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Special Report

Retail National Report

2Q 2024

Retail Retains Status as the Least Vacant Property Sector as Strong Fundamentals and Consumer Resiliency Help Brace Against Potential Headwinds

Greater foot traffic and easing inflation lift outlook. The retail sector was the only major commercial real estate property type to note vacancy compression over the yearlong period ending in March. Consumer resiliency is fueling steadfast tenant demand for space. Core retail sales rose 2.9 percent in the first five months of 2024 when compared to the same period of 2023. Over that span, restaurants, supermarkets, discount stores and fitness centers all noted 5 to 9 percent year-over-year gains in foot traffic. A strong labor market — 1.24 million jobs added over the first five months of 2024 — has aided households’ buying power, fueling the increases in spending and patronage. Should these trends continue, and inflationary pressures ease further from May’s three-year low annual core CPI rate, demand for space will be strong amid a period of limited construction.

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