According to the New York City-based research firm Reis Inc., around 34 million square feet of new retail supply will hit the market between 2014 and 2017. An improved outlook for wage growth and discretionary spending will increase the demand for retail space with predictions that 2016 may be brighter than any point since before the recession for the retail market.
Reis also predicts the retail vacancy rate will decrease slowly reaching a low of 9% by the end of 2017. Even with suppressed construction activity, the retail rate will likely remain elevated above pre-recession levels over the next few years.
Reis projects that large Texas markets including Houston and Dallas will lead the way in terms of completions through 2017. Other markets forecasted to do well include Chicago, Philadelphia and Atlanta.
As for the inventory growth rate, the top five markets include:
- Louisville, Ky.
- Austin, Texas
- Charlotte, N.C.
- Kansas City, Mo.
- Knoxville, Tenn.
(more projections for retail construction industry growth through 2017...)
