Vacancies Rise at Retail Centers

Wall Street Journal (07/07/08) P. A3; Hudson, Kris; Timiraos, Nick
Reis Inc. reports that the nation's weakening economy hit shopping malls and retail centers hard in the second quarter, with vacancies at retail properties climbing to multiyear highs and the International Council of Shopping Centers projecting that 6,500 stores will shut this year. According to Reis' research, vacancies at enclosed malls in 76 major U.S. markets increased to 6.3 percent in the April-through-June period from 5.9 percent in the first three months of the year--the highest level since early 2002. Faring even worse were such open-air retail properties as big-box centers and grocery-anchored strip centers, which saw their vacancy rate increase to 8.2 percent from 7.7 percent--the highest total since 1995. Looking at the nation's multifamily housing stock, Reis reports that apartment vacancies were unchanged in the second quarter as rents rose by a stronger-than-expected 1.1 percent.