Why Retail Hasn’t Benefitted From the Recovery
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While the recovery has benefitted most property types, retail seems to be lagging behind. There has been some improvement for landlords, with rent growth up slightly and vacancy rates holding steady. But overall activity remains sluggish. Reis released its latest retail market report on Tuesday and tried to address what’s holding back the market. As Reis senior economist Ryan Severino explained, a changing retail landscape has been a large factor. While e-commerce continues to impact brick-and-mortar locations, the bigger challenge may lie in the rise of different retail subtypes over the past two decades. Demand has shifted from larger malls, neighborhood and community centers to "lifestyle centers" and outlets centers. Severino also cited the lack of income growth as a continuing problem for underperforming malls. [MHN]