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Retail Space Occupancy Down As Job Losses Take Toll On Spending

Posted By admin || 28-May-2009

According to an article in the Star-Telegram, there are more empty retail spaces in the Dallas-Fort Worth as the rising number of job losses takes its toll on consumer spending.

The article said:

Shopping center occupancy slipped 1.4 percentage points in the first quarter to 84.3 percent, the lowest level this market has seen in three years...That compares with 85.5 percent occupied in the first quarter of 2008 and is down from a peak of 89.6 percent in the first quarter of 2005. Dallas had a greater decline, dropping 2.1 percentage points to 84.4 percent between January and March.

Commercial real estate has taken quite a hit as a whole as the number of job losses rise and the amount of credit available for leases declines sharply. Many consumers who are employed are holding off from spending on fears of job losses and because of very real financial issues. In response to job losses and reduced spending many retailers are closing low performing stores leaving a glut of empty retail spaces on the market.

Some commercial real estate investors aren't able to withstand the high rate of vacancies and are facing foreclosure and bankruptcy adding another item to list of banker worries. As the year moves forward we can expect to see more commercial real estate foreclosures and bankruptcies especially amongst shopping centers.

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