PHOENIX-Marcus & Millichap Real Estate Investment Services‘ Retail Research Market Overview for Q2 2013 shows a fairly optimistic and sunny outlook for the economy, consisting of continued job growth, a recovering housing market and increasing income. As such, the report forecasts growing demand in the retail sector for the remainder of 2013. Specifically, a potential 3.5% increase in employment for 2013 combined with scant retail product being delivered to market will likely lead to what the report calls a “retail property revival.”
- By year-end, it’s anticipated that 63,000 new jobs will be added to the region, followed by the 48,900 jobs created in 2012.
- Retail construction completions will increase by 0.5% in 2013, with the completion of 447,000 square feet (an increase of 333,000 square feet).
- Vacancy at the end of Q1 was 15.4%, a 160 basis point drop from the same time last year. Retailer expansions along with constrained supply means a further 120 basis-point drop is anticipated for the remainder of the year.
- Asking rents are anticipated to increase 1.3% to $13.55. In 2012, asking rents declined by 3.3%.