Retail Fundamentals Continue to Improve in Q3

Executive Summary

• Demand for retail space increased in Q3, with net absorption up by 34% quarter-over-quarter.
• The overall retail availability rate fell to at least an 18-year low. The neighborhood, community & strip center segment had the biggest year-over-year decrease in availability of 50 basis points (bps).
• Total construction completions remained low in Q3, as high construction costs and tight lending conditions made development less feasible.
• Asking rent growth moderated on a quarter-over-quarter and a year-over-year basis, suggesting that landlords believe demand could ease in coming quarters as the U.S. economy slows.