Non-core retail activity is gaining traction
- Average triple net core rental rates have risen to $22.12 per square foot this quarter.
- The East Cooper submarket posted the highest absorption of all of the Charleston submarkets.
2018 Market Recap
Over the past 12 months, the Charleston retail market absorbed 78,502 square feet; likewise, non-core shop space absorbed 124,128 square feet, however, core shop space posted a net negative absorption. There are currently 369,106 square feet of retail space under construction within the Charleston retail submarkets. Also, 323,163 square feet of shopping center space completed construction this year. The overall vacancy rate dropped from 6.08% during the fourth quarter of last year to 5.53% during the fourth quarter of 2018. The overall average triple net weighted retail rental rates dropped slightly from $2.50 per square foot during the fourth quarter of 2017 to $2.40 per square foot this quarter, largely due to the lack of quality available space factored into the weighted average.
The Charleston retail market consists of 14.32 million square feet of retail space, and there were no new retail buildings delivered to the market during the fourth quarter of 2018. The market posted a net negative absorption of 27,389 square feet this quarter. Core shopping centers posted a net negative 28,881 square feet during the fourth quarter of 2018, non-core retail space absorbed 1,492 square feet. The overall market vacancy rate increased from 5.34% last quarter to 5.53% during the fourth quarter of this year. Also, the rental rate for the remaining shop space availabilities averaged $20.40 per square foot, up 0.84% above the average shopping center space of $20.23 per square foot during the third quarter of 2018.
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