New York City Vacancies at the largest U.S. retail centers rose to the highest level in at least a decade amid high unemployment and “inconsistent” consumer spending, according to Reis, the New York-based real estate research company.
"Until we see stabilization and recovery take root in both consumer spending and business spending and employment, we do not foresee a recovery in the retail property sector until late 2012 at the earliest," Victor Calanog, Reis director of research, told Reuters.
Vacancy rates at shopping malls in the top 77 U.S. markets rose to 8.9% in the January-to-March period, from 8.8% in the previous three months and 7.9% a year earlier. The rate was the highest since 2000, when based Reis began tracking the data.
Average landlords’ asking rents at shopping malls during the first quarter were $38.79 per square foot annually, down 3% from a year earlier. It was the sixth consecutive quarterly decline.
Vacancies at smaller neighborhood and strip centers rose to 10.8%, the highest since 1991, up from 9.5% a year earlier and 10.6% in the fourth quarter. Effective rents at such centers, which are often anchored by supermarkets, fell to $16.62 per square foot, down 3.4% a year earlier and 0.8% the fourth quarter.
Markets such as Las Vegas and the cities of Tampa, Orlando and Fort Lauderdale in Florida posted among the highest vacancy rates or greatest rent decreases.