• June 25, 2024

Mall Vacancy Rate In US At 9%, More To Closures On The Way

In last few months, several stores of Sears, J. C. Penney, and Bon-Ton have been rapidly closing down. Owners of shopping centers and malls although seemed indifferent to the situation, they would certainly take notice when more of them get closed in the course of 2019.

The rate of vacancy in different regions in the last 4 months of 2018 was 9%. In the 3rd quarter of 2018, the rate had gone its highest, reaching 9.1%. But the rate is indeed more than 8.3%, which was towards the end of 2017. In spite of a large number of stores getting closed, the least alterations in vacancy rates clearly portray that retail sector has tolerated the latest changes in the industry. Senior economist at Reis, Barbara Denham said many had predicted the vacancy rate would swell up following which rents would come down at a rapid pace. But, nothing of the sort has happened.

In 2018, companies were about to shut down over 145 million square feet of shopping places throughout US. The figure is more than the one declared in 2017, which was 102 million. As 2019 has approached, Denham has reported both big and small retailers would close many stores in different locations. This has been declared after the end of the festive season. In the very first quarter of 2019, it is easier for companies to realize their current state and decide accordingly.

The vacancy rates should however be stable in 2019, and rents would be increased a bit but stay below the rate of inflation. Companies such as Express, Gap and L Brands owned by Victoria’s Secret has announced of more store closures. Reis have informed that the mall rate on an average has risen by 0.2% in the last quarter after a drop of 0.3% in the quarter prior to that.

Leave a Reply

Your email address will not be published.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