The 16.2-million-square-foot Oklahoma City community-neighborhood shopping center market was hit with modest negative net absorption in the second quarter of 2012, and the vacancy rate rose 20 basis points to 13.8%. That is down 70 from a year earlier. The 23,000 square feet of negative net absorption was followed by minus 9,000 in July and August, but Reis predicts a 2012 total of plus 77,000 square feet and a year-end vacancy rate of 13.7%. Small vacancy rate decreases are forecast for later years amidst improved demand and revived new supply, as the rate remains in double digits.
Community-neighborhood center rents are increasing moderately. Both the average asking rent and the average effective rent increased 0.4% during the second quarter, to the very low levels of $11.33 psf and $9.89 psf, respectively. The year-over-year gain was 0.8% by both measures. There was no additional change through August, and Reis predicts an increase of 1.4% by both measures for all of 2012. Subsequent annual effective rent gains will rise from 2.3% in 2013 to 4.4% in 2016.
The 164,325-square-foot second phase of the Yukon Village community center completed construction outside established Reis submarkets in Yukon in April, and the 11,410-square-foot North Park Shops neighborhood center completed construction in Norman, home to the University of Oklahoma, in September. Most of the development activity, however, is outside the community-neighborhood center segment. The 300,000-square-foot second phase of the University Town Center lifestyle center in Norman is the largest retail project under construction. It has been underway since 2007. In northwest Oklahoma City, the 348,000-square-foot first phase of The Outlet Shoppes at Oklahoma City completed construction in August 2011, with the 27,000-square-foot second phase expected to follow in August 2013.