The Q2 reports for commercial real estate retail did not show much deviation from the Q1 reports. This was mainly due to limited construction starts and deliveries, resulting in consistently low vacancy rates and subdued absorption.
However, there was a slight increase in absorption during the second quarter, primarily driven by a decrease in move-outs and space taken up by community centers, lifestyle centers, and Class C malls. Despite this improvement compared to the previous quarter, supply constraints continued to impact overall absorption rates. According to Cushman & Wakefield’s U.S. National MarketBeat Shopping Center Q2 2024 report , “Absorption is on track for a lackluster year.” The national vacancy rate remained stable due to rising demand from tenants as well as fewer bankruptcies and limited new supply.
In terms of leasing activity during Q2 2024, Lee & Associates’ Market Report (retail) noted growth primarily driven by food-and-beverage retailers along with discount stores, health/beauty retailers,and experiential concepts. However,the focus has been on smaller spaces of 2
