Retail Healthy Despite Sluggish Hiring
Hiring may still be sluggish, even with the recession far in our rearview mirror, but don't tell that to retail real estate. According to the latest numbers, Phoenix retail landlords saw continued strong absorption of 395k SF during Q2 and lower vacancies with such deals as Floor & Decor at Camelback Colonnade (here) and LA Fitness. Colliers' Bob Mulhern and Pete O'Neil tell us there's also a dwindling supply of distressed retail in Phoenix, with prices rising for what's left, causing buyers to seek leverage for their buys.
And Bob (left, with Pete) says that development should remain in check. “Population growth and new home construction would need to accelerate significantly before retail construction gains significant momentum,” he says. He says the slump in local hiring is somewhat disconcerting, though, particularly because it's running counter to the national trend. If the slowdown drags on, it will ultimately carry over into the retail market, he says.