SA retail market continues to grow

​​​SAN ANTONIO – ​The
strong second quarter performance featured an impressive 542,735 sf of positive
net absorption, according to the survey of more than 47 million sf of retail lease
space by the REOC San Antonio and the Xceligent Retail
Advisory Board.

At the close of the second quarter, the citywide retail market vacancy rate tightened to 7.8 percent compared with 9.2 percent last quarter and 10.0 percent recorded in the same quarter a year ago. 

“The
retail market vacancy rate is expected to remain at sub-ten-percent levels through the end of
the year based on the limited number of new projects under construction and healthy demand
for space by retailers and restaurants,” says Kimberly Gatley, senior vice president and
director of research for REOC San Antonio and member of the Xceligent Retail Advisory
Board. 

Less than 125,000 sf of retail lease space is currently under construction throughout the area. 

Although the citywide average rent stepped
backwards $0.31 in the second quarter, the current rate of $16.01 is up $0.75 or 4.9 percent compared with this time last year. Asking rents for top-tier
shop space can reach into the $40s. New construction typically ranges between the mid-$20s to the mid-$30s.

The local retail
market will benefit from the projected 3.4 percent increase in retail sales, forecasted by the National
Retail Federation. In addition, the local economy will continue to attract and support
expanding retailers and restaurants with steady population growth and a strong housing
market. ​​