The 27-million-square-foot Columbus community-neighborhood shopping center market finished the second quarter of 2012 with a 15.7% vacancy rate, up 20 basis points for the quarter and down 40 over 12 months. The rate was unchanged in July, according to the latest Reis data. Power center vacancy is 7.5% in the second quarter, Reis reports, down 50 basis points over 12 months. Columbus remains fourth from the bottom of Reis’ top national retail metros in terms of community-neighborhood occupancy. The vacancy for that segment has been in the double digits here since 2003. Net absorption totaled 74,000 square feet from 2002 to 2011, while new construction saw 2.2 million square feet added in that time span. This is a fairly small construction amount even for a modest market like this, but demand could still not make much of a dent. There were no community-neighborhood shopping centers completed in 2011, and none are on tap for 2012, according to Reis’ latest construction data. The first quarter’s positive net absorption of 93,000 square feet has already been more than halfway undone by the second quarter’s negative 50,000 square feet.
Rents have not performed well here. Reis reports average asking and effective community-neighborhood center rents of $12.62 psf and $10.73 psf, up 0.4% and 0.3%, respectively, for the quarter and up 0.5% and 0.4% over 12 months. July rents were up 0.1%. Power center rents, at $19.54 psf, are up 0.7% over 12 months. In keeping with this market’s generally dismal forecast, Reis does not estimate annual gains to reach 1.0% for asking or effective rents in 2012, while minimal gains are forecast for 2013. Rental gains exceeding 2.0% for both categories are not projected until the out years of the Reis forecast period.
Reporting on greater Columbus regional retail space, Colliers states “the Columbus retail market returned to positive growth with 110,000 square feet adding to the recent trend that eight of the last nine quarters have seen positive absorption.” This source reports a “grand total” retail asking rent of $11.10 psf.