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The Newsroom - 2010 |
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Retailers adjusting to local consumer-buying patterns
April 16, 2010 -
The slowdown in
consumer spending that has driven up retail vacancy rates and brought down rents
may also be the remedy for that sector improving, according to a local research
firm.
Leases from retailers such as Kohl’s and other discounters show that they are
positioning themselves to take advantage of shifting consumer-buying patterns
that focus on value and need, said Jake Joyce, project manager with Applied
Analysis.
“Similarly situated retailers will likely continue absorbing second-generation
space and lead the retail sector into an extended period of recovery,” Joyce
said.
Southern Nevada’s retail market showed minor improvement in the first quarter,
but continued to suffer from rising vacancy rates, said John Stater, research
manager for Colliers International Las Vegas.
This month, brokerage CB Richard Ellis said the retail market is starting to
rebound by having a declining vacancy rate.
But by Collier’s account, the vacancy rate has risen to 9.3 percent, up from 7.1
percent at the end of first quarter 2009.
Because of that, average monthly lease rates requested by landlords fell to
$1.72 per square foot, down from $1.83 at the end of fourth quarter 2009.
The good news was that no new anchored-retail space was added in the first
quarter, Colliers reported.
Applied Analysis reported the vacancy rate in the first quarter edged up
slightly to 10.5 percent from 10.2 percent at the end of fourth quarter 2009. By
its calculations, more retail tenants moved out of space than moved into space,
and the vacancy rate will remain high for a lengthy period.
Applied Analysis said the highest vacancy rate was in neighborhood shopping
centers at 13.3 percent.
Little retail construction is taking place, with one of the few such projects
being Caroline’s Court at U.S. 95 and Durango Road in the northwest valley. The
center anchored by Lowe’s measures 258,000 square feet and is expected to open
in the summer.
Tivoli Village is also under construction. The mixed-use project at Alta Drive
and Rampart Boulevard that contains retail and office will have 450,000 square
feet in its first phase expected to open by Christmas. |
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Applied Analysis provides professional services in urban
economics, market analysis, financial advisory services,
information technology and hospitality/gaming consulting
services.
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Reliable data is the foundation of any solid analysis.
We are the market leader in information and research. We
track economic, development and fiscal trends, and
publish the area's most comprehensive office, industrial
and retail market survey.
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Applied Analysis has a broad client base, including both
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In Business Las Vegas
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Applied Analysis
reported North Las Vegas had the highest vacancy rate at 12
percent in the first quarter. That was followed by 11.6 percent in Henderson,
11.3 percent in Las Vegas and 7.8 percent in unincorporated Clark County.
North Las Vegas, which has had a lot of new construction in the last two years,
had the highest asking rents at $1.87 per square foot per month.
That was followed by $1.74 in Las Vegas, $1.72 in Henderson and $1.65 in
unincorporated Clark County.
Colliers reported that the average lease term for retail space in 2009 in Las
Vegas was 68 months.
About 62 percent of the retail leases signed in 2009 were with local retailers
followed by 22 percent with national retailers and 17 percent with regional
retailers.
The most active leases were for grocery stores, furniture stores, education and
social services, food services and salons and spas.
Colliers reported there are 77 retail units available for lease that are 10,000
square feet or larger, 23 more spaces than were available a year ago. The
largest of those spaces was anchor space at the Great Indoors at Boca Park at
139,000 square feet. The indoor swap-meet space at Charleston Plaza mall
measures 106,000 square feet, and the former Albertsons at Renaissance Center
East measures 62,000 square feet.
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Author: B. Wargo, In Business Las Vegas
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