REOC San Antonio
Commercial Real Estate Since 1974   
Kim_Gatley
Kim Gatley
S
enior Vice President & Director of Research at REOC San Antonio

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REOC Releases 4Q 2015 Retail Market Report

Source REOC San Antonio/Xceligent

Source REOC San Antonio/Xceligent

The San Antonio retail market remained remarkably stable throughout 2015 and closed the year with a citywide vacancy rate of 9.3% which is unmoved from last quarter and down only 0.1 percentage points compared to year-end 2014. Neighborhood and Strip Centers continue to hold the highest vacancy rates citywide at 13.9% and 14.5%, respectively; however, both vacancy rates improved slightly in the CBD compared to the same quarter a year ago.

Demand for retail space continues to outpace new supply. Newly delivered projects during the last three months of the year included Verde Plaza (24,265 sf), a strip center in the far North East sector that fronts I-35 near the Amazon Fulfilllment Center, and Roadrunner Plaza (18,375 sf), a small strip center at Hausman & Loop 1604 near UTSA. In all, new construction delivered roughly 430,000 square feet of retail lease space in 2015.

The absorption tallied for the year more than doubled the amount of new supply added. Leases and expansions inked in the fourth quarter generated 94,794 square feet of positive net absorption which pushed the year-end total net gain to 912,166 square feet. The Northwest market experienced the lion’s share of that activity with nearly 343,000 square feet, largely due to the completion of Phase 5 at The Rim which came online 95% pre-leased including big box retailers such as Hobby Lobby, Hemispheres, PetSmart, and many more.

Rental rates vary by product type and location but, in general, rental rates continued to climb in the fourth quarter. The citywide average quoted rental rate increased to $16.96 per square foot per year on a triple net basis; this reflects a bump of $0.36 or a modest 2.2% annual increase compared to the same quarter a year ago.

Click to download REOC San Antonio’s complete 4Q 2015 Retail Market Report

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