Strong consumer confidence and fundamentals, but still many hurdles ahead for retail

As of the close of the second quarter of 2018, shopping center vacancy in the United States stood at 6.6 percent, according to Cushman & Wakefield.

This reflects no change from the previous quarter but does obscure a number of trends that are playing out in the shopping center world. Over the course of the second quarter, the market recorded just under 4.3 million square feet of occupancy growth — about half of what has been typical in the post-recession era. Since 2010, the U.S. shopping center market has averaged approximately 8.8 million square feet of positive net absorption quarterly.

Despite the strongest economic indicators since the Great Recession and consumer confidence near an 18-year high, the retail marketplace will continue to face challenges in the near term, according to Cushman & Wakefield. The reality is that consolidation will continue for a number of key retail categories: apparel, bookstores, consumer electronics, department stores, office supplies, and gifts and specialty stores.

Download this quarter’s U.S. Shopping Center MarketBeat report to learn more about these impacts and what’s up next for retail as we move further into 2018.