The vacancy rate in the Minneapolis-St. Paul retail market fell slightly to 5.7% in Q2, after rising each of the previous three quarters. The market has remained steady between 5.5-6.0% for the last year, maintaining vacancy averages above the low point of 4.4% in 2015. Quarter Two saw nearly 140,000 square feet of absorption, accounted for by new tenants in Regional and Community Centers taking 129,000 of the total 140,000 square feet of absorption. The largest of these new tenants include Burlington Coat Factory, Designer Shoe Warehouse (DSW) and Urban AIR.
Regional Malls Embrace Fitness, Food and Fun
Large regional malls are on the front line of a major shift in the retail world. Traditional department store anchors are not driving consumers to malls the way they once did; and as a result, Sears, Macy’s and JC Penney’s are struggling with market share and are rapidly closing stores.
Online Retailers Shift to Brick and Mortar
E-commerce has caused a seismic shift in brick-and-mortar retail. But recently, we have seen a trend of online-only retailers expanding into the physical brick-and-mortar retail space as well.