Retail’s next chapter is being written not just by where stores are located, but by how well retail formats match the shifting rhythms of consumer life. Across the country, the strongest rent growth isn’t always found on the storied high streets of major cities, but increasingly in dense suburban corridors and live-work-play districts where convenience, walkability, and a blend of uses draw steady foot traffic. While high-street retail in top-tier cities like Los Angeles and Miami continues to command premium rents, these gains are uneven, and elevated availability rates reveal that even the most prestigious addresses are not immune to the aftershocks of hybrid work and changing tourism patterns.
CBRE’s 2025 Retail Rent Dynamics report reveals that high-street retail remains the most expensive among all retail formats, with Los Angeles standing out as the market where high-street rents are more than triple those of suburban locations. Yet, this premium comes with a significant catch: high-street districts in most major cities are experiencing higher availability rates than their suburban counterparts, a lingering effect of pandemic-driven shifts in work and tourism.
In New York City, for example, the gap between high-street and suburban availability reached 15.36 percentage points, while Washington, D.C. saw a 10.66-point difference. Only Dallas and Denver buck this trend, with suburban availability surpassing that of high streets due to rapid construction and evolving demand.
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Dense suburban retail districts have not only matched but often exceeded high-street rent growth in recent years. In cities like New York, Boston, and Denver, suburban rent growth has outpaced downtown high streets. New York’s dense suburbs grew at 2.1% compared to just 0.7% for downtown, and similar trends play out in Boston and Denver. This momentum is fueled by population shifts, consistent demand for residential properties, and the appeal of service-oriented retail closer to where people live and work.
The rise of live-work-play (LWP) districts has become a defining feature of the current retail landscape. These districts, which blend residential, office, and entertainment uses, are outperforming both high-street and broader mixed-use areas. The highest live-work-play district rents are seen in New York at $91.40 per square foot, followed by Boston at $47.33 and Washington, D.C. at $46.21.
These thriving districts benefit from dense populations, strong employment and ongoing residential development. All of which create lifestyle destinations that resonate with today’s consumers. However, performance varies by market. San Francisco, for instance, sees LWP rents at a relatively low $27.80 per square foot, reflecting the diversity of asset types and performance levels within mixed-use inventory.
Despite these shifts, the supply of new retail space remains tight. High capital costs have slowed new development, and overall availability is expected to remain limited through 2025. This constraint is likely to keep asking rents elevated, especially in prime locations. Retailers are responding by aggressively competing for well-located space and locking in longer leases to hedge against future supply disruptions.
Consumer behavior is also reshaping the retail landscape. Economic uncertainty and inflation have made shoppers more budget-conscious, increasing demand for grocery-anchored centers and essential goods. The ongoing rise of e-commerce is prompting retailers to consolidate locations and favor open-air centers, which better support online order pickups and returns.
Even as foot traffic patterns evolve, high-street retail has demonstrated remarkable resilience. Since the second quarter of 2021, high-street rent growth has outperformed the broader market, with a compound annual growth rate of 3% compared to 2.1% for the overall sector. The rent spread between high streets and the broader market reached $38.90 per square foot in mid-2024, the highest since 2016, underscoring the enduring appeal of premier shopping corridors.
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