Mall Vacancy Rate Hits 7-Year High
Third-quarter store closures at Sears and Bon-Ton (not including owner-occupied ones that also shuttered) pushed the mall vacancy rate to 9.1% from 8.6% last quarter, the largest quarterly increase since 2009 and a retreat from the low of 7.8% in the fourth quarter of 2016. The mall vacancy rate had earlier peaked at 9.4% in the third quarter of 2011, according to retail real estate research firm Reis. Average mall rents fell 0.3% in the quarter to $43.25 per square foot, the first decline since 2011, according to the report, which was emailed to Retail Dive. While growth had been sluggish over the last few quarters, it remained positive until now. Retail vacancy rate at neighborhood and community shopping centers stayed flat at 10.2%; rent growth is 0.4%. A ‘clear turnaround” is demonstrated in the positive net absorption of 2.29 million square feet in the period, down from the 3.76 million square feet in the second quarter from numerous Toys ‘R’ Us and Babies ‘R’ Us store closings. Construction of 2.28 million square feet was the highest level in three quarters. Read more at Retail Dive.
