Several key fundamentals in Omaha, Nebraska’s retail sector have started to move in a less favorable direction as 2025 begins, yet overall market conditions remain stable.
A Colliers report finds that net absorption was negative at -13,700 square feet in the first quarter. That's a notable flip from the positive 189,200 square feet posted in the previous three months. The Sarpy East and Northwest submarkets struggled the most in this category for nearly -18,000 square feet.
Also, vacancy ticked up by 20 basis points in the first quarter from the previous three months to 5.7 percent. However, even with the spike, vacancy remains below six percent for the third consecutive quarter. It is considered low compared to the historical trends for retail in Omaha, according to Colliers.
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The elevated vacancy didn't stop asking lease rates from continuing to rise. The $15.69 per square foot NNN is a slight improvement from the $15.50 posted last quarter and a substantial increase of $1.62 from the third quarter of 2024.
"This combination of record-low vacancy rates and rising rents highlights the growing demand and competitive dynamics within Omaha’s retail market," Colliers said.
"Retail momentum across the Omaha metro continues to build, driven by strategic mixed-use developments, population growth, and rising demand for lifestyle-oriented amenities."
Currently, 305,000 square feet of product is under construction. A big contributor to this is the Maple 180 mixed-use development, which has more than 200,000 square feet underway.
Despite the mixed report, the demographic trends look strong, which bodes well for retail in the city. Recently, Omaha ranked as the number one hottest housing market by U.S. News & World Report and third in the country for office-to-residential conversions, according to Colliers.
"With major office developments nearing completion and steady demand for housing, the city is not just bouncing back, it’s gaining real momentum. A strong, stable workforce, a growing population, and a balanced economy continue to drive Omaha forward," the CRE firm wrote.
"As more companies invest in modern headquarters and more people choose Omaha for its affordability and quality of life, the metro is evolving into one of the Midwest’s most dynamic and well-rounded markets."
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