled with an expanding consumer base, will likely elevate retail sales, encouraging vendor expansions, which, in turn, will amplify demand for available space. Many of these businesses will browse the metro's limited stock of vacant floor plans, as nearly 90 percent of deliveries slated for this year are pre-leased. Improved space demand and limited supply pressure will stimulate rent growth throughout the year, while preserving tight availability. Metrowide vacancy is expected to fall within 10 basis points of Seattle's 15-year low by the end of 2022.