Latest News

Reis: Regional Mall Vacancy Rate Decreased in Q1

Reis reported that the vacancy rate for regional malls was 11.0% in Q1 2022, down from 11.2% in Q4 2021, and down from 11.4% in Q1 2021. The regional mall vacancy rate peaked at 11.5% in Q2 2021.

For Neighborhood and Community malls (strip malls), the vacancy rate was 10.3% in Q1, unchanged from 10.3% in Q4, and down from 10.6% in Q1 2021. For strip malls, the vacancy rate peaked during the pandemic at 10.6% in both Q1 and Q2 2021.

Click on graph for larger image.

This graph shows the┬ástrip mall vacancy rate starting in 1980 (prior to 2000 the data is annual). The regional mall data starts in 2000. Back in the ’80s, there was overbuilding in the mall sector even as the vacancy rate was rising. This was due to the very loose commercial lending that led to the S&L crisis.

In the mid-’00s, mall investment picked up as mall builders followed the “roof tops” of the residential boom (more loose lending). This led to the vacancy rate moving higher even before the recession started. Then there was a sharp increase in the vacancy rate during the recession and financial crisis.

In the last several years, even prior to the pandemic, the regional mall vacancy rates increased significantly from an already elevated level.

Effective rents have been mostly unchanged for regional malls over the last 3 years, and flat for strip malls for 5+ years.

Mall vacancy data courtesy of Reis

What is your reaction?

Excited
0
Happy
0
In Love
0
Not Sure
0
Silly
0

You may also like

Leave a reply

Your email address will not be published. Required fields are marked *

More in:Latest News